Most agents are aware that, under the Consumer Rights Act of 2015, they’re legally required to display the details of the fees they’re charging landlords and tenants or face a hefty fine, but not everyone is aware of exactly how detailed the disclosures need to be.
With a focus on the fine print, we’ve prepared a comprehensive guide on not just what you need to disclose, but how you need to disclose it.
Where is the information displayed? In order to comply with the Consumer Rights Act, it needs to be displayed conspicuously in any place where you have face-to-face interaction with a client, as well as being positioned prominently on your website. Making sure all the relevant fee information is displayed clearly will make sure that your clients are informed from the outset and could save you a great deal of stress during the tenancy.
Fees must be clearly described, with the fees purpose included and the total amount including VAT detailed. You must also make it clear who the fee is payable by – landlord or tenant. The intention is to ensure that landlords and tenants can’t be double charged for the same thing, not to put them off so agents with fair and clear pricing should have nothing to fear.
If a fee can’t be calculated in advance have you detailed the method you plan to use to calculate it? Divulging your calculations should allow both landlords and tenants to work out whether or not they can afford all the costs associated with the price of their rental and avoid awkward situations where either party claims they can’t pay a fee later into the process.
Right to redress
Not only is it mandatory to be a member of a redress scheme (either The Property Ombudsman or The Property Redress Scheme) it’s also mandatory to display details of your membership. Failure to make it clear which scheme you’re part of is punishable by £5,000 whether or not any of your clients need to seek redress.
Client Money Protection
Offering tenants Client Money Protection services will soon be compulsory and when the legislation is passed, it’s likely that agents will have to display details of the authorised scheme they’re a part of. Why not get a jump on the legislation by setting out details of the scheme you belong to now? Making this kind of transparency a habit should ensure that not only do you stay on the right side of the legislation, but that your openness attracts new clients as well.
For more information on exactly what needs to be displayed under the Consumer Rights Act of 2015, why not download our free checklist entitled Are You Displaying Your Fees Correctly?