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  • Most tenancy agreements will include a forfeiture clause stipulating what will result in the retention and non-return of a payment
  • There are pre tenancy situations which might also include such a clause such as when reserving a house.  In England and Wales it is normal to secure a house by payment of an administration fee.  Whilst the purpose of the fee is to cover administering the new tenancy the payment for this service creates a significant deterrent to later drop out.  Such commitment creates reasonable certainty the prospective tenant is serious and will reassure an agent to take the property off the market.  The cost to an agent and landlord of dropping out cannot be overstated as it is likely to exceed the value of the admin fee.  For this reason a tenant is likely to forfeit any admin fee.
Published: 8 November 2013 Last Updated: 17 November 2021