Help with a rental deposit when you are on a low income

Finding a home you can afford is hard enough; finding the deposit and rent in advance on top can make a move impossible. For people leaving temporary accommodation, escaping an unsafe situation, or simply moving on Universal Credit or a low wage, a deposit of several weeks' rent is often more than the whole month's budget. In the United Kingdom there are council schemes, charities and legal protections designed for exactly this problem, and many of them avoid the need to borrow.

This page covers raising a deposit and first month's rent for a new tenancy, and protecting that money once it is paid. For removal vans and other costs of the move itself, see our guide to help with moving costs.

Know the rules on deposits

• In England, the Tenant Fees Act limits most tenancy deposits to five weeks' rent (six weeks where the annual rent is high), and caps holding deposits at one week's rent. Most other fees charged to tenants are banned.
• In England and Wales, landlords taking a deposit on an assured shorthold tenancy (or occupation contract in Wales) must protect it in a government-approved scheme and give you prescribed information. Scotland and Northern Ireland have their own approved schemes.
• At the end of the tenancy, the schemes offer a free dispute service if the landlord wants to keep part of the deposit.

Knowing these rules helps you spot landlords or agents asking for more than they should.

Help from your council

Rent deposit and bond guarantee schemes

Many councils run rent deposit schemes, either paying the deposit to the landlord or giving a written guarantee (a bond) instead of cash. They are often aimed at people who are homeless or threatened with homelessness, and you may need to approach the council's housing options team first. Some charities run similar bond schemes with local landlords.

Discretionary Housing Payment

If you will claim Housing Benefit or the Universal Credit housing element at the new address, you can ask the council for a Discretionary Housing Payment. Councils can use DHP to help with a deposit or rent in advance when it helps you move into more affordable or suitable housing. Policies differ, so ask before signing.

Homelessness prevention

If you must leave your current home, councils in England have duties to help prevent and relieve homelessness, and this help can include deposits. Wales, Scotland and Northern Ireland have their own duties. Our page on avoiding eviction explains how to contact the right team.

Other sources of help

• Universal Credit Budgeting Advance: an interest-free advance, repaid from future payments, which can be used for rent in advance or a deposit if you meet the conditions.
• Local welfare schemes: some council schemes in England, the Scottish Welfare Fund, the Welsh Discretionary Assistance Fund and Northern Ireland Discretionary Support help with setting up home, though most do not pay deposits directly.
• Charities: organisations supporting care leavers, veterans, people leaving domestic abuse or prison, and benevolent funds linked to occupations can help. Turn2us lists grants by situation.
• Social housing: councils and housing associations usually ask for little or no deposit, so register on your local housing list even if the wait is long.

Getting your old deposit back quickly

If you are moving from one rented home to another, your existing deposit is often the biggest source of funds. Leave the property clean, take dated photos, return all keys and request the return in writing. If the landlord delays or makes unfair deductions, use the deposit scheme's free dispute service. If your deposit was never protected, get advice from Shelter or Citizens Advice, as tenants may be entitled to compensation.

Ask your new landlord whether they will accept a later date for part of the deposit to fit with the return of the old one, or split the deposit into instalments. Get any agreement in writing.

Deposit replacement products: read carefully

Some agents offer "zero deposit" or deposit replacement schemes, where you pay a non-refundable fee instead of a deposit. This lowers the cost upfront, but the fee is never returned, and you can still be asked to pay for damage or unpaid rent at the end. Compare the total cost over the tenancy with saving for a normal deposit, and ask whether a standard deposit is also accepted.

Borrowing for a deposit: last resort

A loan for a deposit means starting a new tenancy already in debt, at the same moment as other moving costs. If you need credit, compare these options:

• a Budgeting Advance, if eligible, which carries no interest;
• a credit union loan at a capped rate; some credit unions work with councils on deposit loans;
• help from family, agreed clearly in writing.

Check the APR, the total amount repayable and how repayments fit around your new rent. Our guides to solidarity and community lending and to borrowing while on benefits explain the risks.

Rental scams to watch for

People in a hurry to find a home are prime targets. Warning signs include:

• a landlord who asks for a deposit or holding fee before you have viewed the property;
• pressure to pay by bank transfer to a personal account or in cryptocurrency;
• a rent far below other homes in the area;
• someone claiming to be abroad and offering to post the keys;
• loan offers on social media that ask for a fee first.

Check that letting agents belong to a redress scheme and that landlords own the property, and never hand over money without a written agreement.

Checklist

• Ask the council about rent deposit, bond and DHP help before signing.
• Check that the deposit asked for respects legal limits.
• Apply for a Budgeting Advance if you are on Universal Credit.
• Recover your old deposit through the scheme if needed.
• Make sure the new deposit is protected within the time limit.
• Borrow only from authorised, low-cost lenders, and only as a last resort.

In Ireland, ask your Community Welfare Officer about help with a deposit, and Threshold for tenancy advice. In other countries, look for public housing support before any loan.