Re: [property address]
It has recently come to my attention that your deposit was not protected properly and I apologise for this. The regulations say that I need to refund the money to you now and I have therefore paid £X in respect of the deposit money directly into your bank account. Please confirm receipt.
Unfortunately (for me) you are also entitled to claim a penalty via the court, because the deposit was not protected when it should have been. The minimum you would be entitled to, were you to bring a court claim, is the deposit sum of £X.
However I am sure you do not want to go through the bother of bringing court proceedings. I propose therefore that I pay you the sum of £X now in full and final settlement of any claim you may have in this respect. [Note that this is less than the amount you would be entitled to, were you to get a court order, to reflect the fact that you are spared the need to go to court] *.
I enclose a cheque in the sum of £X made payable to you, which is sent in full and final settlement of any claim you may have under the tenancy deposit legislation. If you would like to accept this offer, all you need to do is bank the cheque. I hope the money will be useful for you.
Finally, I need to let you know that I now require the property back and I will therefore be serving a section 21 notice requiring possession upon you shortly.
However if you are prepared to move out voluntarily, and without the need for me to bring any court claim, I would be prepared to pay a further £Z, as a contribution towards your moving out costs. Note that this offer will only be available for the next 28 days. The money will be paid to you once you have vacated the property and handed the keys back to me.
If you would like to take advantage of this additional offer, please can you contact me to confirm as soon as possible.
*Use the words in the [square brackets] if you are going to try to settle for less than the deposit sum. Whether you do this or not will depend on the situation you find yourself in. Some tenants may re-act badly thinking that you are trying to ‘take advantage of them’ by doing this, others will just be grateful to get some money without having to go to court! You need to think about this in the context of your own tenants and decide accordingly.
If the tenancy is a joint and several one, payment to one of the tenants should be sufficient but you may want to speak to them and ask them to elect someone to receive the money on behalf of them all.
If this proves difficult, make the payment to the first named tenant on the tenancy agreement (assuming they are still living at the property). Or if you think the tenants are likely to be difficult, you could consider making a payment in cash to them. If so, I suggest you deliver this to them at the property by hand, taking an independent witness with you when you do this.
The final part of the letter (in brown/red font) is the third offer of £Z if the tenants move out without the need for you to bring a court claim. Whether you include this is entirely up to you. However if your tenants are cash strapped it may mean that they are able to move out sooner.
Please feel free to adapt this letter as you think fit. If is just a suggestion.
Next, I will be looking at situations where the tenants owe you money.
How to use the draft letters
I suggest you highlight the whole of the letter text and copy it. You can do this via the Edit menu on your browser software, or you can use the keyboard copy shortcut using the Ctrl and C keys held down at the same time, while the text you want to copy is highlighted.
Then go to your word processing software and copy the draft, either via the edit menu or using the keyboard paste shortcut Ctrl and V.
You can then adapt the wording to suit your situation, and put it into your letter templates etc.