Moves seem under way to cap charges tenants might have to pay while living in a private rented home.
The Tenants and Fees Bill before Parliament allows landlords to charge an uncapped fee for events that might happen during a tenancy, like damage to the home or having to change locks after keys are lost.
The default charge is open-ended, which has made housing charities suspect unscrupulous landlords could exploit the loophole to make money unfairly from their tenants.
Although the government will issue guidance on what a default charge should cover, the guidance would not be enforceable.
Housing charities and some MPs want the government to resolve the problem by closing the loophole now.
Gillian Guy, chief executive of Citizens Advice, said:
“The government’s pledge to ban fees will be fundamentally undermined unless the clause on default fees is significantly tightened.
“The loophole leaves tenants vulnerable to rogue landlords and agents looking to continue charging unfair fees.
“The government must tighten this clause and issue a clearer definition of what a default fee is. Leaving this just to guidance risks poor outcomes for both renters and landlords.”
The government says the charge was inserted into the bill to allow landlords to recover unpaid rent and amounts for damage that might exceed the tenant’s deposit.
“There is clearly overwhelming support in Parliament for the ban, however MPs do not seem to understand what is meant by default fees and the implications of reducing tenancy deposits,” said David Cox, chief executive of ARLA Propertymark.
“As the Bill goes to committee stage it is more important than ever that landlords and agents go and see their MPs to make the case for why these fees remain vital even after the ban comes into force.”