New research has revealed a stark financial reality for renters – with one in five tenants taking on repayable debt to cover their five-week cash deposit.
A survey by deposit alternative provider Reposit found that among these tenants, 6% borrowed £1,500 or more, 18% secured between £1,000 and £1,500, and 24% took on debt ranging from £500 to £1,000.
Previous research by Reposit indicated that 38% of renters were turning to friends, family, credit cards, loans or overdrafts to cover deposits – though not all of this debt was necessarily repayable.
The latest poll of 1,000 tenants confirms that borrowing is widespread across all UK regions and age brackets, with average deposits now reaching £1,218.
STARK REALITIES
Regional disparities are also stark. Despite lower rents in the North, tenants in the North East were more likely to borrow sums exceeding £1,500, with similar patterns emerging in the West Midlands, East Midlands, and London. Younger renters (18-34) were the most frequent borrowers, while those aged 55-64 were more likely to take on the highest debt levels, likely due to higher rents. Women were found to borrow larger amounts than men.
Ben Grech (main picture), Chief Executive of Reposit, says: “Our research proves this is a myth. Many tenants are forced into debt just to pay a cash deposit, leaving them financially vulnerable before even moving in – something no responsible landlord would want.”
CREDIT CHECK
Grech argues that deposit alternatives offer a crucial solution and he adds: “As a minimum, Reposit requires tenants to pass a credit check, identity verification, and affordability assessment, proving their salary is at least 30 times the monthly rent,”
