really sorry about your situation, but as a fellow renter i'm sorry to say you wont get your holding fee back. it is what it says it is - the fee takes the house off the rental list and holds it for you, so that noone else can have it. If the rental then falls through the owner of the property then gets to keep it as a kind of compensation for the house having been taken off rental market.
really hope your situation improves soon x x
Hi there!
I felt that I had to reply. You should get the 300 back. Go to citizens advice buruex and find out your rights. You probably have contacted all of the housing associations around but if not try that. All that I can say is that it will get better ( I'd rather live in a 1 bed flat in brighton then a 3 bed in Birmingham which is where I live!!) Chinn up hunn!!! Hugs to u!!!
basically here is my situation
i live in a small one bed, with kitchen in lounge, my bed is raised more then 4 foot high so i have just on a chair to get into bed as its built in.
anyway i found a lovely 2bed flat was so excited so my grandad agreed to be my garuntoor...i put my holding fee of THREE HOUNDRED POUND down while they got in contact with my grandad mean while his bank done the checks and declined us claiming he wouldnt be 100% perfect.... 
my grandad belives they did not fully investigate his account as the letter must of been sent the same day they took there direct debit out for looking into it, which means its was clering done very quickly...anyway my grandad is very strict and always pays his bills and morgage on time
so i had no flat to move in to as i already gave in my notice i was soo upset and worried what was going to happen to our housing situation...thankfully we have a very understandle land lady who let us stay put.
the same day we foned every flat going in brighton, and because we are on housing benefit no-one wants us, it isnt any hassle at all as they all claim as it gets paid to us then we pay them we have always been very reliable. and they all NEED a garuntoor
soooooo.....i feel there is no hope, i will never move, council will not help coz you just wait years anyway...and il be cooped up here for ever
AND LAST OF ALL.........I DONT GET BACK MY £300 HOLDING FEE

sooooo upset xxxxxx
in association with Huggies
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try getting your hv to write a letter to council about how small flat is and not enough room for lo ect ect and this should help moving you up the list also as your claiming housing benefit council should be able to help with the depoist on privately rented place