Someone more knowledgeable will be along with detailed correct information tomorrow morning (or earlier). In the meantime: the costs for claims under £1500 are capped at something in the order of £120 or £150. (For claims above £1500 the cap is 10%) The costs are the combination of court fees and litigants' expenses (the total for both sides*). So essentially the maximum that can be lost (or charged) (in addition to the £400 or £650 that is in dispute) is £150. (Court costs are typically about £50.)
As I said, these are ill-informed ball-park figures from my memory from a couple of years ago. The basic principle is sound but please await more accurate data from someone less anachronistic.
But as Vak said, remember that you have no guarantee that if victorious the defendant will pay the money back at more than a few pounds a month (if at all.) As is often illustrated on these forums, there are hideous numbers of ways for miscreants to avoid paying their debts. (Hang on. You're the ones with the money anyway.)
(BTW, where does your landlord live? I can clean a whole house for a lot less than £250! That's the sort of nonsensical claim from a landlord that creates this sort of bad situation in the first place. (Yes I know there are many evil tenants who trash and destroy properties. But that is not what you are claiming). Tidying and cleaning a property does not cost more than fifty quid, for goodness' sake.)
* Doh. Obviously it's just the winners' expenses that are charged. The losers have to pay their own way.