The Truth Behind Rental Bond By Gregory Ellis At Isnare.com Ezine Articles

You've found a good apartment that seems well within your budget, so the next step is to sort out how much money it will cost to move in. One of the costs you will have to consider is the amount of the rental bond, a sum of money that protects the landlord in the event that you damage the property in some way or move out without paying any valid expense that is due. The landlord can deduct the cost of any money you owe from the rental bond when you move out. You should receive the entire sum back after you move out as long as you leave no damage to the premises and are paid up on your rent or other valid expenses when you leave.

The landlord may also ask you to pay some rent in advance before you move into your new apartment. If your lease is for a fixed term the landlord can only require you to pay one month's rent in advance, and if you are renting a moveable dwelling (such as a caravan or a manufactured home) you can only be charged up to two weeks' rent in advance. The rental bond, however, is in addition to any rent payment you must make in advance.

If your rent is $500 a week or less your landlord can only charge an amount equal to 4 weeks' rent for the rental bond, but if the rent is more than $500 a week there is no limit on the amount of the bond. If the amount your landlord asks seems too high you might try negotiating a lower amount.

If your rent is subsidised by an employer, the maximum bond is the greater of $400 or the equivalent of four weeks’ rent (two weeks’ rent for movable dwellings).

After you have paid the rental bond your landlord must immediately give you a receipt. For safekeeping, your landlord must send your rental bond to the Residential Tenancies Authority (RTA) within 10 days of receiving it. The RTA will hold the bond in trust until you move out of the apartment, and they should send you an Official Receipt within a few weeks to let you know they've have received the bond. Do not lose this notice  it has your Rental Bond Number on it, which you'll need to use if you contact the RTA about the bond.

Suppose that your rent is $500 a week, and your landlord asks for $2,000 for a rental bond. You, however, have only $1,000 left in your account. What do you do?

The first thing you should try is to ask the landlord if you can make payments over time. He may accept $1,000 now with the other $1,000 due at the first of next month (or whenever it works out with your pay schedule). He may agree to let you pay $500 a month for the first four months. You haven't anything to lose, so why not ask for favourable terms? If the landlord does turn you down, you can always try to get an interest-free bond easy loan from the Department of Housing. There are certain income limits and other criteria that must be met to qualify for a bond loan, so contact your nearest Department of Housing for more details.

Suppose that you are moving from one apartment to another. You new landlord is asking for a rental bond before you move in, but your current landlord is still holding on to the rental bond money you paid to him for your old apartment. You may be able to transfer your bond from your old apartment to your new place if you can’t get your hands on a source of quick cash before payday and if both landlords agree. Simply ask your current landlord to fill out a Transfer of Bond (Form 3) and send it to the RTA.

If you do attempt a bond transfer, your first landlord still has the right to deduct any monies due from damages or other claims before the bond money is transferred to your new landlord. You and your new landlord will also have to fill out a Bond Lodgement (Form 2) and send it to the RTA. You will still have to pay any additional bond amount due if the new bond is more than your previous bond amount.

Most of the rules regarding rental bonds come from the Residential Tenancies Act 1994, and your landlord cannot charge a rental bond fee to cover the costs of complying with this law. Visit the RTA website for full details. Bond is not a source of easy money, so it is important that your bond is treated under the law. If you feel your payment has been misused, you can contact the RTA and access their dispute services.

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