If you’re a tenant looking to rent a property, you must pay a security bond to obtain a lease. Alongside the cost of moving homes, extra fees like security bonds can make the process even more stressful, especially considering the money will be held until your lease is up.
For those looking to rent a property for the first time, they may not know what a bond is, why they’re needed and how they work. But, ZeroBonds has you covered.
A rental bond is a sum of money requested by the landlord to be paid at the beginning of the tenancy. It is a form of security or financial protection in the case of a breach in the tenancy agreement – such as when a tenant skips out on paying the rent or causes damage to the property.
For a bond to work, an official document must be put together and set in an agreed bond trust controlled by an approved financial institution or by each state government. As a tenant, you will be required to pay the set bond amount. Once paid, the bond money, along with the bond lodgement document, must be submitted to the residential bond authority for the relevant state.
It is the responsibility of the landlord or agent to submit the bond lodgement form and money to the applicable state department. In doing so, this makes certain that the money is secured and obtainable when the time has come for the end of your lease.
The bond amount is stated in the lease agreement document with the maximum amount differing depending on the state. In New South Wales, the amount required for a bond is a flat rate of four weeks’ rent, regardless of the rent amount.
There are a few conditions on what the landlord can ask for from the tenant:
- The maximum bond you should be asked to pay is a sum equal to four weeks of the agreed amount of rent
- The landlord is unable to ask for a bond to be paid before the official signature of the tenancy agreement
- The landlord is unable to ask for an increase in bond amount or for another bond to be paid in the case of an increase in rent or the number of people moving in
When the time comes for the end of your lease, the landlord or agent will inspect the property for any damages or faults caused during the tenancy period. They will also check to ensure that all rent payments have been made and are up-to-date.
If your apartment or home is left in good condition upon departure and all payments are up-to-date, you can expect to get your bond back when you move out.
If an issue came to light, such as damages found in the property or unpaid rent, the landlord would seek to claim money from the tenant’s bond to cover the costs. If the tenant feels these claims are unreasonable, they can dispute them through a tenancy tribunal.
To ensure that the bond is returned in its total amount, there are a few things you should consider doing as the tenant:
- Adhere to all legal requirements and follow through with any outstanding paperwork.
- Prior to moving into the property, complete a thorough and detailed report listing any existing issues and damages to the property. This is effective in ensuring that the landlord is made aware of any problems with the property so as to not blame the tenant.
- When the time comes to move out, insist on an exit report that compares the condition of the property against the report completed prior to your entry. In doing so, the landlord is able to indicate whether or not the damages were preexisting or made during your tenancy.
The landlord can claim money from the bond to make up for the reasonable costs of:
- Repairs for anything damaged on the property
- Cleaning – if the tenant has property in an unclean condition
- Replacing locks or security devices that may have been altered or removed
- Outstanding rent or charges owed under the tenancy agreement.
Looking for a rental bond alternative? ZeroBonds has you covered.
Our team at ZeroBonds understands the pressure placed on tenants having to pay four weeks’ worth of advanced payments and came up with a rental bond alternative to help alleviate some expenses.
At ZeroBonds, we offer rental bond alternatives that allow you to cover your security bond because we understand how expensive the process of moving in can be. For just a small cost, you can move with extra money in your pocket to put towards other necessities or areas of your home.
If you’re looking for a rental bond alternative, register for ZeroBonds today.