Communtity Law Manual | Tenancy & housing | Bond: The landlord’s security against damage or unpaid rent

Rent, bond and other costs

Bond: The landlord’s security against damage or unpaid rent

What is a “bond”?

A bond is money that you, the tenant, pay to the landlord as security for any unpaid rent or any damage you cause that has to be fixed when the tenancy ends. In those cases the landlord will be able to take the rent or repair costs out of the bond.

How much bond can a landlord ask for?

Residential Tenancies Act 1986, ss 18, 18A

A landlord can ask you to pay a bond equal to up to four weeks’ rent. They can’t ask for any other form of security on top of the bond – for example, they can’t ask you to put up your car as security.

What happens to the bond after I pay it to the landlord?

Residential Tenancies Act 1986, ss 19-21, 109

The landlord has to give you a receipt for the bond and pay the bond over to Tenancy Services within 23 working days. If they don’t pay it over to Tenancy Services, the Tenancy Tribunal can order your landlord to pay you a penalty of up to $1,000. Alternatively, you can pay your bond directly to Tenancy Services, if the landlord agrees to this.

You and the landlord must both sign a bond lodgement form, which is sent to Tenancy Services with the bond money. Tenancy Services will give you both a written acknowledgement that they’ve received the bond.

What happens to the bond at the end of the tenancy?

Residential Tenancies Act 1986, ss 22-22E

This depends on whether there’s any disagreement between you and the landlord about whether you should get all the bond money back:

  • If you and the landlord agree, either of you can apply to have the bond refunded. If you both agree that everything in the property is OK, or if you agree that the landlord can take some money out of the bond to cover damage, cleaning or unpaid rent, then both of you sign a bond refund form that says what you’ve agreed should happen with the bond.
  • If you and the landlord don’t agree, then one of you can apply to get the bond, and the other side then has 10 working days to object. If the other person doesn’t object in time, the bond will usually be paid to the person who applied for it. As the tenant, you can apply for a bond refund at any time after the tenancy ends, but the landlord has only two months after the tenancy ends to apply. If there’s a dispute about the bond refund, you can take it to the Tenancy Tribunal (see “Problems with your landlord: What you can do” later in this chapter).

Can I transfer my bond if I move to a new place with a new landlord?

Yes, if the old landlord agrees. You can just keep the old bond with Tenancy Services and have them transfer it to cover the new tenancy. You’ll have to fill out a “bond transfer” form, which has to be signed by you and by both the old and the new landlord. The new landlord then sends the form to Tenancy Services.

What happens to the bond if a flatmate moves out and another moves in?

This depends on whether the person moving out is a tenant who has signed the bond lodgement form. If they are, and the person moving in is going to be a tenant in their place, the new tenant can pay them out for their share of the bond. The new tenant has to complete and sign a “Change of tenant form”, get it signed by the outgoing tenant, and send the form to Tenancy Services.

If the person moving out hadn’t signed the tenancy agreement and the bond lodgement form they have no right to any of the bond (unless they had agreed otherwise with the tenant or tenants). For more about the difference between a tenant and someone who’s just a flatmate, see “Who’s covered by the minimum tenancy protections”.

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