Everything You Need to Know About Bonds & The Rental Bond Board
You’ve just found the rental property of your dreams. However you worry about this whole bond business. Read on. Like most things in life, a little preparation and knowledge goes a long way. Forewarned is forearmed. Bonds are in place for a reason. Sometimes it helps to understand those reasons to make the whole process less daunting.
What is a bond?
A bond is something that binds, holds or fastens together, or an agreement with legal force. It is part of an agreement that you undertake with your landlord. It’s money paid as a security deposit, usually the equivalent of four weeks’ rent. It’s given back to the tenant at the end of their tenancy provided no repairs are necessary (that is, if you damage something, the cost of repairs comes from your bond).
What is the Rental Bond Board?
In NSW, there’s a body called the Rental Bond Board. They look after bonds paid to landlords by their tenants. The board is managed by the NSW Fair Trading’s Rental Bonds. The interest earned by investing the rental bond money goes back into advisory services and the like. All to the benefit of the residential tenancy sector (in particular, the tenants). The lodgement, maintenance and refunding of all bonds is done through this body. There is also an online service available.
When you decide to lease a property, you need to make a mutually agreeable time for the landlord to come and inspect the premises. Once you both agree that there is no damage etc, bond should be repayable, and you and the landlord will fill out a Claim for Refund of Bond Money, which is lodged with Fair Trading. Be sure that the amount of bond is correct before you sign. Never sign a blank form.
What about the cost of maintenance and damages?
Finally, any repairs necessary as a part of normal usage of the property is not the tenants’ responsibility. “Fair wear and tear” includes indentations on carpet from furniture, faded paint (or chipped or cracked paint), loose hinges and water stains from bad plumbing. If your children tear the wallpaper, or you cause cigarette burns to the benchtop, or your picture hooks leave holes in the wall, then you are liable for the cost of repairs. The landlord can make a claim against your bond, and you have a chance to appeal it.
If you have questions about your rental bond, contact the Rental Bond Board NSW. However our friendly staff at Aspect Estate Agents are always happy to help – contact us today.