All you need to know about collecting a rental bond

As a landlord, you have a lot of rights and responsibilities which are important to know about before renting your property to tenants. Among these is the rental bond. The rental bond is an important right that landlords receive in order to provide themselves some protection, should the tenancy agreement be broken in specific ways. To help you understand what the rules are regarding the bond, why it should be collected, and the rules regarding its use, we have created this guide.

Know the rules

The bond acts as a security deposit, generally paid at the start of the tenancy. There are many rules surrounding how much you can take, and where the money must be stored. This is dictated by the Residential Tenancies Authority (RTA). Of course, the laws regarding bond do differ between states, we will be focusing on Queensland here.

In Queensland, upon taking the bond you must provide your tenant with a receipt. The money must then be lodged to the RTA within 10 days. They will store the money and release it back to the tenant, or to you on a successful claim, at the end of the tenancy.

In terms of how much bond you can charge, the law says that if the rent is $700 per week or less, then the bond can be no higher than 4 weeks’ worth of rent. If the amount of rent is above $700 per week, then the tenant and landlord must negotiate a suitable bond. In this situation, the law gives no maximum amount for rent higher than $700.

Why you should collect a bond

As said before, the bond acts as a security deposit for the property. It means that if your tenant does not pay all the rent, doesn’t keep the property clean, or damages your property, you can claim part of or all of their bond at the end of the tenancy. However, it is important to keep in mind that issues that are covered under “fair wear and tear” cannot be claimed.

What you can claim on the bond

While you can’t claim fair wear and tear, there are some things you can claim the bond for. These include:

• Cleaning expenses for when the property isn’t left in the condition it was entered.
• Damaged caused by tenants, and their visitors.
• If your tenant abandons the premises.
• Unpaid bills which your tenant was supposed to pay.
• Loss of your goods.
• Any unpaid rent.

Under these conditions, you can claim all or part of the bond in order to cover these expenses.

What to do if there are disagreements

In the case of disagreements where you claim the bond, it is important to negotiate with your tenant. See if you can find a compromise with your tenant to solve the issue quickly. However, in the case where a compromise cannot be reached, you may need to apply for a claim with your state tribunal. They will assess your claim, and release the bond to you should it be successful.

Conclusion

Rental bonds can be tricky to deal with on your own. Collecting them are a vital part of being a landlord, however. Unfortunately, a lot of the legislation and responsibilities surround bonds is complicated, especially when you need to claim them. This is where a property manager comes in. They can ensure that you remain compliant with all legislation. As well as this, they will assist whenever the bond needs to be claimed.

For a great property manager, reach out to Link Living.