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BONDS

BONDS

(March 2006)

The information in this Fact Sheet is not legal advice. It is intended as a general guide only. It applies only to legislation current in the state of Victoria, Australia. For information regarding a specific tenancy problem, phone the Tenants Union Advice Line on (03) 9416 2577. The Tenants Union accepts no responsibility for actions based on this information, nor for actions based on electronic translations of this information.

Bonds

A bond is a security deposit (usually one month's rent) paid by you to the landlord or agent at the start of the tenancy. It is designed to act as security for any damage to the property or for unpaid rent.

If a bond is required, the landlord or agent must also provide you with 2 copies of a condition report signed by or on behalf of the landlord. See the Starting a Tenancy fact sheet on www.tuv.org.au for further information.

When you pay your bond, you and the landlord or agent must sign a Bond Lodgement Form. If part (but not all) of the bond is paid by the Office of Housing, you will have to sign a separate Bond Lodgement Form for that part of the bond that was paid by the Office of Housing.

The landlord or agent must then lodge your bond money and the Bond Lodgement Form with the Residential Tenancies Bond Authority within 10 business days of you paying it. You should receive notification from the Authority that the landlord or agent has lodged your bond. If you don't receive a receipt within 15 business days, you should contact the Bond Authority.

If you move out of the property and someone else takes over your tenancy, you must notify the Bond Authority within 5 days that your interest in the bond has been transferred to the new tenant. You can do this by filling in a Bond Transfer Form (which must be signed by you, the new tenant and the landlord or agent) and sending it to the Bond Authority.

The bond is held with the Residential Tenancies Bond Authority until the end of the tenancy. At the end of the tenancy, a number of things can happen:

  • your landlord makes no claim against your bond
  • you agree with your landlord about an amount to be paid to them out of your bond
  • your landlord applies to the Victorian Civil and Administrative Tribunal for an order that they be paid some or all of your bond

Your landlord makes no claim

If your landlord agrees that they won't be making a claim against your bond, you and the landlord must apply to have your bond money returned to you. You must both sign a Bond Claim Form, and on the form you must provide details of the bank account that you want the bond money paid into. Once the form is lodged with the Authority, your bond money should be paid into the nominated bank account on the next business day.

To prevent the landlord or agent from making a fraudulent claim, do not leave any $ amount sections blank on the Bond Claim Form. If the bond is to be paid to you in full, make sure you write the full amount of the bond in the 'Tenant payment details' section, and write the word 'zero' or draw a line through the 'Total amount payable to Landlord/Agent if applicable' section. Make sure you keep your copy.

If your bond was paid by the Office of Housing under the bond loan scheme, the money will automatically be paid back to the Office of Housing.

You agree with your landlord

If you agree that the landlord is entitled to some or all of your bond, you can agree to have that amount paid out to them. Both you and the landlord must fill out the Bond Claim Form, specifying how much of the bond is to be paid to the landlord and how much is to be paid to you.

If the bond is to be divided between you and the landlord, make sure you write the appropriate amounts in the 'Tenant payment details' section and the 'Total amount payable to Landlord/Agent if applicable' section. Check that these amounts add up to the total amount of the bond.

You cannot agree to paying out your bond (or part of your bond) more than 7 days before the end of your tenancy. If the agreement with the landlord or agent was made more than a week before the end of your tenancy, the Bond Authority won't accept it.

If your bond was paid by the Office of Housing you cannot agree to have part of it paid out to the landlord. The landlord or agent must apply to the Tribunal for an order that they have paid part of the bond. The Tribunal will notify the  Office of Housing of any decision they make that effects a bond paid by them.

Your landlord applies to keep your bond

If you and the landlord or agent disagree on how the bond should be paid out, they must apply to the Tribunal for an order that they be paid part or all of the bond. The landlord must make the application within 10 business days of your tenancy ending.

If the landlord or agent does apply to the Tribunal within 10 business days, you will be sent a copy of the application and a Notice of Hearing from the Tribunal.

Applying to the Tribunal for return of your bond

If it has been 10 business days since you moved out but you haven't received your bond back, you should apply to the Tribunal for the return of your bond as soon as possible. There is no application fee for applying for the return of your bond.

Tribunal hearings

Whether it is you or the landlord who applies to the Tribunal, you should take the following information with you to the hearing:

  • the date you started the tenancy and the type of tenancy (fixed term or periodic ie month to month)
  • the amount of bond paid
  • the amount of notice given to end the tenancy, either by you or the landlord
  • evidence about the condition of the premises at the start of the tenancy (the Condition Report if you have one)

If you are claiming your bond back because the landlord hasn't made a claim within 10 business days, you should resist any attempt by the landlord to argue their claim against your bond. Point out to the Tribunal member that the landlord is out of time and that they should bring their compensation claim separately. However, be prepared for the possibility that the Tribunal may allow the landlord to argue their claim against your bond even though they are out of time.

For more information on defending a landlord's claim against your bond, see the Defending a compensation claim Fact Sheet.

If the Tribunal makes an order about your bond, you will still have to complete a Bond Claim Form to get the money back from the Bond Authority. Attach a copy of the Tribunal order to the claim form.

When more than one tenant is owed bond (eg in a shared household), you and the other tenants will have to agree as to how the bond should be paid out. For example, you could agree that a smaller proportion of the bond be paid to one tenant if that tenant takes responsibility for damage that the landlord has successfully claimed for.

Abandoned premises

If you owe rent and you leave the property without giving notice and without providing a forwarding address, the landlord can apply to the Principal Registrar of the Tribunal for an order that they be paid some or all of your bond. They must provide written evidence that you owe them rent and that they have tried to find out where you live now. If the Principal Registrar is convinced you have abandoned the premises and you cannot be found after the landlord has made reasonable enquiries, they can make an order that the landlord be paid your bond without them having to go to a hearing.

If the Principal Registrar has made such an order, you must act quickly to challenge it. You should contact the Tenants Union or another tenant advice service for assistance.

For more information contact the Tenants Union Advice Line on (03) 9416 2577.

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PO Box 234, Fitzroy, VIC 3065, Australia

Admin 9419 5577

Advice 9416 2577

Fax 9416 0513

Last updated 19 February 2004

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