You may be asked to pay a holding fee on approval of your application for a tenancy. The most the landlord/agent can ask you to pay is 1 week’s rent. The landlord/agent can hold only one fee for the premises at a time.
On receiving a holding fee, they cannot enter into an agreement with another prospective tenant for 7 days (or longer, if you both agree). Upon signing the tenancy agreement, the fee will go towards the rent starting from the first day of your tenancy agreement.
If the landlord/agent declines to enter into the tenancy agreement, they must refund the fee. If you refuse to enter into the tenancy agreement because the landlord/agent made a misrepresentation or failed to disclose any ‘material facts’, they must refund the fee. If you otherwise decide not to enter into the tenancy agreement, the landlord/agent can keep the fee.
You can apply to the Consumer, Trader and Tenancy Tribunal to resolve a dispute about a holding fee (whether or not you enter into a tenancy agreement).
Information supplied courtesy of the Tenants Union of NSW
Further information and advice for NSW tenants can be sourced from www.tenants.org.au