Getting the Bond Money Back
When should I get my bond money back?
All of the bond money should be returned to you at the end of the tenancy unless you owe the owner money for rent, damage, water or other costs you are responsible for. If you owe money you should be paid the bond less anything you owe. You will have to pay the owner extra if you owe more than the bond money. Be aware the owner/agent may charge rent until you vacate the property. This includes returning the keys.
What should I do before handing back the keys?
- Make sure the property is in the same condition as when you moved in (except for normal wear and tear – see chapter Fair Wear and Tear for more
Have a copy of the ingoing Property Condition Report available to compare with the condition of the premises at the end of the tenancy. If you don’t have a copy, ask the owner/agent for one. Explain you want it so you can make sure you do everything you need to do.
- Check your written tenancy agreement for any special conditions; such as having the carpets professionally cleaned. Ask the carpet cleaner to give you a receipt and a written report on the carpet’s condition after it has been cleaned.
- Go through the premises with an independent person (someone who has not lived there) to be a witness to the condition of the premises at the end of the tenancy. It is better if this person saw the premises when you moved in.
Put the details in a property condition report. If possible, take photographs (showing the date) or video the condition of the property. This can be used as evidence if there is a dispute.
- Arrange a date for the final inspection with the owner/agent. Have a witness present at the final inspection. Ask the owner, in front of your witness, what they want to deduct from the bond and to put it in writing. Let the owner know if you disagree and why.
- Make sure you keep your documents and copies of letters between you and the owner/agent in a safe place where you can find them easily after you move.
DISCLAIMER: While making every attempt to present general legal information accurately in this publication, TAS disclaims liability for any loss or damage arising from its use. This publication should not be relied upon as a substitute for legal or other professional advice.
What is the bond recovery process?
One of two things must happen for the bond to be withdrawn from the account at the end of the tenancy:
- 1) the original signatories to the bond lodgement account must sign a Joint Application for Disposal of Security Bond Form (Form 4); OR
- 2) an order for the release of the bond money must be made by the court.
The bond cannot be taken out of the account by you or the owner unless you both agree OR the court makes an order.
What if you are a Homeswest tenant?
Homeswest does not have to lodge your bond in the same way as a private owner/agent does. See chapter The Security Bond for more information.
The bond recovery process also differs from the one described above for private rental tenants. One difference is that Homeswest can take money from your bond without telling you first. This is called “Vacated Tenant Liability”.
Homeswest tenants have the right to appeal against tenant liability charges. If the appeal is unsuccessful, you can apply to Court for a decision on what is fair. For further information, refer to TAS’ Tenants Rights Manual for Homeswest Tenants – Tenant Liability (download from www.taswa.org).
Signing the Bond Disposal Form (Form 4)
You should not sign the Form 4: Joint Application for Disposal of Security Bond if there is any dispute over who should get the money, or how much each party gets. Instead, either you or the owner/agent can apply for a bond dispute hearing in the local court.
See Applying to the Local Court for a Bond Disposal Order for more information.
You and the owner/agent should negotiate bond deductions and agree on how much money each person will get BEFORE the Joint Application for Disposal of Security Bond Form is signed.
Never sign this form until the amounts are filled in. If you sign the form while the “please pay” sections are still blank, you will lose negotiating power on the return of the bond. If you sign a blank form, the owner/agent can deduct whatever amount they decide on. A sample Form 4 has been attached to the end of this chapter.
Never sign a form to take your bond money out of the account until AFTER your tenancy has ended.
Make sure the Application for Refund of Security Bond section (as pictured below) is filled in correctly:
Things to remember:
- NEVER sign a blank or only partially completed Joint Application for Disposal of Security Bond Form. DO NOT sign the Joint Application for Disposal of Security Bond Form unless you agree with how much bond you or the owner are to be paid.
- DO NOT sign anything under pressure.
- ALWAYS get a copy of what you sign.
- If you don’t understand something, check it out before you sign.
- You can get your bond money back without signing the Joint Application for Disposal of Security Bond Form by applying to the court. See Applying to the Local Court for a Bond Disposal Order for more information.
Never sign a blank form to release your bond.
What if I refuse to sign the Bond Disposal Form?
If you can’t reach an agreement with the owner/agent and you refuse to sign the Bond Disposal Form, either you or the owner may make an application to the Local Court for a decision on what is fair. See Applying to the Local Court for a Bond Disposal Order.
When can the bond money be released?
The bond money can be released when all parties agree on how much bond should be repaid and the Joint Application for Disposal of Security Bond Form
is completed and signed.
The completed form is then presented (by the owner/agent or by the tenant) to the place where the bond is held. Under the Residential Tenancies Act (1987), the security bond must be lodged in a joint account (in the name of the tenant/s and the owner/agent) at the beginning of the tenancy (s. 29(4)(b)) with:
- an authorised financial institution (for example, bank or building society);
- the Bond Administrator; or
- a Tenancy Bond Trust Account.
The bond withdrawal is like any other bank withdrawal – you hand the release form over and the teller hands back the cash, a cheque or makes a direct debit transaction into your account for the amount written next to “Please pay tenant” on the Joint Application for Disposal of Security Bond Form.
Under the Residential Tenancies Act (1987), real estate agents must return your bond within seven days of completing and signing the Joint Application for Disposal of Security Bond (Form 4). There is no time limit for owners to return the bond.
What if there are delays in getting the bond back?
Sometimes owners/agents may give you excuses to delay the payment of your bond such as “it is being held up because we are waiting for the bank to clear its release”, or “it is still in the computer”. If this happens, make it clear that you believe the hold-up is due to the owner/agent, and that you would like the money returned immediately.
If you’re having difficulties in getting the bond money back, also try finding out where the bond is lodged. Information about where the bond money is being held will be on your copy of the Lodgement of Security Bond Money (combined Form 1 & 8) which you and the owner/agent should have signed at the beginning of the tenancy.
The Department of Consumer and Employment Protection may be able to help you get the account details from the owner/agent if you don’t know where your bond money is being held (Ph:1300 304 054).
Sending a Letter of Demand
If you and the owner/agent can’t agree, you can attempt to negotiate repayment of your bond money by sending a “letter of demand”. This needs to be done BEFORE signing the Joint Application for Disposal of Security Bond (Form 4).
If you are still unsuccessful in getting back your bond money, you can take action in the Small Disputes Division of the Local Court. The letter of demand is optional. You can apply directly to the Small Disputes Division of the Local Court.
However, it is a good idea to write first as you may be able to use your letter and the owner/agent’s response as court evidence. See chapter 5.3 Applying to the Local Court for a Bond Disposal
Order for more information.
In your letter, give a reason for each claim you don’t agree with. For example, the alleged damage was not your fault, or you are being charged too much to fix the problem, or you may be able to make an offer to solve the problem.
In the letter give the owner a deadline to reply and let them know you will take court action if they don’t respond. You can ask the owner/agent to explain their reasons for withholding the bond money and to provide copies of receipts for any work they claim to have had done and want to charge you for.
A sample letter has been included at the end of this info sheet, as a suggestion only. Make sure your letter includes all points which are relevant to your situation. Contact a tenancy worker in your area (see chapter 1.12 Community Contacts) to discuss your case if you’re not sure what to say to the owner/agent.
Always keep copies of letters to and from the owner.
What if the owner hasn’t lodged the bond correctly?
If you didn’t sign a Lodgement of Security Bond Money (combined Form 1 & 8) before you moved into the property, the owner/agent has not lodged the bond according to the Residential Tenancies Act (1987). This also means the owner/agent can get access to your bond money without your signature. If this has happened, you can make a written complaint to the Department of Consumer and Employment Protection asking that the owner be prosecuted for not complying with the Act. If prosecuted, the owner may be penalised $4000 (s 29). If your bond hasn’t been lodged correctly, you can write and demand the owner return it to you. If the owner refuses to return your money, you can apply to court. Part of your argument to the court can be that the owner should not be allowed to benefit from the illegal action of incorrect bond lodgement. See Applying to the Local Court for a Bond Disposal Order for more information.
List of Tenants’ Rights Manual chapters referred to in this info sheet:
- Community Contacts
- The Security Bond
- Fair Wear and Tear
- Applying to the Local Court for a Bond Disposal Order
SAMPLE FORMS ATTACHED:
- Joint Application for Disposal of Security Bond (Form 4)
- Lodgement of Security Bond Money (combined Form 1 & 8)
OWNER OR AGENT?
It is important to know that whilst you may be dealing directly with the real estate agent about your tenancy, it is the owner who takes on all the landlord responsibilities under the Residential Tenancies Act (1987). If the agent or owner does something wrong and you have to fill out a breach notice or go to court, it is the owner you will list on the forms and notices.
DISCLAIMER: This is a sample letter only. You should write your own letter telling your own story in your own words (See Writing a Letter to the
Owner/Agent for information on writing your own letter.)
Mr P Owner
15 Hill Street
West Coast WA 6666
31 February 2003
Dear Mr Owner ** WITHOUT PREJUDICE
RE: Return of Bond – (the address of the rented premises)
I lodged with you (state $ amount of the bond) when I moved into the above property on the ….. (date you paid the bond). I vacated the property on the …. (date you moved out) and left the property in a state of cleanliness and repair (equal to/better than) when I moved in, less fair wear and tear. I therefore expect the bond money to be returned to me in full and disagree to your claim that you are entitled to $… (amount of bond owner/agent said they want to keep). I disagree with your claim for the following reasons:
(List here the things the owner is claiming and state why you do not agree with the claim. For example: because the item was already damaged when you moved in, or was not in need of the repair/cleaning claimed by the owner, or you have already carried out the work (such as having the carpets professionally cleaned). Make sure you give full details of why you think each claim is unfair and include copies of receipts for any work you have carried out).
(Also list if there are deductions which you do agree should be taken from your bond. You can also agree to having work done and you paying for it in principle but query the cost being charged. You can ask for quotes if you think the amount being claimed is too high. If old items are to be replaced offer to pay only part of the cost of the replacement due to depreciation for the age or state of repair before the item was damaged during your tenancy).
I believe you are making unfair claims on my bond money. I agree to $x… (state the amount) being deducted from my bond to cover the expenses I agree to (if any). I will be happy to sign a joint application form to arrange for the disposal of my bond to this effect. If you are not agreeable to this, or I receive no reply from you within 7 days I will lodge an application for the return of my bond with the Local Court.
I look forward to your urgent reply.
(your forwarding address)
** PLEASE NOTE: You may choose to write ‘Without Prejudice’ on a letter to the owner/agent, however you need to understand the legal implications of doing so. ‘Without Prejudice’ is a statement made without an intention to affect the legal rights of any person. This means you can write a letter using ‘Without Prejudice’ and it cannot be used in court as evidence against you. You can still bring the letter into court but you cannot give it to the Magistrate as evidence. You can verbally refer to it but only to show that you tried to negotiate a solution to the problem. You may decide to not write ‘Without Prejudice’ in your letter if you think you may want to present the letter in court as evidence.