Taking a bond in NSW
Information for landlords
rental bond is money paid by the tenant as a form of security
in case they breach the tenancy agreement. A bond should not be treated
as a substitute for careful selection of prospective tenants. All bonds
must be lodged with Fair Trading and you can make a claim against the
bond for certain reasons after the tenancy ends.
tenants do the right thing and get their bond back at the end of the
tenancy. However, sometimes a bond does not cover the damage
and rent owed by a tenant. If you are concerned about this
risk, consider taking out landlord insurance.
Amount of rental bond
While not compulsory, taking a rental bonds is highly recommended unless there is a good reason not to.
Be aware that a rental bond:
be an amount more than 4 weeks' rent. This is paid at the start of the
tenancy and applies to all NSW rental properties, whether furnished or
unfurnished. Higher bonds cannot be charged for tenants with pets,
children or for any other reason. Also, you cannot request or receive
additional bond payments ('top–ups') during the tenancy.
be in money, not in a form such as personal goods or a written
guarantee from the tenant's friends or relatives. The only exception is
for Tenancy Guarantees issued by Housing NSW. These guarantees (of up
to $1000 over and above any bond paid) help those with a limited or
poor rental history to rent a place in the private rental market.
not need to be paid before signing the tenancy agreement. This includes
applicants for the tenancy and those who have paid a holding fee. The
tenant may decide to transfer the bond into a bank account before
signing the tenancy agreement but they are not obliged to do so.
- is for the whole tenancy: if there is more than one tenant, you cannot take a separate bond from each of them.
- can be paid in instalments if you as the landlord allow this. Learn more in the ‘Bond instalments’ section below.
Rent in advance
the beginning of the tenancy, the tenant can be required to pay the
first 2 weeks' rent. This is not another form of bond. The tenant is
simply paying their rent in advance, meaning that no rent is due until
2 weeks have passed. Besides a rental bond and 2 weeks' rent in
advance, you cannot ask the tenant for any other money at the start of
you have employed an agent to manage your property, they should lodge
the bond on your behalf. However, if you are acting as a self-managing
landlord, you are responsible for lodging the bond with NSW Fair
a bond is taken from a tenant they must receive a receipt or record of
the payment details on the tenancy agreement. The bond must be lodged
with NSW Fair Trading. A landlord or agent cannot keep the money or put
it into an account in the tenant’s name.
can currently lodge a bond either through a paper-based process or
through Rental Bonds Online. Rental Bonds Online was introduced in July
2015 and is a new service for tenants, agents and private landlords to
lodge, manage and refund rental bond money more securely and easily.
You can visit the Rental Bonds Online for private landlords web page for further information.
Paper based process
You can complete the bond lodgement using the paper-based method as follows:
a Rental Bond Lodgement form from any Service NSW Centre or by calling
13 32 20. As each Lodgement form has a unique barcode they cannot be
downloaded from this website
- Fill out and get the tenant to sign a Rental Bond Lodgement form.
a Lodgement Form along with a cheque/money order for the amount of the
bond to the address on the form, or lodge it in person at any Service
letting and managing the property yourself, you have 10 working days to
lodge the bond with Fair Trading. You will receive confirmation (with
the bond number) from Fair Trading once the bond is processed.
you have employed an agent, they will lodge the bond and handle the
paperwork. Agents have 10 working days from the end of each month to
lodge all bonds received during that month. These are maximum
timeframes and you can lodge a bond sooner.
You are advised to accept bond payments in either cash, bank cheque or bank transfer from the tenant's account.
Trading does not accept liability for a tenant's dishonoured personal
bond cheque. If the cheque bounces, this means you have no bond or
security. You will need to try to collect the money again and re-lodge
the bond or issue a termination notice for breach of the tenancy
Rental Bonds Online (RBO)
you are using an agent registered to use RBO and your tenant has agreed
to use the service, the agent will manage this process for you.
If you are a self-managing landlord you will need to be set up on RBO. For more details visit the Rental Bonds Online – For landlords web page.
you are a registered user and if you have agreed with the tenant to use
the online service, the bond can be paid by the tenant direct to Fair
Trading by credit card or BPAY. Fair Trading will notify you by email
or SMS when the bond is held, allowing you to arrange for the tenancy
agreement to be signed.
the tenant pays the bond online by credit card, you will be immediately
notified that the bond is held by Fair Trading. BPAY payments may take
up to 3 days before the tenant’s bank advises Fair Trading that the
bond is held.
landlords request the tenant to pay the bond in one lump sum before
handing over the keys to the property. However, landlords may allow a
tenant to pay in instalments.
you agree to this, you can keep the part payments until the whole bond
is paid then lodge the bond with NSW Fair Trading in one amount.
However, if this takes more than 3 months, you will need to lodge what
you have received no later than every three months.
you and the tenant are Rental Bonds Online(RBO) users and have
initially agreed that the bond can be paid in instalments, you can
request that the tenant pay a bond instalment using RBO. An email will
be sent to the tenant. This will prompt them to log on to their RBO
account and pay the instalment. You will be notified when the tenant
pays the instalment. Once paid, the instalment amount is included in
the full bond amount held. For further information on RBO visit theRental Bonds Online for private landlords web page.
Trading can take you to court or issue fines if you do not follow the
bond rules. This includes taking more than 4 weeks' rent as a bond or
not lodging a bond on time.
Updating bond records
the name of the landlord, agent or co-tenants changes during the
tenancy, a Change of Shared Tenancy Arrangement or Change of Managing
Agent/Owner form will need to be completed and lodged with NSW Fair