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Paying the rent – what you should know.

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There are certain rights and obligations both the landlord and tenant have in regard to the payment of rent. To keep it very simple:

RECEIPTS: When a landlord receives the rent, they must receipt it and keep proper rent records. The landlord isn’t obligated to send the tenant a receipt if the rent is paid directly into a financial institution of the landlord and/or agent.

PAY ON TIME: The obligations of the tenant are very clear when it comes to the question of when the rent is due. The tenant must pay the rent according to their tenancy agreement. This agreement – and the Residential Tenancy Act – also states that the tenant must pay rent on time. “On time” means on the day the agreement specifies the rent is due. The frequency of payment will also be specified – whether the tenant is required to pay weekly, fortnightly or monthly.

RENT IN ADVANCE: Paying rent in advance means the tenant pays rent for the period they are about to occupy (just like a hotel room where you pay for a night in advance and pay more if you wish to extend your stay). A landlord can’t insist on any additional rent until the end of the payment period unless the tenant wishes to do so. (Note that when a tenancy starts, tenants are asked to pay two weeks rent in advance. This is their initial payment for the first two weeks of occupancy. It is not held in credit. Tenants must continue to pay rent as scheduled until the end of their tenancy.)

SET A BUDGET: Sometimes a tenant will need to budget for their rental payments especially if their pay days are after the date the rent falls due. By not paying the rent when it falls due means the tenant is in breach of their tenancy agreement which constitutes rent arrears. Following up these rental arrears becomes time consuming for the landlord and/or agent. If a tenant finds themselves in a position where their rent falls due prior to their wage payment, they should work out a payment plan with the landlord and/or agent, This way the tenant ends up paying their rent in accordance to their tenancy agreement.

DON’T BE RED FLAGGED: If a tenant doesn’t pay rent in accordance to their tenancy agreement, and they are constantly in arrears, this will reflect badly on them when it comes to finding a new property. A tenant will rely on a rental reference from the current landlord and/or agent and one of the questions generally asked is “did the tenant pay their rent on time?”. Some agents conducting rental references will also request a copy of the tenancy ledger, so bad payment history will be an immediate red flag against the tenant.

In all circumstances its always best for all parties to communicate efficiently and work out the best method to ensure the rent is paid on time and in advance, as per the tenancy agreement.

If you own an investment property and would like peace of mind, contact Lisa Akeroyd from Barossa Rental Specialists on 0414 335 660 to discuss your rental management strategy.

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