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What is a bond?
A bond is a payment by a tenant/resident to the property manager/landlord/owner that acts as security against the tenant/resident meeting the terms of their rental agreement or their duties under the Residential Tenancies Act 1997.
The bond must be lodged with the Residential Tenancies Bond Authority (RTBA) who will hold it in trust until the end of the lease, when the bond is:
- refunded entirely to the tenant/resident, or
A landlord or property manager does not have to ask a tenant/resident to pay a bond. If they do, they must give the tenant/resident a copy of a condition report setting out the state of repair and general condition of the property at the start of the lease. For more information, view Condition report.
Tenants renting a house, unit or apartment will usually be required to pay a bond.
In a short-term lease (five years or less), if the weekly rent is $350 or less, the bond cannot be more than the amount of one month’s rent.
In a long-term lease (more than five years) using Form 2, if the weekly rent is $760 or less, the bond cannot be more than the amount of one month’s rent. For more information about Form 2, view Long-term leases.
The Residential Tenancies Act 1997 does not mention how much a bond should be if the weekly rent is more than $350 (short-term lease) or $760 (long-term lease).
A landlord or property manager can ask for a bond amount that is more than one month’s rent if the:
- tenancy agreement states that the rental property is the landlord’s principal residence and the landlord plans to live there once the tenancy ends, or
- weekly rent is more than $350 (short-term lease) or $760 (long-term lease), or
- landlord or estate agent gets an order from the VCAT with the higher bond amount.
Bond top ups
When the bond top-up can occur
In a long-term lease agreement (using Form 2), a landlord can ask the tenant to add money to the existing bond amount (top-up) by giving the tenant 120 days’ written notice. The top-up can only occur after five years, and only if there are five or more years left on the lease. For example, in a 10-year lease, the landlord can ask the tenant to top-up the bond after five years as there are still five years left on the lease. In a seven-year lease, the landlord cannot ask the tenant to top-up the bond after five years, as there will only be two years left on the lease.
If there are less than five years left on the lease, the landlord can extend the lease agreement with the tenant’s permission so that there are five or more years remaining. This would allow the bond to be topped up.
The top-up process is similar to lodging a bond through the RTBA Online website.
Amount of bond top-up
If the landlord chooses to top-up the bond after five years, and the rent at the time is less than $760 per week, the total bond amount after the top-up cannot be more than one month’s rent.
Case Study: Example only (outcome may differ in individual cases):
Nicole and Mark signed a 10-year long-term lease for $700 per week with a bond of $2,800. After five years, the rent increased to $750 per week as agreed in the lease, and the landlord gave Nicole and Mark 120 days’ written notice asking them to add to the existing bond. The new bond amount is re-calculated as one month’s rent, and the new bond is $3,000.
Nicole and Mark give the landlord $200, the difference between the initial bond $2,800 and the new bond of $3,000. The landlord then lodged the bond top-up with the RTBA within 10 business days of receiving it.
There are no limits to the initial bond amount or bond top-up amount where the rent:
- is more than $760 per week, or
- increases to more than $760 per week during the tenancy.
Bond amounts can be disputed through the Victorian Civil and Administrative Tribunal (VCAT).
If the tenant does not top up the bond
If the tenant does not pay the required amount on the date specified in the 120 days’ written notice, the landlord may apply to VCAT for a decision. VCAT can make an order requiring the tenant to follow the terms of their lease agreement. That means the tenant must pay the top-up amount.
For rooming house residents
If you are a rooming house resident and the owner asks you to pay a bond, the amount cannot be more than the equivalent of 14 days’ rent.
Note: A rooming house is a building where one or more rooms are available to rent, and four or more people in total can occupy those rooms.
For caravan park residents
A park owner cannot ask for a bond unless there is a written agreement with the resident to pay a bond.
If you are renting the caravan and the site, you may have to pay two bonds: one for the owner of the caravan and one for the owner of the caravan park.
The bond for the site, or the caravan, cannot be more than the equivalent of 28 days’ rent or hire charge.
For site tenants
If you are a site tenant and the site owner asks you to pay a bond, the bond cannot be more than the equivalent of one month’s rent if the rent is $350 a week or less.
How to lodge a bond
All rental bonds for residential properties in Victoria must be lodged with the RTBA electronically or on a paper form (if not available electronically).
Property managers and landlords usually initiate bond lodgements and claims.
Electronic (mandatory for licensed estate agents)
Electronic transactions can only be initiated by property managers and landlords who are registered with RTBA Online
. The tenant/resident gives the bond money to the property manager or landlord who then lodges a bond application with the RTBA.
When the property manager or landlord lodges a bond application, the RTBA withdraws the bond money from the agency bank account or trust account. These funds are automatically deposited into a RTBA bank account and held in trust by the RTBA until the bond is claimed. Tenants should keep a record or receipt of this transaction. Bonds may also be searched via RTBA Online.
View lodging a bond online for property managers or our guide for tenants using RTBA Online.
Paper form (not preferred)
Paper forms should only be used in cases where a tenant or resident does not have an email address or is unable to complete an electronic transaction.
You can generate a printable PDF bond lodgement form through RTBA Online. Blank forms are not available as each form is generated with a unique identification number. If you have trouble generating the form, check your browser has pop-ups enabled.
The completed form must be:
- signed by all parties to the bond
- posted to the RTBA with the lodgement payment, payable to ‘the RTBA’. This payment must be in Australian dollars as either a cheque from an Australian bank or a money order from Australia Post. The postal address is:
Locked Bag 007
Wendouree, VIC 3355
Bond receipt and bond receipt/ID number
When the RTBA receives the bond lodgement, the tenant/resident will get a copy of the bond receipt by email (if an email address was provided) or mail. The landlord/property manager or owner will only get a receipt if they ask for one. Tenants should include their email address to get the receipt as soon as possible. Property managers can only receive a receipt via email.
Keep the bond receipt/ID number handy - you can use it to search on RTBA Online for bond details.
If you do not receive the bond receipt within 15 business days after paying a bond, call the RTBA on 1300 137 164. Note: Calling this number costs the same as a local call. Additional charges may apply if you are calling from overseas, on a mobile or payphone.
Checking the details and status of a transaction
RTBA Online allows tenants, residents, landlords, property managers and owners to view the details and status of a bond transaction.
Landlords and property managers can register on RTBA Online to view and undertake transactions on bonds registered to them.
To check the details and status of a bond transaction, view the Bond Summary page on the RTBA Online homepage. Ensure pop-ups are enabled in your web browser.
Tenant and resident responsibilities
The bond and rent are separate payments. You cannot use any part of the bond as rent.
You must meet the conditions of your rental agreement so you can get the full bond amount back once your lease has ended.
The landlord/property manager or owner may claim part or all of the bond if, for example, you have damaged the property or owe rent. If there is a dispute about the bond claim, the tenant, resident, landlord/property manager or owner can apply to VCAT for a decision on who gets all or part of the bond.
If a bond is not paid, the landlord/property manager or owner can organise to collect the money and re-lodge the bond, or give you a:
If you get written permission from your landlord/property manager to sub-let the rental property, you become the head tenant and must take on landlord responsibilities. This includes lodging the sub-tenant’s bond with the RTBA. For more information, view Subletting (sub-tenancy).
Landlord/estate agent and owner responsibilities
If you are a landlord/property manager or owner and take a bond from a tenant or resident, you must give them a copy of the condition report.