Not Eligible for Office of Housing Bond Loan
This is a huge issue that a lot of professionals have identified! Here are some of them…
1 | Someone has a current bond loan, and is interested in looking for a new property. How do they access bond for their new property?
A common problem is that someone cannot access a bond to secure a new property because they used the loan to secure their current property.
In most cases, a person cannot access their loan from Office of Housing for at least 3 days (sometimes longer) once they have moved out. Real-estate agents need this time to do checks of the house for damage and to transfer bond back to Office of Housing.
On the other hand a person cannot even secure their new property until this bond is paid in full.
In addition, a lot of the organizations that support people financially with Rent in Advance will not agree to support someone UNTIL they have had their bond paid and get a letter from Office of Housing or the real-estate confirming that approval.
This can be a real problem. So what can you do?
- The best strategy is to pre-plan before the person starts looking for a new property.
Can they save up enough money to pay a new bond in full?
Has the house incurred damages? Are they likely to have their bond returned?
Do they have enough to contribute to Rent-in-Advance?
- The best solution is to save up so they can pay their bond in full. This will actually leave them in a better position in the future in terms of securing other rental properties.
- Sometimes looking for a new rental within the same agency can allow for the bond to be transferred from one property to the other. It depends on the agency and landlord; sometimes if the agent is aware that you keep the property in good condition and you have had a good relationship with them, they are willing to consider this.
- Consider private loan companies however this is not ideal as they have strict eligibility criteria and high interest rates (see below).
- Are they moving into the rental with anyone? Can they apply for the bond loan in their name if they haven’t accessed one before?
2 | What if a person has a bond loan debt from a previous rental and they are looking for a new property?
A person has limited choices if they have a bond debt. They either need to pay back the debt first, or pay the bond through their own money or private bond agencies.
The best option is often to pay it back. A person needs to pay back any bond loan debts in FULL before they can access another bond loan.
3 | How can a person pay back an Office of Housing Bond Debt?
- Go into their nearest Office of Housing office and request assistance with paying back bond debt.
- They will receive 2 documents.
1: ‘Agreement to Repay Bond Loan Arrears’
2: Account Statement
- They need to complete and sign these documents and return them back to the Office of Housing desk.
- Office of Housing will give them a payment slip with reference details. This slip is to be used when making payments through Australia post.
- There is only one way to make payments which is to go into Australia post with the payment slip as a reference and pay using Cash/Card (no credit).
There is no option for a person to have repayments made through Centrepay or Automatic Bank deductions. It must be done in person through Australia post.
4 | What if their debt is result of previous Office of Housing tenancy?
If a person has incurred debt through a previous office of housing property, they also need to pay this back in order to access a bond loan. HOWEVER, they are able to request that debt be paid using Centrepay or automatic bank debit.
They do not need to pay their debt back in full. They need to provide evidence that they are on a payment plan to pay back the debts related to their tenancy.
5 | What if they can’t afford to pay their bond loan debt back right now?
If the participant is not eligible for an office of housing bond loan, they can access bond loans from a number of private companies. They might pay something like $40 a week for a few months depending on the price of their rental etc. Unfortunately, they have quite strict eligibility criteria and high interest rates.
TIP — Consider Centrelink advance prior to considering private loans.