Understanding your obligations
A Residential Tenancy Agreement is a legal contractual arrangement between you and our client. There are certain obligations on both parties, however your rental payments are one of your main obligations.
When applying for rental properties, it is required that you provide evidence of your rental history and ability to pay rent. A copy of your tenant ledger will be requested by the next managing agent or landlord.
Constant arrears depicted on your ledger may cause difficulty in the future for obtaining a rental property, as it shows that you are constantly in breach of your agreement and are unable to meet your tenant obligations, such as paying your rent on time. This is considered a high risk tenant.
Understanding how rent is receipted
Rent is paid into a Queensland Real Estate Trust Account, which is audited regularly in accordance with Agents Financial Administration Act.
The trust account is reconciled daily, however it is for the previous business day as it requires the total amount for the entire day; as transactions come in constantly during the day.
Trust Accounting Software for rental properties uses 2 methods for calculating your rent arrears:
- Paid to Date – Weekly Rent Amount
- Effective Paid to Date – Daily Rent Amount
Your Paid to Date is calculated on receipt of a full week’s rent amount. The above tenant is paid to 07/10/2018 with a credit of $122.00. This means that the tenant has paid an odd amount of $122.00, which the system is not able to allocate to the paid to date, as it requires the full weekly rent amount of $240.00 towards the Paid to Date.
If this tenant was to take their weekly rent amount and subtract the current credit ($240 – $122.00 = $118.00) and pay the gap of $118.00, their paid to date will move forward a week to 14/10/2018 and have no part paid (credit) on their file.
However, as Rent Arrears is calculated with Daily Rent Amount, the credit is taken into consideration and their current rent arrears is only 7 days. The Paid to Date plus the Part Paid amount is also known as the Effective Paid to Date.
Your daily rent can be calculated using the following formula. Below is an example of what the weekly rent +1 or +2 days would look like.
Weekly Rent Amount ÷ 7 days = Daily Rent Amount
In accordance with the Residential Tenancies and Rooming Accommodation Act 2008, the Lessor can apply to Tribunal for termination of the tenancy for repeated breaches by the tenant.