1. Background
Generally, all tenants living in a property owned or managed by the Department of Family & Community Services - Housing NSW are required to pay tenancy charges. Tenancy charges include rent, water usage, repairs, miscellaneous debts and combined former debt.
Housing NSW establishes a separate account for each tenancy charge, so there is an account for rent, an account for water usage and an account for each other tenancy charge. Housing NSW will manage these accounts throughout the tenancy by placing charges on these accounts when they become due, for example, a weekly rent charge, and ensuring tenants meet their obligation to pay those charges.
When a tenant moves out of a property, Housing NSW will calculate all charges and payments relating to the property. Any credit or debit amounts remaining are known as vacated accounts.
The intent of this policy is to explain how Housing NSW manages tenancy accounts. The Account Management and Tenancy Charges Policy Supplement provides further information to support this document.
2. Scope
This policy applies to tenants and former tenants who are living, or who have lived, in a property owned or managed by Housing NSW, including tenants of the Aboriginal Housing Office.
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3. Policy statement
Housing NSW is able to apply and recover tenancy related charges in accordance with the provisions of the Residential Tenancies Act 2010 and the Housing Act 2001.
Tenants have a legal obligation to pay their tenancy charges as they become due. If tenants do not make payments, their accounts will fall into arrears. This will result in a breach of their tenancy agreement.
Tenants must notify Housing NSW immediately if they are unable to make payments. Housing NSW will work with tenants to ensure they meet their obligation to pay their tenancy charges. However, Housing NSW will take eviction action when there are major or persistent arrears.
Former tenants must pay all money owing on vacated accounts. Housing NSW may decide to refer vacated accounts to a mercantile agent for collection, or pursue legal action if former tenants do not make payments. Housing NSW will refund any credit amounts.
Advising current tenants of arrears on their tenancy accounts
Housing NSW will always contact tenants in writing if their accounts fall into arrears. Additionally, Housing NSW may also contact tenants by phone, or by visiting them in their homes. Housing NSW will act quickly to ensure that tenants pay their tenancy charges on time, and to help prevent the debt from escalating.
Managing current accounts in arrears
Whenever a tenant's account goes into arrears, Housing NSW will work with the tenant to try to resolve the problem. When deciding how to respond to a tenant's account being in arrears, Housing NSW will consider the following factors:
- The tenant's payment patterns.
- The amount of time the tenant has been in arrears and the arrears amount.
- The reason the tenant is in arrears.
- The tenant's capacity and willingness to repay the arrears.
- The need for involvement of support services.
- Previous arrears patterns, including the steps that have been taken to resolve the problem.
Consideration of these factors will assist Housing NSW to determine when to:
- Negotiate a repayment arrangement
- Apply for a Specific Performance Order
- Issue a Notice of Termination
- Apply for an order of Termination and Possession.
Both before and after taking any of the above actions, Housing NSW will continue working with the tenant to try to resolve the problem.
Housing NSW reserves its right to issue a Notice of Termination in accordance with the Residential Tenancies Act 2010 if there have been breaches of the residential tenancy agreement.
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Referrals to support services
Where appropriate, Housing NSW may refer tenants to various financial and other support services to assist them in managing their arrears.
Repayment arrangements
If a tenant goes into arrears, Housing NSW will negotiate a reasonable repayment arrangement with the tenant. A debt can be repaid whether in full or by instalments. Housing NSW expects the tenant to make a commitment to repay all debts, including those from a previous tenancy, and to repay them within a reasonable timeframe.
Where a tenant advises Housing NSW of financial or other difficulties that affect their ability to afford the proposed repayment amount, they will need to supply evidence of their financial position. Upon the presentation of such evidence, Housing NSW may consider a lesser payment arrangement. For more information on the type of evidence to supply, go to Evidence requirements when making decisions about managing accounts.
Where Housing NSW is unable to negotiate a reasonable repayment arrangement, it will escalate the arrears recovery process. Depending on the circumstances, Housing NSW may apply to the Consumer, Trader and Tenancy Tribunal for a Specific Performance Order, or an order to terminate the tenancy.
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Specific Performance Orders
A Specific Performance Order requires a tenant to correct a breach of their tenancy agreement. It is an order granted by the Consumer, Trader and Tenancy Tribunal. For information on when Housing NSW will apply for a Specific Performance Order, go to the During a Tenancy Policy - Dealing with breaches of the tenancy agreement.
Notices of Termination
Housing NSW may issue a Notice of Termination under Section 87 of the Residential Tenancies Act 2010 requiring the tenant to vacate the premises on a specific date due to a breach of their tenancy agreement. For information on when Housing NSW will issue a Notice of Termination, go to the During a Tenancy Policy - Dealing with breaches of the tenancy agreement.
Orders of termination and possession
An Order of Termination is an order granted by the Consumer, Trader and Tenancy Tribunal, which legally ends the tenancy on a certain date. An Order of Possession sets a date by which the tenant must vacate.
If a tenant fails to move out of the property by the date in the possession order, Housing NSW will apply for a Warrant of Possession for the NSW Sheriff's Office to evict the tenant. For information on when Housing NSW will apply for an Order of Termination and Possession, go to the During a Tenancy Policy - Dealing with breaches of the tenancy agreement.
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Managing vacated accounts
When a tenant moves out of a property, Housing NSW will reconcile all charges and payments relating to the tenancy. At the end of this process, there may be amounts remaining in the accounts. These amounts may be debits or credits.
Tenants who vacate and are no longer being housed by Housing NSW
When finalising accounts, Housing NSW will automatically transfer balances between the tenant's accounts if the tenant:
- Has left the property, and
- Will no longer be housed by Housing NSW.
This means that, if there is a credit balance in one account and a debit balance in another, Housing NSW will use the credit to pay off the debit.
Housing NSW, through NSW Businesslink, will manage vacated accounts and advise the former tenant in writing of their final accounts, including whether Housing NSW has transferred any credit balances between accounts and the reasons for the transfer.
Housing NSW will manage any remaining credit or debit balances as outlined below.
Credit balances
Housing NSW will refund credits where:
- An account is in credit, or
- An extra deduction has been made from a tenant's Centrelink payment after they have left the property, or
- The tenant's financial institution has deducted an additional amount by direct debit after the tenant has left the property.
If the total credit amount is more than $50, Housing NSW will attempt to find the former tenant and refund the money. If the amount is less than $50, Housing NSW will refund the money when the former tenant asks for it. However, if a former tenant is deceased, Housing NSW will refund any remaining credit balance to the former tenant's estate.
If a joint tenancy ends and is in credit, Housing NSW will divide the amount equally amongst all the former tenants. One of the former tenants may provide written authority to pay their share, or a nominated amount of their share, of the refund to another of the former tenants.
Debit balances
Housing NSW will waive debit balances where:
- The former tenant is deceased, or
- The former tenant is declared bankrupt. In this case, Housing NSW will waive debit balances up to the date of bankruptcy. Housing NSW will pursue debit balances accrued after this date.
If the debt is more than $50 and the former tenant does not repay the debt, Housing NSW may refer the account to a mercantile agent. Where the debt is less than $50, NSW Businesslink, on behalf of Housing NSW, will manage debt recovery action.
If a tenant leaves their property owing Housing NSW money and reapplies for social housing in the future, Housing NSW may restrict the services available to the former tenant. For more information, see the Eligibility for Social Housing Policy.
If a joint tenancy account is in debit, all the former tenants are liable for the debt. If one of the former tenants reapplies for assistance, they will have to arrange to repay all money owing.
Tenants who vacate their current property and are going to another Housing NSW property
Where a tenant will be housed in another Housing NSW property, Housing NSW will not automatically transfer balances between former accounts or from a former account to a new account. Housing NSW will manage debit and credit balances as outlined below.
Credit balances
Tenants may agree to:
- Transfer a credit balance to pay off a debit balance on their former or new tenancy accounts, or
- Transfer a credit balance to their new tenancy account.
Debit balances
Housing NSW will not transfer debit balances in vacated accounts to the new tenancy accounts. However, Housing NSW will manage debt recovery action as part of the current tenancy. Under Section 140 of the Residential Tenancies Act 2010, a tenant who has an outstanding debt from a former tenancy make a reasonable arrangment to repay the debt and continue making repayments, or Housing NSW may take action against their new tenancy through the Consumer, Trader and Tenancy Tribunal.
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Evidence requirements for managing accounts
When making decisions about managing accounts, Housing NSW will consider various information and evidence. For more information, go to Evidence requirements when making decisions about managing accounts.
4. Legislation and compliance
Housing NSW is able to apply and pursue tenancy charges in accordance with the provisions of the Residential Tenancies Act 2010 and the Housing Act 2001.
5. Further information
Appealing decisions or actions
If a tenant disagrees with a decision Housing NSW has made, they should first discuss their concerns with a Client Service Officer. The next step, if they still believe Housing NSW has made an incorrect decision, is to ask for a formal review of the decision. For information on how reviews work, the tenant can ask a Client Service Officer for a copy of the fact sheet 'Reviewing Decisions' , or read the policy Client Service Delivery and Appeals.
A tenant can only ask for a formal review of tenancy charges if:
- They believe Housing NSW did not calculate the rent subsidy correctly
- Housing NSW has not correctly credited payments for tenancy charges
- Housing NSW cancels their rent subsidy.
The tenant cannot ask for a formal review if rental arrears results in eviction proceedings. In these cases, an independent body called the Consumer, Trader and Tenancy Tribunal (CTTT) will hear the matter. The role of the CTTT is to resolve disputes between tenants and landlords.
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