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Lease Break Question - Victoria


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#1 namie

Posted 30 January 2013 - 01:20 PM

We are unable to continue to rent our current house. Our savings have finally dried up and we have registered with Centrelink. On the payments we are eligible for we simply cannot afford the rent of this house, so we have given the Real Estate agent 28 days notice of our intention to vacate.

The lease doesn't end until 27 Sept 2013 so we are breaking the lease. I knew we'd potentially be responsible for paying rent until a new tenant is found if no one moves in the day after we move out, but I've just been notified of the following and I wondered if this was standard:

'As you are currently on a fixed term lease until 23/09/2013 – there will be lease break fees payable.

These include:
Rent until a new tenant is found.
Pro rata letting fees
Advertising $110
For Lease board $77
NTD checks $13.39 each'


How much are Pro rata letting fees likely to be and what is an NTD check?

We've lived here for 2.5 years and I'm really upset about this. We don't want to move as it is. The rent has gone up $108 since we moved in (the first year was $2492, the second year was $2576, it's now $2600 a month). We simply don't have the money to pay the above-mentioned costs, so I've no idea what we're going to do. If someone would just give DP a job, we'd be fine, but he's really struggling to get work, and now we're being slugged with costs I haven't budgeted for.

If they're standard costs then I guess we just have to try to find the money from somewhere, but if anyone has any suggestions, I'm all ears.

Edited by namie, 30 January 2013 - 01:21 PM.


#2 elizabethany

Posted 30 January 2013 - 01:43 PM

From the Tenants Union Victoria Breaking a Lease

QUOTE
Hardship
If something unforeseen happens and it will cause you severe hardship to stay in the property until the end of the fixed term, you can apply to the Victorian Civil and Administrative Tribunal to reduce the period of your fixed term and allow you to end your tenancy. You should ask the Tribunal to hear your case as quickly as possible. You must continue to pay rent as usual, until the hearing has taken place. If you plan to apply for hardship, you must do so before you move out.

To claim hardship, you will have to prove to the Tribunal that:
> there has been an unforeseen change in your circumstances (eg you have lost your job) and you will suffer severe hardship if the tenancy continues; and
> the hardship you will suffer if the tenancy is not ended will be greater than the hardship of the landlord if the tenancy is ended.

You may still have to compensate the landlord
if you break your lease due to hardship. See
‘Costs’ below.


QUOTE
Costs
Breaking a lease on the grounds of hardship or by giving up possession can be costly. The landlord can claim compensation for any reasonable costs they have to pay as a result of you breaking the lease.
The costs you could be liable for include:
>a reletting fee (usually one or two weeks’ rent). This must be based on the fee that the agent charged the landlord so it is a good idea to ask for a copy of the invoice
>reasonable advertising costs
>rent until new tenants move in or until the end of the fixed term (whichever happens first)

What the landlord or agent may not tell you is that you only have to pay the reletting fee on a pro-rata basis, which means you only have to cover the fee for the remaining term of the lease. For example, if you leave 7 months into a 12-month tenancy agreement, there is only about 40% of the fixed term remaining so you only have to pay 40% of the reletting fee.

Managing the costs
If you want to break your lease, you should give as much notice as possible in writing (keep a copy of your letter). It is a good idea to state the exact date you will be leaving and that you want the landlord or agent to find a new tenant. The landlord is expected to take all reasonable steps to find a new tenant as quickly as possible. The more you can do to help find a new tenant (such as having the property available for inspection, or advertising the property yourself) the less you are likely to have to pay.

You should only pay rent up until the day that you vacate. Once the new tenants move in, you can then pay the landlord compensation for any lost rent.

You should make sure the landlord or agent are taking steps to relet the property after you give notice, and check the date that new tenants move in. The landlord has a duty to keep their loss to a minimum, so if they do anything to make it harder to find a new tenant (such as putting up the rent), or if they don’t make an effort to find a new tenant, you can argue that you should not have to pay them the full amount of compensation.

Check the Properties to Let section in the major newspapers and the Rental Listings available from the agent. If you have internet access, you can also check the agent’s website. If the property is not being advertised or is being advertised at a higher rent, keep this as evidence that the landlord has not tried to keep their loss to a minimum.

If you think the costs that your landlord is claiming are unreasonable, don’t agree to pay. The landlord will then have to make a claim against your bond or apply to the Victorian Civil and Administrative Tribunal for compensation. The landlord must give you notice of their claim and you will have a chance to present your side of the story to the Tribunal. See the Defending a compensation claim and Bonds fact sheets for more information.

For more information, phone the Tenants Union Advice Line on ☎ (03) 9416 2577.


I would seriously look into the hardship claim, it may be able to get you out of those costs.  Otherwise, you may need to ask them to take it out of your bond.  If your new rental is cheaper, there should be something left over that could help defray those costs.

Goodluck OP.

#3 solongsuckers

Posted 30 January 2013 - 01:44 PM

QUOTE (namie @ 30/01/2013, 02:20 PM) <{POST_SNAPBACK}>
We are unable to continue to rent our current house. Our savings have finally dried up and we have registered with Centrelink. On the payments we are eligible for we simply cannot afford the rent of this house, so we have given the Real Estate agent 28 days notice of our intention to vacate.

The lease doesn't end until 27 Sept 2013 so we are breaking the lease. I knew we'd potentially be responsible for paying rent until a new tenant is found if no one moves in the day after we move out, but I've just been notified of the following and I wondered if this was standard:

'As you are currently on a fixed term lease until 23/09/2013 – there will be lease break fees payable.

These include:
Rent until a new tenant is found.
Pro rata letting fees
Advertising $110
For Lease board $77
NTD checks $13.39 each'


How much are Pro rata letting fees likely to be and what is an NTD check?

We've lived here for 2.5 years and I'm really upset about this. We don't want to move as it is. The rent has gone up $108 since we moved in (the first year was $2492, the second year was $2576, it's now $2600 a month). We simply don't have the money to pay the above-mentioned costs, so I've no idea what we're going to do. If someone would just give DP a job, we'd be fine, but he's really struggling to get work, and now we're being slugged with costs I haven't budgeted for.

If they're standard costs then I guess we just have to try to find the money from somewhere, but if anyone has any suggestions, I'm all ears.


Yes it is standard. Letting fee is usually one week's rent, so a pro rata amount of that.


#4 solongsuckers

Posted 30 January 2013 - 01:46 PM

QUOTE (elizabethany @ 30/01/2013, 02:43 PM) <{POST_SNAPBACK}>
From the Tenants Union Victoria Breaking a Lease





I would seriously look into the hardship claim, it may be able to get you out of those costs.  Otherwise, you may need to ask them to take it out of your bond.  If your new rental is cheaper, there should be something left over that could help defray those costs.

Goodluck OP.


What you quoted said even if you claim hardship you may still have to pay those costs, so I'm not sure you can get out of it.


#5 namie

Posted 30 January 2013 - 02:04 PM

Thank you.

#6 MrsLexiK

Posted 30 January 2013 - 02:11 PM

As others have said it is standard but look at a hardship claim.  Goodluck I hope your DP gets offered a job soon.

#7 elizabethany

Posted 30 January 2013 - 02:11 PM

It is up to the tribunal whether you do or not.  If you don't claim it, you will pay.

#8 lynneyours

Posted 30 January 2013 - 03:30 PM

What kind of work is he looking for?  EB should have plenty of leads for him.

#9 namie

Posted 30 January 2013 - 03:51 PM

He's a software developer/computer programmer.

Predominantly in .Net but he knows a little Ruby (amongst other languages) and is certainly willing to learn on the job if required.

He's been out of work for over 9 months now since his last contract ended, and the longer it goes on, the more of a stumbling block it is unfortunately. We were looking at Plan B, which was for him to go to Uni, but we just keep getting financial hurdle on financial hurdle. Just as I get the budget sorted and on track something else pops up to derail us *sigh*

We both know there will be an end to this eventually, it's just hard waiting to get there and doing everything we possibly can in the mean time.

Edited by namie, 30 January 2013 - 03:51 PM.


#10 FeRaL n ScReWeD

Posted 30 January 2013 - 03:57 PM

Could you find someone to take over the lease? My cousin got someone else approved by the realestate to take over!
No penalties payed.


#11 MrsDamonSalvatore

Posted 30 January 2013 - 04:05 PM

I agree with sarah,if you can find someone to take over the lease it will save a lot of $$ for you. Advertise on all homes or gumtree, you shouldn't find it hard to find someone...




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