Tenants are flocking to a new bond guarantee scheme that allows them to cut the cost of paying a rental property bond, says CBL Insurance’s Richard Blake.
By Susan Edmunds
The company is offering BondAssist, a guarantee that offers landlords the same protections offered by a bond.
The cost of the guarantee to the tenant is 23% of the total cover – for example, $460 for cover of $2000. This fee is non-refundable.
“The clear advantages are less upfront costs, you as the tenant can get pre-approval so you are a more attractive tenant to landlords and the guarantee can be transferred across rentals if needed.”
Blake said there had been an exceptional response to the scheme.
“Landlords don’t have to do anything different. They’ll receive a certificate they can claim against in the same way as a normal bond.”
The cover lasts three years and can be transferred to another property.
If a claim is made on the bond guarantee, CBL Insurance recovers the amount paid to the landlord from the tenant, sometimes with legal costs added.
Blake said legislation passed in 2010 allowed landlords to take guarantees as well as or instead of traditional bonds.
CBL Insurance says BondAssist offers up to five weeks’ bond by way of a guarantee. Landlords can then also require a traditional bond of up to four weeks, if they want extra cover.