Is it a standard practice to charge Document Charges?
Bhuvnesh Goel asks:
(updated on Tuesday, December 22nd 2009)
Yesterday I have moved to new apartment. Real estate Agent has Charged me letting Fee as one week's rent+GST plus Document Changes (80$) plus GST on documents charges (10$).
I was not informed about the Document changes before moving in to the apartment. Is it a standard practice to charge Document Charges?
Our Experts Answer:
Generally, landlords are prohibited from charging "key money", which includes a fee for the grant or assignment of a tenancy. However, a landlord can charge a letting fee or other charge for services rendered by a real estate (or solicitor) relating to the grant or assignment of a tenancy.
This will apply where the landlord is themselves a real estate agent. This means that the letting fee and associated charges such as document charges may be acceptable if the real estate agent is your landlord, or has been engaged by your landlord to let or manage the property. Where the tenant is to pay solicitors' or real estate agents' fees relating to the grant or assignment of the tenancy, the tenancy agreement should include a statement to that effect.
However, tenancy agreements (and clauses that form part of agreements) are not necessarily unenforceable on the grounds that they are not in writing, and there is no requirement that the amount of the charges for which the tenant is responsible is to be recorded in the tenancy agreement. I suggest you discuss the letting fee and document charges with the real estate agent (or with your landlord, if the real estate agent is not your landlord).
If you are unable to agree on whether these fees should be charged in this situation, or whether you were adequately notified of them, you can apply to the Tenancy Tribunal to have the matter resolved. To discuss your situation further, or for advice and information about applying to the Tenancy Tribunal, you can contact the Department of Building and Housing on 0800 TENANCY (0800 836 262).
The Department of Building and Housing provides information and guidance on building law and compliance, services including weathertight homes, and advice for tenants and landlords.
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