Residential tenancies mortgagee repossessions

On Thursday 18 June 2009, the Residential Tenancies Amendment (Mortgagee Repossessions) Act 2009 was passed by NSW Parliament, and commenced on Friday 19 June 2009.

The Act amends the Residential Tenancies Act 1987 to require that a mortgagee who becomes entitled to possession of a rented premises must provide the tenants with at least 30 days notice to vacate the premises before taking possession.

Once a tenant has received the minimum 30 days notice, the tenant is entitled to withhold the payment of any rent for 30 days and seek repayment of any rent paid in advance for that period.

While the tenant is still occupying the premises the mortgagee can show the property to prospective purchasers, but any such inspection must be arranged with the agreement of the tenant.

The tenant can agree to vacate the premises before the date of the notice, and the mortgagee can decide to extend the notice. The mortgagee can also decide to hold off on giving notice or not give notice at all and enter into a new lease agreement with the tenant.

The Amendment Act also amends the Landlord and Tenant (Rental Bonds) Act 1977 to enable the mortgagee to authorise release of the tenant’s rental bond.

The new requirements apply to all existing tenancies, unless the mortgagee obtained a possession order before 19 June 2009.