Connecting with Your Landlord Kindly and Confidently | Foundd Legal Blog

Connecting with Your Landlord Kindly and Confidently


Let’s be honest with each other, here. Paying rent is the pits in the best of times. But right now, when the world that we know has been turned on its head and things are scary and uncertain, not only is rent the pits...right now, for some, it’s simply impossible to pay. I feel deeply for these tenants. And for the landlords who are struggling to pay their mortgages. Everyone is hurting, that’s the long and the short of it. So now more than ever, kindness is key. Understanding is key. Communication is key. Showing empathy and humanity will help us through this. I believe that kindness is innate in us as human beings. We need and want to help each other. But when the going gets tough, we get scared. So what do we do in these situations? What do we do if we can’t pay rent because COVID-19 caused us to shut our doors because customers aren’t coming due to social distancing, or because we’ve fallen into the government directive and had to shut down? It may seem impossible right now. But there are options. 


Take stock of your financials

Get a clear picture of what is coming in compared to what is going out. I know, checking out the finances can give you that yuck feeling. Sometimes closing your eyes feels easier. But not right now, friends. So take a good, hard look to find out where you can cut or reduce costs (subscriptions, etc). Reaching out to your accountant or bookkeeper to get a clear financial forecast for the next number of months, at least 3 to 6, maybe more, will help you plan for what’s ahead. As much as it can be dreadful, you need to know what the worst-case and best-case scenarios are for your business and life so you can make fully informed decisions. 


Find out what relief you’re eligible for

Though not every option is ideal for every individual, the Government has put together a number of relief plans and packages in place that could be of assistance. Be sure to check out what type of relief you are eligible for. Below are a few links to get you started:

Treasury Website for COVID-19 affected Businesses 

Stay informed and get the latest updates from this app. Don't have an iPhone?  Got you covered over on WhatsApp right here.  

Queensland is offering rental relief of up to $2000 for residential tenancies, which adds up to about 4 weeks’ rent. Check it out

Stay in the know, friends. Things are in constant flux, so the more informed you are, the better chance you have to not get into any sticky situations. I’d suggest following Government updates, though, not updates in your Facebook feed or from popular magazines. From the source not from the media, you don’t need added stress on top of what’s already swirling around. 


Mandatory Code of Conduct from the Australian Government 

*Commercial landlords are legally required to engage with tenants who meet the criteria for rental arrangements.

*Landlords cannot terminate leases or DRAW ON TENANT’S security while tenants must still honour their leases.

*Landlords will have to reduce leases in proportion to the reduction in the tenant’s business revenue.

*Waivers will have to account for at least 50% reduction in tenant’s business.

*Deferrals of rental payments will also need to be made but can be put off and spread over the remaining time of the lease, and for no less than a period of 12 months. This basically means that if a tenant has say 3 months left on their lease, they would still have at least a year to make any deferred rent payment.

*This will apply to any tenancies where the landlord or tenant has applied for Jobkeeper and where there is a turnover of $50 million or less.

*Arrangements will be overseen by binding mediation and a mandatory code will be rolled out per State and Territory

*Landlords are now legally required to speak with tenants about rental arrangements and if they refuse, they’ll “forfeit their way out of the lease”.

These new rules bring together a set of “good faith leasing principles” in the hopes that both landlords and tenants can get through this difficult time.  


Communication is key

Connecting with your landlord right now won’t be easy. They’re hurting, too. Not everyone has major reserves of cash that they can depend upon during times like this. We’ve been so fortunate here in Australia to be in a position where until now, that ‘rainy day stash’ hasn’t really been a necessity. But now some of us are suffering because we weren’t quite prepared (Hindsight and all of that, but truly, as soon as you can, start that rainy day stash for future. Ok. Future you talk done.).

So, in light of the recent announcement, please do reach out to your landlord and work out together what would be fair to you both. There are obviously new regulations at play and your landlord will need to come to the table with you. If you really are at zero income then be honest about that. Go over what your reductions have been so you can renegotiate your lease. Discuss possible deferred payments.  What would work for you that may also work for them? Could you freeze rent and then once the money starts coming in again (from Jobkeeper, Jobseeker or elsewhere) spread out payments across what’s left if the term that way you aren’t stuck repaying a crazy lump sum? Because that would SMART. Big time. Or if you’re able, can you contribute to a more reduced rent based on what you do have coming in, and then revisit every couple of weeks or so to see where you both stand? Perhaps releasing part of your bond or offering services (marketing for their business? Fixing their plumbing issue?) in exchange for rent for a time. Just make sure you are both talking AND listening so you can work together to find a solution. Chances are, your landlord won’t be in a position to go out and find a new renter right now for full rates. So talk it out. Be proactive. You’ve got this. You don’t want to get into a legal battle. It isn’t worth it for either party.


Alrighty. Little recap. 

*Communicate and be kind.

*Get on top of your financials so you know going in to talk to your landlord where you stand.

*Apply for relief if you can.

*Short term rent reduction / pause on rent could be a viable solution for you and your landlord in light of the recent Government announcement.

*Pay it off over time if you can’t pay right now.

*The Landlord cannot take any rent payments from your guarantee/bond, in light of the recent Government announcement as of 7 April 2020.

*Be sure that any offer is subject to government directives as they’re constantly changing.

*Document your agreement to stay protected. If you and your landlord both agree to a variation on your lease, make sure it’s properly recorded in writing to avoid future disputes or misunderstandings as to what you jointly agreed upon. Go team!

Little side note. I’ve created a handy template letter for you if you need some assistance in approaching your landlord kindly yet confidently: Landlord Letter Download

Got it? Good. Now I’m giving you a big, fat virtual hug and cheering you on from afar. If you want to chat or if you have any questions, jump on over to the Foundd Legal COVID-19 Facebook Group or schedule a chat free of charge. I’m here for you. x



***Disclaimer. Please read!!***

This checklist and template letter are for general information purposes only and should be used solely as general guidance.  The letter is not a binding legal document and has been created to assist businesses in their negotiations with their landlords to enable an amicable solution.  If you cannot come to an amicable solution, you will need to consider engaging a lawyer.  This checklist and the letter are not intended to be comprehensive or to represent legal advice or other professional advice.  You should seek independent legal advice for your specific circumstances.

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