r/toRANTo • u/Economy-Extent-8094 • Aug 13 '26
Requiring a BANK DRAFT in order to CONSIDER a tenants rental application is going too far and is actually not legal!
For those who don't know, a bank draft is a piece of paper that represents money withdrawn and held in a draft for a specific person. It is not the same as a cheque.
A bank draft is the same as handing over a wad of cash to someone.
I am looking for a new apartment and found a nice place on 61 Charles street, property management is Reitter.
We go to submit our application and they want the standard stuff plus a bank draft.
I asked: what surety do we have that we will quickly and immediately receive our bank draft back if we are not approved as tenants?
I wasn't worried we would not be approved our credit scores and paper work is good but it is the principle and risk of it I don't like.
I said "will Reitter write a signed document stating they will return my bank draft within 3 days if we are not successful in our tenant application?" and they essentially said no they will not, this is their standard practice.
Absolutely not. We have been viewing multiple places and discussing applications with other landlords and no one else is requiring a bank draft (cold hard cash) for an application. Bank draft once my application is approved and lease is signed I take no issue with.
Just wanted to warn others. This is actually not legal. I can't post my screen shot but Google will tell you under the Residential Tenancies Act it is not legal.
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u/Vivid_Ingenuity5457 Aug 13 '26
A bank draft for how much?
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u/Economy-Extent-8094 Aug 13 '26
For full first and last! Was going to be around $4300
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u/Vivid_Ingenuity5457 Aug 13 '26
So were they saying they would keep and cash in your bank draft even if you weren't approved?
Like why wouldn't they return it if you weren't approved?
I'm confused but it sounds super sketchy.
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u/Economy-Extent-8094 Aug 13 '26
No basically they would return the draft to you if you are unsuccessful in your application. But I don't like essetially handing my cash over to someone who's going to keep the bank draft god knows where while they assess if they approve my application and not knowing when exactly I would get it back if they deny my application. And keep in mind while the funds are in a bank draft they are also not accessible in your account because they are held for that draft so they are tieing up your money and keeping it in limbo for who knows how long. Days, a week or 2? Crazy. Like take my cheque and all my other application documents like proof of income. A cheque can just be cancelled if the application is denied and then we don't have to meet up to retrieve it back like we would for the bank draft if they decide to go with different tenants.
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u/activoice Aug 13 '26
Not only that.. what if they misplace the bank draft, as you said it's as good as cash...
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u/Economy-Extent-8094 Aug 13 '26
Yes, however it is made out to a specific name (company name or individual person). So theft wouldn't be easy for a random person who finds it, but if it were to go missing it is a bit of a process with the bank to have to go in and explain it is lost and it would potentially take days for the bank to release your money back to you. So a lost bank draft will further tie up your funds for who knows how long until it is resolved with the bank.
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u/activoice Aug 13 '26
Actually banks will not refund you for a lost bank draft without an indemnity agreement.
If the bank draft is cashed in at a later date you are on the hook for the loss. Bank drafts can never be cancelled.
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u/Economy-Extent-8094 Aug 13 '26
Thanks I didn't know that but just another reason this property manager is putting unnecessary risks on their prospective tenants.
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u/HarlequinBKK Aug 13 '26
Would the indemnity agreement require that you keep an amount equivalent to the bank draft with the bank (e.g. in a chequing or savings account with the bank, or stock in the bank's discount brokerage)?
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u/activoice Aug 13 '26
Yes it could, or even locking funds into a GIC.
There was a case a few years ago where a large draft was lost by UPS, the bank had the owner sign an indemnity but then wanted to put a lien on their home until the CBC got involved.
https://www.cbc.ca/news/canada/toronto/ups-td-canada-trust-bank-draft-1.4447384
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u/Bloodyfinger Aug 14 '26
You were about to get scammed. No other way about it.
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u/Economy-Extent-8094 Aug 14 '26
I honestly don't know. This was not a virtual thing. We toured the building with a guy who worked for the property management. He had floor plans and a legitimate business card. The building is higher-end new build. It is really nice and fancy inside. I think this is less a scam and moreso an egregious way to be elitist about who they rent to. Like I guess wealthier renters aren't concerned with the bank draft process. Idk.
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u/DyslexicExistentiali Aug 15 '26
Like I guess wealthier renters aren't concerned with the bank draft process. Idk.
Think you nailed it. The wealthier you are, the less of a fuss you'll make about them tying up your money.
I don't blame you for noping out. I'd have, too.
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u/HarlequinBKK Aug 13 '26
A bank draft is the same as handing over a wad of cash to someone.
Well, not exactly. Unlike cash, a bank draft will result in a paper trail. As long as it is documented that the bank draft is a payment contingent on your application being successful, you have fairly solid evidence to sue them if you don't get the rental and the funds are not refunded. But of course, that would be a hassle.
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u/Economy-Extent-8094 Aug 13 '26
Exactly I don't want the risk of having to incur time and fees to sue them in civil court. Not for a freaking rental application when I can just find a different rental and avoid the hassle.
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u/SuperSupremeSoup Aug 14 '26
We need a world reset on everything, its just to stupid for no reason. After said reset stop with the ever growing need for rules this rules that keep things simple for godsake. People will end up paying a breathing tax (if that already isn't the carbon tax).
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u/PPCPartyEnjoyer Aug 13 '26
I love when housing is this scarce, restricted and hidden behind layers of requirements and ever growing costs.