How to Calculate Amount Owing
Let’s break down how Openroom gets to the final amount owing each month.
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How Openroom calculates the amount owing by the Debtor to the Creditor
Who can use this feature
→ Anyone using Openroom’s Rental Debt Ledger product.
Subscription Plans
→ Anyone on the Openroom Community plan
→ Anyone on the Openroom Plus plan
Definitions
Why is Openroom calculating the amount owed and not the Creditor?
There are many reasons we do not let a landlord write the owing amount.
- Tribunal Orders and/or Court Orders are difficult to read. 99% of the time, we see people (even Legal Professionals) misinterpret what the Order actually says.
- Impacts of wrong amounts to an individual’s credit history. As a Consumer Reporting Agency, Openroom is responsible for ensuring we get the most factual and the most accurate data reported into the Credit Bureau.
- We know the intricacies inside and out. Our staff at Openroom have spent thousands of hours looking at Orders and checking with experts in the field to ensure we have the calculations done right.
How do you calculate for Ontario Landlord and Tenant Board Orders?
In a N4/L1 - Nonpayment of Rent Landlord and Tenant Board (LTB) Order, there are 3 components we are looking for in a “Standard Order” that make up the calculation behind the math.
The math = Clause 5 + Clause 6 + Clause 7
- The amount a Tenant owes at the time of the hearing. Usually, it’s located in Clause 5 of a Standard Order.
- The “per day use” rate, should Tenant stay longer than the hearing until the date the Tenant moves out of the unit. Usually, it’s located in Clause 6 of a Standard Order.
- The number of days the tenant stays up until the day they leave is “inclusive”. This means that if it’s November 1 to November 26, we count the November 1st date and November 26th date. Altogether, it is 26 days.
- The interest rate is calculated on the balance outstanding. Usually, it’s located in Clause 7 of a Standard Order.
These three clauses added together gives us the final balance each 15th of the month that we report to the Credit Bureau such as Equifax.
How is the Simple Interest calculated?
The interest is calculated based on GAAP (Generally Accepted Accounting Principles) whereby we calculate the interest on a daily basis and accrue interest accordingly.
You can see the amounts that are calculated on your Openroom Rental Debt Ledger’s Transaction Page to track exactly what interest amounts were accumulated.
What happens when the interest isn’t specified?
In certain documents such as a Small Claims Court record, it will state that the interest for pre/post judgement is to use the Courts of Justice Act Interest Rates. The rate changes per year and per quarter.
See the interest rates: https://www.ontario.ca/page/prejudgment-and-postjudgment-interest-rates#section-4
When the Tribunal Order does not specify to use the Courts of Justice Act Interest Rates, then we do not include the interest rate. The most ideal way to get interest on here is to request for an amendment at the Tribunal or ask the Tribunal of your province.
See the form: https://tribunalsontario.ca/documents/ltb/Other Forms/Request to Amend an Order.pdf
What’s the process of a Rental Debt Ledger verification?
Every Rental Debt Ledger goes through a two step verification process.
#1: Openroom’s Nika Bot Extraction Process
#2: Openroom Staff Manual Review
A record does not get sent to the credit bureau unless Openroom human has looked at it first.
How do I dispute?
Please reach out to us!