Accepting rent payments through a third party

Whenever money exchanges hands, a tenancy is created.

Historically, landlords have frowned upon arrangements where third parties such as family members or caretakers pay the rent, out of fear that a tenancy can be inadvertently established with the payor, who can conceivably claim a right to possession of the unit at some point down the road. Thanks to a new law, these concerns can be put to rest.

AB 2219 provides that landlords can require third parties to sign an acknowledgment form that clearly spells out that the transaction of paying rent does not establish a tenancy. If the third party refuses to sign this acknowledgment, the landlord does not have to accept the rent payment.

Can landlords demand cash?

Although the law requires residential landlords to accept rent payments through a third party if they ink the acknowledgment, and the tenant is allowed at least one form of payment that is neither cash nor electronic funds transfer, there is a notable exception.

In the event the rent check bounces or the tenant put a stop payment on the check, the landlord may demand cash as the exclusive form of payment for the following three months. If cash is the only acceptable form of payment, the landlord must give written notice to the tenant, with a copy of the dishonored instrument to the notice.

At MT Evictions, we are sticklers for documentation and can assist rental property owners in all of the paperwork and notices needed to stay compliant with the law – contact our office today.