Landlord can’t require tenants to pay rent by automatic transfer

Question: When I recently signed a lease for an apartment, the community manager told me the owners wanted all rent payments to be made by automatic deposit in the community’s bank account. I told her I wasn’t comfortable with automatic transfers because I was the victim of an identity theft a couple of years ago.

I signed the lease anyway, although it specified that rent must be paid by automatic transfer and deposit. Since I moved in, I find myself still feeling uneasy about paying my rent this way. Is there anything I can do about it?

Answer: California Civil Code Section 1947.3 recently has been amended to address the question you asked. Under this statute, a landlord and tenant can agree that rent may be paid through an electronic deposit process, but only if the landlord allows an alternative method of payment. Payment by cash is not an acceptable alternative method for a landlord to require, unless a tenant’s rent check has bounced or been dishonored, and even then cash can be required for only the next three months.

The fact that you signed a rental agreement limiting your options to electronic transfer is not an impediment for you. This same statute declares any such condition in a rental agreement to be void and unenforceable.

Section 1947.3 defines “electronic transfer” broadly, essentially any transfer of funds not initiated by a check or other paper “instrument,” including transfer via computer, telephone or point-of-sale contact or direct deposit permitting a financial institution to debit your account. This statute preserves your right to pay rent by check or some other old-fashioned method.

Your local mediation program could bring you and the property owner together to agree on a mutually acceptable payment alternative to the electronic transfer.

Eichner is director of Housing Counseling Programs for Project Sentinel, a Bay Area nonprofit. Send questions to info@housing.org.