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Pay Rent Cash Check
The landlord or landlord’s agent normally cannot require you to pay rent in cash. However, the landlord or agent can require you to pay rent in cash if, within the last three months, you have paid the landlord or agent with a check that has been dishonored by the bank. (A dishonored check is one that the bank returns without paying because you stopped payment on it or because your account did not have enough money in it.)
In order to require you to pay rent in cash, the landlord must first give you a written notice stating that your check was dishonored and that you must pay cash for the period of time stated by the landlord. This period cannot be more than three months after you:
• Ordered the bank to stop payment on the check, or
• Attempted to pay with a check that the bank returned to the landlord because of insufficient funds in your account.
The landlord must attach a copy of the dishonored check to the notice. If the notice changes the terms of your rental agreement, the landlord must give you the proper amount of advance notice.107
These same rules apply if the landlord requests that you pay the security deposit in cash.
Example: suppose that you have a month-to month rental agreement and that your rent is due on the first of the month. Suppose that the rental agreement does not specify the form of rent payment (check, cash, money order, etc.) or the amount of notice required to change the terms of the agreement.
On April 1, you give your landlord your rent check for April. on April 11, your landlord receives a notice from his bank stating that your check has been dishonored because you did not have enough money in your account. On April 12, the landlord hands you a notice stating that your check was dishonored and that you must pay rent in cash for the next three months. What are your rights and obligations under these facts? What are the landlord’s rights and obligations?
Unfortunately, the law that allows the landlord to require cash payments does not clearly answer these questions. the following is based on a fair interpretation of the law.
The requirement that you pay rent in cash changes the terms of your rental agreement and takes effect in 30 days (on May 12). This is because under your rental agreement, the landlord must give you 30 days’ notice of changes in it. Therefore, you could pay your May 1 rent payment by check. However, this might cause the landlord to serve you with a 30-day notice to end the tenancy. The requirement that you pay rent in cash continues for three months after the landlord received the notice that your check was dishonored (through July 10). You would have to pay your June 1 and July 1 rent payments in cash, if the tenancy continues. What about your April 1 rent check that was returned by the landlord’s bank? As a practical matter, you should make the check good immediately. If you don’t, the landlord can serve you with a three-day notice, which is the first step in an action to evict you.108
107 Civil Code Section 1947.3. Waiver of these provisions is void and unenforceable.
108 Paying by check with knowledge that the account has insufficient funds and with intent to defraud is a crime. (Penal Code Section 476a.).
This is a blog post for Real Estate Professionals, Investors, Landlord, Property Manager, and Property Management Companies. Tenants Guide to Paying Rent with Cash or Check is brought to you by SimplifyEm Pay Rent Online and Property Management SoftwareYou might also want to read:
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