Can landlord require me to pay rent through ACH? I'm undecided as to whether this question belongs here on in the Money &amp; Personal Finance SE, so apologies in advance if it should be migrated. I'm facing a situation where my landlord had previously collected rent through an online service, in which I had to initiate the payment each month and specify the amount. That service has since been discontinued. As a result, the landlord is now asking all tenants to sign a modification to the lease agreement that specifies two actions: The ownership of the rental property has changed names to a different LLC. The rent will be collected through automatic monthly ACH payments from a bank account that I would furnish. This form authorizes the LLC to withdraw funds from my account as determined by my rental agreement and any future addenda to this agreement, until I move out. My first question is not so much a legal one, but a plea for advice: is this something I need to worry about? If I agree to these terms, would I be exposing myself to financial risk? Second, is this type of contract legally enforceable under California housing law? I know I haven't provided the verbatim wording or additional details (mainly to preserve some sense of anonymity), but this whole thing smells fishy to me and I cannot imagine how an arrangement in which a landlord has direct access to my bank account is permissible as a condition of rental. I am not able to move on such short notice. For the previous month, I wrote them a check, and it went through, so their request isn't out of an absolute need to have this arrangement, but it appears to be for their convenience. For what it's worth, the property owners have been very gracious to me and we get along extremely well, but I have learned not to confuse the personal with the professional. This whole thing smells to me. Update: I spoke to my bank and was informed that by signing the ACH authorization form, I would be giving my landlord complete access to funds in my checking account. The representative told me that they would not need subsequent authorizations. It's similar to scheduling automatic payment of utility bills, but this is obviously unacceptable to me for such large transactions on an account where I get my paycheck deposited. While it is true that my account number and the bank routing number are printed on paper checks, the critical difference is that I have to sign each check I write, and that instrument can only be used once. The form I am being asked to sign permits repeated withdrawals without further intervention on my part. I have also found the relevant portion of California law, in Civil Code Section 1947.3. Because I have never been delinquent/late in paying rent, I not obligated to sign this request, nor can the landlord force me to sign it as a condition of remaining on this property. Moreover, I would tolerate paying in cash if necessary despite the monthly inconvenience, as the issue is about control of my funds. But in the meantime, I will try to negotiate some other arrangement. I've also discovered that I've been overpaying my rent for the last 8 months.
As noted in your update, Cal. Civ. Code section 1947.3 says (a) (1) Except as provided in paragraph (2), a landlord or a landlord's agent shall allow a tenant to pay rent and deposit of security by at least one form of payment that is neither cash nor electronic funds transfer. Paragraph 2 related to cases of recent bounced checks, and it sounds like you don't have that problem. From the personal finance angle, if you liked the convenience of the online service but don't trust the new ACH agent, your bank may have an "online bill pay" service where they can withdraw money at a designated time each month and send it. Chase has such a service, no charge, they do an electronic transfer if the payee accepts them and otherwise mail a paper check.
My guess is the answer to this question is going to be in your lease. You likely signed a lease that agreed that you would pay accept this practice and spelled out what ever rights you have to challenge the billings. My guess is they are as limited as the courts will allow in Florida. And the only way to ensure access to those records would be to get the court to compel they provide you with the records. Perusal of the Water codes in Florida does not appear to directly engage this practice(I could have missed it). However it appears that there is code regulating the management of electrical limits the billing to no more than the actual costs to the customer of record(probably your real estate management company.) According the the NCSL (This refers to electrical service. I am assuming there is similar language used elsewhere for plumbing, or that the intent of the law is uniformity of these codes in all utility billings. Where individual metering is not required and master metering is used in lieu thereof, reasonable apportionment methods, including submetering may be used by the customer of record or the owner of such facility solely for the purpose of allocating the cost of the electricity billed by the utility. The term “cost” as used herein means only those charges specifically authorized by the electric utility's tariff, including but not limited to the customer, energy, demand, fuel, conservation, capacity and environmental charges made by the electric utility plus applicable taxes and fees to the customer of record responsible for the master meter payments. The term does not include late payment charges, returned check charges, the cost of the customer-owned distribution system behind the master meter, the customer of record's cost of billing the individual units, and other such costs. Any fees or charges collected by a customer of record for electricity billed to the customer's account by the utility, whether based on the use of submetering or any other allocation method, shall be determined in a manner which reimburses the customer of record for no more than the customer's actual cost of electricity. Each utility shall develop a standard policy governing the provisions of submetering as provided for herein. Such policy shall be filed by each utility as part of its tariffs. The policy shall have uniform application and shall be nondiscriminatory (Fla. Administrative Code §25-6.049). Now here is where the 3rd party comes in. The 3rd party is the one levying fees for the management on your landlord. Granted if you follow the strings ill bet you find that the billing company is owned by the same company that owns your rental management firm. So your landlord can collect no more than what it costs to provide you with the service, but part of providing the service is employing this 3rd party utility management firm.
It may not be legal -- in many places zoning restricts running a business from a residential address. If the academy involves physical students, the landlord could reasonably claim an increase in wear and tear, and liability risks. In any case, with a month-to-month tenancy, the landlord can normally raise the rent with a month's notice for any reason or none.
You agreed to pay these fees when you applied for the apartment, so unless they explicitly say that one or both of these fees is waived in case you don't take the apartment (virtually no chance that they said such a thing), you owe that money. Your obligation is not contingent on them convincing you that the fee is just, so it doesn't matter that they won't explain the difference. However, if they said you can pay electronically, then you can pay electronically, since that too is part of the agreement.
If you want to protect yourself or any property interests you may have in this circumstance you have to talk to a lawyer. You cannot get (or trust) legal advice from the internet. I will, however, make the following personal observations: I only provide a W-9 to people who are paying me money, and who request it as a condition of paying me. I don't know of a legal requirement to supply it after the fact. However, not providing it to someone who did pay you more than $600 in a tax year could certainly make it difficult for them to comply with their tax filing obligations. I do not sign any agreements, assignments, or contracts, without what I consider to be fair consideration. E.g., if on leaving a job (as has happened) I am asked by a former employer to sign something that I am not already obligated to sign due to some prior contract, then I negotiate what is commonly called a "severance package." They pay me and/or extend benefits, and I sign something that limits their liability.
am I obligated to pay this fee? Yes. You entered the lease despite been aware of the existence of that fee. That meets the contract law tenet that an agreement be entered knowingly and willfully. Does it not invoke an issue where they can arbitrarily set the price? If the landlord requires a fee that is unreasonably high, that would violate the contract law covenant of good faith and fair dealing. As such, that part would be unenforceable, meaning that the landlord may only charge a reasonable fee. Likewise, unless the lease clearly entitles the landlord to decide the telecom fee arbitrarily, the lease would fail to meet that extent of the aforementioned tenet of a contract being entered knowingly. Does this fall under the category of lease addendum? The form (or format) in which the requirement of telecom fee was mentioned --and agreed upon-- does not matter. The landlord only would need to prove that the tenant was --or should have been-- aware of that fee. Usually the landlord can prove that by showing/producing in court the lease with tenant's signature.
Here is the Illinois Landlord and Tenant Act, and here are the Chicago Residential Landlords and Tenants ordinances. Neither set of law addresses application fees. So it would have to be covered in whatever agreement you have with the agent (assuming you paid the agent), or with the landlord (if you paid the landlord). Fees for a credit history check are generally not refundable since they are actual costs incurred by someone, no matter what the outcome is. Check the forms you signed, like this one, to see whether they explicitly say that the fee is not refundable.
Is It Legally Binding? While their customer service sucks, your oral authorization of the charge is legally binding (I take payments that way almost every day in my own business, it isn't an unusual business practice in small professional businesses). You authorize oral authorization of payments over the phone in the credit card agreement that your credit card company sends you every year that you don't read and throw away. The provider has to collect more information for a credit card payment over the phone than they do for an in person swipe in a credit card machine (e.g. your credit card billing address) and they are fully responsible for wrongful charges if they deal with an imposter. By regularly checking your credit card statements, you can confirm that no incorrect charges are present. Tax Issues If you want to take a tax deduction for non-reimbursed medical expenses, you simply need to tote up the amounts your are entitled to from your own records, and put it in the appropriate box on your tax forms. You don't have to attach documentation to your return. If the IRS disputes your payment, you can offer up your credit card statements and your photograph of the receipts, and if necessary, medical records to show that you received the services, to show that the payment really happened and are deductible. Your credit card company's records, reflected in your monthly credit card statements, are considered very reliable for tax purposes. You have the burden of proving that the expense was incurred and is of a type that qualifies for a deduction by a preponderance of the evidence in the event that there is a dispute that is litigated, which means that you must show that it is more likely than not that you incurred a deductible expense of that kind in that amount in that tax year. Privacy Issues While there are financial information privacy issues associated with this transaction, HIPAA, which covers medical records, normally wouldn't apply to a credit card payment that indicates the person paid, the person paying, the account, the amount and the date, but not a description of the medical services provided or to whom they were provided, which is what is normally on a credit card receipt. The financial privacy issues are also partially addressed by the provider's merchant agreement with the credit card company which contains terms requiring them to maintain certain kinds of security with respect to your financial information (which is not to say that the provider actually follows all of the requirements of their merchant agreement scrupulously, which is why data breaches happen all the time in businesses both large and small).