How Property Managers Should Respond to Bounced Checks

What to do with a Bounced Check

In an ideal world, your tenants would never have trouble paying their rent. But of course we all know that isn’t always the case. While you might sometimes accept a late payment from a long-term, loyal tenant, a bounced check can be a whole other matter. Bounced checks can actually cost you money in fees, not to mention you now have to spend energy and resources collecting the overdue rent.

Bankruptcy vs Credit Repair Flyer


As with all legal matters, a bit of prevention can prevent a big headache later. The first step to dealing with bounced rent checks actually comes before the first check is ever written! Make sure to have a real estate attorney review your leasing forms, to make sure all rights and responsibilities are spelled out for both landlord and tenant. You should clearly outline a procedure for dealing with returned checks, so that your tenant is prepared for the inevitable action should they ever write you a bad check.

If your bank collects a fee for submitting a returned check, you might be able to recover that amount from your tenant. In addition, make sure your lease clearly outlines a course of action for late rent payments. By the time your bank notifies you that a check has been returned, several days or even a week may have gone by. At this point you have to not only talk to your tenant about the dishonored check, but also about their late rent. 

Normally, you can’t require cash payments from tenants. However, if a tenant has paid you with a dishonored check within the last three months, you can ask that payments be submitted in cash. By law, you must give your tenant the amount of notice specified for any routine changes to the lease. Submit the notice in writing, attach a copy of the dishonored check, and inform your tenant that rent shall be paid in cash.

If your leasing forms have been reviewed by a real estate attorney and are compliant with the law, you shouldn’t have any problems requesting cash from your tenants or collecting late rent payments. And if your leasing forms clearly outlined the procedure for dealing with bounced checks, your tenants shouldn’t feel surprised by your actions.


Can Bankruptcy Prevent Foreclosure?

Many people wonder if filing for bankruptcy will prevent foreclosure on their homes. When you file for bankruptcy, it’s important to ask your bankruptcy attorney to explain all possible ramifications of that action. This prevents unpleasant surprises and helps you to better plan for the future. While banks will often delay foreclosing on a home while your bankruptcy proceeds, they can indeed proceed with foreclosure at any time.

Bankruptcies and Foreclosures

There are two basic ways in which the bank can reclaim your property:

With a “deed in lieu of foreclosure”, you sign over the deed and all interest in the property to the lender. This can be slightly better for your credit than a foreclosure, but not all banks give you the option to proceed in this way.

With an actual foreclosure, the bank may proceed with a  judicial or non-judicial process. With the judicial process, the lender has to go through a court process in order to reclaim the property. In the non-judicial process, the bank can take possession of the property and sell it at auction after proceeding through a specific foreclosure process set forth by the state.

Unfortunately, filing for bankruptcy does not mean you can stop paying for the home and keep it. Many banks will wait until your bankruptcy is complete before starting or continuing with the foreclosure process, so while bankruptcy may play a role in delaying the inevitable, it does not prevent foreclosure altogether.

Until the home is legally possessed by the bank, you still own it.  TO THE SURPRISE OF MANY UNDERWATER HOMEOWNERS, EVEN A SURRENDER IN BANKRUPTCY CANNOT FORCE THE BANK TO RETAKE POSSESSION OF THE HOME. In many cases it is wise to use this time, if you are not still making payments to the bank, to save cash for your eventual move to another residence. It will probably be difficult to purchase a new home for two to three years, and sometimes longer, due to the impact the foreclosure will have on your credit rating. You can, however, bounce back from this unfortunate situation. Talk to your bankruptcy attorney to be sure you have reasonable expectations for the future.


IMPORTANT NOTICE: Real Estate Exams and COVID-19

The Department of Real Estate (DRE) is cancelling real estate salesperson and broker license exams in all exam centers through April 30, 2020. This action is being taken to comply with state and local public health agencies ordering residents to shelter in place to slow the spread of COVID-19.

Examinees affected by these cancellations will be notified by email and will be allowed to reschedule their canceled exam dates using DRE’s eLicensing system. Exam rescheduling fees will be waived for canceled exams.

Examinees with questions or concerns regarding canceled exams can contact DRE’s Licensing program at (877) 373-4542 or by email at [email protected].

MLS/NAR Clear Cooperation Policy

In this video, CRMLS CEO Art Carter speaks on the NAR Clear Cooperation Policy, what is being done with the feedback received from real estate professionals in our MLS community, and a little about how CRMLS is addressing the policy.

CRMLS welcomes your feedback on Clear Cooperation. Please email them at [email protected] with your thoughts.

Courtside Real Estate: Fair Housing Regulations: Consideration of Criminal History


Under the recently released Fair Housing Regulations (“Regulations”), the Department of Fair Housing and Employment (“DFEH”) clarified what a landlord can consider when screening their potential tenants. These Regulations are incredibly important to both landlords and property managers as they are likely to effect current screening tenants for prospective tenants.

Generally, the Regulations prohibit the use of criminal history Information if the use of information results in a discriminatory effect, amounts to intentional discrimination, constitutes a discriminatory statement, or it otherwise creates a discriminatory practice. Essentially, landlords and property managers cannot establish or maintain an applicant screening process which amounts to a blanket ban against renting to any person with a criminal record and cannot consider any prior arrests which did not lead to a conviction. Criminal history is broadly defined under the regulations as “any record that contains individually identifiable information and describes any aspect of an individual’s criminal history.”

Although landlords cannot use criminal history to discriminate against tenants, the landlord may be able to avail themselves to an exception if they can demonstrate, among other things, that they have not violated the regulations by demonstrating that the landlord has a legally sufficient justification for a practice of seeking or otherwise considering information which has a discriminatory effect. Additionally, nothing in the Regulations prevents landlords from establishing a policy which permits individual assessments of the types of convictions. However, by default, the law prohibits a person from seeking, considering, using, or taking an adverse action based on criminal history information.

While the Fair Housing Regulations establish new laws relating to criminal history information, a person may also be subject to local laws and ordinances which provide additional limitations. If landlords consider the criminal history information for purposes of denying tenants, they should seek counsel or carefully review their local ordinances to determine what restrictions apply to their properties.

Supra Maintenance Notification – January 28

Dear Valued Customer,

On Tuesday, January 28th starting at 8:00pm PST and ending at 11:00pm PST, Supra will be conducting routine maintenance at our data center and services will be unavailable for short periods during this time.

How will Updates be Available?

·         SupraWEB

·         KIM Voice (888-968-4032)

What will NOT be Working?

·         SupraNET

·         SupraWEB (only available for update codes)

·         KIM Voice (only available for update codes)

·         Automated Phone Payments (IVR system)

·         ActiveKEY Automatic Updates

·         DisplayKEY eSYNCs

·         eKEY Syncs and Wireless Updating

What WILL be Working?

·         SupraWEB (update codes only)

·         KIM Voice (update codes only)

Thank you,

Supra Support Team

Courtside Real Estate: New Fair Housing Regulations: What You Need to be Aware of in 2020


What are the most important laws to keep in mind for property managers and landlords at the start of the new year? The answer to this question tends to vary. Some may comment “Rent Control”, while others may begin to discuss minimum wage increases and AB 5. In the midst of the avalanche of new laws from the California Legislature, the new Fair Housing Regulations, which are effective as of January 1, 2020, are often overlooked. The new Regulations are extensive, detailed, and cover a wide variety of topics. These new Regulations address Service Animals and Assistance Animals; establish permissible questions for service animals; address the landlord’s ability to use criminal history and acts in considering tenants; establishes reasonable accommodation as it relates to unlawful detainer actions; and addresses discrimination in housing.

It is of the utmost important that individuals set aside appropriate time to analyze the Regulations, assess their internal policies, and modify their practices as necessary to ensure they comply with the new Regulations. The Regulations clarify duties as they relate to protected classes, define liability for discriminatory housing practices, address financial assistance obligations, address harassment and retaliation, establish residential real estate practices with discriminatory effects, clarify discriminatory land use practices, clarify reasonable accommodations, establish Regulations for assistance pets, and outline the types of information which a landlord may rely on when considering tenants.

While the above list is not exhaustive, it aims to provide a thousand mile overview of some of the broad and important topics which are included in these new Regulations. With numerous other housing laws going into effect, landlords and property managers should ensure they are allocating sufficient time to understanding these new Regulations. Due to the depth of the new Regulations, we suggest that property managers and landlords independently assess the new Regulations, attend a training at their local REALTORS® association, and consult legal counsel to ensure their policies and practices are compliant with the Fair Housing Regulations in the new year.

New Laws: The 2020 Real Estate Laws You Should Know – The Courtside Newsletter


The California legislature passed a series of new laws which Real Estate Broker and Agents should be aware of as the industry moves into the new-year. While a majority of the laws go into effect on January 1, 2020, some laws became active as recently as September 2019. Thus, it will be important to quickly assess your practices to determine if you are complying with the new laws. Administrative regulations are sure to follow. These laws are briefly addressed here for purposes of providing an overview of some of the important laws for the coming year.


Courtside Newsletter: Assembly Bill 1482: Rent Caps & Just Cause Evictions

October 2019


Recently, Governor Newsom signed into law Assembly Bill 1482. For those who may not yet know, AB 1482 adds new Civil Codes, sections 1946.2, 1947.12, and 1947.13, which establish a Rent Cap and Just Cause eviction. While this article provides information related to this new law, it is of the utmost importance that landlords, property managers, and tenants subleasing their properties consult legal counsel to address their individual concerns as the law is complex and ambiguous.

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