Phil Querin Q&A: Late Rent Payment Agreements and Bounced Checks

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October 3, 2018
Phil Querin
MHCO Legal Counsel
Querin Law

 

Question:  I have made an ongoing accommodation to a tenant that he can pay his rent on the 11th of the month. Because of a pension from the employer he retired from, funds are deposited to his bank on the 10th of every month. Earlier this month, we accepted his personal check and that check bounced. That is the 3rd time in the past 13 months that his rent checks have been returned to me. This tenant is otherwise a good resident, but the frustration has brought me to ask the following questions:

  • Have I created a problem for myself by agreeing to rent being due on the 11th of the month instead of the 1st of the month? 
  • Is there an MHCO form that can address this problem?
  • Can I charge this tenant a late fee for bounced checks along with the NSF fee (This is not addressed in my park rules and regulations but is addressed in the MHCO rental agreement 5A)?
  • Can I insist that this tenant pay his monthly rent by Certified Check or Money Order?  

 

 

Answer:  Making an accommodation like this without a writing is an invitation to problems. You can easily enter into an addendum to the Rental Agreement saying that “Rent will be paid by the 11thof the month, and late after the 15th”(i.e. 4 days per statute). 

 

Under this scenario, a 72-hour Notice could issue no earlier than the 18th(seven days from first date rent is due, per statute). If the Rental Agreement provides that there will be a fine of $X for a bounced check and a late fee of $X, then you’re OK to do so.

 

As to whether you created a problem for yourself by allowing the late payments, I would say “No” so long as you have it in writing. Without a writing there is too much chance for argument as to when rent is late and when a late fee can issue.

 

MHCO does not have a form for this, but could. I will check.

 

Lastly, to your question about insisting on a certified check or money order, I would like to see it in the Rules or Rental Agreement, so it is enforceable. If it is not in your rules, you can still tell the client that henceforth, he or she will have to pay the rent by certified check or money order, but you could not enforce it, if they refused.  

 

The rule can simply say: “In the event a Resident’s rent check bounces on more than one occasion within any twelve month period, all further payments for the following 12 months shall be paid by certified check or money order.”  

 

But this would have to be an amendment to your current rules, following ORS 90.610.

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