Are Electronic Rent Payments a Ripoff for Tenants?

During the past year, many landlords have been notifying tenants that electronic payments are the “preferred” way for them to send their monthly rent. They’ve sent letters and emails stating that they would like tenants to pay by e-Check (ACH) or with a major credit card. If a credit card is used, tenants are charged a “transactional fee” ranging from 2.95 to 3.95 percent of their rent. This differs from standard practice, in which retailers, not buyers, pay the fee for credit-card transactions—the reason some businesses won’t take credit cards for very small purchases.

The notices state that this method is easier for tenants rather than sending a check or money order through the Postal Service, as it means the rent is automatically deducted from their bank account or charged to their credit card. But if the amount owed is disputed, it robs the tenant of the power to pay only what they believe they owe.

For example, suppose the landlord decides to disregard a rent abatement granted for lack of services such as no cooking gas? Such abatements are legal if granted by the state Housing and Community Renewal agency or a Housing Court order.

Suppose the landlord decides to charge a fee for late payment? Late fees are ONLY allowed if the first lease the tenant signed for the apartment explicitly states that they are.

Suppose there are rent increases for disputed individual-apartment improvements and/or major capital improvements that are being negotiated or contested through HCR or Housing Court? The landlord may decide to put those increases on the bill anyway.

Suppose you pay by e-Check, but the paycheck you deposited in your bank account doesn’t clear until a couple days after the rent is deducted, so you do not have sufficient funds to cover it, and your check bounces?

Many tenants who receive these notices feel intimidated by language such as “Important Billing Changes” and the “preferred” way to pay. They shouldn’t be. Tenants have the right to choose to pay rent by sending a personal check or money order through the mail, regardless of the pressure or presumed mandate from the landlord