Tenants' check bounced. Property mgr mishandling?

34 Replies

Tenants' check was returned for NSFs. Property manager said they turned in paperwork to officials that if tenant didn't make the check good within so many days she would be arrested!

In all my reading on BP and numerous books on REI - I've never heard of this approach being used.


Nonsense. The police would consider this a civil matter and not get involved. At a certain point, passing bad checks is a crime, but, just one check returned for NSF is not a crime.

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Did you ensure they also sent the proper pay or quit notice to start eviction if they cannot pay and are following proper landlord/tenant laws?  If not, you could be looking at even more problems.   I'm not a lawyer, no legal advice, but if it were me, I'd likely send PM an email stating that you do not agree with the criminal charges as it might be construed as harassment, as it's a rather severe action on PM's part, especially if they have never bounced a check on you before.

Hold on there.  See the attached.  There can be criminal charges as writing a check with NSF is considered check fraud.  The attached described the possible criminal penalties by state:

http://www.ckfraud.org/penalties.html

Gail

Why take personal checks? I require money orders or cashier checks. It costs the tenants about $1.30 or so. Never had a complaint!

In most states there is a criminal charge for passing bad checks. Typically if someone gets criminally charged they are more likely to make the restitution than if a civil judgement is passed. There is no guarantee that restitution will be made in criminal court though. In order to prove the crime it typically only requires the account to have insufficient funds when the check is written.

@Karen Young ,

Wow the only person I could ever imagine doing this is on this site. Everyone else would handle it as their lease says. Essentially there is a bounced check fee of XYZ and the timer is still going on late fees. Then when late issue pay or quit and continue down the road until satisfied. 

In my opinion that is an empty threat from your PM and just makes the whole operation look like a bunch of drama queens. 

Good luck in getting them under control

@Mike Cumbie

no names mentioned?:)

OP...change PM companies TODAY and make sure the new one requires money orders or cashier checks! 

Considering the fact that there are no details included regarding the back ground on this situation, and the PM is not here to explain, it is possible there is information missing that would warrant the PM to inform the tenant she had committed a crime. If the source of the information was from the tenant then the facts may defiantly be incorrect.

It is true that knowingly writing a bad check is fraud and a criminal offence therefor the PM may have informed the tenant of this fact. There may be no more to the story than that.

Have you ever written a check that bounced? Did you do so with criminal intent? The PM overreacted. Tenants sometimes make unintentional mistakes in managing their money. The rental agreement should outline a standard response when a tenant writes a check that bounces, typically a NSF fee. Here's an example from ours.

NSF FEE. Any checks returned for Non Sufficient Funds will be charged a twenty-dollar ($20.00) NSF fee and the late fee may also be imposed. NSF for the purpose of this contract means a check that is not honored for any reason by the bank it is drawn on the first time it is submitted for payment. If Landlord’s bank notifies Landlord of a declined or resubmitted check, the check will be considered NSF.

Originally posted by @Marcia Maynard :

Have you ever written a check that bounced? Did you do so with criminal intent? The PM overreacted. Tenants sometimes make unintentional mistakes in managing their money.

EXACTLY! People generally don't become renters because of their excellent finances.

It is NOT a crime to accidentally have a check returned for NSF. The link posted above shows civil penalties state by state...that is not criminal, and no, they cannot be arrested! Try calling the cops and see how hard they laugh. Yes, under the right circumstances you can charge an extra fee for this, and you can treat it as if the rent has not been paid with late fees and such.

It is criminal to knowingly and purposely pass a bad check. Try proving that. No information has been given here to suggest such a thing is happening. Now, if you get a NSF every month from the same tenant, that's different. One NSF is nothing to anybody!

Thank you everyone for your answers!

According to the property manager, they forwarded the information to the bad check division of the sheriffs' office, who will send a letter giving the tenant 10 days to pay. They have been in phone contact with the tenant, reminding her that she has this outstanding bill.

At first this response from the property manager seemed overly harsh, but I've learned that the tenant is being manipulative, telling the PM she had surgery but today posted on FB that she was working.

Please fire this property manager. There is no "bad check division" at the sheriff's office. They have better things to do. They certainly aren't going to be your collections department even if this did rise to the criminal level.

If they REQUIRED money orders or cashier checks this would not happen! 

Originally posted by @John Thedford :

If they REQUIRED money orders or cashier checks this would not happen! 

 This is not a bad idea for a bad or risky tenant, but, if you can't trust them to write a proper check then why would you trust them with your property? This is something that would totally annoy and piss off a responsible tenant and send them packing...

@Karen Young as others have already said that doesn't seem accurate.  If it was returned as Account Closed instead of NSF then there may be criminal charges as those are considered more serious in some states.  Which state is the rental property located in, SC?  

@Account Closed

I have to disagree. I have fantastic tenants, some being with me for years. Not once have they complained about getting a M/O or cashier check. 

Originally posted by @John Thedford :

@Ryan R.

I have to disagree. I have fantastic tenants, some being with me for years. Not once have they complained about getting a M/O or cashier check. 

 Just because they haven't complained doesn't mean they like it. Some people are too nice to complain about things like that. If they have been "fantastic tenants for years", then why can't you trust them to write a check? I would be highly annoyed if I had to go wait in line somewhere every month to pay some bill with a money order.

Better yet, welcome to 2016. We have the internet now. No need to exchange any papers every month.

It's not that big of deal. NSF means rent is not paid. Oh well. Start eviction process, hopefully the tenant will make it right, if not, boot them and find somebody else. It's just part of the job...

The rental property is located in SC.

The tenant is on a month to month lease; I've informed the PM to notify the tenant that if rent and late fees are not received by 5pm Friday, Oct 28, that 30 day notice would be given.

@Account Closed

So far, no complaints. Several are on 2nd and 3rd renewal. Maybe my charm, wit, and personality make up for it:)

I have, in the past, required a tenant to pay with either cash or money order/cashier's check...long story, special circumstances, but they constantly complained about it. After a few months I realized "special circumstances" is not something I need to deal with, and had to remove this tenant. I realized if I can't trust them to write a proper check then they shouldn't be allowed access to my personal investments in the first place.

Now, if you had maybe an inherited tenant that you didn't trust, something like that might make more sense. I see no reason to do it across the board. Most tenants who bounce a check will say "oops" and fix it shortly when threatened with eviction, otherwise it's easy to evict if they didn't pay rent.

Hi @Karen Young maybe the PM is referring to this SC law:

http://www.scbar.org/Public-Information/LawLine/So...

Texas has a similar "Hot Check" law that some landlords use so maybe this is a similar law in SC.  That would be my best guess but the PM should still start the eviction proceedings also as other people already suggested.  Please update us if you find out more information from the PM about what law they are referring to.  Thanks!

@Rick S. - thanks for that article regarding SC law; very informative.

The tenant is on a month to month lease; I've informed the PM to notify the tenant that if rent and late fees are not received by 5pm Friday, Oct 28, that 30 day notice would be given.

@Karen Young

This has been an interesting thread. I have rentals in SC, and I've never used this criminal bad check threat. I have heard of it before, and the link shared above from the SC bar seems legit.

But the situation seems clear to me - the rent isn't paid (NSF or no NSF).  So, why pursue criminal charges? Why not just file an eviction?  And that could have been done immediately after getting the NSF.  If tenant pays rent + backed fees + eviction fees, then you could still keep them in place.

But that eviction clock ticking is what motivates. And it's what will get either your rent paid or your property back the soonest.

You mentioned a 30 day notice. Is that just to let them know you'll no longer be renting to them? An eviction notice is only 5 days, and in SC if the notice is written correctly in your lease (your PM should definitely have this), then you don't even need to mail notice. You can just file eviction after 5 days.

Good luck getting this resolved.

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