New Law Changes How NJ Landlords Can Accept Rent
The New Jersey Legislature started 2020 off by passing a new law affecting many NJ landlords.
S.1493, which was overwhelmingly approved by legislators, prohibits landlords from requiring residential tenants to pay rent and certain other payments through electronic funds transfer and requires landlords to provide receipts for cash payments.
The new law defines a landlord as “any person who rents or leases or offers to rent or lease, for a term of at least [1] one month, dwelling units, except dwelling units in rental premises containing not more than two such units, or in owner-occupied premises of not more than three dwelling units, or in hotels, motels or other guest houses serving transient or seasonal guests.”
This law applies to you if you rent a residential property with a long term (> 1month) lease, in a triplex or quad (if owner-occupied) or larger buildings.
It may be simpler to understand when the law does not apply to you.
This law does not apply to:
Commercial properties
Duplexes or single-family homes
Owner-occupied properties which are three units or less
Short term rentals (less than 1 month in length)
Hotels and motels
NJ Landlords Cannot Require Electronic Payment
This new law states that NJ landlords cannot require a tenant or prospective tenant to pay any amount due to the landlord pursuant to a residential lease, renewal, or extension agreement by means of electronic funds transfer.
“Any amount due” includes:
Rent
Security deposits
Parking fees
Utilities
Any other payments made to a landlord
The legislature indicated that this law was necessary because the “practice [of requiring electronic payment] is harmful to renters as it limits the ability of individuals to retain control over their finances. It furthermore may be used as a means to discriminate against low-income and disadvantaged tenants, thereby limiting access to affordable rental housing,”
Landlords who fail to abide by this section of the law will face penalties of $100 to $200 per offense.
NJ Landlords Must Give A Receipt for Cash Payments
This new law also requires landlords to provide a receipt, either printed or emailed, to a tenant for each cash payment.
The receipt must include:
Amount of the payment
Purpose of the payment
When the payment was received
Printed or typed names of both the landlord and tenant
Who accepted the payment
If a landlord does not provide a receipt for cash payment, the tenant will have a defense in an eviction proceeding based on the nonpayment of rent.
When does the law go into effect?
This law went into effect immediately and applies to all leases signed, renewed, or extended today onward.