As we have reviewed in other blogs, Arizona law (A.R.S. § 33-1371) allows landlords to reject rental payments that are not for the full amount due. Additionally, we have addressed why as a Phoenix Landlord you shouldn’t accept partial rent payments – main reason being that you often don’t get the rest of the payment or if you do it is so late that then the resident doesn’t have any funds to pay the next months’ rent.
However, did you know that as a Phoenix Landlord you may reject payment attempts by your resident – even if it is the full amount due at that very moment – when the payment form is one that is not permissible under your lease agreement (for example not allowing payment by personal check). Refusal is performed by returning the incorrect form of payment directly to the resident, but what do you do if it was a night-drop or mailed payment? In these circumstances, you can use a modified version of your rent demand notice keeping in mind that you must declare your rejection of the non-conforming payment attempt, describe the exact problem with that payment tender (e.g., by not paying via certified funds on or after the 5th day of the month), and inform the resident that he/she still has the obligation to pay the rent in full via the proper format – and do so within five days.
There are two caveats here. First, rejecting the incorrect form of payment with a written note will not be sufficient to place the resident on formal notice that he/she has not paid the rent. The non-payment of rent notice must be prepared in writing and either hand-delivered to the resident or sent via certified U.S. mail to the residence and must always be issued prior to commencing an eviction action for non-payment. Second, if you have already issued a non-payment of rent notice and the resident tries to pay with the non-conforming payment offer, do not use this form – because you will end up restarting the “cure-or-quit” clock.
Use of this notice will hopefully be rare, but it is nice to know that you do have an option if your tenant pays with the wrong wrong payment type.
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