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[asking regarding state law in Ohio, U.S.A. only]

Recently I have noticed landlords issuing their residents a debit card with attached bank account. This is typically implemented without prior notice and often with an additional fee attached. Typically the landlord will have a preexisting clause in the lease that says the landlord may choose to amend the lease at a later date. The landlord then amends the lease to insist that rent payments are only accepted in the form of deductions from a landlord-issued debit card. The landlord then will not accept payments using traditional methods such as a check.

Word of mouth seems to be that these policies are illegal, but I have had difficulty finding information on this topic that is not from the card-issuing entities.

Can a landlord in Ohio (U.S.A.) legally impose a mandate on their existing residents that a bank account be opened in their name and used for rent payment? If landlords can or cannot, what section of the law defines who can and cannot compel a citizen into banking against the citizen's will?

Nate Eldredge
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Regional Director
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2 Answers2

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Typically the landlord will have a preexisting clause in the lease that says the landlord may choose to amend the lease at a later date.

While that may be in contracts, I don't see that holding up in court. You can't unilaterally amend contracts to add new terms without acceptance on part of the lessee. Any clause in the contract like that will require notification of the lessee of the change and a chance for the lessee to terminate the contract without recourse on part of the lessor. Generally this must be done in the same format as the original lease (written). Most jurisdictions don't allow for a verbal amendment to a written lease.

So in a way, yes, it is legal for a landlord to require payment via a certain method (like a direct debit from a bank account). They cannot however change the payment terms unilaterally without notification and acceptance. They can use language such as sending the notification (via registered mail) and then saying that a failure to respond is acceptance (because you are, by actions, accepting the terms by continuing to live there).

Ron Beyer
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This site on Ohio landlord/tenant law says:

Ohio’s landlord/tenant code does not include detailed rules when it comes to rental terms, but it does require that a landlord must include certain terms in the lease agreement. A tenant legally agrees to follow these rules when she signs the lease agreement.

...

The lease should state when rent is due and where and how the tenant should pay the rent. The landlord must usually accept at least two forms of payment. Common forms include certified check, cashier’s check, money order, personal check, direct deposit, or cash. Will the landlord come to the premises collect the rent each month? Does the tenant have to go to the landlord’s place of business to drop off the rent? Can the tenant mail the rent? Can the tenant pay the rent via an electronic funds deposit?

The site notes that there are many county and municipal level laws regulating residential tenancies, which might also apply.

I have not found any Ohio state law requiring that the landlord accept two forms of payments, or prohibiting a requirement that a direct debit card be used. However, under 31 U.S. Code § 5103 currency (US Paper money) is "legal tender for all debts", and I suspect that a landlord is required under that law to accept cash payment, although not to make change, as rent already due is a debt.

David Siegel
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