Understanding AB 2747: What You Need to Know
Effective January 1, 2025, California Assembly Bill 2747 is making waves across the multifamily housing industry. If you're a landlord, investor, or property manager in the state—this one’s for you.
What Is AB 2747?
AB 2747 requires California landlords to offer tenants the option to report positive rental payment history to at least one nationwide credit reporting agency. This aims to help tenants build credit through consistent on-time rent payments—but for property owners, it introduces new administrative responsibilities and legal obligations.
Who Must Comply?
All residential landlords—unless they meet one of the following exemptions:
15 or fewer units and
NOT a REIT, Corporation, or LLC with a corporate member
Examples:
A private individual who owns 12 units personally = Exempt
A REIT that owns three triplexes = Must comply
Compliance Deadline - April 1st, 2025
For Existing Leases: You must offer tenants the reporting option by April 1, 2025 and then annually.
For New Leases Signed on or After April 1, 2025: Offer must be made upon execution of the lease.
Can Landlords Charge for This?
Yes—landlords can charge tenants up to $10/month or the actual cost (whichever is lower). However:
You can’t evict for nonpayment of this fee
You can’t use rent or deposit to cover the fee
Tenants must opt back in after 6 months if they decline or stop paying
What If I Don’t Comply?
Failure to offer this reporting option in accordance with the law could open landlords up to potential civil penalties or tenant legal actions. While specific penalties are still being evaluated, non-compliance could be treated as a violation of California’s consumer protection and housing laws.
Why It Matters
California continues to lead the country in tenant-focused housing legislation. Whether you're aligned with the direction or not, compliance is non-negotiable. Laws like AB 2747 are part of a larger trend that underscores why staying ahead of new legislation is vital.
Final Thoughts
Tracking compliance may seem minor, but it adds up quickly—especially for mid-sized and institutional owners. Automation, CRM support, and clear tenant communication will be key to ensuring smooth rollouts of laws like AB 2747.
Source: AACSC Article on AB 2747
Disclaimer: This post is for informational purposes only and does not constitute legal advice. Always consult a licensed attorney for legal guidance related to your property.
