Landlord Information:
California AB 2747

California AB 2747

Positive Credit Reporting for Tenants

AB 2747 requires that we offer tenants credit reporting—specifically, positive credit reporting. This means we report their good payment history to a national credit reporting agency. However, we are limited in that we cannot report bad credit history through this process, though we certainly can through other means.

We have our plan in place, which we will discuss in just a moment. Regarding the cost, we can charge the tenant up to $10, but no more than the actual cost incurred. While this allows for some cost recovery, smaller landlords might find it challenging to implement.

Exemptions

Now, this is where the exemption comes in. Small, non-corporate landlords are exempt under the following conditions:

The exemption applies to any landlord of a residential rental building containing 15 or fewer dwelling units, unless the landlord:

• Owns more than one residential rental building, and

• Is structured as a real estate investment trust (REIT), a corporation, or a limited liability company (LLC) with at least one corporate member.

In reality, this likely exempts 99.9% of landlords, as you would need to own a single building with 16 or more units or own two separate residential buildings as a corporation to be subject to this requirement.

At WSR, we have taken the stance that it is beneficial to implement this for all tenants, regardless of exemption status. We have a positive credit reporting process in place that all of our tenants can participate in. Even if there is any question about exemption eligibility, we have it covered.