Key Provisions

• Mandatory Electronic Return: If a landlord previously accepted electronic payments (rent or deposit) from a tenant, they are now generally required to return the security deposit electronically, unless otherwise agreed upon in writing.
• Tenant Notification: Landlords must notify tenants in writing regarding their right to receive these funds electronically.
• Flexibility in Agreements: Landlords and tenants can now mutually agree on the method of refund and the delivery of itemized statements at any time during the lease, rather than waiting until the move-out notice.
• Email Statements: The law clarifies that itemized deduction statements can be sent via email if both parties agree, providing a faster alternative to traditional first-class mail.
• Clarity for Multiple Tenants: Establishes clearer guidelines for handling refunds when a single lease involves multiple occupants.

Impact on Landlords and Tenants

This legislation reduces the reliance on physical checks, which are often prone to being lost, stolen, or delayed in the mail. By facilitating direct bank transfers or digital platform payments, tenants gain faster access to their funds for their next housing move, while landlords benefit from simplified record-keeping and proof of payment.

Legislative Status

• Author: Assemblymember Gail Pellerin
• Signed: October 6, 2025
• Chapter: 340, Statutes of 2025