Updated August 2026 | Authored by Scott Engle, Broker DRE #01332676 | Realty Management Group | Serving San Diego County Since 2005
Last verified against primary sources: August 31, 2026. Every claim below is cited to a subdivision of Civil Code section 1954.07. See Sources and Verification.
Does AB 2747 apply to me? Only if one of two things is true. Either your building contains 16 or more dwelling units, or your building has 15 or fewer units and you own more than one residential rental building and you are a REIT, a corporation, or an LLC with at least one corporate member. Both of those last conditions must be met together. Most individual owners in San Diego County are outside the statute.
Is the reporting mandatory? No. The offer is mandatory for a covered landlord. The reporting only happens if the tenant signs and returns the written election.
What can I charge? The lesser of your actual cost or $10 per month. If reporting costs you nothing, you may charge nothing.
Can a tenant opt out and come straight back? No. A tenant who stops reporting cannot resume for at least six months, and your written election has to say so.
Is a late payment reported? Not under this law. AB 2747 covers complete, timely payments only.
AB 2747 has been summarised more often than it has been read. The two most common versions in circulation are that every California landlord must now report rent, and that the exemption covers anyone under sixteen units. Both are wrong, and they are wrong in opposite directions, which means an owner can be told they must comply when they need not, or that they are exempt when they are not.
This page walks the statute as codified at Civil Code section 1954.07, subdivision by subdivision, with the operational detail that matters if you are the one sending the notice.
What This Guide Covers
- Four Terms the Statute Uses Precisely
- Does AB 2747 Apply to You? The Two Conditions
- San Diego County Scenarios, Worked
- What the Statute Requires When It Applies
- The Eight Things the Written Offer Must Contain
- Delivery, and the Stamped Envelope Rule
- What You Can Charge, and When You Can Charge Nothing
- Opting In, Opting Out, and the Six Month Bar
- Deadlines
- What Positive Rental Payment Information Means
- Repair and Deduct Is Not a Late Payment
- What the Section Says Happens If You Do Not Comply
- Four Formulations That Get AB 2747 Wrong
- Frequently Asked Questions
- Sources and Verification
Four Terms the Statute Uses Precisely
Positive rental payment information. Information regarding a tenant's complete, timely payments of rent. Civil Code 1954.07(l)(2) expressly excludes any instance in which a tenant did not completely or timely make a rental payment. Nothing negative goes to the bureau under this statute.
Residential rental building. The unit the statute counts. The exemption at 1954.07(j)(1) turns on whether a building contains 15 or fewer dwelling units, not on how many units the owner holds across a portfolio. Two eight unit buildings are two buildings of eight, not one property of sixteen.
Nationwide consumer reporting agency. An agency meeting the definition in section 603(p) of the federal Fair Credit Reporting Act. The statute requires reporting to at least one of them, or to another agency under 603(f) that resells or otherwise furnishes the information to a nationwide agency. It does not require all three of the large bureaus.
Assisted housing development. As defined in Government Code section 65863.10. These developments are carved out of 1954.07 by subdivision (j)(2) because they are separately governed by Civil Code 1954.06, the earlier SB 1157 scheme.
Your unit count is on the deed. Your entity type is in the operating agreement. The statute needs both.
Tell us the building, the unit count and how title is held, and we will tell you whether 1954.07 reaches you, and whether AB 2801 and AB 628 do. No charge, and no obligation to hire anyone.
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Does AB 2747 Apply to You? The Two Conditions
Start here. If the statute does not reach you, nothing else on this page is an obligation.
Civil Code 1954.07(a) states the duty broadly, then immediately subjects it to subdivision (j). Subdivision (j)(1) is where the real scope lives. It exempts a landlord of a residential rental building that contains 15 or fewer dwelling units unless both of the following apply:
(A) The landlord owns more than one residential rental building, regardless of the number of units in each building.
(B) The landlord is one of the following: a real estate investment trust as defined in section 856 of Title 26 of the United States Code; a corporation; or a limited liability company in which at least one member is a corporation.
The word doing the work is "both." Owning several buildings is not enough on its own. Being an LLC is not enough on its own. The exemption survives unless (A) and (B) are satisfied together.
A landlord of a building with 16 or more dwelling units is outside the (j)(1) exemption entirely and is covered regardless of ownership structure. Subdivision (j)(2) separately carves out an assisted housing development as defined in Government Code section 65863.10, because those are governed by Civil Code 1954.06, the earlier SB 1157 scheme.
| Your situation | Covered? | Authority |
|---|---|---|
| Building with 16 or more dwelling units, any ownership structure | Yes | 1954.07(a); outside the (j)(1) exemption |
| Building with 15 or fewer units, individual owner, one building | No | 1954.07(j)(1); neither (A) nor (B) met |
| Building with 15 or fewer units, individual owner, several buildings | No | 1954.07(j)(1); (A) met, (B) not met |
| Building with 15 or fewer units, corporation or qualifying LLC, one building only | No | 1954.07(j)(1); (B) met, (A) not met |
| Building with 15 or fewer units, corporation or qualifying LLC, more than one building | Yes | 1954.07(j)(1); (A) and (B) both met |
| Assisted housing development under Gov. Code 65863.10 | No, separately governed | 1954.07(j)(2); see Civ. Code 1954.06 |
Source: California Civil Code section 1954.07, read against the code text on August 31, 2026. This table states the statutory test and is not a determination about any particular property.
The statute counts buildings, not portfolios. Subdivision (j)(1) turns on a "residential rental building that contains 15 or fewer dwelling units." Two eight unit buildings are two buildings of eight. They are not one property of sixteen. The portfolio size only matters through limb (A), which asks whether you own more than one building at all, and it is the entity test in limb (B) that determines whether that matters.
Bottom line: 16 or more units in the building means covered. Below that, you are exempt unless you are both a multi building owner and one of three named entity types.
San Diego County Scenarios, Worked
The abstract test is short. Applying it to a real holding is where it goes wrong. Two things produce the wrong answer: counting units across a portfolio, and assuming the entity type alone settles it.
| Holding | Covered? | Why |
|---|---|---|
| One house rented out in Santee, held in your own name | No | One building, 15 or fewer units, natural person. Neither limb met. |
| A duplex in Lemon Grove plus a house in Spring Valley, both in your own name | No | Limb (A) is met, limb (B) is not. A natural person is not a REIT, a corporation or an LLC. |
| A 24 unit building in El Cajon, held in your own name | Yes | 16 or more units in the building. The (j)(1) exemption never engages, so ownership structure is irrelevant. |
| Two fourplexes in Chula Vista, held in an LLC with a corporate member | Yes | Eight units total, but both limbs are met: more than one building, and a qualifying entity. |
| Two fourplexes in La Mesa, held in an LLC whose members are all individuals | No | Limb (B) names an LLC in which at least one member is a corporation. An all natural person LLC is not that. |
| A condo in Mission Valley and a house in Poway, both in a family trust with natural person beneficiaries | No, on the statutory text | Limb (B) lists three entity types and a family trust is none of them. Confirm your trust's structure with counsel. |
| An 18 unit building in National City that is an assisted housing development | Not under 1954.07 | Carved out by (j)(2). Civil Code 1954.06 governs instead. |
Source: Civil Code section 1954.07(j), read August 31, 2026. Illustrative applications of the statutory test, not legal advice about any specific property. Ownership structure questions in particular should go to a California licensed attorney.
Owners of 4 to 16 unit properties sit closest to the line, which is also where our multifamily management work concentrates. If you own a single house with an accessory dwelling unit as an individual, the answer is no under the statutory test. The analysis changes if title is held by a qualifying entity that owns another residential rental building. Our ADU rental guide covers the rules that do reach you.
Bottom line: count the units in the building, then check the entity. Counting units across a portfolio produces the wrong answer in both directions.
What the Statute Requires When It Applies
Civil Code 1954.07(a) requires a covered landlord to offer any tenant obligated on the lease the option of having that tenant's positive rental payment information reported to at least one nationwide consumer reporting agency meeting the definition in section 603(p) of the federal Fair Credit Reporting Act. An agency meeting the 603(f) definition also qualifies, provided it resells or otherwise furnishes the information to a nationwide agency.
Two words in that sentence carry the operational weight. Offer, because nothing is reported unless the tenant accepts. And any tenant obligated on the lease, because in a shared tenancy the obligation runs to each of them, not to one of them.
Everything else in the section is machinery: how the offer is written, how it is delivered, what it costs, and what happens when someone changes their mind. If you hold California rental property from outside the state, this annual notice is one of several that has to be served locally and on time, and our out of state landlord guide sets out the rest.
The Eight Things the Written Offer Must Contain
This is the part almost no published summary sets out, and it is the part a compliance file is actually judged on. Civil Code 1954.07(d) requires the offer to include a written election containing all eight of the following.
- A statement that reporting of the tenant's positive rental payment information is optional.
- Identification of each consumer reporting agency to which the information will be reported.
- The amount of any fee charged under subdivision (g).
- Instructions on how to submit the written election to the landlord by first-class United States mail or email.
- A statement that the tenant may opt in at any time following the initial offer.
- A statement that the tenant may elect to stop reporting at any time, but will not be able to resume for at least six months after the election to opt out.
- Instructions on how to opt out.
- A signature block the tenant dates and signs in order to accept the offer.
Item 6 is the one that gets left out. The six month bar is not something a landlord may mention. The statute requires the written election to state it. An offer letter that describes opting out as freely reversible is missing a required element and misstates the tenant's position at the same time. Disclosure timing is a recurring theme in the 2024 and 2025 legislation: AB 2493 works the same way on screening criteria, which must reach the applicant before the fee is collected.
Bottom line: eight elements, and a signature block is one of them. An email that describes the programme without a datable, signable election is not the offer the statute describes.
Delivery, and the Stamped Envelope Rule
Under 1954.07(c) the offer may be delivered by first-class United States mail or by email. Those are the two routes named.
Then 1954.07(e) adds a requirement that is easy to miss and impossible to retrofit: if the offer is made by first-class mail, the landlord must provide the tenant with a self-addressed, stamped envelope to return the written election.
Subdivision (f) then keeps the door open indefinitely. A tenant may submit the completed election at any time after receiving the offer, and may request additional copies of the election at any time, which the landlord must supply. In practical terms the offer is not a window that closes; it is a standing option you have to keep serviceable.
Bottom line: mail the offer and you are mailing a stamped return envelope with it. Email delivery does not trigger that stamped return envelope requirement.
What You Can Charge, and When You Can Charge Nothing
Civil Code 1954.07(g)(1) permits a fee only from a tenant who has elected reporting, and caps it at the lesser of the landlord's actual cost to provide the service or ten dollars per month.
Two consequences follow that the common "capped at $10" phrasing hides. If your actual cost is four dollars, four dollars is the cap. An owner of a 20 unit building in Escondido paying a service three dollars per unit per month may charge three dollars, not ten. And if you incur no actual cost to report, no amount may be charged from the tenant at all.
The same subdivision adds two more rules. The payment or nonpayment of the fee may not itself be reported to a consumer reporting agency. And under (g)(2), an amount tendered in full or partial satisfaction of rent or any other lease obligation, however the tenant designates it, may not be applied or credited to the fee. You cannot take the fee out of a rent payment.
If the fee goes unpaid
Subdivision (h) is short and restrictive. Failure to pay the fee is not cause for termination of the tenancy, whether pursuant to Code of Civil Procedure section 1161 or otherwise. The landlord may not deduct the unpaid fee from the security deposit. If the fee remains unpaid for 30 days or more, the landlord may stop reporting, and the tenant may not elect reporting again for six months from the date the fee first became due.
Deposit deductions have their own rules in California, and this is one more thing that cannot go on the itemised statement. Our San Diego County security deposit guide covers what can.
Bottom line: the fee is the lesser of your cost or ten dollars, it is uncollectable through the deposit or an eviction, and if reporting costs you nothing you charge nothing.
An annual obligation is the kind that quietly lapses in year two.
The offer repeats every year for as long as the tenancy runs. If you are covered, the file needs a dated offer, a signed or unreturned election, and a diary date, per tenant, every year. That is bookkeeping, and it is what a manager is for.
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Opting In, Opting Out, and the Six Month Bar
Opting in is open ended. Under 1954.07(d)(5) and (f)(1) the tenant may opt in at any time after the initial offer, not only at signing and not only at the annual repeat.
Opting out is where the asymmetry sits. Civil Code 1954.07(i) provides that a tenant who has elected reporting may file a written request with the landlord to stop, with which the landlord shall comply. The same subdivision then bars that tenant from electing reporting again for at least six months from the date of the written request to stop.
There is a second, separate six month bar at (h)(3), running from the date an unpaid fee first became due. They are different triggers with the same duration, and a compliance file should record which one applies.
Bottom line: in at any time, out at any time, back in only after six months. Guidance describing the round trip as unrestricted is describing something the statute does not permit.
Deadlines
| Lease | First offer due | Thereafter |
|---|---|---|
| Entered into on or after April 1, 2025 | At the time of the lease agreement | At least once annually |
| Outstanding as of January 1, 2025 | No later than April 1, 2025 | At least once annually |
Source: California Civil Code section 1954.07(b), read August 31, 2026.
The April 1, 2025 deadline has passed. The live obligation is the annual repeat. A covered landlord who sent the offer once in March 2025 and has not sent it since is out of compliance today, not in 2025. That applies the same way to an 18 unit building in Oceanside as it does to two fourplexes held in a qualifying entity in Imperial Beach. That same date carried the first phase of the AB 2801 deposit photo rules, which is worth checking at the same time. The other dates on a California landlord's 2026 calendar are collected in our 2026 rental law summary, and the August 1 rent cap reset is in the San Diego rent cap guide.
What Positive Rental Payment Information Means
Civil Code 1954.07(l)(1) defines it as information regarding a tenant's complete, timely payments of rent. Subdivision (l)(2) then states that it does not include an instance in which a tenant did not completely or timely make a rental payment.
AB 2747 is therefore a positive only scheme. It creates no route for reporting a missed or partial payment, and a landlord who signs up with a service that furnishes negative data is doing something this statute does not authorise. If your problem is a tenant who is not paying, that is a different body of law entirely, and our guide to non payment in San Diego is the right starting point.
Repair and Deduct Is Not a Late Payment
Subdivision (k) protects the tenant's habitability remedies from the reporting scheme. A tenant who elects reporting does not forfeit any rights under Civil Code sections 1941 to 1942. Where a tenant deducts from rent or withholds rent as those sections authorise, the deduction or withholding does not constitute a late rental payment.
One condition attaches: the tenant must notify the landlord of the deduction or withholding before the date rent is due. And the subdivision closes by stating expressly that none of it relieves a housing provider of the obligation to maintain habitable premises.
For a covered landlord this is an operational instruction, not a footnote. If a tenant gives that notice and then short pays, the reporting file has to treat the month as timely. On a larger building, say a covered property in San Marcos, that means the habitability correspondence and the reporting feed have to be read together rather than kept in separate systems.
What the Section Says Happens If You Do Not Comply
This is the second question every covered owner asks, and it deserves a straight answer rather than a warning.
On our August 31, 2026 reading of Civil Code section 1954.07, none of its twelve subdivisions creates an express penalty, civil fine, statutory damages figure, or private right of action for failing to make the offer. That is a statement about what this section contains. It is not a statement that non compliance is costless: other bodies of California law may reach the same conduct, a court may treat the omission as evidence in a dispute about something else, and the section can be amended. Confirm exposure with a California licensed real estate attorney rather than reading the absence of a penalty clause as permission.
What the section does contain is a short list of express prohibitions, and every one of them runs against the landlord and attaches to the fee rather than to the offer:
- Non payment of the fee is not cause for termination of the tenancy, under 1954.07(h)(1).
- The unpaid fee may not be deducted from the security deposit, under 1954.07(h)(2).
- The payment or non payment of the fee may not be reported to a consumer reporting agency, under 1954.07(g)(1).
- Rent tendered may not be applied or credited to the fee, under 1954.07(g)(2).
- No fee at all may be charged where the landlord incurs no actual cost, under 1954.07(g)(1).
Because the scheme reports payment records, the quality of your rent collection and accounting records is what a reporting feed actually draws on. The practical shape of the risk is therefore documentary rather than financial. There is no fine in this section to budget against. There is a file that either shows a dated offer, per tenant, per year, with the eight required elements and the tenant's signed or unreturned election, or does not.
Bottom line: we found no penalty provision in section 1954.07 on our August 2026 reading, and the enforceable prohibitions in it all limit what a landlord may do about the fee.
Four Formulations That Get AB 2747 Wrong
Each of these appears in circulation, each can be checked against the text of the section in under a minute, and each changes an owner's answer.
1. "15 or fewer units if you are an LLC, corporation or REIT." This drops limb (A). As written it tells a single property LLC owner they must comply. The statute requires the entity test and more than one residential rental building.
2. "Non-corporate landlords with 16 units or fewer are exempt." The exemption line is 15 or fewer, not 16 or fewer. Stated this way it tells the owner of a 16 unit building they are exempt when 1954.07(j)(1) does not reach them at all and they are covered.
3. "Mandatory rent reporting." The offer is mandatory. The reporting is optional and tenant elected. Subdivision (d)(1) requires the written election to say so.
4. "A tenant can opt out and back in at any time." Out at any time, yes. Back in, not for at least six months, under (i), and the offer document has to disclose that under (d)(6).
Bottom line: errors 1 and 2 point in opposite directions, which is why owners hear contradictory answers. Both are resolved by reading subdivision (j) rather than a summary of it.
Frequently Asked Questions
Does AB 2747 apply to every California landlord?
No. Civil Code 1954.07(j)(1) exempts a landlord of a residential rental building that contains 15 or fewer dwelling units unless both of two conditions are met: the landlord owns more than one residential rental building, regardless of the number of units in each, and the landlord is a real estate investment trust, a corporation, or a limited liability company in which at least one member is a corporation. Both conditions must be satisfied. A landlord of a building with 16 or more dwelling units is covered regardless of ownership structure. Assisted housing developments as defined in Government Code 65863.10 are separately carved out by 1954.07(j)(2).
I own three single family rentals through an LLC. Am I covered?
Possibly, and the answer turns on the LLC's membership. Both conditions in 1954.07(j)(1) look satisfied on the first limb, because three houses are more than one residential rental building. The second limb requires that the landlord be a real estate investment trust, a corporation, or a limited liability company in which at least one member is a corporation. An LLC whose members are all natural persons is not on that list. An LLC with a corporate member is. Read your operating agreement rather than assuming, and confirm the conclusion with a California licensed real estate attorney.
Is rent reporting mandatory under AB 2747?
The offer is mandatory for covered landlords. The reporting is not. Civil Code 1954.07(a) requires a covered landlord to offer the option, and 1954.07(d)(1) requires the written election to state that participation is optional. Nothing is reported unless the tenant signs and returns the election. Guidance that describes the law as mandatory rent reporting reverses which half is compulsory.
How much can a landlord charge for rent reporting?
The lesser of the landlord's actual cost to provide the service or ten dollars per month, under Civil Code 1954.07(g)(1). It is not a flat ten dollar entitlement. If the landlord incurs no actual cost to report, no amount may be charged at all. The payment or nonpayment of the fee may not itself be reported to a consumer reporting agency, and under 1954.07(g)(2) an amount tendered toward rent or another lease obligation cannot be applied or credited to the fee.
What happens if the tenant does not pay the rent reporting fee?
Civil Code 1954.07(h) sets three consequences and two prohibitions. Failure to pay the fee is not cause for termination of the tenancy, whether under Code of Civil Procedure section 1161 or otherwise. The landlord may not deduct the unpaid fee from the security deposit. If the fee remains unpaid for 30 days or more, the landlord may stop reporting, and the tenant may not elect reporting again for six months from the date the fee first became due.
Can a tenant opt out and then opt back in whenever they want?
No. Under Civil Code 1954.07(i) a tenant who has elected reporting may file a written request to stop, and the landlord must comply, but that tenant may not elect reporting again for at least six months from the date of the written request. The six month bar is not optional lease language. Section 1954.07(d)(6) requires the written election itself to state it.
When was the offer due, and how often does it repeat?
Under Civil Code 1954.07(b), for leases entered into on and after April 1, 2025 the offer is made at the time of the lease agreement and at least once annually thereafter. For leases outstanding as of January 1, 2025 the offer was due no later than April 1, 2025 and at least once annually thereafter. The annual obligation is ongoing, so a landlord who made the offer once in 2025 and never repeated it is not compliant.
Does a late rent payment get reported to the credit bureau under this law?
Not under this statute. Civil Code 1954.07(l)(1) defines positive rental payment information as information regarding a tenant's complete, timely payments of rent, and 1954.07(l)(2) states that it does not include an instance in which a tenant did not completely or timely make a rental payment. AB 2747 is a positive only scheme. It does not create a route for reporting missed or partial payments.
What if the tenant withheld rent for repairs?
It does not count as a late payment. Civil Code 1954.07(k) provides that a tenant who elects reporting does not forfeit any rights under Civil Code sections 1941 to 1942, and that deductions or withholding authorised by those sections do not constitute a late rental payment. The tenant must notify the landlord of the deduction or withholding before the date rent is due. The subdivision also states expressly that it does not relieve a housing provider of the obligation to maintain habitable premises.
Do I have to report to all three major credit bureaus?
No. Civil Code 1954.07(a) requires reporting to at least one nationwide consumer reporting agency meeting the definition in section 603(p) of the federal Fair Credit Reporting Act, or to any other consumer reporting agency meeting the 603(f) definition provided that agency resells or otherwise furnishes the information to a nationwide agency. One qualifying agency satisfies the statute.
Does AB 2747 reach a landlord who owns two small buildings in San Diego County?
Only if the ownership limb is also satisfied. Owning more than one residential rental building meets the first condition in Civil Code 1954.07(j)(1)(A), but the exemption is lost only where the second condition in 1954.07(j)(1)(B) is met as well, meaning the landlord is a real estate investment trust, a corporation, or a limited liability company with at least one corporate member. Two small buildings held by a natural person, or by a family trust with natural person beneficiaries, do not match the entity types the statute names.
Does a single family home with an ADU trigger AB 2747?
For an individual owner, no. A house with an accessory dwelling unit is a residential rental building well under the 15 unit line, and an individual owner is not a real estate investment trust, a corporation, or a limited liability company with a corporate member, so the exemption at Civil Code 1954.07(j)(1) holds. The analysis changes if the property is held in a qualifying entity and that owner also holds at least one other residential rental building.
Sources and Verification
Every subdivision cited on this page was read against the code text on August 31, 2026.
- AB 2747 (Haney, 2024) bill text, which adds Civil Code section 1954.07
- Civil Code section 1954.07 as codified, subdivisions (a) through (l)
- Senate Judiciary Committee analysis of AB 2747, for the legislative purpose behind the section
- Civil Code section 1954.06, the assisted housing scheme under SB 1157
- Government Code section 65863.10, the definition of an assisted housing development
- Civil Code sections 1941 to 1942, habitability and repair and deduct
- 15 U.S.C. 1681a, the Fair Credit Reporting Act definitions at 603(f) and 603(p)
- 26 U.S.C. 856, the definition of a real estate investment trust used by 1954.07(j)(1)(B)(i)
Bottom line: this section has twelve subdivisions and the answer to most owner questions is in (j), (g) or (i). Read those three before you read a summary.
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About the author
Scott Engle is the Broker/Owner of Realty Management Group (DRE #01332676, Corp DRE #02075336). He has been a licensed California real estate broker since 2002, has managed San Diego County rental property since 2003, and founded Realty Management Group in 2005. As of August 2026, RMG manages 400+ units countywide, with management starting at a flat $199 per month, and holds a 4.9-star rating across 127 Google reviews. RMG has been named Best Property Management Company in San Diego by Expertise.com in 2023, 2024, and 2025.
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This article is general information about California landlord tenant law and is not legal advice. Whether Civil Code section 1954.07 reaches a particular property depends on the unit count of the building and on how title is held, and ownership structure questions in particular should go to a California licensed real estate attorney. Statutes change. Realty Management Group, 4025 Camino Del Rio South, Suite 300, San Diego, CA 92108. (619) 456-0000.
