Landlording & Rental Properties

3 Rent-Paying Methods That Beat Mailed Checks Any Day

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During the lease signing, when you get to the part that says how much the monthly rent is, this is a good time to collect the money for the first month’s rent. You should have already received the tenant’s security deposit (in the form of the “deposit to hold” when they were approved), so typically, this is when you would collect the first month’s rent.

If a tenant moves in in the middle of the month, I don’t prorate the amount they pay for that first month. Instead, I prorate the second month to match the first. In other words, every tenant pays a full month’s rent when they move in, but when the time comes to pay the rent on the first of the following month, they will pay only for the amount of days they lived in the home the previous month. For example, if the rent is $1,200 per month, and they move in on January 10, they will pay a full $1,200 for rent when they move in but only $800 on February 1.

One final note on the rent, only accept rent in certified funds, such as a money order or a cashier’s check. Don’t take cash, and don’t accept personal checks, especially for the first month’s rent. You do not want to move a tenant in and find out weeks later that the check was bad, forcing you to evict. This is a wise policy to have all around in your relationship with your tenants: certified funds only.


3 Ways for Tenants to Pay Rent

As for rent payments in the future, I recommend not picking up the rent in person, because this will only train the tenant to expect you each month. For my rentals, I used to mail monthly statements to the tenant, and they mailed their certified funds to my post-office box. However, over time, I grew tired of the “my check is lost in the mail” story, so I switched to giving tenants three different options:

  1. or These similar services allow tenants without bank accounts to pay at local businesses like Wal-Mart or 7-11. Currently, the tenant must pay a small fee ($4) for this service, but it is generally free (or low cost) to the landlord.
  2. Dwolla: Similar to PayPal, tenants can use Dwolla to pay rent directly from their checking account for free. This was a little bit cumbersome to get set up, but once I got it going the process works pretty great. The only trouble I’ve had is that some banks don’t work with Dwolla (usually small community banks) so prepared for such an instance.
  3. Intuit Payment Network: Intuit, the company behind TurboTax (to learn more about TurboTax, click here) and QuickBooks, offers a payment solution that is extremely easy to use and that allows tenants to pay their rent directly from their checking account. Currently, payments are just $.50 each and we use this when the tenant’s bank doesn’t work with Dwolla.

Many landlords have different techniques for collecting rent, so be sure to check out the BiggerPockets Forums for more suggestions and ideas from other experienced property owners. Ultimately, you may change or adapt your style as you learn more and grow, or as technology advances.

How do you have your tenants pay rent?

Let me know about your system with a comment!

Brandon Turner is an active real estate investor, entrepreneur, writer, and co-host of the BiggerPockets Podcast. He began buying rental properties and flipping houses at age 21, discovering he didn’t need to work 40 years at a corporate job to have “the good life.” Today, with nearly 100 rental units and dozens of rehabs under his belt, he continues to invest in real estate while also showing others the power, and impact, of financial freedom. His writings have been featured on,,, Money Magazine, and numerous other publications across the web and in print media. He is the author of The Book on Investing in Real Estate with No (and Low) Money Down, The Book on Rental Property Investing, and co-author of The Book on Managing Rental Properties, which he wrote alongside his wife, Heather, and How to Invest in Real Estate, which he wrote alongside Joshua Dorkin. A life-long adventurer, Brandon (along with Heather and daughter Rosie) splits his time between his home in Washington State and various destinations around the globe.

    Dawn Vought Buy and Hold Investor from Commack, New York
    Replied about 2 years ago
    Good tips Brandon! We got tired of the “check is lost in the mail” excuse a long time ago as well. I require electronic payments of my tenants now. We use Chase Bank, so we generally use the Chase QuickPay system which can connect with most banks. We also allow tenants to use their own banks system if that is easier for them, such as Bank of America bill pay or Pop Money for the “credit union” type banks. I believe most of the major banks now have some sort of electronic payment system available, all of which is totally free to both the buyer and sender. We also get basically instantaneous emails when a payment has been sent, which we go by to determine if the payment was sent on time or not. Makes it very cut and dry!
    Karen Rittenhouse Flipper/Rehabber from Greensboro, NC
    Replied about 2 years ago
    Hi Brandon: We use pay services as you describe, mostly through banks. For tenants who don’t have bank accounts, its certified funds in the mail. Never cash, as you mentioned. I don’t want anyone thinking we have cash in the office (we don’t). Checks are fine – not at contract signing for the reason you mentioned – but we do accept checks after they’ve moved in. Bounce one check, however, and we’ll only accept certified funds after that. We also charge $5 for anyone who brings payment to the office as that totally disrupts office flow. Automatic payments are, without a doubt, the best way to go and offering a discount for those if needed is worth it for the hassle that they save. Thanks for your tips!
    George Smith Investor from Latham, New York
    Replied about 2 years ago
    Thanks for tip on prorating the second month. It eliminates the need in taking a month and a half upfront or taking the half month.
    Margie Kohlhaas Rental Property Investor from Algona, IA
    Replied about 2 years ago
    Thanks for all these tips. I just looked into Dwolla and they are charging .5% fees for deposits.
    Jessie Huffey from Sandpoint, Idaho
    Replied about 2 years ago
    We use Cozy for both accepting rent payments and for screening potential tenants. Very pleased with their site: and I highly recommend it.
    Clint S. Investor from Pearland, Texas
    Replied about 2 years ago
    I use Cozy as well. It’s incredibly simple to use and FREE for the tenant and landlord. My only complaint with Cozy is that it takes 7 or 8 days for funds to hit my account after the tenant makes the payment. Oddly, you can pay a premium (I think $7/mo.) to get your payments in 2 days instead of 7 or 8. I think Cozy probably invests the funds in the interim to make some money off of their free service but obviously can’t verify that. But it would explain why they don’t just go ahead and get the money into your account by day 2.
    Joseph M. from Saint Paul, Minnesota
    Replied about 2 years ago
    Agreed. I use Cozy and its awesome, all these other options are cumbersome by comparison. I will be doing all my future rentals either through property managers or via Cozy only. If they can’t pay automatically via ACH then they dont get to be my tenant.
    Brendon Woirhaye Rental Property Investor from Whittier, CA
    Replied about 2 years ago
    We have half of our tenants on Cozy, which is free for both landlord and tenant (for ACH). Landlords can pay a little to get payments quicker, tenants can pay a charge to use a credit card instead of ACH.
    Keith Leckey Investor from Johnstown, Pennsylvania
    Replied about 2 years ago
    We have used cozy as well. It’s great low/no cost option. We have also used erentpayment which allows the tenant to have their rent payments reported to TransUnion to help boost their credit score. There is a $3 fee for this service which you can pay as the landlord, split with tenant or have the tenant pay all of it. Earlier this year we started switching our tenants over to Rentecdirect which is an online property management software. They can pay their rent thru their tenant portal (no cost) and it’s nice for maintenance requests, easy access to copies of all the lease paperwork, producing a variety of reports, etc.
    Sarah Noel Block Investor from Hoffman Estates, IL
    Replied about 2 years ago
    I second I absolutely adore the simple interface. Sarah Noel Block |
    Jason Henning Real Estate Agent from Denver, CO
    Replied about 2 years ago
    We use Venmo and it works great. It’s free for both tenant and landlord and hits our checking account next day, if… You do have to manually transfer funds to your account but as soon as I get a notification that we’ve received funds, I go into the app and immediately transfer it to our bank account. there is no option for automatic transfer so if you had a lot of tenants this could get tedious. but for a handful, it’s super convenient and fast.
    Nathan Richmond Rental Property Investor from Visalia, CA
    Replied about 2 years ago
    I like Venmo as well. Trying to get my tenants to set up an account. But totally free!
    Lisa Green Investor from Richmond, VA
    Replied about 2 years ago
    Hi Jason, Quick question about Venmo, I understand you have to manually transfer funds once received but can you have more than one account set up to transfer into? Thanks so much!
    Jason Henning Real Estate Agent from Denver, CO
    Replied about 2 years ago
    Hi Lisa, yes indeed, you can set up multiple accounts to transfer into. and I love that it’s app based … makes it super convenient.
    Cindy Larsen Rental Property Investor from Lakewood, WA
    Replied about 2 years ago
    I used to use DWOLLA until they changed their business model,for $0.25/transaction, to a fee nearly as expensive as paypal. So I changed to google wallet, which has an app that works on phones, ipad, etc. google wallet is totally free. It does an ACH transaction (just like paypal, dwolla, etc)!from your tenant’s bank account to your bank account. You get an email when the money is sent bynthe tenant, and another one when it is deposited in your account. NO one has anyone else’s bank account info. It works great, but transactions clear faster if everyone uses their debit card instead of a bank account number. I also use it to pay house cleaners, maintenance guys, etc who do not take credit cards.
    NA Lee from Midlothian, Texas
    Replied about 2 years ago
    This is all great information for a noob. I’ve used most of these apps for various social transactions but didn’t think to use them to collect rent. Thanks for all the ideas.
    Jeff P. Real Estate Agent from Farmington, Utah
    Replied about 2 years ago
    Like others, I have had a great experience using Venmo. Free for both parties, easy to use, and keeps a record of the transactions.
    Pat Forde Commercial Real Estate Broker from Jersey City, New Jersey
    Replied about 2 years ago
    Hi. Can Venmo be connected to a business account when holding a property in an LLC?
    Ben Ruskin
    Replied about 2 years ago
    Great post Brandon. And the feedback from others about the apps you listed and others is helpful. I love that you give your tenants multiple options…and no excuses.
    Jason McNeal
    Replied about 2 years ago
    zelle just rolled out and covers many of the national banks – super easy and free…
    John Adams Investor from Atlanta, Georgia
    Replied about 2 years ago
    I use Buildium to manage my rentals. Great web-based software, and while some might squawk about the price, it is a pittance compared to the many hassles and hours saved (I have 11 units, so automating and streamlining procedures is a big help; I’d use Buildium if I had fewer units, and would certainly use it if I had more!). Anyway, Buildium has a “tenant portal” where tenants can do things like submit maintenance requests — and notably, make online payments. The fee (which I absorb for my tenants) is a paltry $.50 (yes, 50 cents) for ACH payments. Of course, the tenants need to have a checking account, etc. so this might not work for some types of tenants. But works for me. Money goes straight into my checking account, and the accounting records in Buildium are automatically updated. Eliminate slots of steps. My lease now stipulates that if the tenant doesn’t pay via the “tenant portal”, then there is a $25 handling fee.
    Vincent Joseph Investor from Croissy, Île-de-France
    Replied about 2 years ago
    Hi Brandon, I have to ask: why not Paypal as it is the most commonly used online payment platform? Free for both landlords and tenants. Vincent.
    Tony Link Investor from Amarillo, Texas
    Replied 9 months ago
    Vincent, my experience using PayPal is that they take a percentage as their fee. Unless the payer designates it as a ‘gift’. Is there another way to set this up?
    John Teachout Rental Property Investor from Concord, GA
    Replied about 2 years ago
    We require first month’s rent and the security deposit to be paid in cash. (green stuff) It’s the only method of payment we’ll accept for this first transaction. Almost impossible to commit fraud with it. After that, any method of payment is fine but we prefer and most tenants utilize direct deposits into our local bank account.
    Matt M. from San Antonio, Texas
    Replied about 2 years ago
    +1 for Venmo here. Super easy and free. Most people have a smartphone connected to an AppStore so it isn’t difficult to get set up for tenants even if they don’t use it currently. We have even had tenants who have thanked us because they now use Venmo for other things in their life too. Right now we have 6 accounts connected to it including business accounts.
    Bryce Cutler Investor from Wynantskill, New York
    Replied 9 months ago
    Brandon, I know this has been reposted but I was using Dwolla and they shut down their transfer part of the page I was using so I switched to Cozy and it has been very easy to use and the feedback from tenants was good as well.
    Dale Miller from Atwater, OH
    Replied 9 months ago
    Thanks Brandon for all the tips.
    Alexandra Chaploutskiy Rental Property Investor
    Replied 9 months ago
    Hey guys, I was wondering if anyone has used Azlo for business checking account? It’s a fee-free online only “bank”, tenants can pay rent either by doing a bank transfer or depositing a check, all for free.
    Kevin Phu from Oxnard, CA
    Replied 9 months ago
    I started using Cozy for my three tenants and it’s been great! The platform is so easy to use and set up.
    Soyini Grandison-Tracey Investor from Bronx, NY
    Replied 9 months ago
    My husband and I also currently use to collect rent from our tenants. It is free for the tenants if they use a checking account but if they pay with a credit card there is a fee. It is also free for the Landlord.
    Sean Goodwin Rental Property Investor from Harrison, NY
    Replied 9 months ago
    “If a tenant moves in in the middle of the month, I don’t prorate the amount they pay for that first month. Instead, I prorate the second month to match the first. ” Why is this? Why not pro rate the first month?
    Stefano Bello Investor from Miami, Florida
    Replied 9 months ago
    by doing it as Brandon suggests you get an extra margin of safety. thats all
    Sky Shah from Grand Prairie, TEXAS
    Replied 9 months ago
    Zelle. Easy and free. U can categorize the payment once u get it. Works with well known banks
    Cathy McCormick from Dunnellon, FL
    Replied 9 months ago
    I use as well. Super easy to use, free to use for both landlords and tenants (except when tenants use a card to pay, or the landlord wants payment faster), but I am very happy with it and will use it for future rentals.
    Jon Simpson from Berks County Blandon Pa
    Replied 9 months ago
    Read all comments to date. Seems like cozy is the strong favorite.
    Seth Harkness from Portland, Maine
    Replied 9 months ago
    I use Google Pay — it’s free for both parties (as long as your not paying from a credit card) and easy to download and use. It’s really helped simplify my life. And I’m assuming Google will be around for a while.