Rent payment

7 Replies

For those of you who have a single family home in your name, use an umbrella insurance policy, and have no LLC, I assume you have the tenant write the check to you directly? Do you have a separate bank account just for your rental for tax purposes? Do you manage the property yourself?

A separate bank account and if you can also use a specific credit card for purchases. Easier to do the accounting. For one rental you can manage yourself.  We have a PM for some properties due to distance.

Originally posted by @Colleen F. :

A separate bank account and if you can also use a specific credit card for purchases. Easier to do the accounting. For one rental you can manage yourself.  We have a PM for some properties due to distance.

 Do you open a bank account for each property? 

You need to have a "business" bank account to deposit your rents.  (Separate from your personal checking account.

You need to have a separate checking account for Security Deposits.  In some states it needs to be an interest bearing account and should be called the Tenant Security Trust Fund Account.

It's best to manage the rental homes yourself.  However, you may not have time.  But if you choose to have a Property Manager, they must be a licensed Broker or work for someone that is a broker.  (There are about 3 states that say you don't need to be a broker but a PM must be licensed)

If you manage your homes yourself, then you will have the education you need to continue to be a landlord and know if this is for you.  There is a lot involved in being a landlord, then buying a home, renting it out and collecting the rent.

Nancy Neville

"Busines bank account" meaning separate account from personal accounts since the home is not in an LLC? Thanks.

Yes, keep all business transactions separate from your personal stuff.

Yes, but just to be clear if your  rental is in your personal name you can open what the bank considers a personal account as long as you separate what you do with it as just for the rental. You just don't want to co-mingle the funds with your personal obligations.   In some states you need a separate account for the security deposit but not all. Check your state laws.  It is what you do with the account that makes it a business account since of course it has to be in your personal name.  The security deposit,  check the local laws but even if not required setting the money aside in the account it is still good to do because it is the tenants money, not yours.  

I have a separate checking and savings account for each property.  It makes it easy to keep money separate from mine, easy to see exactly who paid, and easy to keep Security deposits separate in case that's ever challenged.  I keep a balance in each checking account that is used for maintenance on that property.  I only have a few properties, so it's not a burden to do it this way for now.  I also nickname the accounts to match the property address.  

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