Tenant Can't Pay Onliine, I Don't Pick Up Checks. Help!!!
Mil SanghviPro Member
Rental Property Investor · Atlanta, GA · Member since 2014 · 57 posts · 10 votesIs there a way for the tenants to pay rent at a store?
A couple of my tenants don't have computers and can't pay online. I will not go to the property and physically collect rent and really don't prefer mailed checks or money orders.
These are the ways I currently accept rent payments.
1. Government pays for military tenants
2. PayPal (friends and family so it's free)
3. Online on the website (Buildium)
I can tell them to deposit at the bank but don't want to give them the account number.
I've heard of "Pay Near Me" Tenants can make cash payments at 7 Eleven and Family Dollar. I don't have 7 Eleven in Phenix City AL or Columbus GA. Family Dollar may not accept rent payments specifically.
Are there any other options?
I am going to date myself some, but we used to have these relics called envelopes (crazy little white things)..
Google "envelope" if you are under like 25 years old. Way back in the day, we did everything this way...
How to bullet proof it for your unbanked tenants: give them SASE (this stands for self addressed stamped envelopes) for the entire tenancy. An unbanked tenant can just get a low cost money order or check and drop it in the mail. Easy.
For some reason this is the hard part I have seen in a few forums, you open the envelope (usually from a PO box ancient mail box device of some form).. take out the check and deposit it in your account (be as tech savvy or unsavvy as you like here)..
I have not lost one in a decade this way... The old late in the mail excuse is a tenant issue 99% of the time and not about the USPS.
If getting the mail is too hard, wait until you turn around a rough unit (getting rent checks is actually my highlight--easy and fun mailbox money; and I planned it out so the bank is next to the po box; even get free coffee (a dark beverage made from...nevermind..) Best of luck... and sometimes even in the high tech world, the low tech route works best for some tenants.
I collect post dated cheques for the whole duration of the lease
it is my requirement
dishonoured cheque $50
never have late payment, do not have to go to collect them
on the first of each month just go and deposit all the cheques at once
seem to work for me
!!!??? It's lawful to collect 12 months of post-dated checks in Alberta? For reals?
K. Marie:
It is both lawful and common practice in most jurisdictions in Canada. The key is that the cheque itself is not negotiable until the post-date - prior to then, it is merely a piece of paper.
Here in New Brunswick we are not allowed to require, nor accept rent, further in advance than the next rental period {so basically the current month and the next month}. However, post-dated cheques are acceptable.
Maybe it's because we collect cheques and not checks ;-)
Indeed in California it's lawful to write and collect on post dated checks. Never even occurred to me that one could collect post dated checks for rent. Of course the dependability of the payor makes or breaks that arrangement. Post-dated and in-hand doesn't mean there is cash to back it. But now that I think about it, a bad check could be better than non receipt of payment. It's immediate evidence of non payment as opposed to the wishing and hoping that so many landlords do while waiting for payment.
Give them a notice that electronic payment will become a requirement at a future date. In the mean time give them an incentive to open an account that allows them to email transfer
Give them a notice that electronic payment will become a requirement at a future date. In the mean time give them an incentive to open an account that allows them to email transfer
Richard,
The e-mail transfer to which you refer is a Canadian artefact. The U.S.A. banking system is far larger and far more distributed with many small, local/regional institutions. ACH is slowly spreading, but there is not (at least not which we have discovered) the equivalent of Interac e-Transfers.
Additionally, the rate of unbanked citizens in the U.S.A. is far greater than in Canada. I do not believe U.S.A. banks are required to allow a citizen to open an account in the same manner as banks in Canada are required to make accounts available to Canadians.
You certainly have enough ways for any tenant to get rent to you. You are not a babysitter, and you do not work for them.
Be kind, but let them know the date the rent is due, and they have the responsibility to get it to you in one of the ways provided. If they don't know about those ways, then they will have to learn.
"I don't know how to pay on line, blah, blah, blah..." is all a smoke screen. If they discover they can work you, they will keep on working you. Next month, it will be some other reason the rent is late that is somehow your fault and not theirs. Let them know that rent not received on time is late and subject to a late fee - no excuses.
For example, they can buy a prepaid Mastercard or Visa (gift card) and pay on-line that way from any library.
The point is, it is their problem and keep it their problem. They are responsible for getting you the rent. You are not responsible for picking it up. They'll test you one time. When you sock 'em with a late fee and make it clear you won't tolerate excuses, you won't get any. You'll get your rent on time.
Unless the tenants signed a lease that says they agree that payment will only be accepted electronically, it is the landlord's problem. The OP did not say that his tenants are unbanked, rather that they don't have computers. I gotta wonder if there is some class issues going on here. My mother is plenty with it and knows how to use her smart phone and is plenty comfortable in retirement. But she would never agree to pay her mortgage online or order a book from Amazon. She sends checks and goes to the bookstore. Like tens of million other 70+ Americans. Chase and BofA aren't making it harder for people like her, who've never been late a day in their life, to pay their bills. I suggest taking a page from their playbook.
Give them a notice that electronic payment will become a requirement at a future date. In the mean time give them an incentive to open an account that allows them to email transfer
Richard,
The e-mail transfer to which you refer is a Canadian artefact. The U.S.A. banking system is far larger and far more distributed with many small, local/regional institutions. ACH is slowly spreading, but there is not (at least not which we have discovered) the equivalent of Interac e-Transfers.
Additionally, the rate of unbanked citizens in the U.S.A. is far greater than in Canada. I do not believe U.S.A. banks are required to allow a citizen to open an account in the same manner as banks in Canada are required to make accounts available to Canadians.
For sure we are way more unbanked than Canada. There is no right to a basic bank account here, and loads of barriers to getting one. From his post it appears that the OP's tenants are not unbanked, but rather don't have computers and/or online transfer accounts. Which is entirely different from being unbanked. We have so many people entering land lording right now without the first clue about their tenant population's financial habits. Many people who are 65+ are going to go to their grave without making online rent or mortgage or utility payments. Is the inconvenience of accepting checks or money orders via mail really so great that one would want to eliminate that entire population from their tenant pool?
If a tenant needed me to come pick up the rent and they were good renters (and I'm close enough to do this within reason) I see no reason why I wouldn't want to go and get my money.
is it in your lease they need to pay electronically? If so, then they need to figure it out. If it's not in your lease then I think you sound like a brat that is too good to go collect rent. Sorry if that's harsh but that's how this is coming across. This is the kind of thing that perpetuates a negative landlord stereotype.
Assuming it is in their lease, then they can go to the library and access the Internet for free and pay online.
My lease states that rent should be paid in the method stated by the property manager. It is the tenant's responsibility to pay rent.
I prefer not to take mailed checks/Money orders is because don't want there to be any future issues from tenants saying they have mailed it and they really haven't.
My focus is not to make it difficult on my tenants. I am building systems and automation to create efficiency in my business practices. This is the only way more I can acquire more units and I become a better property manager. I recently got set up with Buildium.
I currently accept payment through Buildium, ACH, Military, section 8 and Paypal. I have researched Pay Near Me since there are several Family Dollar's near the property however on Family Dollar's website it says they do not accept rent payments through Pay Near Me.
If a tenant needed me to come pick up the rent and they were good renters (and I'm close enough to do this within reason) I see no reason why I wouldn't want to go and get my money.
If I go pick up the rent check once, they will expect me to pick up every time. The property and PO box is 2 hours away and I also have a full time job. It's not practical.
My lease states that rent should be paid in the method stated by the property manager. It is the tenant's responsibility to pay rent.
What does this mean? What exactly does your lease say regarding payment method? Payment methods need to be defined and in writing. And when you want to change the method, you have to follow state law regarding notice of change. You don't have something as vague as "payment to be paid in the method stated by the property manager" do you?
My lease states that rent should be paid in the method stated by the property manager. It is the tenant's responsibility to pay rent.
What does this mean? What exactly does your lease say regarding payment method? Payment methods need to be defined and in writing. And when you want to change the method, you have to follow state law regarding notice of change. You don't have something as vague as "payment to be paid in the method stated by the property manager" do you?
My thoughts exactly! If I put that language in my lease and then tell my tenants that they need to attach a canister to the leg of a carrier pigeon with a money order attached do you really think that's going to fly? Yes, pun intended.
I want my tenants to pay electronically. I tell them they need to pay via Chase QuickPay, PNC PopMoney, or approved equal. Some of my tenants use credit unions and have asked to setup automatic bill pay that has a check cut on the first of each month and mailed directly from their banks. This is OK with me and we let them do that. Other tenants get great credit card rewards and asked if they could pay with a credit card. We use QuickBooks Online and allow credit card payments. The tenants agree that any fees associated with an electronic payment like that are paid by them. Your language needs to be specific.
My lease states that rent should be paid in the method stated by the property manager. It is the tenant's responsibility to pay rent.
What does this mean? What exactly does your lease say regarding payment method? Payment methods need to be defined and in writing. And when you want to change the method, you have to follow state law regarding notice of change. You don't have something as vague as "payment to be paid in the method stated by the property manager" do you?
My thoughts exactly! If I put that language in my lease and then tell my tenants that they need to attach a canister to the leg of a carrier pigeon with a money order attached do you really think that's going to fly? Yes, pun intended.
I want my tenants to pay electronically. I tell them they need to pay via Chase QuickPay, PNC PopMoney, or approved equal. Some of my tenants use credit unions and have asked to setup automatic bill pay that has a check cut on the first of each month and mailed directly from their banks. This is OK with me and we let them do that. Other tenants get great credit card rewards and asked if they could pay with a credit card. We use QuickBooks Online and allow credit card payments. The tenants agree that any fees associated with an electronic payment like that are paid by them. Your language needs to be specific.
Like many threads on BP this one ends up being the uninformed informing the uninformed. I'm pretty on top of CA landlord/tenant issues. But upon checking for CA I just read that CA passed a law in 2012 that prohibits landlords from requiring electronic payments from tenants. And if the landlord wants the payment made in person at a bank, the bank has to be within 5 miles of the unit. And that cash cannot be required unless the tenant has previously written a bad check.
So we can give the OP all kinds of payment and collection ideas for GA or AL, but it could all be ill advised if it's illegal to require electronic payment in those states.
My lease states that rent should be paid in the method stated by the property manager. It is the tenant's responsibility to pay rent.
What does this mean? What exactly does your lease say regarding payment method? Payment methods need to be defined and in writing. And when you want to change the method, you have to follow state law regarding notice of change. You don't have something as vague as "payment to be paid in the method stated by the property manager" do you?
My thoughts exactly! If I put that language in my lease and then tell my tenants that they need to attach a canister to the leg of a carrier pigeon with a money order attached do you really think that's going to fly? Yes, pun intended.
I want my tenants to pay electronically. I tell them they need to pay via Chase QuickPay, PNC PopMoney, or approved equal. Some of my tenants use credit unions and have asked to setup automatic bill pay that has a check cut on the first of each month and mailed directly from their banks. This is OK with me and we let them do that. Other tenants get great credit card rewards and asked if they could pay with a credit card. We use QuickBooks Online and allow credit card payments. The tenants agree that any fees associated with an electronic payment like that are paid by them. Your language needs to be specific.
BTW Ohio law does not allow you to require electronic payment. You have to have at least one payment method in addition to cash and/or electronic payment methods. The law defines "electronic" as pretty much anything that is not cash, check or money order/certified funds. Which means you can't require direct deposit, any form of ACH, wire transfer, or that tenants use any electronic store front payment services. Ohio 1947.3
If you are not allowing tenants to pay via check or money order in OH, you're violating state laws. Read your code. Check your lease.
I don't force anything on anyone. Our preferred method is electronic payments. Almost all tenants love it. One previous tenant was in the restaurant industry, didn't have a checking account, and paid by money order each month. I like getting paid electronically, I love getting paid more. We allow our tenants to pay in whatever way makes the most sense to everyone involved. If I can avoid physically collecting checks, I try to do that but we don't force anyone to do anything. We always attempt to be above board and follow all regulations, codes, statutes, and laws.
I don't force anything on anyone. Our preferred method is electronic payments. Almost all tenants love it. One previous tenant was in the restaurant industry, didn't have a checking account, and paid by money order each month. I like getting paid electronically, I love getting paid more. We allow our tenants to pay in whatever way makes the most sense to everyone involved. If I can avoid physically collecting checks, I try to do that but we don't force anyone to do anything. We always attempt to be above board and follow all regulations, codes, statutes, and laws.
I'm with you in that it makes sense to make it easy for tenants to pay the way that works for them. Be honest. Before this morning, did you know that Ohio law prohibits you from requiring electronic payments and that you must offer an additional method besides cash and electronic payment. My point was that this thread is filled with ideas to support the OP's desire to have his tenants pay only electronically. But no one has mentioned or questioned where it is or might be, in fact, illegal to do so. Both California and Ohio do not allow landlords to require electronic payments.
This is where BP can be both terrible and a resource. If you search the archives there are many threads about requiring tenants to pay electronically. But little mention of state law. Just everyone repeating what they do or want to do. These forums would be more useful IMO if we were working with at least a basic understanding of what is legal before we start brainstorming.
If you are not allowing tenants to pay via check or money order in OH, you're violating state laws. Read your code. Check your lease.
I think you need to check your source. Section 1947 of the Ohio Revised Code doesn't exist. This is the link to the section on landlords and tenants of real property in Ohio: http://codes.ohio.gov/orc/5321.13
There is no mention of payment methodology in this section.
I'm also unaware of any statute or case law that prohibits a landlord from requiring electronic payment (though admittedly I've never looked). If anyone has any binding authority on this, I'd much appreciate seeing it.
I like to require a signed ACH form and a voided check at move in for them to get keys. I believe if you have it your lease that they must pay electronically that is fine. I am not an attorney, but I am also unaware of a statute that prohibits it. Further, we had a real estate attorney on retainer at apartment communities when I was in property management in the past (which is where I git the idea) and we used this method of payment and it was approved by him. I would recommend setting up the payment to come out on the 3rd or 5th to allow them some wiggle room since if they don't have the money in their account the will get hit with a returned check fee on their end and your end, etc. As always consult a real estate attorney.
Not everyone has a checking account, not everyone has internet access. So you may want to also set up a UPS box as a drop off point for rent, if you don't have a property management company managing with a local office. You can also have them go into a branch of your bank and pay, they would simple deposit into your account. Snail mail is sometimes the only option unless you want to pick it up, say they are shut in - seniors for example. Just use the post marked date to determine if it is on time in that scenario.
Hope that helps.
Eric
@K. marie P. @K. ...Damn that @!
Regarding "Be honest. Before this morning, did you know that Ohio law prohibits you from requiring electronic payments and that you must offer an additional method besides cash and electronic payment." Nope.
There are lots of us who advocate checking state laws. We ran into this on page 1 of this topic when I asked @Account Closed about some statutory comments he made. His response was that in Texas (not related to the OP, but he did qualify and say "in some places") there are statutory restrictions (per Biggs, "Texas Sec. 92.011 of the Property Code" that reflects what he posted). He is correct, it's there in Texas. There are CA statutes as well, and I see California's section 1947.3 But I can't find the Ohio reference you cite. At least I can't find anything in ORC Chapter 5321: LANDLORDS AND TENANTS
Regardless, your post (as always) has merit (and my vote). Everyone needs to know the limits in their own states. I like complete automation so like (tenant initiated) deposit cards and ACH payments.
For anyone collecting in person... I suggest you do what my company does. If a manager needs to spend company resources going to the tenant, then there is a base service call ($35 minimum) charged to the account. When I tell them that, they change their behavior.
If you are not allowing tenants to pay via check or money order in OH, you're violating state laws. Read your code. Check your lease.
I think you need to check your source. Section 1947 of the Ohio Revised Code doesn't exist. This is the link to the section on landlords and tenants of real property in Ohio: http://codes.ohio.gov/orc/5321.13
There is no mention of payment methodology in this section.
Sorry about that. My bad. I lifted that off an OH attorney's site that was quoting CA Civil Code, not OH. 1947.3 is revised CA Civil Code.
@K. marie P. @K. ...Damn that @!
Regarding "Be honest. Before this morning, did you know that Ohio law prohibits you from requiring electronic payments and that you must offer an additional method besides cash and electronic payment." Nope.
There are lots of us who advocate checking state laws. We ran into this on page 1 of this topic when I asked @Account Closed about some statutory comments he made. His response was that in Texas (not related to the OP, but he did qualify and say "in some places") there are statutory restrictions (per Biggs, "Texas Sec. 92.011 of the Property Code" that reflects what he posted). He is correct, it's there in Texas. There are CA statutes as well, and I see California's section 1947.3 But I can't find the Ohio reference you cite. At least I can't find anything in ORC Chapter 5321: LANDLORDS AND TENANTS
Regardless, your post (as always) has merit (and my vote). Everyone needs to know the limits in their own states. I like complete automation so like (tenant initiated) deposit cards and ACH payments.
For anyone collecting in person... I suggest you do what my company does. If a manager needs to spend company resources going to the tenant, then there is a base service call ($35 minimum) charged to the account. When I tell them that, they change their behavior.
See above, my mistake. 1947.3 is CA CC, not Ohio. My fault for quoting an Ohio attorney, assuming he was writing about Ohio code when he was not.
My lease states that rent should be paid in the method stated by the property manager. It is the tenant's responsibility to pay rent.
What does this mean? What exactly does your lease say regarding payment method? Payment methods need to be defined and in writing. And when you want to change the method, you have to follow state law regarding notice of change. You don't have something as vague as "payment to be paid in the method stated by the property manager" do you?
Yes.
That is what the lease says in NC. "Tenant shall pay the Rent, without notice, demand, or deduction, to Landlord or as Landlord directs." Standard form 410-T as created by the NC Bar and NC REC and implemented by companies like formulator and others.
Adding to this. I manage some properties in D/F type areas where some of the tenants don't have bank accounts. The previous property manager used to collect cash rents in person. Or at least attempt to. He'd often get there and find out they had part of the cash, or refuse to answer the door when he arrived. Naturally he got pretty sick of this pretty quick and ultimately left the business. Our company's policy is to not collect cash rents or collect rents in person and the tenants are made aware of this up front. They are due in our mailbox by the due date payable by money order or they are considered late. I don't recommend collecting rents in person because of these issues and the overall hassle involved in doing so.