How to Collect Rent

Question

I have 2 different companies that own properties.  For my 9-5, I'll be on assignment out of town for 6-18 months.  I'll be coming back home at least twice a month.  My question is how is the best way to collect rent?  I would prefer to not have a property manager if I can avoid it.

I've read about bad experiences with PayPal (investors getting stiffed).  And Dwolla got hit with big fine for unfair practices.

What other options do I have?

My bank is not where I'll be assigned.  Maybe open 2 more bank accounts at a bank where I'll be assigned and have tenants send checks to where I'll be?  Then I can periodically transfer money to the original bank?

Jordan Williamson · Answer

I use Cozy for all my rentals and highly recommend it. My tenants love it, and I love not having to chase down checks. I have been told you cannot require a specific method of payment, but wha tI do is I have an online application for screening the tenants so I KNOW they are comfortable with using the computer for personal information etc. When we sign the lease together I tell them we collect payment through Cozy and every single time they have been excited to not worry about writing checks etc.

Bryan O. · Answer

@Jeremy Paschedag if you are mobile that is your own issue, not your tenants! Do not try to figure out a way for them to find you. Use any of the online payment sites. I do like cozy.co because it is free and automatic. I also use the Quickbooks flavor (whatever it is called these days). They can ACH it to you or drop it at your bank. Whatever you go with, make it consistent. Imagine trying to evict for non-payment and they claim they sent it and you just never deposited it. They then show a string of addresses you keep trying to bounce them around to.

Stability for your tenants should be one of your top priorities. If you can't provide a reliable payment method, how will they have confidence that you will do anything else right? That type of uncertainty will lead to turnover or bad behavior.

Jeremy Paschedag · Answer

I went with Cozy.  I love it.  Iget a message when my tenant has sent the rent so I don't have to keep checking the bank account.  And there's no cost to me, nor my tenant.

Michele Fischer · Answer

My state landlord association has a vacation coverage option for short term property management, may be something to explore.

Mike Wood · Answer

@Jeremy Paschedag  Unless your tenants are low income, I would suggest setting up online payments.  There are several options, that allow tenants to pay directly from their checking account.  I would suggest a service that does not charge the tenant any extra money or fees.  Alot of folks on BP like cozy.co which has online payments.  I personally use rentpayment.com, which charges a small fee ($10/month for upto 10 payments, then a couple of bucks per transactions above that).  All of my tenants use online payments.  One good thing about rentpayment.com is the tenants can pay at any moneygram location, so cash tenants can pay electronically just as easy.  Some of my tenants in the past did not have checking accounts.  Since I dont take cash, they would already need to go get a money order.

Eugene Kemp · Answer

If your tenants are internet savvy, have them pay you online. Either via online bill pay from their bank, or via lots of other options out there.  I recently became aware of a new method being tested by Turbo Tenant.

Matt B. · Answer

Maybe they can send you the check and you can do a mobile deposit from your cell? have a friend pick up the checks and deposit them for you? set up an ETF from your tenant's account to yours? thats really all I can think of at the moment.

Zach Scheer · Answer

After reading this thread i think i'm going to sign up for Cozy.   I feel like i visit my property too many times to collect rent and there are no checks in the box.

Will Schreiber · Answer

@Jeremy Paschedag what did you end up settling with?

Jeremy Paschedag · Answer

Thank you Mike!  I'll have to check those sites out.

Online options would certainly be better than the tenants having to remember what addy to send the checks.

How to Collect Rent

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