Collecting Rent through ePayments (Yes or No?)

Montreal, Québec · Member since 2016 · 133 posts · 19 votes

Hi everyone,

What is your opinion about collecting rent through electronic payments? Specifically online debit or credit card payments.

Any good or bad stories? Any methods of preventing a tenant who uses a frauded card on the last month of the lease before moving out?

Mailed or picked up cheques seem to still be the most common method, but I am wondering if anyone has or is considering online payments.

I know there is often a fee attached to the epayments, which might discourage your tenants...

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Aaron Linden

South Bend, IN · Member since 2015 · 180 posts · 93 votes

10y

C. Timothy Murphy III I use erentpayment and theee is an option you are able to select when setting up the property that allows you to not accept partial payments.

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JD MartinBusiness Member
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Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
10y
If you use Cozy with ACH there's no fee. Erentpayment (another I use) charges $3, which I have the tenants pay. Few have chosen to use credit cards any way you look at it, because they are charged the CC processing fee which can be pretty substantial.
There's no 100% guarantee against fraud; hell, even cash can be counterfeit. Checks can be drawn on closed accounts or stolen. MO's, same thing. If you have done a good job of screening your tenants, and are renting to quality people, this should be a very minor concern.
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Chris Walters
OP
Montreal, Québec · Member since 2016 · 133 posts · 19 votes
10y
First, sorry for my ignorance, but what is ACH?
Secondly, did most of your tenants accept? Did any of them requested that you cover the $3 fee? And besides making sure the payment is received quicker, have any of your tenants mention why they prefer this method?
Thirdly, how does it work with your bank account? Is there a 3-7 days delay before funds are deposited in your bank account or is it instantaneous? Do you have any back fees at all besides your monthly fees for the software?
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Jeff B.
Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
10y
Look for POPMONEY - - free and it's only a three day hold on the funds.
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Spence Rodman
Investor · Olive Branch, MS · Member since 2016 · 20 posts · 18 votes
10y
We just began using erentpayment and we really like it. There is a wait period of 3-7 days before funds are deposited, but other than that I really like it.
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JD MartinBusiness Member
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Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
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ACH = automated clearing house. Basically a bank-to-bank transfer which costs everyone essentially nothing, which is why most banks (and some services like Cozy) do it for nothing, just for establishing the relationship.
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Chris Walters
OP
Montreal, Québec · Member since 2016 · 133 posts · 19 votes
10y
Nice! Thanks for the input everyone! If anyone has additional advice, please keep the ball rolling :)
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Casey Cousins
Real Estate Investor · Anchorage, AK · Member since 2013 · 12 posts · 7 votes
10y
It looks like I can use Cozy for everything - contract, background and credit screening, and ePayment. Would you guys recommend Cozy for all these things?
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JD MartinBusiness Member
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Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
10y
I use Transunion Smartmove for the screenings, because it's cheaper if you are ex-military USAA member ($12 vs. $35). It saves the applicant a little bit of money, and I run a check on all adults listed on the application.
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Kaycee Miller
Professional · Grants Pass, OR · Member since 2016 · 89 posts · 77 votes
10y
ACH payments are the best options for landlords and renters. Since you attached a checking accounting, which the renter has to give approval for, it avoids the potential of using a stolen card/account.

ACH rent payments can be established as recurring (so they happen automatically each month), making it much more likely that your renter will not have any more late payments.
There are several companies that handle online rent payments for landlords and property managers, including full featured property management software, that keep excellent records for accounting, reporting and tax purposes. I would check out reviews on places like Software Advice and look at the features you want and need, plus client support/customer service. The quality of customer service will make or break any online software, no matter the cost!
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Chris Walters
OP
Montreal, Québec · Member since 2016 · 133 posts · 19 votes
10y
Has anyone encountered the issue of receiving partial payments through these websites?
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Bob CollettPro Member
Property Manager · Brecksville, OH · Member since 2014 · 486 posts · 464 votes
10y
@Chris Walters Hi Chris... I use E-payment almost exclusively for the rentals I manage in my property management business. This requires tenants to have a checking account. If they do not have a checking account, this usually means they had a checking account and could not manage it, so they lost it.
This said, I do allow tenants to pay by money order as well... but I let them know at the time of the lease-up, that the preferred method is E-pay. They pay a premium of $.99 per transaction.
The biggest advantage of the E-pay in my Cleveland Ohio property management business, is that all payments received are instantly posted to my property management software, and my property owners can instantly see what's going on.
I can set the threshold, such that we wait 3 days, or 5 days before we transfer the money from the E-pay system to my property management trust account. This will catch 95% or more of the "NSF" situations.
Good luck.
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Chris Walters
OP
Montreal, Québec · Member since 2016 · 133 posts · 19 votes
10y
@Bob Collett Hi Bob! Thanks for all that information. It will be veey usedul. Can you please tell me if hou use difeerent software for your property managment and your company's book keeping? Can you please tell me which ones you use.
Thanks
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Michael StrobelPro Member
Investor · Lynchburg, VA · Member since 2015 · 41 posts · 20 votes
10y
For rent collection I use the CASH app. Its great because all you need to do is link a debit card to your account and you can send money instantly (for a 1% fee) or next day (for free). Never have to worry about a check clearing or something getting lost in the mail. Its super easy for the tenant and for me. I get paid really quick.
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Al Williamson
Rental Property Investor · Sacramento, CA · Member since 2011 · 2k+ posts · 1k+ votes
10y
Yes, Cozy.co!
1 Reply
Chris Walters
OP
Montreal, Québec · Member since 2016 · 133 posts · 19 votes
10y
@Michael Strobel @Al Williamson Nice, i will check those out.
Iknow i am going off topic here but do any of you use quickbooks and if yes, how much easier does it help out when your accountant has to do your income tax?
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Neal Collins
Developer · Portland, OR · Member since 2014 · 732 posts · 490 votes
10y
@Chris Walters We exexulsivey accept electronic payments. There is just too much liability and time wasted collecting cash, money order, or check. This may be our renter demographic but having a fully electronic system is a big selling point for our tenants. Now if I could just get one last client to stop requesting checks everything would be so much smoother!
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Greg Cyr
Rental Property Investor · Bend, OR · Member since 2014 · 7 posts · 2 votes
10y
I have used google pay for the last year or so with no issues. Free for both parties
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Angela K.
Investor · Los Gatos, CA · Member since 2016 · 20 posts · 9 votes
10y
I have been using ClearNow since 2007. The tenant signs up at lease signing and then the payment is automatically deducted from their account and transferred to ours after a 3 -5 day holding period. Saves me a lot of time and hassle. They do charge a fee that is higher than some mentioned here but I thought I would throw out another option. It also keeps track of lease end dates which have to be updated to continue. I also have one guy paying by PayPal currently which is a pain because i then have to move the money around and make sure he sent it.
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Angela K.
Investor · Los Gatos, CA · Member since 2016 · 20 posts · 9 votes
10y
Chris Walters I do use Quickbooks and it definitely makes tax time easy. I'm also a freelance bookkeeper so it's what i do ;)
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Dustin Beam
Kansas City, MO · Member since 2015 · 609 posts · 321 votes
10y
My first and only online payment has been through Cozy. I like that there are no fees to me or my tenants. So far so good (just 4 months). My only thing I would like to change is if you could add an auto late fee if they didn't make payment on time and that there was a minimum payment.
My rent is "due" the first, but there's a grace period of 5 days. At 12:01 am on the 6th, I wish it would tack on the late fee and not accept anything less than that. And generally I wouldn't want anything less than normal rent available for them to pay so you don't get caught delaying an upcoming eviction because a savvy tenant deposits $20 into your account.
But overall it's been great, has a good interface and isn't "clunky". It's a well planned website IMO.
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Timothy Murphy III
Real Estate Broker · Cleveland, OH · Member since 2012 · 771 posts · 252 votes
10y
@Bob Collett
Can you block partial payments with this service? Acceptance of a partial payment would stop the landlord from evicting if necessary, so this seems relevant to me.
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Bob CollettPro Member
Property Manager · Brecksville, OH · Member since 2014 · 486 posts · 464 votes
10y
Tim, I don't think you can block patrial payments, but once the eviction process starts; you would have the ability to turn off e-pay for that tenant.I will check, next time I call customer service.
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Bob CollettPro Member
Property Manager · Brecksville, OH · Member since 2014 · 486 posts · 464 votes
10y
Chris
I use Buildium.
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Aaron Linden
South Bend, IN · Member since 2015 · 180 posts · 93 votes
10y
C. Timothy Murphy III I use erentpayment and theee is an option you are able to select when setting up the property that allows you to not accept partial payments.
2 Reply
Chris Walters
OP
Montreal, Québec · Member since 2016 · 133 posts · 19 votes
10y
do any of these softwares offer different languages? In the province Where is reside we speak English and French.
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