Tenant won't pay online, what is good alternative?

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Tenant won't pay online, what is good alternative?

Brian Cooke
Cincinnati, OH · Member since 2015 · 42 posts · 8 votes

I inherited a tenant in a purchase recently. Previous landlord drove to the property to collect every month. I'd rather not do that, so I suggested paying online. It is an elderly tenant, and she said she "isn't good with that sort of thing." The lease i also inherited specifically says rent is paid in person, so I can't really say she has no choice. I was thinking I could try having her use a deposit only debit card to directly deposit the rent every month at the bank (since she is already going there to get the rent money), but I'd be concerned about her depositing only partial rent. In Ohio I can't evict if I have accepted partial rent. Is regular mail my only option if I don't want to go in person to collect (although technically that is still against the lease, since that is an option where the box is NOT checked)?

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Todd Plambeck
Agent/Investor · Murphy, TX · Member since 2013 · 542 posts · 304 votes
9y

Mail her a rent statement with a return envelope, either pre-addressed or windowed.  I started doing this before online payments became commonplace and my late payment issues all but disappeared.  It's just another bill that comes in the mail to be paid that way.

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  • Samantha Klein
    Investor · Monroe, WI · Member since 2015 · 691 posts · 610 votes
    9y

    Set up a PO box and ask if she can mail you the rent if you don't want to pick it up. I usually let inherited tenants continue paying whichever way they were comfortable with, but I have new tenants pay thru Cozy.

    1Reply
  • Brian Cooke
    OP
    Cincinnati, OH · Member since 2015 · 42 posts · 8 votes
    9y

    Cozy is actually what I was going to use until she said she wouldn't do online.

    0Reply
  • Kim Meredith HamptonBusiness Member
    Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
    9y

    @brian 

    @Brian Cooke there is a service called PayNearMe, where the tenant can go to 7 eleven and pay up to $1500 with cash

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  • Todd Plambeck
    Agent/Investor · Murphy, TX · Member since 2013 · 542 posts · 304 votes
    9y

    Mail her a rent statement with a return envelope, either pre-addressed or windowed.  I started doing this before online payments became commonplace and my late payment issues all but disappeared.  It's just another bill that comes in the mail to be paid that way.

    3Reply
  • Thomas S.
    Member since 2016 · 13k+ posts · 12k+ votes
    9y

    The biggest issue you face is the fact that the previous landlord has trained her to be hand fed by him. Many hobby landlords say they pick up rent as aexcuse to check the property which is lame by any stretch of the imagination. They pick up rent because that is what the tenant has trained them to do.

    You must decide on what form of payment fits the criteria of her lease and demand payment in that form. Your best option based on her attitude is probably by mail and I would insist on a money order as opposed to a check.

    Your tenant needs to be retrained and that will be your first task. As soon as her lease ends change it to reflect how you wish to be paid.

    1Reply
  • Robert Nason
    Lowell, MA · Member since 2014 · 260 posts · 99 votes
    9y
    Tell her it is her responsibility to make sure that the rent is paid to you on the first. She needs to come out to you to pay it so be it. It's not up to you to go to her to collect the rent.
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  • April Crossley
    Investor · Reading, PA · Member since 2015 · 102 posts · 119 votes
    9y
    We use rentpayment.com and it allows them to pay cash at a moneygram. You can also set up auto withdraw from her account. I switched all tenants to on-line rent pay. Tenants that were resistant, I simply told them that unfortunately this is the way out business is going and at lease renewal time I would be ending our lease agreement. Control your business. Treat it like a business. Re-train her. She will get over it. I went through it with a handful of tenanats and when push came to shove they didn't want to move and set up auto-withdraw
    1Reply
  • Jeff B.
    Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
    9y

    Fair Housing Regulations says we can not discriminate on the form of payment.  You certainly do not have to go "collecting rents", so it's up to the tenant to make payments to you - - any way they choose.

    Offer to give her preprinted envelops or to arrange auto debit from her account, but tell her she as 30 days to figure it out and missing payments will result in the 3 day pay or quit notice.

    0Reply
  • Max T.
    Investor · Philadelphia, PA · Member since 2015 · 3k+ posts · 3k+ votes
    9y
    I also have a tenant who refuses to pay online. My only one not on cozy! They forget to pay rent every few months. I send them an email before the grace period expires and they bring the rent over immediately. They are just forgetful. Anyways it frustrates me that they refuse to sign up for cozy!
    0Reply
  • Brian Cooke
    OP
    Cincinnati, OH · Member since 2015 · 42 posts · 8 votes
    9y

    @Thomas S. I completely agree with you. I'm having to deal with that already with some of the repair requests. I guess I will have to just insist on online or mail as her only options.

    0Reply
  • Brian Cooke
    OP
    Cincinnati, OH · Member since 2015 · 42 posts · 8 votes
    9y

    @April Crossley I can see what the fees are when paying online for rentpayment, but they don't list a fee for using moneygram. Do you know, is there no fee for that?

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  • Gail K.
    Augusta, GA · Member since 2014 · 1k+ posts · 1k+ votes
    9y

    Give her a bunch of self addressed envelopes; it would be up to her to get stamps to send the checks/mail orders out to you.   Most of my tenants wouldn't know how to do the online payment system either and about half don't even have a checking account.

    Gail

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  • April Crossley
    Investor · Reading, PA · Member since 2015 · 102 posts · 119 votes
    9y

    @Brian Cooke you have to give the tenant a code to pay at moneygram that rentpayment.com will give you. It cost my tenants an extra $3.50 to pay at a moneygram :) 

    0Reply
  • Hozona B.
    Milford, NJ · Member since 2017 · 19 posts · 2 votes
    9y

    What our wife's family did, was give the tenant the checking account #. Every month like clock work he deposits the cash into the checking account using Pnc deposit slips. I am not so sure, if this was a wise solution. However, i check on the web it seems a lot of folks use this arrangement. I think the  online sites like Cozy is definitely the way to go.   

    1Reply
  • Mindy JensenPro Member
    BiggerPockets Money Podcast Host · Longmont, CO · Member since 2014 · 7k+ posts · 10k+ votes
    9y

    Having a mother who is not computer savvy, I can sympathize with this tenant. I like the Addressed Envelopes suggestion. I'd even put stamps on them for her. It will cost you a lot more than $.44 to drive over and pick it up.

    I get why some would not play with this woman, but she's probably just scared of doing the online thing. I'd humor her through the end of her lease with the stamped envelopes, then tell her that the next lease she has to do it herself or sign up online. Surely she has a relative who is more computer savvy who can help her out?

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    2Reply
  • Colleen F.Pro Member
    Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
    9y

    Does the lease say paid in person at the property ? If not just ask her does she want to drop it off to you or (insert your option). If she is old /disabled but reliable I would let her deposit or send a check. 

    Cash is also old school. My landlord years ago and my dad collected cash for rent. It is what some people are used to from that time. I had a neighbor that went to collect his rent cash. He liked to see his money going in and out the door and he had a fair number of units too. Sometimes it is just  a mindset.

    If you must convert her consider a transition timeperiod. Ask if   she has someone who will help her set up autopayment from her bank  by next month. 

    0Reply
  • Kimberly H.
    Residential Real Estate Broker · Chicago Suburbs, IL · Member since 2013 · 1k+ posts · 594 votes
    9y

    Have her write you a year's worth of postdated checks.

    0Reply
  • Roger P.
    Investor · Arvada, CO · Member since 2014 · 7 posts · 3 votes
    9y

    I never understood going around and collecting rent $$s at the property. Maybe back in Mayberry you could get away with it. There is always a resistance to change, but we converted all of our tenants to deposit accounts several years ago. It is amazing how much easier it is- no more waiting on the post office, or listening to excuses about the check's in the mail...

    We did convert people gradually as leases were being renewed- I think all tenants really like it now that they are doing it- they have more options on how to pay- they can go to the bank and make the deposit or setup recurring deposits that are automatically transferred from their account to ours. and they get a receipt showing their rent was paid at the time it is paid.  

    0Reply
  • Luke King
    Toledo, OH · Member since 2016 · 14 posts · 4 votes
    9y

    One option I offer is for tenants to use the bank at the local walmart.  It's open seven days a week and can accept payment without fees by debit card, credit card, check, ACH transfer, cash, etc.  All they need is your name and last 4 digits of your account number.  

    0Reply
  • Luke King
    Toledo, OH · Member since 2016 · 14 posts · 4 votes
    9y

    One option I offer is for tenants to use the bank at the local walmart.  It's open seven days a week and can accept payment without fees by debit card, credit card, check, ACH transfer, cash, etc.  All they need is your name and last 4 digits of your account number.  

    0Reply
  • Brian Cooke
    OP
    Cincinnati, OH · Member since 2015 · 42 posts · 8 votes
    9y

    I have given her a deposit only debit card so she can deposit at the bank down the road. In case of eviction I can cancel the card to avoid her depositing anything to delay the process. There's still a risk of partial payment before the eviction process, but I guess that won't stop an eviction. 

    0Reply
  • Jeff Sprunger
    Lockport , NY · Member since 2014 · 265 posts · 124 votes
    9y
    Originally posted by @Kim Meredith Hampton:

    @brian 

    @Brian Cooke there is a service called PayNearMe, where the tenant can go to 7 eleven and pay up to $1500 with cash

    Does the 7 Eleven store need to agree to this? not sure in stores in my town would even know of this service.

    0Reply
  • Kim Meredith HamptonBusiness Member
    Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
    9y

    @Jeff Sprunger it is my understanding that all 7 elevens accept this 

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  • Rick S.
    Fort Collins, CO · Member since 2014 · 397 posts · 161 votes
    9y

    @Kim Meredith Hampton and @Jeff Sprunger I think PayNearMe will only accept managers with over a 100 payments per month, however you could check with them to be sure.  The last time I talked with them that was the case as they have a minimum.

    0Reply
  • Lisa A.
    Sawyer, MI · Member since 2013 · 19 posts · 4 votes
    9y
    Originally posted by @Kimberly H.:

    Have her write you a year's worth of postdated checks.

     Not all banks honor post-dated checks anymore. Mine does not. Not a good idea.

    0Reply
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