When lease begins after the 1st...

6 Replies

... do you prefer to prorate the 1st mo rent or change the due date? I’ve always pro-rated the 1st month but I have property mgmt software that can easily keep track of multiple due dates. I have a tenant moving in on the 5th and am thinking about just making the 5th of the month the due date for rent instead of the 1st. Thoughts?

It’s really personal preference. I like to make the due date the first, so I receive all my checks on or before the first. That’s when my mortgages are due, so therefore, want the cash to pay for the mortgage. Iv heard a BP podcast of a guy saying he’d like to own 30 properties, and make each due date a different date, as to have money coming in everyday of the month. I don’t see any reason that one way it better than the other, so do what’s best for you and YOUR business.

@William C. Every single day of the month? Gosh that sounds like a headache. All due on the same day. F you want consistent cash flow weekly or whatever just set up different bank accounts.

I don’t do that, a guy joked about it on a podcast. I agree, it would be confusing. Which is why I make all my rents due on the first.

Keep it simple and keep things standard, rent is always due on the 1st. We require a full months rent up front and the prorate the second month based on their move in date. Our software handles those calcs for us.

I'd prorate, that seems like an awful lot for your accountant. Which in my case is my wife. No way, Jose!