How do your tenants pay you?

12 Replies

My tenants currently use cashier's check or money order. Is there an online way such as cash-app or anything that will allow me to collect payments that are over 500?

I used to collect it in cash or check. It was nice at first to physically hold what amounted from your accomplishments. Now, all of my tenants have to deposit it direct into my Wells Fargo Account. They have no excuse not to pay, because they can drop it off at the bank in person if they don't understand how to send it using their computer.

Also, BiggerPockets has a list of online services here:

https://www.biggerpockets.com/rei/pay-rent-online-payment-tools/

All my tenants pay directly into a bank account that I set up just to collect rents. I then transfer the rents into my different LLCs and only keep $200 in that account. When they sign their leases, I give them a stack of deposit slips and I write their unit number on each slip so I know exactly who has paid when I bring it up online.  It has worked really well so far as my tenants are mostly low income and only seem to have cash (no bank accounts).  With them depositing cash into my account, I've never had to deal with a bounced check either or it "being lost in the mail".  My rentals are all in a small town and the bank is close for everyone, I understand that this may not be a suitable solution for landlords with multiple properties in different locations.

+1 here for Cozy.co

Having the tenants deposit into the bank account, like what was described above, is also a good option, but requires a bit more management/tracking.

With the above two options, I never have to physically collect rent or be given the excuse of “check’s in the mail”.

Originally posted by @Alison P. :

All my tenants pay directly into a bank account that I set up just to collect rents. I then transfer the rents into my different LLCs and only keep $200 in that account. When they sign their leases, I give them a stack of deposit slips and I write their unit number on each slip so I know exactly who has paid when I bring it up online.  It has worked really well so far as my tenants are mostly low income and only seem to have cash (no bank accounts).  With them depositing cash into my account, I've never had to deal with a bounced check either or it "being lost in the mail".  My rentals are all in a small town and the bank is close for everyone, I understand that this may not be a suitable solution for landlords with multiple properties in different locations.

Did you just choose a bank that was most accessible for your tenants?  We use small community banks for our lending so its not convenient for most of our tenants to drive to those banks.   

Are there any fee associate with transferring funds between your banks?

Other than using deposit slips is there any way to track who is paying? 

@Curtis M. If you want simplicity, use Cozy. It user friendly and easy to set up. The money gets deposited directly into your acct. within 5 days or so. I tell tenants to deposit into cozy 4-5 days before the 1st to insure timely payments. You can also have your prospective tenants pay for Credit/background checks via Cozy, as well. Cozy has grown, you can add expenses, late fees etc. and it's free! I am happy with them so far for what they provide at no cost!!!

@Anna Maher

Hi Anna, I use US Bank. There is a branch centrally located in my little town, which is perfect. All my LLC accounts are set up with them (I have a separate LLC for each rental for asset protection) so there are no fees to transfer the money. I do use a small local bank for my loans but I don't do my day-to-day banking with them. In my opinion, US Bank has the best online banking that I have used and that's why I prefer them because I do most of my banking online. The local banks online systems pale in comparison and are pretty clunky to use.

Unfortunately, other than writing the unit number on the deposit slip, there is not much else you can do to determine who has paid.  Several of my mobiles have different rents that were grandfathered in, so that helps, but several are on the same rent and occasionally someone will forget their printed deposit slip and just go to the bank and hand write one out and not put the unit number on.  Then it's a case of waiting until everyone has paid and do a process of elimination.  It's not perfect but it's a lot less hassle than collecting cash in person.  

I don't think Cozy would work in my situation because of the different backgrounds. ie. some tenants are elderly and don't understand that stuff, I have a tenant who is mentally disabled and wouldn't be able to do it and several that are low income and like I said before, only deal in cash.  So, for now, this way seems to be the best way for my situation.  Hope this helps.

I use Venmo to collect and then transfer to my operating account used solely for my rental. My rental is in a college town. I rent out each room. Average age 22. This is the easiest and fastest. It is free. Occasionally there is a parent that pays rent for their kid and Venmo is quick and simple because it is all digital transfer so none can do it from anywhere. 

@Lisa L. : Tell me about your experience with using their late fee and extra expenses feature? How have it work for you? Do you experience compliance issues with payment? Does the site send out automatic notifications to the tenants via phone every month to remind them of rent payment? I am looking into cozy as an option and would like to know how efficient it is.

@Jupshy Jasmin The site is easy to use! I add bills, etc. with ease and Cozy sends the tenant an email immediately letting them know what they owe or need to do, etc., along with rent due.  I've never had any problems with my tenant (s) not paying their bill, but then again, I have class A property and a clad iron lease. However, I wouldnt hesitate to start eviction immediately should it need be. Always remain on a cordial yet professional relationship with your tenants... Good luck to you Jupshy! Try Cozy, Im sure you'll be happy!