New to Real Estate · Detroit, MI · Member since 2018 · 8 posts · 1 vote
I’m a getting my first investment property in Detroit. Let’s just say the area isn’t what I’m used to and picking up cash seems a little risky here. I’ve heard a ton of strategy’s for collecting rent on the podcast but was just wondering what you guys thought is the most efficient way.
Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
7y
Nothing wrong with collecting in cash in my opinion . It’s not a waste of time when you want to check up on the property or do repairs there . You should be visiting your properties ! Go ahead and Look at all the threads where people get screwed on these new online resources or read of the checks that bounced or how they are lied about it being in the mail . It’s old school but Uncle Ben is taxed differently plus he’s accepted anywhere and he won’t bounce or leave me without my rent over a false promise
Rental Property Investor · Evanston, IL · Member since 2015 · 19 posts · 1 vote
7y
@Mouhamad Rahal you can try Cozy.co if they have bank accounts or Zelle. If neither works make sure they get money orders so you don't have cash on hand. Either that or good old fashioned put it in the mail, but we know that comes with plenty of excuses..."I mailed it last week etc."
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
7y
You shouldn't go pickup cash in any neighborhood. It's just not an efficient use of your time (and not safe in some neighborhood's as you pointed out).
Use an online portal like Cozy if they have a bank account. If they don't have a bank account (which they may not), have them mail a money order or - better yet - go get a business bank account and tell them to go deposit the money at the bank directly into your account. Try to do whatever you can to remove yourself from the money handling process.
Hartland, MI · Member since 2018 · 30 posts · 8 votes
7y
Cozy is good,but you can't beat the universal ease of sorting it out through the banks. That is unless, you want to go and visit your units once a month, in which case, enjoy driving through the neighborhood. Perhaps you will learn some new perspective. What exactly makes a whole neighborhood "bad"?
@Mouhamad Rahal in todays market there are so many apps that give you cash directly into your account like cash app, venmo, with these company's the customer cant get the cash back i.e. like if it was a credit or debit card transaction they could dispute the charge and potentially get their cash back. How do I know I had a lady pay with a debit card and stated that it was a illegal transaction and tried to get the payment back. I had all of her info so they realized she was trying to commit fraud.
Wichita, KS · Member since 2018 · 29 posts · 9 votes
7y
Venmo, Cozy, or bank transfer. You are wasting your time travelling to units anyway. Just as the others here have said. As a social worker in my day job, I don't see how any neighborhood can be so bad as to you not being able to drive through it. Perhaps it's your perspective that needs to change?
Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
7y
Nothing wrong with collecting in cash in my opinion . It’s not a waste of time when you want to check up on the property or do repairs there . You should be visiting your properties ! Go ahead and Look at all the threads where people get screwed on these new online resources or read of the checks that bounced or how they are lied about it being in the mail . It’s old school but Uncle Ben is taxed differently plus he’s accepted anywhere and he won’t bounce or leave me without my rent over a false promise
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
7y
If you own property in an area where you are afraid to go , why own it in the first place ? How would you do an inspection? A repair? Show the place ? As a contractor I have been asked to do work in some rough neighborhoods . " No thanks , money isnt everything "
As a social worker in my day job, I don't see how any neighborhood can be so bad as to you not being able to drive through it. Perhaps it's your perspective that needs to change?
But, you're not the "mean old landlord" coming to collect the rent. ;>)
From my point of view the rough areas of LA do not seem as rough as they did 20 - 25 years ago. Or maybe I am getting older. I still would not go near skid row or the projects after dark. During the day it can seem sketchy at times and places, but not particularly dangerous. And I'm not getting out of the car, except at my destination. My $2.
Rental Property Investor · Erie, PA · Member since 2018 · 84 posts · 462 votes
7y
I have all my tenants directly deposit into my bank account. I pick a bank that has several locations to make it easy for the tenant to get to one of the branches. They put it in the account, and get a receipt right then and there. Cuts out any excuses too. No "its in the mail" or "I gave it to you, you must have misplaced it." Make sure you go with a bank that has a good online system that shows you pictures of the deposit slip and make the tenants put their name and address on the slip.
Anyone get pushback on the online apps? I'm not nervous about visiting properties just dont want the hassle. I know a lot of tenants in Lower priced rentals dont do online banking so not sure how to force the issue there
I’m a getting my first investment property in Detroit. Let’s just say the area isn’t what I’m used to and picking up cash seems a little risky here. I’ve heard a ton of strategy’s for collecting rent on the podcast but was just wondering what you guys thought is the most efficient way.
Either require that payment be mailed to your PO box or office, or provide the tenant w/ bank and account info of a buffer account for them deposit to and for them to make note of their address/unit on the deposit slip. Driving around to collect rent is an enormous waste of time. Its also an extreme security issue since you'll be known to carry large amounts of cash when in the neighborhood.
South Holland, IL · Member since 2017 · 374 posts · 432 votes
7y
@Mouhamad Rahal
CHASE QUICKPAY
ZELLE
Have them deposit it at the bank directly into the corresponding account. Give them the account number (the bank will sell them a money order or they can deposit their own). They get a receipt and you get an electronic notification as proof.
Philadelphia, PA · Member since 2019 · 174 posts · 124 votes
7y
If you're wanting them to pay online, have them use an ACH. It beats the chance of them using a 3rd party processor using a credit card, which they can then reverse the transaction on.
If you have tenants that insist on using cash, have them use the paynearme locations to get cash turned into an online payment. That service has convenient locations at places like 7-11, family dollar, pharmacies, etc. Anyone can go in and pay with cash and you'll get an electronic payment.