Comingling rent payment

5 Replies

I recently leased a residential property that is titled in a trust. I was delayed in getting a checking / operating account set up as I needed to consult with my lawyer on the proper name that should be on the account and obtain an EiN #. While this was happening, my new tenant needed to pay rent and security deposit. He suggested using Zelle. I set up my personal account to accept and worked fine. I have since gotten my trust account set up and was advised that since it is a business account, I would not be able to use Zelle. I realize I may need to amend the rent payment agreement to come up with an alternative to Zelle. However, if I decide to continue accepting Zelle payment from tenant, can’t I just write a check from my personal account into the business account? Am I creating any commingling of fund problems. I appreciate any insight.

Jon, you need a separate account to house your security deposits and rental payments. The problem with Zelle you encountered is not with Zelle - but with your bank; not all banks/credit unions offer Zelle for all business account types. You may need to choose another institution if you want to use Zelle or find out which payment systems your bank currently accepts.

Never easy, huh?

Your tenant has zelle that means they have a bank account.  If your tenant pays bills online they can add your business to their payee list.  A bank check in the tenants name will be sent to you and it arrives in the mail.  

You can also set up your bank account to accept electronic payments and the money is in your account within 24hrs.

@Jon Pinkerton ,

A couple of solutions for your rent collection I would consider:

Software:  You can consider some of the landlord software that offers (typically) free rent collection.  A few sites do charge per transaction or require a monthly membership.  You can setup your business account and it will allow tenants to pay through ACH or credit/debit card.

Bank-to-Bank:  Zelle works great with the major banking brands but if you use a more local bank then it might not be available.  However, your tenant should still be capable of submitting a transfer to your bank account.  It might take a little longer.

Direct Deposit:  Landlords who allow cash payments often have success by providing their tenants the bank and account number.  Tenants will need to go to the bank branch and make a direct deposit into your account.  A lot of landlords feel uncomfortable with this approach but it does work.


Also, every state laws are different so it is important to check your property's state laws.  In Arizona for example, landlord's don't need trust accounts for security deposit but property managers do.  I would research to learn your states requirements.


Hope this helps!