Forms of payment for security deposit and 1st months rent

Minneapolis, MN · Member since 2017 · 28 posts · 26 votes

So I just accepted someone for a unit in my duplex and are having them provide certified funds for the security deposit and 1st month rent. I will then use Cozy for their regular rent payments. I then got to thinking if it is possible to use online sites like Cozy to accept those initial funds instead of the traditional certified funds. Has anyone used something like Cozy for accepting these initial funds or am I restricted to just certified funds?

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Kyle J.

Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes

@Brian Loibl I only accept cash, money order, or a bank cashier’s check for payment of the initial first month’s rent and deposit.

Cozy is great for collecting rent once they’re an established tenant, but I wouldn’t accept payment of those initial funds from a new tenant. There’s been several post on here like this one where Cozy payments were later reversed. It’s rare but it has happened, and you don’t want to take a chance with a new tenant who’s unproven.

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Bjorn AhlbladPro Member
Investor · Shelton, WA · Member since 2017 · 6k+ posts · 6k+ votes
6y
I only accept certified funds to collect move-in fees. Other forms of payment will take time to clear.
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Kyle J.
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
6y
@Brian Loibl I only accept cash, money order, or a bank cashier’s check for payment of the initial first month’s rent and deposit.
Cozy is great for collecting rent once they’re an established tenant, but I wouldn’t accept payment of those initial funds from a new tenant. There’s been several post on here like this one where Cozy payments were later reversed. It’s rare but it has happened, and you don’t want to take a chance with a new tenant who’s unproven.
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Kim Meredith HamptonBusiness Member
Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
6y
@Brian Loibl we only take first months rent via certified funds, they could easily reverse those funds. That’s the downside of collecting online, credit card, debit card etc... they can reverse funds on you, but they can also bounce a check too. It’s all a gamble no matter how you look at it, crazy times....
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Michael Noto
Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
6y
From what I know of Cozy it takes time for funds to clear into your account and the tenant can actually reverse payment once it has been submitted. Actually have a client who got screwed because of the latter.
Always collect move in money via certified check, money order or a merchant processing system that does not allow the tenant to reverse payment.
Once they are tenants I'd be more open to cozy, personal check, etc..
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Brian Loibl
OP
Minneapolis, MN · Member since 2017 · 28 posts · 26 votes
6y
Thanks everyone for your responses and sharing WHY it's not a great idea to take anything other than certified funds for the deposit and 1st months rent. I have since received the certified funds from them and I look forward to receiving the monthly payments via Cozy.
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