Rent Collection in person

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Rent Collection in person

Steve K.
Specialist · PA · Member since 2016 · 143 posts · 71 votes

We recently closed on small multi family property in PA and have inherited tenants. Previous landlord went door to door to collect rents in cash or other tender and issued rent payment receipts.

I personally went to meet each of them along with previous landlord. All tenant but one were very welcoming. Let's call them a "problem tenant". The problem tenants are retired folks and are on social security. This problem tenant went on and on about issues they are facing during their current tenancy and stress it's causing them on day one. Maybe the previous landlord had different management style and was not responsive. (Property is in an urban area and rodents can get it.) Pest control was done last month by professional company and we offered to do it again (already scheduled) and fix other issues in the building. They were also not happy that the property was sold without informing them and it was not disclosed at lease signing 3-4 month ago. No other tenants had that many issues and were very understanding.

Initially, we offered online payment thru Cozy but quickly realized that some tenants would like to pay cash, check or money order. We then extended them an option to deposit rent at a local bank.

We have already received rents from all but that problem tenant (some online and some at bank). Even the tenant that we didn't expect to pay, after they discussed their job loss with me, have already paid. What a surprise.

This problem tenant insists that I must collect rent (2l Money orders) at their door, like previous landlord, and issue a receipt. Any deviation in rent payment methods causes them undue stress.

Previous landlord has her home address listed on the lease where the rent must be paid but she picked it up in person. Our bank is 2 minutes drive from where the previous landlord address listed on lease.

Since they are non responsive to my phone call before, I had to put a notice of pest control service on their door along with additional payment method with our bank information.

We have stood firm that we don't collect rent in person at their doorstep. In my opinion, it's not safe in any environment.

Is this tenant being reasonable? Are we obligated to collect rent in person and issue receipt? Also, in middle of this public health crisis? How should we approach this? Thank you

(We are predicting they will not pay rent and insist that we must collect. I hate to put notice to quit but we may have to)

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Nathan GesnerBusiness Member
Moderator
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
5y
Originally posted by @Steve K.:

Steve, I recommend you pick the rent payment up at their door, just like the last Landlord. At the same time, hand the renter a 60-day notice and kindly tell them they need to find another place to rent. No reason, no arguments, no discussion. Just get rid of them or they will continue to make your life hell. 

Can you imagine them going into the grocery store and demanding the clerk to use paper bags because that's what they're used to? Or screaming at a doctor for using a forehead thermometer instead of an oral or rectal thermometer?

Give me a break. The world changes and people need to adapt. If they want to play games, let them do it somewhere else.

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  • Suzanne PlayerPro Member
    Attorney · New York City / Long Island, NY · Member since 2020 · 597 posts · 248 votes
    5y

    Haven’t these people heard of something called the US Post Office?  Any reason they won’t just drop the check in the mail like they probably do with all their other bills?

    What about offering to let them out of their lease early?  

    I would see an attorney about this one immediately.  It’s already a problem because they are trying to impose an unacceptable condition to rent payment (a personal concierge-style service of collecting rent at their door), which you say is not in the lease.   From what you are saying they are in default on rent payment right out of the gate, and I see no reason this will get any better, and time is money.  

    Good luck

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    2Reply
  • Steve K.
    OP
    Specialist · PA · Member since 2016 · 143 posts · 71 votes
    5y

    @Suzanne Player Thanks for your reply. I predict that they will be late, grace period ends on 5th. USPS is where they get their money order, which do come with a receipt. However, they still may want a LL receipt. Also, the mail can be lost. (I have sent many money order all over the US most on mine reached.). I will give them an option for them to mail it in, let's see what they say.

    0Reply
  • Filipe Pereira
    Property Manager · Windsor Locks, CT · Member since 2016 · 1k+ posts · 1k+ votes
    5y

    Congratulations on closing on the property!

    This is pretty typical when taking over new tenants. Unfortunately, there is a lot of “tenant potty training” and hand-holding at the beginning but they usually pays off within a couple of months.

    You are doing everything that I would be doing @Steve K., and are right to stand strong regarding not collecting rent payments in person. Tell the tenant about the landlord that was robbed at gunpoint after collecting rent, and thus the reason for your policy.

    If the tenant is still hell-bent on a receipt, tell them that you will pay for tracking on the rent payment through USPS by offering a $5 discount for mailing it in. They can send it with signature upon receipt required, and will get their receipt that way. 

    We had a very old lady at our Bristol CT property who ONLY paid with tracking / signature upon receipt. It was a minor inconvenience for me to stand in line at the post office, but if that's what it takes, so be it. 

    Don't go too fast on the attorney thing, or telling them to move out - you don't have much leverage in this environment, so be wise in how you play your cards. Solve the problem (they want a receipt) and you may be able to turn it around. This sounds like something straight out of Carnegies "How to win friends and influence people" book. Great read, by the way. 

    5Reply
  • Lynnette E.
    Rental Property Investor · TN · Member since 2018 · 2k+ posts · 2k+ votes
    5y

    I have one tenant that is paid in cash with no banking who is also asking I pick up the rent.  I am trying to get him to walk the 2 blocks to the bank and deposit into my account, but he has not so far.  He seems overwhelmed.  His whole life is cash, so far I have made this exception for him.

    0Reply
  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    5y
    Originally posted by @Steve K.:

    Steve, I recommend you pick the rent payment up at their door, just like the last Landlord. At the same time, hand the renter a 60-day notice and kindly tell them they need to find another place to rent. No reason, no arguments, no discussion. Just get rid of them or they will continue to make your life hell. 

    Can you imagine them going into the grocery store and demanding the clerk to use paper bags because that's what they're used to? Or screaming at a doctor for using a forehead thermometer instead of an oral or rectal thermometer?

    Give me a break. The world changes and people need to adapt. If they want to play games, let them do it somewhere else.

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    9Reply
  • Steve K.
    OP
    Specialist · PA · Member since 2016 · 143 posts · 71 votes
    5y

    @Filipe Pereira Thank you and Thank you for suggestions. Gun point is exactly why my policy is that. My last tenant have threatened me and have shown up on my door uninvited. I have read that Carnegie book. Threatening legal action is last thing we want.

    Post office return receipt is something that never came to my mind. I can offer them $5 credit on monthly rent to reimburse them for the charges. Let's see where that goes.

    I'm documenting everything and need to because they are the type who think me and previous landlord it at fault for everything.

    @Nathan G. I have offered to let them out of lease verbally on the first day because they didn't seem happy because of issues. That may be the good outcome for all parties. They keep telling me they have right and we have violated zero.

    The lease ends mid next year. How can I ask them to leave? What if they refuse to leave?

    3Reply
  • Tracy StreichPro Member
    Real Estate Broker · Tulsa- OKC Oklahoma · Member since 2017 · 868 posts · 801 votes
    5y

    I would agree that it is not safe to collect the rent.  You should be able to provide a 30 day notice to change the place of rent receipt.   Obviously online is best but not a probable outcome in this situation.  Why not drop off 6 months of envelops with your address and stamp attached?  Hard for them to argue that is stressful 

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  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    5y
    Originally posted by @Steve K.:

    The lease ends mid next year. How can I ask them to leave? What if they refuse to leave?

    Many renters don't know they can push back. If you tell them to leave, they may accept it and leave. If they refuse to leave, just accept it and abide by the lease.

    Another option: tell them you will not be renewing their lease and they'll have to leave. Give them the option of staying until the termination date or they can leave early with no penalty. This gives them flexibility to look for something at any point between now and then. Since they know they'll have to leave anyway, they may choose to go sooner rather than later.

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  • Alexander Szikla
    Real Estate Agent · New York City · Member since 2020 · 818 posts · 639 votes
    5y

    These people are taking advantage of you. You're the owner, remember that. This is your property and you are providing a service. So long as you are being upstanding (evident with the pest inspection at all) they need to hold up their end of the deal. 

    You are the property owner/manager, not the property butler waiting on their hand and foot.

    2Reply
  • Steve K.
    OP
    Specialist · PA · Member since 2016 · 143 posts · 71 votes
    5y

    @Lynnette E. Rental properties are passive investment and we want to keep it that way. I'm here to address the real problems not wishes. SSA don't pay them cash.

    @Tracy Streich Thank you. Another good idea. Most entities accept payment by mail. Lease has the previous owner address. 

    "You should be able to provide a 30 day notice to change the place of rent receipt." What you mean by this?


    @Nathan Gesner I have verbally offered them to let them out of lease. (They said they signed with previous landlord, not me. They don't need to honor it. Sure, they don't know how contracts work). They are kind of people who talk about rights without knowing them; join rent strikes even when they are not impacted. (I can sense from my conversation with them). They also said they are not withholding rent until now. What they don't seem to realize I'm not there previous landlord. 

    If I put lease termination in writing they may ask for moving charges, by stating poor living condition, which I'm trying to avoid. (Property was inspected by local govt before settlement, they unit had zero issues. We have very strict code enforcement)


    @Alexander Szikla They are trying to take advantage. If I fall for it, they may have another demand. Most people stop at first eviction notice and let's see how far they would go. 

    0Reply
  • Tracy StreichPro Member
    Real Estate Broker · Tulsa- OKC Oklahoma · Member since 2017 · 868 posts · 801 votes
    5y

    @Steve K.   That is a provision on your lease you can update.   Say you hired a PM.   They would notify of new payment address. Same is true of a new owner.   You have to comply the terms such as lease dates and $$ amounts but with proper notice you can change the mailing address for lease payments.   Most say it is due at property address unless notified in writing of different address.   If you moved it would not be reasonable for the tenant to continue to mail it to the new owner of your house and then go collect it there.   Just give a formal written notice that rent continues to be $xxx due on the ____ and the new mailing address effective ______ will be   ______.   I would also note that if it is mailed or delivered to the old address it will be subject to a late fee.

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  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    5y

    @Steve K. I wouldn't sweat the threats. If they feel the lease is invalid because it was signed by the previous owner, that would mean they are on a month-to-month lease and you can give them 30 days notice to vacate (or whatever your state requires).

    I would probably talk to an attorney to be sure and then hit them with everything possible until they are out. I would also limit my interaction and communicate only in writing to prevent them from getting into an argument or wasting your time.

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  • Anthony Wick
    Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes
    5y

    @Steve K.. Whether they pay rent or not on time, I am getting rid of these people asap. Their problems are not my problems. I don't like these kind of tenants. There are plenty of tenants out there that are better. 

    And, btw, never collect rent in person or in cash. Ridiculous. As a matter of fact, my lease states if I have to come get the rent, or it is paid in cash, there is a $25 convenience fee. 

    2Reply
  • Steve K.
    OP
    Specialist · PA · Member since 2016 · 143 posts · 71 votes
    5y

    @Tracy Streich Thanks for that. I'll wait to see if they deposit in the bank account.

    @Nathan G. In my last conversation with them, they hung up on me; and zero issues were resolved. All I heard was fault finding and over 30 minutes of time was wasted. After my last conversation, I decided I will not communicate with them verbally. They need to leave a message for anything not urgent, even rent payment objections.

    (I even thought to record their conversation after disclosing that it's being recorded. We are a 2 party disclosure state.) That may annoy them or they may hangup. I want to have some easier way to communicate.

    I spoke with my attorney, who offered to send them a letter. I think it's too early for that.

    I'm posting notices and communication on their door to avoid false non receipt claims in future. If they are not taking this seriously, first eviction notice may set them right. (Many don't want to end up in court)

    0Reply
  • Steve K.
    OP
    Specialist · PA · Member since 2016 · 143 posts · 71 votes
    5y

    @Anthony Wick Mine too but not $25. I inherited the poorly written leases. It look like a 1990s version that never got updated. They use money orders not cash. No rent collection in person.

    0Reply
  • Account Closed
    Member since 2019 · 1k+ posts · 1k+ votes
    5y

    @Steve K.

    Zero chance I would attend, or send an on site, to collect in person. Never once. Unless your local laws state otherwise,it is generally the responsibility of the tenant to make sure rent arrives on time. There is no need to agree to a second part time job of collecting from difficult people. They can take their difficulties right on down the road. I would get what you can from them, however you can, and evict, or economically evict them if they’re late multiple times. End.

    0Reply
  • Ned J.Pro Member
    Investor · Manteca, CA · Member since 2017 · 1k+ posts · 2k+ votes
    5y

    What does your current lease state in regards to accepted payments? Even if it states that cash is acceptable, I doubt it states on how its to be transferred.

    My lease states NO CASH or CHECKS..... direct deposit only....at the bank, ACH or Zelle, Cozy, Venmo etc

    No way am I going to go door to door and pick up rent payments...... waste of my time and not safe on top of that...... if they want to pay cash, money order etc, they can direct deposit it into the local bank.... period. I don't care what the other LL did. This is the procedure...... if you don't comply and rent is not paid, then you are in violation of the lease for failure to pay rent and an eviction will be filed...... plain and simple...... put that in writing. No arguments... no debate..... no negotiations...... this is it.... don't go back and forth and try to convince them to comply.

    Worst case scenario is that I would suck it up for the next 4 months or so, pick it up and then give notice that the lease will not be renewed with the proper notice time.... no exceptions

    0Reply
  • E.S. Burrell
    Rental Property Investor · MI · Member since 2019 · 192 posts · 205 votes
    5y

    Given the times we are living in, collecting rent face to face is not an option. Too dangerous especially with this hostile tenant. Someone suggested giving him stamped envelopes which is an awesome idea.

    This “Bully” tenant is setting the tone of how he is going to act the duration of his tenancy. Old LL is probably happy he is rid of this tenant. Be humble but firm, and cordial so he does not destroy your property and do not renew the lease.

    1Reply
  • Steve K.
    OP
    Specialist · PA · Member since 2016 · 143 posts · 71 votes
    5y

    @Account Closed These folks are 30 year younger than my grandmother who is 100+ now, my GM has seen a lot in her life and has adapted to changes as we grew up. The problem tenant are being unreasonable. I have enough things to work on than to collect rent at their doorsteps. There are no local laws about rent collection and payment method. I read a CA local law (most tenant friendly state) which stated tenant cannot be forced to pay online and there must be additional options to pay. There is another option to deposit at the bank with us.

    @Ned J. That lease doesn't mention any accepted payment methods. So, they are free to pay however they want but it also doesn't say LL must collect at their door. It mentions that Tenant makes payment to: Previous LL address is stated. It also say on 15th of the month, tenant will be responsible for any legal or court fees. If I go to court and file and then they pay before the court date, I don't think would pay my filing fee with next months rent. I don't think they are collectable even if I win a judgement. If I have to file to get them to pay, I do not want them living there. I could have spent their full first month rent just to make them happy and the way it has gone so far I would not spend anything more than I need to.

    First 5 days is grace period. Lease has incremental late charges (as I said it's poorly written). I can post notice to Quit or Pay on 6th. I'm thinking to post a notice on 8 or 9th. I wanted to be courteous because they shared that one of them just got diagnosed with life threatening illness. I can give them time but I refuse to collect at the doorstep. Can the judge ask me to collect at the door?

    0Reply
  • Steve K.
    OP
    Specialist · PA · Member since 2016 · 143 posts · 71 votes
    5y
    Originally posted by @E.S. Burrell:

    Given the times we are living in, collecting rent face to face is not an option. Too dangerous especially with this hostile tenant. Someone suggested giving him stamped envelopes which is an awesome idea.

    This “Bully” tenant is setting the tone of how he is going to act the duration of his tenancy. Old LL is probably happy he is rid of this tenant. Be humble but firm, and cordial so he does not destroy your property and do not renew the lease.

     
    I don't see them doing anything to the property but you never know. They are annoying, seem very high maintenance type and I have lost my cool few times. However, I never said anything bad to them. I think their pest control requests were ignored by previous landlord initially and they seem frustrated. Previous LL spent money and put her best efforts later by hiring professional company. Those mice find their way inside these urban area building no matter how much money is spent on pest control. I don't know how clean these bullies keep their surroundings, that could be another reason for their furry friends. They want to get those living being out and none of us can control them. I told them this first time I met them, when they started to complain.


    What they are trying here is to control rent, so we have to coordinate the collection and they could refuse until all their wishes and demands are met. Plus we need listen to their whining during that process, every month.

    0Reply
  • Michael Noto
    Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
    5y

    The fact is no matter what you do you are not going to make people like this happy. Instead of focusing on the one problem tenant who is not embracing the change of ownership look at it as a good thing that everyone else seems to be on board. 

    One solution may be to put a small mailbox with a lock and key at the property and visit once a month to pick it up for anyone who chooses to use it? This way you make it easy for them and when the time comes if you need to evict they can’t claim you only provided one option to pay rent. 

    1Reply
  • Jaquetta T Ragland
    Real Estate Agent · Winston Salem, NC · Member since 2014 · 486 posts · 303 votes
    5y

    @Steve K. Dropping off at the bank is a great option so you are being reasonable.

    0Reply
  • Zachary Elliott
    Real Estate Agent · Burlington, KY · Member since 2018 · 206 posts · 232 votes
    5y

    @Steve K. I had a similar inherited tenant a few years ago who was very belligerent despite my attempts to make our relationship work for both of us. I'd do my best to stick to the terms of the lease, and offer incentives to pay via tracked mail. Worst case scenario, you just don't renew the lease. The re-training does take some time but sometimes it just isn't worth it. Our inherited tenant was living in a unit that badly needed rehabbed and was horribly under market value (if the unit was rehabbed). We ended up having to make some repairs because the place was unlivable (major plumbing issue) and did not renew. Doesn't sound like that's an option for you. 

    If the tenant doesn't end up paying and you're unsure about the best way to move forward, it would probably be worth at least a phone call to your attorney to see how he/she recommends that you move forward. Good luck with everything!

    - Zac.

    0Reply
  • Ian WalshBusiness Member
    Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
    5y

    When we were dealing with transitioning to a full 'no cash' system, we just let them know their options as opposed to them letting us know ours.

    3Reply
  • Filipe Pereira
    Property Manager · Windsor Locks, CT · Member since 2016 · 1k+ posts · 1k+ votes
    5y

    @Steve K. do you have an update as to where the tenants stand on this? You've gotten some awesome replies here and from the outside looking in, one of them should work unless your tenant is being completely unreasonable, at which point it probably makes more sense to just elect to not renew their lease, or post a notice to vacate.  

    Usually when it's this bad, it's only going to get worse. 

    If you think this is retaliation from them towards their previous landlord, do all that you can to square up any loose ends, but otherwise you have to keep things moving forward. 

    0Reply
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