Any suggestion on how to collect rent?

Question

Looking for any advices what you use to collect rent? Checks, Cash, Money Transfer, Cash apps?

Aly W. · Answer

All our tenants pay us through Zelle these days. They also have the option to go directly to my bank and make a deposit to our business account, which they all did prior to Zelle. We have never accepted checks and never will. Since we live in another state than the rentals, they cannot hand us cash and we do not allow anything to be mailed. They go to our bank, or use Zelle. All this is discussed prior to lease signing.

Bob S. · Answer

HIRE A PM CO, IMMEDIATELY

Ned J. · Answer

Electronic payment only.... if you want to submit a check, then the tenant has to directly deposit it in the bank. I use a very common bank and all they need is an account number (and I pull the $$ out of that account so there is very little balance for anyone to jack with should that acct number fall into the wrong hands) .

As for the mention of a new law about 1099's etc..... how does that screw us? Unless you are falsely reporting rental income

Konstantin Ginzburg · Answer

@John SmithI prefer digital transfers whether its a cash app or online rental portal. It's easier, more convenient, it prevents anyone from telling you "the check is in the mail".

Mohammed Rahman · Answer

Hey @John Smith - friendly advice from a fellow investor and landlord, in NYS you cannot force your tenants to use a rent-payment method that involves technology. If they say they don't want to Zelle you or use any 3rd party online platform that would make your life so much easier... they're allowed to simply pay you in cash or check. Good luck!

John Smith · Answer

@Alecia Loveless, in regard to late fees I would say it depends on the tenant. If tenant is nice, keep it clean, and its not late too offten I would let it go. If lateness is common(like it's happening every month), and is late with more than a week then Yes, have them pay late fees.

John Smith · Answer

I have no problem with tenants. We use Zelle and  we have setup automatic recurring payments. So everything is pretty much automated. However, there is a new IRS law that will require all of these apps - Venmo, Zelle to send 1099 form. Essentially,  it's screwing almost every one who uses those apps, even though it could for a different purposes (like splitting lunch). The limit is 600$ so thats pretty much almost every one. So I am wondering if any other landlords are already gravitating or considering alternative payments methods? Perhaps even more traditional payments like  -  bank transfers, checks?

Alecia Loveless · Answer

@John Smith I primarily use Venmo and checks. I have found the younger generation mostly gravitates towards Venmo while the older generation still holds onto checks kicking and screaming that they can’t use online banking technology.

I find the epayment tenants typically pay early or on the 1st but the check paying tenants don’t mail their checks until the grace period is over on the 5th and then the rent arrives in the 8th. I have a great debate each month as to whether or not I should charge them a late fee knowing the rent will be there or to just let it slide. Part of me is starting to lean towards being the A**hole and charging the late payment because most of these people have been tenants their whole lives and are just gaming the system.