Having tenants pay for rent on a website.

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Having tenants pay for rent on a website.

Anthony Wienke
Missoula, MT · Member since 2016 · 163 posts · 55 votes

I know I could have tenants pay for rent on my own website but is it even worth it?

The negatives im thinking about are a credit card processing fee, payments to keep the website up and running, and just another headache to deal with.

I could charge a processing fee to have tenants pay online but with the other two issues mentioned above im not sure.

I guess there's no problem to wait for checks to arrive in the mail or have them handed to me personally. Just didn't know if letting tenants pay online was a convenient way for them to pay for rent.  Is it worth it?

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Jim Adrian
Architect · Papillion, NE · Member since 2015 · 1k+ posts · 840 votes
10y

Have you looked at www.erentpayment.com as they have a small fee for checks rather than 3% each time.

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  • Mo Sheikh
    Investor · Houston, TX · Member since 2015 · 29 posts · 18 votes
    10y

    You can always have your tenants use the bill pay feature from their bank to pay the rent. I know a number of landlords who do this and don't have to pay a fee.

    If you step up your own website and payment portal you will have to pay CC and/or ACH fees. Not worth the trouble in my opinion.

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  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    I sort of figured it wasn't worth the hassle, just trying to make the renting experience for tenants easier and didn't know how others handled rent payments online.   

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  • Nathan MillerPro Member
    Property Manager · Grants Pass, OR · Member since 2009 · 429 posts · 201 votes
    10y

    Hi @Anthony Wienke - it would be normal (in most states) for the tenant to pay any CC processing fees which average about 2.75%.  You might also consider ACH as it's usually a fixed rate of about 50c no matter how much the tenant is paying.  ACH is a far more convenient and popular option for rental payments in our industry.

    Here's an article our staff wrote about ACH vs Check last month that might help you make up your mind:  https://www.rentecdirect.com/blog/2016/05/ach-vs-checks-better/

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  • Josh Auerbach
    Investor · Vancouver, WA · Member since 2016 · 4 posts · 1 vote
    10y
    *********** is a hassle free site and includes ACH debit for collecting rent. The $3/transaction fee can be charged to the tenant, although I typically pay it so as not to nickel and dime.
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  • Jim Adrian
    Architect · Papillion, NE · Member since 2015 · 1k+ posts · 840 votes
    10y

    Have you looked at www.erentpayment.com as they have a small fee for checks rather than 3% each time.

    1Reply
  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    @Nathan Miller

    That's was a great article, I appreciate you showing me that. ACH seems like a better way to collect rent payments at the tenants convenience.

    Although, looking at it from a renters perspective on getting ACH set up it seems like a hassle at first. Also, it makes me un easy thinking about someone else digging into my checking account for rent payment. 

    Would providing a new tenant with instructions for setting up ACH payments you think get more renters on board with the plan? Given that I try to sell the safety, security, and ease of the ACH payments.

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  • Nathan MillerPro Member
    Property Manager · Grants Pass, OR · Member since 2009 · 429 posts · 201 votes
    10y

    Hi Anthony, including setup instructions at the time of the lease, and even possibly an incentive to use ACH, is a great way to get people enrolled.  A lot of landlords will offer $10/m discount for 6 months to get somebody enrolled just because the automated nature of ACH saves them so much time the $60 cost is nothing.  Plus I've seen plenty of evidence in my own rentals, that the tenants that setup on ACH stick around longer because they don't have to write a check or think about the big rent payment every month.  It's the same reason utility companies and mortgage companies use ACH.

    I haven't really had much pushback from tenants on putting their checking account info out there.  It's only the tenants that maintain an extremely tight checking account balance that have troubles with it, and those aren't the ones you want to rent to anyways probably.

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  • JD MartinBusiness Member
    Moderator
    Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
    10y

    Make life simple. I use Cozy (cozy.co) and Erentpayment (erentpayment.com) . No need to reinvent the wheel here. Cozy is free if they set it up on ACH on auto draft. Erent lets them do one at a time but charges $3 (to the tenant, as per my lease). Either way works for me and both get my money to me simple. 

    Nobody's digging into your account if you set it up right. I have a dedicated account, money flows into that account from the tenant, I do an online transfer immediately into another account. Even if someone could hack that account, there's nothing for them to get. 

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  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    @Jim Adrian @JD Martin @Nathan Miller @Josh Auerbach

    I think the e rent payment service looks pretty good! The only question I have about it is do I have to have my own dedicated website for erentpayment to work or can tenants just go straight to erentpayment online and pay there once I have everything set up?

    Nathan I like your 6 month discount idea, makes it a great way to get tenants started with online payments.

    Josh Auerbach, I couldn't see the website name you were trying to show me. It was blocked probably because your a new member but im assuming you were talking about e rent payment.

    Jd Martin, I also like the Cozy.co website and its added tools that looks like it adds a lot of value. Im torn between the two (erentpayment & Cozy.co) but im starting to lean towards the cozy.co.

    Great advice everyone, didn't think this forum would be that informative!

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  • JD MartinBusiness Member
    Moderator
    Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
    10y

    Nope, you go right through their website. 

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  • Rick S.
    Fort Collins, CO · Member since 2014 · 397 posts · 161 votes
    10y

    @Anthony Wienke if you decide to use our service the tenants can go directly to our site to register and submit payments as we have two ways to sign up tenants:

    1. We provide an email with instructions that you can forward to the tenants if they are registering online on their own.

    2. Or we have an Automatic Authorization form the tenant can sign and the form is then sent to us and we set up the recurring payment in our system.  This is great for tenants that don't have online access or may not want to set up on their own.

    So either option would work.  Please let us know if you have any other questions as regardless of which service you end up with ACH payments are a great option!  

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  • Dustin Verley
    Wholesaler · Newark, DE · Member since 2015 · 303 posts · 80 votes
    10y

    My take is you could always go with a third party. When it comes to processing, it would only make logical sense if you have quite a few renters. As mentioned, there are quite a few investments that need to be made.

    1. Website hosting (Pretty affordable, but typically requires a VPS or Dedicated server which can normally run anywhere from $30) -

    2. Someone to manage your website and/or server (optional, you could do this but can be time consuming sometimes)

    3. Merchant account (processing fees)

    4. SSL certificate (required, can range from as low as $25 yearly to as high to a few thousand, depending on how secure the encryption level you want)

    5. Dedicated IP (web hosting add on, only costs a few extra dollars, but is required for the SSL certificate.)

    All in all, the fees add up but the managing of your own allows for much more flexibility. I wouldn't suggest it at the start or for only a few rentals.

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  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    @Dustin Verley

    I only have 23 units with a future possibility of that number growing to 27. The website thing does sound like a waste of money unless im operating 50+ units in multiple cities. Im just thinking about marketing my rentals to possible tenants but I guess that's what all those rental and home buyer websites are for.  Or craigslist for a quick and simple listing lol

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  • David Goossens
    Investor · San Jose, CA · Member since 2015 · 76 posts · 64 votes
    10y

    I just talked to a friend of mine. His tenants pay him with an app called Square Cash. It's suppose to be pretty easy to setup and use.

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  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    @David Goossens

    Its a great way to get paid fast but it charges the person receiving payments the processing fee. My rents range from $500 to $700 and if im renting every single apartment that's $426.25 a month in fees so Ill have to pass on that app.

    Regardless, I appreciate that you mentioned it David. Obviously Ill always check out everything people recommend to me.

    0Reply
  • Jason Hartley
    Vancouver, WA · Member since 2016 · 230 posts · 161 votes
    10y

    @Anthony Wienke - I've been really happy with Rentec Direct doing my ACH processing, they handle it end to end and provide my tenant a site to login and make one time or recurring payments.  I have about a 60% conversion rate of tenants that used to pay by check or cash to now paying by ACH through Rentec's system.  Cool thing is, when the payments happen it automatically updates my accounting so it's really hands off for me.

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  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    @Jason Hartley

    Another great site for rental payments!

    Im going to have to start writing names and sites down in a property investment journal. Just a few days on this site and I know more now than I did a month ago.

    Again, thanks to everyone for all the suggestions and opinions.

    1Reply
  • Dawn AnastasiPro Member
    Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
    10y

    I use Cozy to have my tenants pay online.  I now try to get EVERY tenant setup on Cozy, if they have an email address.  (I have a few older tenants that don't have email addresses.)  Even if they don't pay online right away, they can use it as a portal.  I've recently had someone who was paying manually for a while start to pay online.  Sometimes it takes a bit for someone to get comfortable with technology.

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  • Chuck MastersPro Member
    Investor · Bel Air, MD · Member since 2015 · 95 posts · 57 votes
    10y

    I love erentpayments. If you are dealing with younger more computer savvy tenants they want to use electronic means for paying the rent. Few may not even use checks to pay for services and goods. 

    I've been looking for a more robust way to do the initial rent application and background check with one service rather than using 2 different service providers.

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  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    @Dawn Anastasi

    "(I have a few older tenants that don't have email addresses.)"

    As much as it pains me and my insurance rates to say this, my rentals are aimed for college students. Don't think I have ever come across a college student that didn't have or know how to use email lol.

    But there is that off chance that someone doesn't use email. I can always keep accepting physical checks.

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  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    @Chuck Masters

    Funny, when you think about it the only thing people really use checks for now a days is to pay for rent hahaha

    That and the old lady's of the world that cut in front of you and use them at the check out counter to pay for $5.00 of goods lol jk

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  • Dustin Verley
    Wholesaler · Newark, DE · Member since 2015 · 303 posts · 80 votes
    10y

    @Anthony Wienke

    Ultimately, it comes down to your business objectives and what you're wanting to achieve. There really is no set standard to how many unit needed for a website. However, having a website can make things a bit easier and some businesses (not necessarily real estate per se) utilize their website as a marketing tool. You can also look at it as a convenience option for tenants to pay their rent online, answer questions online, manage issues, etc. But all this can be accomplished from hosting your own website typically. Or, if you just want them to pay rent, again, you can use a third-party service.

    At the end, it's completely up to you and what the objective of your business is.

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  • Anthony Wienke
    OP
    Missoula, MT · Member since 2016 · 163 posts · 55 votes
    10y

    @Dustin Verley

    I think ill just skip on the website for now and use either Cozy or e rent payments to accept payment from renters. The big selling point for me any way is the quicken type integrations that keep track of incoming payments received so its all nice and tidy come tax time. I believe both of those services do that unless someone knows more about it.

    Ill be using a third party management company to keep tabs on the property while im not around. Unless im mistaken I believe they have there own websites with SEO, tech support, and just about everything else to get my open units advertised online. 80% of people looking for a place to rent jump onto their computer or mobile device to find it, I want to make sure im getting my open listings exposed to that crowd.  

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  • Kiran Rouzie
    Los Angeles, CA · Member since 2016 · 18 posts · 3 votes
    10y
    Anthony Wienke - I own a web design company, including expertise in e-commerce integration, SEO, social media, email marketing and streaming media integration. If you choose not to create a site and integrate a payment processing application (e.g. Square, PayPal, ACH), I'd recommend cozy, e-rental or wiliampaid (if they still exist). Otherwise, another great options - If you use Intuit QuickBooks, they have an electronic payment option. I use it and find it convenient that it integrates easily into my overall business financial records and makes it easy for tax filing. Super easy for the user, too. They receive invoices and can pay electronically and securely online. You can also add late or processing fees this way as well if you need to but it doesn't cost you or them anything.
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  • Dustin Verley
    Wholesaler · Newark, DE · Member since 2015 · 303 posts · 80 votes
    10y

    @Anthony Wienke

    Again, it's all about ones business objective, therefore, if a website isn't necessary then don't spend the money on it. :)

    Best of luck.

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