Accepting rental payment: What are my options??

22 Replies

So I'm pretty excited my closing date is quickly approaching for my first rental property! But I need advise. 

Like many have suggested, I plan to play the role of the property manager when interfacing with tenants. I do not want tenants thinking of me as the owner. This would be hard to pull off if they're writing checks out to me! I have thought about forming an LLC to help with the obfuscation but I don't know if that's something I should do immediately.

Would it be easiest to simply form an LLC and associate a bank account with it since that's what I plan to do in the future?

What are the ways??

Just be honest with your tenants because one day they might ask are you the owner, and I don't think you should lie to them because you don't want the tenant lie to you. See what is the best option for your tenants to pay and allow them to do so.


Joe Gore

A tenant will likely be able to find out who owns the property.  I agree with Joe in just being honest and straightforward.

I used to have tenants send rent to my home address, but as my business has grown I no longer do that.  I use a post office box, or let them pay online.

@Justin B.  

I don't recommend not telling the tenants that you are the owner.  That is my personal opinion.  I have a property manager who plays bad cop.  He's really annoying, so I can be the nice owner, but threaten them with him if they don't play nice.

LLC works nicely. Then your tenants can write checks to ABC, LLC and they'll never know. Keeping a separate banks account is a boon because it allows you to balance your books up to the minute. Never bounce a check again :) Make sure the bank has online interactions because that is the way most people are headed.

I agree with everyone, be honest with your tenants.  The last thing you want is for them to feel that you are dishonest, they may reciprocate that dishonesty to you.  I've had tenants send the money to my home address.  

However, there are sites out there where they can take care of that.  BP markets the service PayNearMe and there is also Sparkrent.  I haven't used them, but I've heard good things about them.

Yeah I guess you're right. I wouldn't want to get caught in the middle of fibbing. I have a hard enough time keeping secrets around Christmas time. :)

I've been afraid of any extra nuisance that may come up with the tenants having that information. There's nothing in particular that I was trying to avoid. 

So checks written to me personally is totally the norm? Maybe I'll take that advice and get a PO Box. It might freak my wife out that strangers know where we live. She's pretty wimpy. But then again almost everything is public info. People could find out where we lived if they really wanted to. 

All of my tenants know I'm the owner, and it's never been an issue before.  I don't like to lie, and I think people wouldn't appreciate being lied to either.  Also, I'm the worst liar ever, so I wouldn't do it. Just wanted to add my name to the long list of people who would say not to do it! ?

All of my tenants know I'm the owner, and it's never been an issue before.  I don't like to lie, and I think people wouldn't appreciate being lied to either.  Also, I'm the worst liar ever, so I just wouldn't do it. Just wanted to add my name to the long list of people agree! ?

All of my tenants know I'm the owner, and it's never been an issue before.  I don't like to lie, and I think people wouldn't appreciate being lied to either.  Also, I'm the worst liar ever, so I just wouldn't do it. Just wanted to add my name to the long list of people agree! ?

All of my tenants know I'm the owner, and it's never been an issue before.  I don't like to lie, and I think people wouldn't appreciate being lied to either.  Also, I'm the worst liar ever, so I just wouldn't do it. Just wanted to add my name to the long list of people agree! ?

All of my tenants know I'm the owner, and it's never been an issue before.  I don't like to lie, and I think people wouldn't appreciate being lied to either.  Also, I'm the worst liar ever, so I just wouldn't do it. Just wanted to add my name to the long list of people who agree! ?

All of my tenants know I'm the owner, and it's never been an issue before.  I don't like to lie, and I think people wouldn't appreciate being lied to either.  Also, I'm the worst liar ever, so I just wouldn't do it. Just wanted to add my name to the long list of people who agree! ?

Originally posted by @Dawn Brenengen:

All of my tenants know I'm the owner, and it's never been an issue before.  I don't like to lie, and I think people wouldn't appreciate being lied to either.  Also, I'm the worst liar ever, so I just wouldn't do it. Just wanted to add my name to the long list of people who agree! ?

you can say that again :)

all jokes aside... be honest and learn to say NO as comfortably as saying YES. In the end, you play a key role in determining the relationship that you have with your tenant. Firm but Fair is my policy

Sebastian

I don't think it really matters if they see you as owner or not. However, setting up an individual Llc for every property is wise for legal and liability purposes. I always use the property address as Llc name so I don't have to get creative with every property I acquire.

OMG! When I posted from my laptop, the page kept showing an error, so i tried a few times. I could never get it to post (or so I thought). Then I opened my iPad, and apparently it worked EVERY time. Sheesh....is there a way to delete your own posts? How embarrassing :O

Originally posted by @Dawn Brenengen:

OMG! When I posted from my laptop, the page kept showing an error, so i tried a few times. I could never get it to post (or so I thought). Then I opened my iPad, and apparently it worked EVERY time. Sheesh....is there a way to delete your own posts? How embarrassing :O

 The same thing happened to me, only it posted like 15 times and in some really weird format(top that). I think the Mod removed them for me. Safe to say that it happens to everyone at least once! Cheers

Sebastian

You can always just file a DBA and open a bank account for your DBA if you're not ready for the expense of an LLC.

I get why you would rather the tenants not know you're the owner. It's easier to be good cop and blame corporate as bad cop. It's never my fault when I have to give the tenants a memo or correct condition notice. It's always...code enforcement, insurance company, my boss at the management company, etc. 

If a tenant ask are you the owner, and you lie the tenant will lose trust in you, and then you will need to lie again to cover up the last lie. Now would you rent to a tenant who lied to you.


Joe Gore

We have just one rental tenants know we own & our also the landlords and make checks out to us.  Ownership is documented at tsx assessors office and is public record so if you own property people know where you live.  This is our firdt and only investment so far.  Just be upfront about everything pertaining to the rental agreement you are getting into with them.  #1 Our first mistake was allowing our first tenants to make a deal because they didnt have deposit.  -Lesson learned if they are trying to make deal to get into property move on to screening other possible tenants.  As long as your rental is priced right a good tenant will have all the money they need to move in as well as adequate income to pay rent in full and on time.  Another red flag we encountered were those that said "we have to have another place by ..." (within a few days)- not good you know when your lease is going to be up. - a good tenant would have already had a place and be all but moved in. Treat it like a business and good luck.

certain things are not meant to be discuss but if your tenant ask you a simple question just answer it the best way you can..or just let your property manager do the answering!

I would sign up for Williams Pd and let them.pay you monthly that way. It's free for them.and can report to credit bureau which increases the chance of cashing out at any time. 

All of my tenants know I'm the owner, and it's never been an issue before.  I don't like to lie, and I think people wouldn't appreciate being lied to either.  Also, I'm the worst liar ever, so I just wouldn't do it. Just wanted to add my name to the long list of people who agree! ?

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