All Forum Posts by: Nathan Miller

@Charlie McClskie - Shawn makes some excellent points here and that's good info to get you started.  I might disagree with him on the Excel part though.  While Excel might help you with the calculations, you are on your own because if you call Microsoft they know nothing about managing a property.  On the other side, if you get a software program designed for landlords, their support folks also know landlord specific accounting practices.  So basically, choose the right software (one with amazing customer service) and you more-or-less get free landlord training with it as their reps are going to be supporting thousands of other landlords just like you.

Also, a landlord specific software is going to keep your records straight so when tax times comes you'll save far more in preparation fees with your CPA than what the software costs you.  

I also believe it's important to offer the same tools to your renters that the other landlords in the area are, like ACH payments, an online portal, etc.  These are all things that come with landlord specific software and not with Excel or QB.

That said, congratulations and good luck on your new venture!

@Valente Sosa - Just noticed you are from Medford!  Hi neighbor!

@Valente Sosa - As Steven said, Xero is an option if you only need accounting.  But if you are handling rentals there's a lot more to consider.  Can the solution you choose provide your tenants with an online portal to make payments or submit maintenance requests?  Can it check credit and criminal history of new clients?  Does it provide you a website to promote your vacant listings and accept online applications?  And does it support the BP community in any way?

While nobody can argue both QB and Xero do what they do well (generic accounting), it's a pretty solid consensus here on BP that landlords are better off using software designed specific for landlords.  There's a number of landlord specific programs that offer free trials so you can definitely try before you buy with most of them.

Whatever you choose, it's difficult to move from a platform once you are into it.  So be sure to evaluate carefully before making the jump.  I usually recommend calling the support line of the software you are evaluating to see if a real human answers your questions intelligently also and understands your business.  It's maybe a couple hours of research up-front, but will save you hundreds or thousands of hours down the road.

@Victoria S. - Yes, I think with credit card payments it is 6 months.  Paypal terms of service change so frequently though I wouldn't date guess what it is with them right now.  I personally have no experience with them for rental collections, just stories I've read.  I feel like there was a forum on BP about it at one point where lots of people had both good and poor experiences with it.  Either way, your money is completely out of your control with paypal and I don't like that when it comes to large payments like rent.

@Abdul Azeez - Once you recognize how easy it is for somebody to print a forged check and/or just do an ACH once they know your account number, you will never allow anybody to know your account # again.  While your bank ultimately would (probably) cover any fraud like that, wouldn't it be alarming if you checked your bank account balance and it was zero tomorrow?  This is why ACH is great for landlords, they don't need to know your account number, nor make a trip to the bank.

I like to look at it from an interest perspective.  Would the money you use to pay them off earn you more if you invested it?  If you can invest it and make 8%, and your real-estate loans are at 5%, you would be 3% better off investing the money instead of using it to pay off your loans.  Of course most investments are not guaranteed, so that's a more risky, but possibly more rewarding way to go.

Of course tax consequences exist too.  You get a write-off for your interest paid right now that you would no longer get if you paid them off.

I think the people who want to sleep soundly at night opt for the debt free methodology.  Those who want to earn more in the long-term maintain and leverage the debt (amidst the nightmares of market crashes, etc..).

@David Stone - Direct deposit, aka ACH or eCheck.  Your best bet is usually to use whichever ACH platform your software supports.  Most of the modern property management software platforms also include ACH.  If you are not already using software specific for property management, you most likely will someday (because traditional or manual accounting is a terrible time sink for landlords).

Jon, might look at the NARPM property manager search.  I don't see any in Akron specifically but there are plenty nearby.

http://www.narpm.org/find/property-managers/?submitted=true&toresults=1&resultsperpage=10&a=managers&orderby=&fname=&lname=&company=&chapter=&city=Akron&state=OH&xRadius=52&cert=

@Charlie Gruber - I've heard of many landlords having issues with venmo/paypal when it comes to chargebacks.  These companies are just too large for a landlord to be able to work with to prove the rent was justified.  They won't ever read a rental agreement - or even a paragraph for that matter because it's easier for them to just return the money to the consumer and let you deal with it in court (sad but true).  I think it's better to work with a merchant provider that is used to dealing with landlord related payments which tend to be larger than the average consumer purchase on paypal.

@Sam LLoyd - not all the landlord specific applications out there that provide ACH are as expensive as buildium either. ;)

@Account Closed - I agree $3 is pretty high for a ACH payment, but let's just assume worst case that was the normal cost (it's really more like 50c though).  Does it really make sense to suggest that a money order or cash is cheaper for the tenant?  No matter what way I look at it if the tenant even makes minimum wage and gas is cheapest in the country they are spending a huge magnitude more in time and gas using the old fashioned method of hand delivering money orders and checks than going online to make a payment.  Even if they mail it, a stamp costs more than an ACH payment too.

Not to mention now that you as a landlord have to take the payment to the bank which is time out of your day.  If the tenant saved themselves the hassle of driving around and made the payment online it saves both tenant and landlord all the time dealing with the payment since ACH is deposited directly into the landlord's account.

Interestingly, look at everybody jumping to the tenant's defense on the Portland news site KGW and blaming the situation on the landlord.

http://www.kgw.com/news/tenants-leave-behind-25-tons-of-trash-at-portland-rental-home/177131842