For you or not for you: Electronic rent collection

General Landlording & Rental Properties
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For you or not for you: Electronic rent collection

Justin HennigPro Member
Investor · Minneapolis, MN · Member since 2013 · 59 posts · 11 votes

I'm a landlord pondering electronic rent payment... I love automation in business and this seems to be a no-brainer but I understand many landlords have not adopted it. There are lots of options, so it's a little confusing with all of them...

Here are a few quick questions:

1) If you personally don't use electronic rent collection, why not (or why not yet?)

2) If you use electronic rent collection, which do you use and why?

3) What features do you like?

4) What would you change or add to the service you use (or would use if it had this feature) if you could?

Bonus question: What else would you (or do you already) automate in your landlording and/or real estate business if you could?

Thanks for any responses...very much appreciated!

Justin

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David Klick
Homeowner · Overland Park, KS · Member since 2013 · 20 posts · 11 votes
13y
Originally posted by Shaun Reilly:
Originally posted by Tom Goans:
@Justin Hennig,
I am older and understand the younger generation is hooked on automation and technology, thus avoiding work - yes I said it.

Ding Ding Ding!!!!

I want to avoid doing work that are superfluous non value added tasks like going to the bank to make deposits, going to a rental to collect rent, or checking in with the residents if the payment isn't in on time.

Exactly. It has nothing to do with avoiding work.

That's like saying that driving a car is LAZY, and one should only ride horses and buggies as they did 100 years ago.

Technology is here, and there are PLENTY of ways to stay connected to your tenants, including birthday cards, Gift Cards for when they pay early each month, Xmas cards, etc.

Don't cut off the nose, to spite the face. Welcome to productivity and results in the 21st century.

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  • Mary Ann Casey
    Lafayette, CA · Member since 2013 · 91 posts · 45 votes
    13y

    I accept rental payments electronically into my bank account, and I also accept payment via cash (with a written receipt when the cash is received and verified), cashier's check, or personal check (I enforce a $50 penalty fee for bounced checks and $50 for the late fee payment that will likely result if the personal check bounces).

    My preferred method of receiving rental payments is via direct/electronic deposit to my bank account. That way, I'm sure the funds are good, and the tenant receives either an online verification (receipt) of the rent payment or a printed receipt if he/she goes to the bank to deposit the rent payment due. This option means "I DO NOTHING" to collect rent. :)

    1Reply
  • Account Closed
    Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    13y
    Mary,

    What part of California is Lafayette?

    Joe Gore
    0Reply
  • Mike S.
    Rental Property Investor · Huntsville, AL · Member since 2013 · 419 posts · 323 votes
    13y

    I notified my tenants last month that I would accept Dwolla as payment. Unfortunately, I am thinking this was a mistake. Best case scenario would have been 5 business days for funds to show up in my account(3 days to Dwolla, 2 days to my account). Here I am on the 5th business day and the first payment still hasn't processed. At this rate, it will be 2 weeks before I have the funds in hand.

    0Reply
  • Will Bradford
    Jefferson City, MO · Member since 2012 · 34 posts · 6 votes
    13y
    I use Intuit. I have two properties and both tenants love it. My pros are that I have recurring payment set up, I get an email at the exact time that they pay, and I don't have to worry about lost checks. It does take a couple of days for the transfer to complete but if your running that lean your in trouble anyway.
    0Reply
  • Account Closed
    Vancouver, British Columbia · Member since 2013 · 7 posts · 0 votes
    13y

    It does seem like offering options is the best bet, unless all your tenants are at the same level of tech sophistication. Although some of the services out there are really easy to use. We've been looking at ProPay, which allows for credit/debit payments including by mobile, and once you're set up you can just text back a number (e.g. Pay 800) and it's done.

    0Reply
  • Scott W.
    Real Estate Investor · chicago, IL · Member since 2012 · 1k+ posts · 231 votes
    13y

    chase quick pay. for those that have chase. It sends me a text or email that i have $ coming and I, literally, just press the accept button and the $ is in my account the following morning.

    all you need to give the tenant is your email address. downside is they have to be with chase.

    but more banks are going this way and I think they're working towards doing wires to each other free astray.

    0Reply
  • Rob K.
    Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
    13y
    Originally posted by Dawn Anastasi:
    My tenants drop rent off at my house. They can see that I don't live in a mansion and my house doesn't look really any fancier than theirs. (At least on the outside.)

    I cannot stress enough what a bad idea this is. I HIGHLY recommend that you rent a post office box and have all future tenants send payment there or use an electronic means. It's just a matter of time until you deal with the wrong psycho. A huge percentage of the population is crazy. They seem normal at first because they are on medication to treat the symptoms instead of the problem. Eventually, they will go nutty. Best case, your house is vandalized. Worst case, they are rapist/murderers.

    You are way better off keeping your business and home life's separate. I'm sure a tenant could find you eventually, but it's extra steps. I've never had a tenant show up at my house for any reason. If I did, they would feel what elbows do to teeth (best case) or meet Mr. Glockenspiel (worst case).

    I'm not picking on you. I would recommend everyone do this and also have an unlisted phone number if you're a dinosaur like me that still has a land line at home. Personal safety should be a high priority whenever you deal with the general public.

    2Reply
  • Chris Feltus
    Residential Real Estate Agent · Fort Worth , TX · Member since 2012 · 211 posts · 152 votes
    13y
    Originally posted by Rob K:
    Originally posted by Dawn Anastasi:
    My tenants drop rent off at my house. They can see that I don't live in a mansion and my house doesn't look really any fancier than theirs. (At least on the outside.)

    I cannot stress enough what a bad idea this is. I HIGHLY recommend that you rent a post office box and have all future tenants send payment there or use an electronic means. It's just a matter of time until you deal with the wrong psycho. A huge percentage of the population is crazy. They seem normal at first because they are on medication to treat the symptoms instead of the problem. Eventually, they will go nutty. Best case, your house is vandalized. Worst case, they are rapist/murderers.

    There must be something in the water for your tenant pool.

    1Reply
  • Rob K.
    Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
    13y
    Originally posted by Chris Feltus:
    Originally posted by Rob K:
    Originally posted by Dawn Anastasi:
    My tenants drop rent off at my house. They can see that I don't live in a mansion and my house doesn't look really any fancier than theirs. (At least on the outside.)

    I cannot stress enough what a bad idea this is. I HIGHLY recommend that you rent a post office box and have all future tenants send payment there or use an electronic means. It's just a matter of time until you deal with the wrong psycho. A huge percentage of the population is crazy. They seem normal at first because they are on medication to treat the symptoms instead of the problem. Eventually, they will go nutty. Best case, your house is vandalized. Worst case, they are rapist/murderers.

    There must be something in the water for your tenant pool.

    It's all fun and games til you're duct taped in a trunk........

    2Reply
  • Scott W.
    Real Estate Investor · chicago, IL · Member since 2012 · 1k+ posts · 231 votes
    13y

    @Rob K. if they're that motivated, couldn't they find you no matter what? all transactions are public information.

    0Reply
  • Rob K.
    Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
    13y

    @Scott W.

    I suppose anyone can find you if they look hard enough. I use a P.O. box for everything. The P.O. box is located near most of my rentals and I live a good 10 miles away. If you're used to having tenants show up at your house, your guard will be down if things go bad. I've never had someone come to my house in the 18 years that I've been doing this. If they did show up, I would know that it's "code red".

    There was a landlord in Detroit a few years back who was murdered by his tenant's dad over a few hundred dollars. Ever since then, most landlords have upped their security. You can never be too careful. Almost every investor I know carries a gun, as do most contractors.

    0Reply
  • Shaun Reilly
    Landlord and Rehabber · Newton, MA · Member since 2010 · 2k+ posts · 877 votes
    13y

    I think it is a bit of paranoia to think your tenants or their families will hunt you down and murder you I do agree that it is not a great idea to let them know where you live and certainly not just have them come by.

    You would hope that the homicidal maniacs will get screened out before you rent to them, but I can see the possibility of vandalism or just a little harassment being a much more likely issue.

    I use a PO Box for all my rental and other real estate business stuff.

    If I were to do it again I would do the thing where you can get the PO Box # as like a "suite" at the Post Offices address as you do get a fair number of crap forms where they ask for an address and "No PO Boxes" BS.

    0Reply
  • Aly W.
    Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    When serving evictions or any notices where a physical address instead of a P.O. Box is required, I use a friend's address, which is in a secured building. The lobby has a guard and the doors to the residence area are locked.

    If one doesn't have a friend in a situation like that, then consider a business address, i.e., "virtual office". Or ask a friend who might work in a secure office building. But never give your address voluntarily.

    0Reply
  • Jimmy MoncriefPro Member
    Chattanooga, TN · Member since 2010 · 319 posts · 100 votes
    12y

    @Tyler Blackwell I have tried using Dwolla and it is very confusing for the tennant and takes a while to set-up

    Podcast Guest on Show #55
    0Reply
  • Account Closed
    Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    12y

    Whatever happen to letting the tenants pay by money order or check and drop it in the mail. It look like all the new land lords want to go high tech on old fashioned tenants.



    Joe Gore

    0Reply
  • Kevin C.
    Investor · McKinney, TX · Member since 2009 · 405 posts · 160 votes
    12y
    Originally posted by Scott W.:
    chase quick pay. for those that have chase. It sends me a text or email that i have $ coming and I, literally, just press the accept button and the $ is in my account the following morning.
    all you need to give the tenant is your email address. downside is they have to be with chase.

    but more banks are going this way and I think they're working towards doing wires to each other free astray.

    I use Chase's QuickPay as well. Tenants do not have to a Chase account to use the service. Money is in my account quicker when they have a Chase account, it takes a few days when they don't have a Chase account.

    Either way, it works, and it's free.

    Down side is the delay in getting funds from those tenants that do not have a Chase account.

    0Reply
  • Cuong Le
    Investor · Houston, TX · Member since 2013 · 228 posts · 30 votes
    12y

    There are no right or wrong answers here. Some tenants requested for online payments since it's more convenient for them so we did. We have some tenants where they prefer mailing in their check which is fine too. What ever makes it easy for the them should be the focus.

    If most of your tenants don't have bank accounts, it won't matter that you setup an online payment. Yet if your tenants can and are willing, why not make it easier for them and for you by offering online payments.

    I haven't used this technique but if you open a "dummy" bank account, tenants can deposit their rents into that account directly. No worries about tenants setting up anything and no excuse that their rent check "got lost". They can go to the bank any where near them and their deposit receipt is their payment receipt.

    0Reply
  • Tyler Blackwell
    Rental Property Investor · Olympia, WA · Member since 2010 · 127 posts · 76 votes
    12y

    @Jimmy Moncrief

    Thanks for the response. I'll stick to something more established. Some others have mentioned Chase QuickPay, which might work as well. I appreciate the feedback!

    0Reply
  • Piotr Komorowski
    West Palm Beach, FL · Member since 2014 · 2 posts · 0 votes
    12y

    Hello everyone,

    As I was browsing the Internet I came across this forum. What a great resource! I was particularly interested in discussions about electronic rent payment systems.

    I see that some of you use it, some don't. I'm not a landlord (I used to have a small investment property) but I'm very interested in this subject on the other end, as a service provider.

    I am researching deeply this subject and would love your input. I know that most of the landlords still collect payments the old way. As I discovered, there are some solutions out there that seem pretty convenient for both tenants and landlords.

    What prevents you from using them? Are there any features missing? If you already use them what would you change about them?

    Please rest assured, I'm not trying to sell you anything, as the service/product doesn't even exist yet. I am just doing the market research.

    I would greatly appreciate if you could share your thoughts with me.

    Piotr

    0Reply
  • Brie SchmidtBusiness Member
    Moderator
    Real Estate Broker · Chicago, IL · Member since 2013 · 6k+ posts · 5k+ votes
    12y

    2) If you use electronic rent collection, which do you use and why?

    WilliamPaid.com - it is free, my tenants like the credit reporting, and it is easy to use

    3) What features do you like?

    It is easy to set up. All I do is put in my building and then I can invite any new tenant to join and it emails them a link. Been using it for 3 years on 6 properties and it is just easy

    4) What would you change or add to the service you use (or would use if it had this feature) if you could?

    I would like them to add an online application and credit/background check feature so I can do everything from one place

    Bonus question: What else would you (or do you already) automate in your landlording and/or real estate business if you could?

    If my pre-tenant (application/checks) was integrated into my rent collecting and then iintegrated with my expenses/costs in a Mint.com type format I would be very happy

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  • Piotr Komorowski
    West Palm Beach, FL · Member since 2014 · 2 posts · 0 votes
    12y

    Thanks @Brianna S. for you input.

    "WilliamPaid.com - it is free, my tenants like the credit reporting, and it is easy to use"

    I am trying to understand their business model. If it's free for you and free for the tenants where the money is made?

    0Reply
  • Account Closed
    Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    12y

    I think before tenants give their banking or credit card info, they should ask WilliamPaid.com for references.


    Joe Gore

    0Reply
  • Mike S
    Investor · Latonia, KY · Member since 2012 · 107 posts · 50 votes
    12y

    Can you do prorated rent with online payments such as if someone moves in mid month?

    0Reply
  • Brie SchmidtBusiness Member
    Moderator
    Real Estate Broker · Chicago, IL · Member since 2013 · 6k+ posts · 5k+ votes
    12y

    @Piotr Komorowski - It is always free for the landlord. For the tenants who do direct debit it is free - but if they want to pay via a credit card or cash there is a charge. There is also a charge if they want that rent paid from multiple accounts (roommates)

    We have also used ChaseQuick pay and offer that option as well. We also let them pay by check but all 6 of our units have opted for WilliamPaid

    I see them expanding their business into the credit/background check space where they could also make money

    @Account Closed They have a few types of security certificates/seals

    http://www.williampaid.com/company/security

    Podcast Guest on Show #132
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  • Account Closed
    Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    12y

    @Brianna S.,

    Any website can get security certificates/seals. I was talking about talking to happy landlords.

    Joe Gore

    0Reply
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