First Unit!! Any suggestions for collecting rent?

Question

I listed my first SFH and it is officially rented. Im wondering about how to get rent automatically deposit in my account?

Also, would you have a separate account just for real-estate??

I appreciate your comments!!

Scott Jensen · Answer

@Jonathan L Berhow-Rivera

I have used a few providers and so far Cozy is my favorite. It is really easy to use for both the landlord and the tenant. Also it is free to use so it isn't a huge commitment to try it out.

Jonathan L Berhow-Rivera · Answer

I have a 2 yer lease and I am collecting rent from my tenannt through cozy!! I appreciate all of the feedback!! I am so greatfull to be apart of this community!!

Nurit Petri · Answer

@Jonathan L Berhow-Rivera

Be very careful with tenants automatic deposits. If, say, your tenants “friend” makes the deposit, it could create a tenancy relationship with the friend. You should ask an attorney about this. Always protect yourself, you may have some exposure.

CJ M. · Answer

@Jonathan L Berhow-Rivera

Here's what I do so far asit relates to collecting rent,

1. Cash, check, money order deposited by tenant at bank

2. Check or money order mailed to me by the 1st of each month (then I mobile deposit via my banks app)

3. Venmo

4. Cash App

I'm considering adding Cozy as well, but as of now, I've had not had a need.

And yes! Definitely keep your rental account seperate.

Brad Bellstedt · Answer

Hello!

I asked a similar question and the suggestions I received include:

E-transfer

Zelle

Cozy

Tellus

Venmo

I collected my first month's rent and deposit in person so I have yet to actually collect it but I chose the Tellus app because you can set it up for automatic late fee schedules and change it so it won't accept partial payments. I like it so far but like I said, I haven't exercised it to it's full potential abilities yet. At the very least, you have a good list to take a look at. Hope that helps!

Brad Bellstedt · Answer

Definitely a separate account and definitely set that separate account up under a new LLC. I'm not a lawyer or a financial advisor so of course, I have to tell you to double check with a professional but that's the advice I received. Co-mingling funds from the business and your personal accounts makes you more vulnerable to risk should something go south. Again, not an attorney so double check but the more layers of protection, the better.

Rob B. · Answer

@Jonathan L Berhow-Rivera Hi Jonathan! Congratulations on getting started with your very first SFH. There are a lot of helpful tools out there that can help you to bring a certain level of automation and transparency to this process.

I'm sure you're experiencing the challenges of trying to decide who to go with; you have a great list, but having everything in different places (ie. using one tool to collect rent, another tool to sign leases, another tool to track the process, etc.) can start to become a hassle.

Definitely consider an option that allows you to achieve all of these steps in one place (ie. keep track of things like rent payments + leases, but it also offers several other tools as well -- the ability for tenants to build a credit score up to 40+ points for on-time rent payments with our CreditBoost feature; which can be enticing for them as they are new student renters); and lastly offers maintenance ticket tracking with automated messaging). Again, sounds like you're about to make a big decision (shouldn't be taken lightly). Again, you may run into transfer limits with some of those other apps when it comes to paying rent.

Michael Noto · Answer

A rent collecting method is only as good as the tenant at the controls. I am joking a little bit, but just make sure your tenant can handle doing the online payments and it doesn't become more of a burden for you. In the end you just want to tenant to pay on time by whatever means they are comfortable.

Ned Carey · Answer

@Jonathan L Berhow-Rivera If the property is owned by a separate entity other than your personal name then a separate account in the name of that entity is a MUST.

If you own the property under your own name then it is certainly good practice to have a separate account for your business activities. A really good book regarding using separate accounts for budgeting is "Profit First" by Mike Michalowicz

Scott Jensen · Answer

Congrats!

First Unit!! Any suggestions for collecting rent?

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