Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 54%
$32.50 /mo
$390 billed annualy
MONTHLY
$69 /mo
billed monthly
7 day free trial. Cancel anytime
General Landlording & Rental Properties
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated about 12 years ago on . Most recent reply

User Stats

31
Posts
1
Votes
Hernan B.
  • Milwaukee, WI
1
Votes |
31
Posts

First Timer: Security Deposit, Rent in Cash, and more

Hernan B.
  • Milwaukee, WI
Posted

I am officially in the process of collecting rent for the first time ever. I have collected rent from one unit in the form of a money order and a second in cash. What is everyone's strategy to collecting rent in cash? Avoid it or collect it. It apparently costs less for the tenant since they need an additional $1.75 or so to get the money order and I was already at the building so I told them I would take the cash (because lets face it cash doesn't bounce), but i did not have a receipt. We agreed that I would write on a piece of paper that rent was paid in full and on time and I signed it. Do people usually have a receipt book in case of a situation like this? The third unit I called today and they said they will have it Monday, furthermore, they agreed to pay the late fee of $50. The fourth unit I cannot seem to get a hold of.

Basically, my plan is to upgrade each unit (4 unit building) and get better tenants. In order to do this I am I handing out 28 notice of month to month lease termination and to vacate or apply for tenancy. The first unit I did this to was the unit that paid in cash and said they would reapply but they would not pay another security deposit. I was told by the seller that there was no security deposit and I signed off that I would not receive any. I told the resident that his security deposit, if there was one, was in the hands of the previous owner and that was his responsibility. However, I am also a little reluctant to kick the resident out right away since they make up 50% of my units that paid on time. Should I hold off to kick them out until I remodel the other units and keep them on a month to month or will this bite me in the butt in a few months when I hand them the same notice? I still have the right to make them reapply and demand a security deposit once I get them on a new lease, correct?

How many tenants should I hand this notice out at a time? When I first bought the building I had a vision to kick them all out at the same time, then I felt two at a time, now I feel like I should just do one at a time starting with the late unit that I cannot get a hold of. How difficult is it going to be to get them out? In your experiences will this end up involving a lawyer? ...so many questions.

Most Popular Reply

User Stats

188
Posts
118
Votes
Chris Weiler
  • Flipper/Rehabber
  • Anaheim, CA
118
Votes |
188
Posts
Chris Weiler
  • Flipper/Rehabber
  • Anaheim, CA
Replied

I am not a fan of cash payments for rent. Where's the proof if your tenant states they paid you and they haven't? I prefer a paper trail and insist on money orders. I would even go as far as driving the tenant myself to get a money order.

Loading replies...