Anyone using zdeposit for security deposits?

Question

MA has a lot of fun compliance rules for holding security deposits. I was reading about (and contemplating) not even bothering with deposits, but I stumbled upon a service that claims to take care of that, is fully online, and is "free." Looks like it was released 4 months ago by Leader Bank and I can't find any discussion on it.

Anyone using it? Any feedback? See here: http://www.zdeposit.net

Anyone using it? Any feedback? See here: http://www.zdeposit.net

Anton Orlik · Answer

Been using it and recommending to others for months. Originally had the idea to do exactly what they are doing given how difficult MA laws are to work with. Very reaponive team as well for any customer service issues or recommendations.

Pietro C. · Answer

I know it's an older thread but we manage 100s of units through my management company and ZDeposit is gold. It was a lot harder and I wouldn't have recommended it in the past as you needed to either have an account with Leader Bank to make an EFT transfer for deposit unless you wanted to scan and upload a check - which was miserable.

Now, as long as they can connect to your bank, you can have the money pulled out and deposited to ZDeposit. This is great if you make deposits into an Escrow account like we do, then have ZDeposit pull the funds. It's also pretty easy to release the funds to yourself or to the tenant at the end of the term.

Lien Vuong · Answer

@Kavi Siegel Thanks for the feedback! I havent tried this yet but definitely will think to with future tenants coming in. It's nice to have a real life practical review on a system rather than just the online review. Thanks again.

Kavi S. · Answer

Since my last post I've refunded one security deposit and signed on two new tenants. I wish I took notes when having zdeposit refund the deposit, I think I recall an option to provide documentation on withholding funds, but I did not need to. Next time I'll take some notes.

One annoyance I had was when a tenant paid out first, last, and security deposit via cozy.co. I was guided to sign up for a leader bank account in order to transfer money into zdeposit on behalf of my tenant. That was not necessary, zdeposit confirmed that the source of the money is not accessible to the tenant and I can just write myself a check in the amount of the deposit, then upload it as if the tenant wrote it.

Either way zdeposit remains a stress free service for Massachusetts landlording in my book. I'm still on it.

Christopher M. · Answer

Hi @Kavi Siegel, I just stumbled upon zDeposit and found your post here from last year. Have you had any issues with the service over your first year of use?

Kavi S. · Answer

Just got my tenant's new leases in order. So far so good.

After I uploaded the photos of the checks from the tenants, the tenants get an email have them e-sign an application for an account, then they deposit the funds from the check into that account, once the deposit clears you get a "secure email" (actually the more frustrating part of the system) that has a PDF attached which they ask you forward to your tenant.

The language is:

"As required by law, the following interest bearing savings account has been opened in your name to hold the security deposit and/or last month’s rent paid under your current lease at: [redacted] You will receive an interest check at the end of each year of tenancy, which will be automatically mailed to the property address listed above. "

...Some information about the tenant, myself, and the bank...

"Please be advised that if the total interest received each year exceeds $10.00, a 1099-INT form will be sent to the mailing address on file for tax reporting purposes. If you have any questions about the status of your security deposit and/or last month’s rent, please contact your landlord directly. For questions specific to the bank account holding your last month’s rent and/or security deposit, you may contact ZDeposit via email at [redacted] or by telephone at [redacted]."

Not a big deal to forward a PDF to a tenant but I'm not sure why it's not part of their system and it was annoying to have to sign up for their secure mail portal (but an understandable limitation since the PDF does contain non-sensitive PII)

I use cozy.co for collecting rent so I just uploaded the PDF to the documents section of the lease which emails the tenant and keeps the docs in one place.

I guess that's a wrap until I release the funds next year.

Kavi S. · Answer

I just signed up and tried to test it out on myself. As far as starting an account goes, it sends an email to the tenant for them to fill out an online W9 form and allows you to deposit their check by photo in the web site.

I'm a software engineer by day, we're generally super nervous handing any sort of PII.. I'm liking that I don't have to handle social security numbers.

Unfortunately I don't have my security deposit checks just yet so I couldn't do any further testing outside of the initial sign up flow. I'll give it a shot when the tenants start out, thanks @Anton Orlik for building a bit of confidence that it's not vaporware.

Dick Stevens · Answer

How do they make the process easier?

Anyone using zdeposit for security deposits?

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