I am buying a 6 unit apartment building. Currently, all rents are sent to the owner's PO Box. I was thinking of installing a rent collection box in the inside hallway of the building instead of having tenants mail it. One less thing to worry about with the US Mail. What you guys think?

There are some major Cons with drop boxes. You have to stop by every day and to look for rents that may or may not be there. A mad tenant might toss a match in it, or pour in a cold cup of coffee or soda. There's no date or timestamp on a drop box. How to prove how many days late?

George

Like SID said, some major Cons. But then all processes have a few Cons depending on how you look at it. Even two of my houses have Cons.

A super Major Pro – Christmas every day when you open the box and tenants have payed.

I had your problem and talked to #22 and SID one night. Solution. Find you a bank that tenants can deposit into and go from there.

Problems I ran into with that solution.

To start off with NONE. I had opened two accounts. A savings and a checking. Tenants got deposit number from me and deposited into savings account. Shortly I went in “set at my computer” and moved that money into the checking account which tenants didn’t know about. I could go online and see deposit slips where tenants had made their deposit. I had made a small MS word document with; TO: My Name and FROM: Tenant Name, Address and last four of account number. I had ran the deposit slips through my printer and printed this info on the deposit slips. When tenant made their deposit I could go on line and see the deposit slip and knew who made the deposit. Great, Good, Oh Man what a difference that made.

And Then. Bank tells me they are going paperless “for my convenience” and now I can’t go on line and see who is making the deposit. I can still see a deposit was made but not WHO made it.

Step two. Require when tenant makes a deposit have them take a picture with their smart phone and text me a picture of the deposit slip. Have them write their name and address on the deposit slip (in dark ink)so you know who made the deposit. Now I have only increased my work load about three times due to this "convenience" the bank gave me. :( Did I mention some tenants forget to send the picture. No problem. Call them up and ask where their deposit is and don't forget to add the late fee whenyou make your deposit. You will get a picture of bank receipt in about 3 seconds.

Step three. Go to bank and open an account for each rental address. Money put into that account and tenant has paid rent. Still require picture sent to you with tenant name and address on receipt tenant gets from bank. This bank lets me request an “Alert” emailed to me when a deposit is made. Down side to this is you only see a “pending” transaction until the next day.

Ok, so now I only have to keep up with 42 gazillion accounts. Increased my work load by – well, I ain’t good enough to figure the math.

But it WORKS. Long story short.

HTH

Other option:

Sign up with clearnow and debit it from their account on the first (or date you choose). The cost is well worth the freedom!!!

On the 4th business day, look at email to see that all addresses were collected and update accounts in software. Pay bills. Done!

There are others, such as Cozy, that may be less expensive, but those put it on the resident to pay the bill. Clearnow sends them a reminder that they will be taking the money, just like their car payment. If resident needs to, they can block the debit, but they have to log in and do so.

George, I have been using the locked drop box method from day one for 20 years now and never once had a problem (I have a 12-unit and a 4-unit).

I do have high standards for credit scores, so my tenants are rarely late. If they are ever late, I text them and ask for an update and they always reply. I ask what day to expect it and they have ALWAYS told me what day they'd have it in there. But late rents are very rare for me.

I also charge $5/day late, so they are motivated to not be late.

I recommend trying it since it's very easy to execute and cheap. If anything goes wrong, THEN change your procedure.

The locked drop box is supremely the best/easiest way to get your rents as long as there are no problems ...and be sure it is locked. My common area hallways are behind locked doors AND the mailbox has a lock on it too.

I use both methods. At my rooming house, I have a drop box because the tenants are less mobile and some don't have bank accounts. I'm starting to discover that more of them are banked than I thought and am considering moving to Clear Now or something similar. For my regular rentals, I have them deposit at the bank.

George,

I'm in the is FREEDOM!!!

ME going to the dropbox is not FREEDOM!!!

ME waiting for checks "lost the mail" is not FREEDOM!!!

ME accepting personal checks is not FREEDOM!!!

ME HOPING they decide to pay me this month is not FREEDOM!!!

ME taking the chance someone breaks or steal moneyorder in a dropbox is not FREEDOM!!!

Not only should you NOT be collecting rents, you should not be HANDLING rents. People DO get conked on the head when the baddies THINK you are carrying money.

Here's what We do:

-autodraft. We TAKE the money from their account, no waiting and hoping. People EXPECT THAT in 2018.

-For those who say they cannot get an account (true for some) and for those who cannot add 1+1, we have one DEPOSIT ONLY account at our bank with branches all over town.

We give them a wallet card that says "Teller, Please write the name and address of this person on the deposit ticket. No personal checks." and "Resident, You must send us a text RIGHT NOW that says you paid so you get credit for your payment."

Works nicely. The res understands it. (we have some who are legitimately mentally limited) People who like to pay their bills in person like it.

We can see the deposit ticket online if there is a question. It's RARE RARE RARE we get a deposit we cannot identify. A text or 2 and we have the correct name.

Local factories are shifting a a paycard (a debit card on a checking account). The res can pay the teller from their factory paycard without an ATM service fee.

Side tip: Zero Tolerance on lates or partial payments makes this MUCH MUCH easier! People pay their rent. No dribbles coming in.

BRAD

Find a bank that will set up multiple accounts, one for each apt unit. Have them deposit it there.

Question, what if your tenants paid partial payments. Then that would conflict with eviction process, since you can't take partial payments. Thats in Texas , not sure about other states.

Yes, I agree with Brad and RathdrumGalle and I use two local banks. Zelle transfers to Bank of America with branches everywhere and I get email notifications of any transfers. In person BOA takes money orders but as of Jan. 1 no longer accepting cash counter credit unless from another member.

Also use local Credit Union that are beginner friendly for counter credits in person. I like Brad's idea of a wallet card so teller puts their name and address on slip.