How did you motivate your tenants to switch to autopay, specifically those with greater than 90% penetration. Obviously you can threaten evection if in your Rules/Prospectus by mandating and returning payments and alternatively motivate some with gift cards for signing up.
I would take some time and investigate if your state has any laws mandating alternate forms of payment for tenants. Meaning you can ask for autopay but the tenant has the right to pay by check or money order if they wish. Regardless of what we can or can’t do it would be ugly standing in front of a judge trying to explain why we want to evict someone because they keep sending us money orders instead of using our app.
We use Manage America. Our autopay usage rates vary by park.
We have one park with 100% autopay uptake. It’s GREAT!
In this particular park, the nearest bank is 30 minutes away, and the closest spot to buy a money order is 20 minutes away. The park manager made a big push to get everyone to sign up for autopay. We even allow the residents to use the park’s computer to log in and pay. She did a great job. My suggestion is to sell this system to the park manager, as it would make their job significantly easier—no more bank deposits, no more printing out bills for folks who lost them, etc. If you can get the park manager to “sell” the tenants on it, you will be more successful than if you try to punish those who do not do it.
In my other parks, we are hovering around 50% uptake. We have two senior parks, and one of them we hit a bunch of resistance. In that park, usage is pretty low; we had a “tenant advocate” going around telling people not to do it. I don’t push it if people don’t want it, but it sure makes life easier for everyone. I am especially mindful of my Senior residents as they are not as accepting of newer technology as the younger folks.
We also offer Zego Paylease. We love that option as well. The only downside of Zego is that it can take a few days to process the deposit into my account. The upside is it’s an easy sell for those folks who pay with a money order anyway. They can usually pay their rent at the exact location from which they bought their money orders.
Whenever we get a new resident, we sign them up as part of their park approval process. They have to sign up for an online account to process their credit check, and that account gets imported into our system once they are accepted as new residents. New tenants are 100% on autopay!
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I do not think autopay is reasonable for everyone. Some people may not have the consistency of a sufficient account balance to make recurring monthly draws. Also, it requires a checking account, which some people may not have. You are better enforcing payment online rather than autopay. There is no reason why they cannot simply login each month to make a manual payment.
However, you should insist that your and your park managers will not accept any physical payments. They should pay online. If they insist on paying by cash they have to go to the local WalMart and pay through Zego which will automatically put the cash in your chosen checking account and automatically record the payment in Rent Manager. If they insist on paying by check or money order they have to mail a check to the Zego lockbox in New York City, and again the payment is automatically recorded in Rent Manager by Zego. There is no reason to tiptoe around this issue - make it mandatory and you will get compliance. Not dealing with money saves a ton of time and makes your job so much easier, but you do not need autopay to stop dealing with physical money.
Be careful here, some states have rules about what you can and can’t enact as a policy.
Here’s the CA statute. Check the rules specific to your state.
California Code, Civil Code - CIV § 1947.3
Current as of January 01, 2023 | Updated by Findlaw Staff
(a)(1) Except as provided in paragraph (2), a landlord or a landlord’s agent shall allow a tenant to pay rent and deposit of security by at least one form of payment that is neither cash nor electronic funds transfer.
In other words, I cannot require only cash or online payments. I am required by statute to accept either a check or a Money Order. I found this out after we sent a letter advising tenants of the new policy for Online or Cash payments only.
Luckily, the person who informed me did not sue me.
Yes, but if I read (a)(1) correctly, you can insist that a check or money order be mailed to the secure Zego lockbox in New York City, and you will not round afoul of the law. The law, as you provided it, does not say that payments have to be made onsite. Also, if you allow them to pay by credit or debit card at WalMart, you do not run afoul of that law.
Thus, in most cases, you can insist that your onsite staff do not take any payments.
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I didn’t know that was an option!
Thank you for pointing that out.
I’ll check with my staff and see if we can implement that. Since I am in CA, we have to navigate some interesting laws and “policies”.
We had our initial consultation with Zego today.
$500 one-time set-up fee and $1.05 per check, which is cheaper than what we are already paying for our Check Scanners.
@mPark Thank you for pointing me in this direction. I had no idea it was possible.
Glad it worked out. Zego has been great for us. The only time we touch a payment is when we are settling an eviction in the courthouse lobby 5 minutes before trial. Payments on our website go through Zego by EFT or Credit or Debit Card. Paper checks and money orders are mailed to Zego on our behalf. Cash payments are made at WalMart, Kroger, and 20,000 stores in general through Zego.
Best part is that no matter which of those payment methods are used, the tenant ledger in Rent Manager is automatically updated by Zego and not us, and we have a direct deposit the next day so the tenant bookkeeping is always perfect with no effort.
As a company, we decided to pay the EFT fee to encourage tenants to pay by that method. The other methods have steeper fees (~3% for credit card), but the tenant pays those fees.
We have our onboarding call in early January. I hope we can roll it out company-wide either in February or March.
We pay the EFTs as well; it’s pretty inexpensive. We do not pay CC fees or the Zego Paylease fee, but we will pay the Zego Check fee. It’s a wash since we were already paying the Check scanning fee of about $1.00 per check via Intellipay.
Manage America also has an API with Zego; we will not enter anything into our system manually. Once Zego scans the check, it will automatically populate our billing system. The money will be deposited shortly thereafter. I am super excited to get this going.
We have one park where the tenants mostly want to pay via check, and the manager slow plays bringing the checks to the bank. This will eliminate that issue.
I have been on a mission since about 2023 to streamline all our systems, and this is a significant hurdle that will soon be behind us.
Thanks again.