Lot rent collections. Old way = cash. New way?


#22

As technology becomes wide spread with park residents, I think this issue will sort itself out. In the meantime, here is a low-tech solution that is working very well for us:

  • ​Find the closest bank to your park with decent online banking (we use Key Bank and Prosperity Bank for our parks).

  • Open a deposit only account for each lot in your mobile home park. Yes, this might be a lot of accounts.

  • Make sure these accounts have overdraft protection, no fees at all, and one login to access all the accounts. At Key Bank, this account is called Hassle-Free.

  • Send out a special notice to each resident. Tell them their unique account number and the new deposit details. We also include these details on their monthly statements.

  • On the morning of the 6th, go through the accounts, make sure the payments match the statements, and transfer the funds to your main account (this is fun). Issue notices for the accounts with no balance.

  • Remove your rent drop box!

This is working very well for us and has completely eliminated the need for on-site manager to deal with rent or for any checks to be mailed. ​If anyone else has other ways of doing this I’d love to hear about them! Will


#23

We just opened one account for deposits and gave the tenants a deposit slip with their unit number hand written on it. When they deposit it there is a scanned copy with the deposit.

Then I move whatever amount I want to another Chequing account.

Tenants that want to pay online can and tenants who want to pay in cash can because its at the bank.

It’s my first park so I’m being a little more hands on until I turn it around.

Ken


#24

@wilbus - My God. A separate account for each resident? Why not use a combination of one of the web services which accepts ACH/credit cards/ and cash through places like K-mart/Walmart? IE Paylease, Cozy, Radpad and others. It just seems that opening that many deposit accounts is a pain - as is checking them all.


#25

@Ivan_ilych
I know, it does seem like a headache. We had a meeting with the bank to discuss the best options for residents to directly deposit their rent and this was their suggestion. They did everything and just gave us a sheet with the account numbers. We assigned each account number to a lot.

When we login to the account on the morning of the 6th, it lists all the account number and lots right there in a row, with the money deposited into each account. We click the account, make sure the amount is right, and transfer it over to the main account. It takes about 45 minutes to transfer 55 lots.

What I like about this method is that it is bullet proof. Internet goes down at the park, no problem. People can’t remember their Cozy password, no big deal. Some residents do pay online through Appfolio, but most choose the bank method. There is something tangible about walking into the bank, something memorable and serene and when they walk out I can imagine them feeling good about checking that big item off their list.

It’s just one option. There are many ways to collect. This happens to be one that gets us the best payment rate with the lowest amount of communication and confusion. Will


#26

@wilbus - I can see that it’s bulletproof, that’s true. It does solve the problem of someone depositing cash with the bank but forgetting to put their info on the deposit slip.

The residents can use some sort of electronic online method to transfer money from their account directly to your bank’s if they don’t want to waste 30 minutes a month driving to/from the bank, right? It doesn’t sound like a half bad idea.


#27

@Ivan_ilych

They could transfer funds online. I think this plan only works if the bank is incredibly convenient. For both of our parks where we do this there is a bank within 10 minutes walking distance.


#28

We have our manager collect checks and money orders and we also offer online card transactions through our website (linked w/rent manager). There are a ton of methods for doing this but you need to pick something that is simple and stress free for you. For me, our process involves this:

  1. Manager takes in checks/money orders and enters those into our bookkeeping software (rent manager)
  2. Manager fills out deposit slip with lot number then amount. Nothing else. Also scans/uploads scanned copies of deposits.
  3. Manager sends the rent manager report to me for the deposit immediately following the physical deposit
  4. Next Day: I proof the deposit against what was sent to me.
  5. On the 6th, I send a delinquent balance report to the manager
  6. By the 8th, manager will talk to each late resident and provide a reason as to why they are late.

If manager takes a credit care payment in the office:

  1. Manager logs in and runs the card

If manager has a resident who wants to sign up for online payments

  1. Manager gives me the resident’s email address
  2. I set up the resident’s account
  3. Resident makes payment, rent manager auto updates to reflect credit card payment

I currently do the bookkeeping for almost 1,000 lots in our portfolio and this has been the most scalable system. Having tenants mail payment isn’t scalable because of the compounding effect of having 1 or 2 people from each park every month tell you it must be lost in the mail. Ours may not be the best system but it is a scalable system.


#29

I agree that scaleability is the order of the day when it comes to collecting and recording payments. We have recently moved to a single banking platform for all our park. If there is a branch in town the manager will physically deposit Checks and Money Orders. If there is no branch in that part of the country, we set them up on a scanner that allows them to scan payments into their dedicated account as they receive them .

Our bank (currently Chase) shows us a photo of every deposited check and money order (of course we don’t do cash) for each of our properties. We then have our accountant ($7/hr Philippines resource), who has view-only privileges, log into each property account and enter each deposited check or Money order from tenants into AppFolio.

So far, this system has dramatically cut down on our regional manager’s “grunt work” time entering items into the system and since Phillipines is 15 hours ahead of us, everything is updated in the system in the morning when we wake up!


#30

hi rmpratt, can you please share the company that you contract for your accountant in the Phillipines?

Regards,


#31

We just used freelancer service Upwork


#32

You’re dead right, cash is a very old-fashioned way, and it can also cause some suspicions about why you prefer this kind of payment (greetings from the IRS).
I’ve been working as a property manager for the fair amount of time, and the solutions like Cozy or Avail are OK. But I started using Rentberry to list my properties, and they’ve recently introduced their own payment system to collect rent online. It’s blockchain-based, and it’s so much faster than receiving cash or ACH transfer! I suggest it’s worth using Rentberry as a listing platform, and get the benefits from their payment platform.


#33

Cozy.co is a free way to collect rent via electronic bank transfer or credit card and I use it now. However some tenants do not have bank accounts or credit cards so they deposit straight to the bank.

I am considering switching to tenantcloud.com as it has additional tools, deposits the money faster and is only $9 a month.


#34

We have gone to having all of our tenants deposit their rent directly into our accounts. It has made life much easier as they no longer have to run out to 7/11 etc to get a money order then mail it and HOPE it reaches us in time (and we don’t have to hear BUT I know I mailed it), simple and easy and we just go in and check to make sure that the rent was paid.


#35

I was just going to ask how you knew who paid for what lot and who didn’t.