Anyone Experimented With Collecting Rent Twice A Month?
I am considering collecting rent twice a month. Has anyone tried this or maybe even every week? I'm considering this because I am thinking about buying several more lower income rentals. I thought it might be helpful to both the tenants and myself.
I have four tenants who I have arranged to collect rent twice a month from- they are long term tenants and I would like to keep them, so it is a win/win.
When I rent out units I do not offer this, but if the potential tenant asks (very few ever do), I will consider it. I'd rather have my units rented and have to collect rent twice a month than leaving it open waiting for the right tenant who can always pay on the first.
Ron
I don't see a problem collecting rent every week or biweekly. Let's face it..some people just can't manage their payments good and need to pay as soon as they receive money. The only drawback I guess is that you have to make sure that you put the money away for what its intended for and not nickel and dime it.
I collect on my car notes when they get a paycheck. Weekly, bi monthly, monthly. Same with my houses. If they pay every 2 weeks you have to be careful or you'll get an extra payment for the year. It can however make your evictions a little tougher.
Good Luck,
Shawn(OH)
I did weekly years ago. Worked well in the right area and loanwizard is right a weekly cycle will net you an extra month.
We to have considered this with a rental we have in a questionable neighborhood.
We bought a bulk of homes from one gentlemen, one of these was in a neighbor I would not usually hold in.
The renter has been in the house 4 years but rarely pays on time. (she always pays - even late fees but never ever on time. This last time it was two months behind.
I have considered renting to her again (the lease expires soon) only because of the area & she has been there 4 yrs, but only under the additional condition that she pay bi-monthly (as her paycheck is bi-monthly) and keeping her under a month to month rental agreement.
any ideas on this one?
Dreamin-
Once late always late. Early rent incentives like a $50 reduction might keep the payments on time but the bi-weekly will just mean twice as many late notices.
I can't believe my eyes. Rent weekly???
I'm an investor and get paid well for my time. I'm not a rent collector. I get paid for buying and selling real estate. That's the business I'm in.
I think that I'd rather work at McDonald's then collect rent 52 times a year. If it's necessary to collect rent weekly, then I submit that you haven't done a good job of tenant selection/qualification.
I am afraid I have many many times collected rents on a bi weekly basis and on a few occasions have set them up for a every Friday collection.
You see when you gather multiple units in areas where the gangs walk with flankers out and a disposable junior member at the point, one must make some adjustments. After all we bought these little beauties at four times the gross. Talk about non performing loan portfolios, well these were non performing rentals. Thats how we got them the big management companies could not handle, could not collect, could not maintain. So masses of nice retired couples who owned these building allowed us to buy them for smiles, lunches, assumption of multiple loans and a lot of handshakes.
I mean these were hostile. So we held tenant meetings, reduced rents listened to their bitching and went to work. We trained managers and we put them on a percentage of collections and we also got everybody including the tenants on our side. damn Lucius Foster, Master Social Worker. If you could not pay your rent we employed you at a minimum wage to work on the buildings. If someone got sick the manager ran them to the hospital unless we could find an ambulance with enough guts to pick them up.
The only problem is that you have to go into the areas yourself and back your managers up. My family started to complain that I was speaking Gullah or Street talk all the time. I even began to walk with that head back arm sliding walk. But you know it was fun. It took almost six months before our tenants accepted the fact that we were on their side and helping correct the age old problem of haves versus havenots. And we put our money where our mouth was.
We never gouged. We had managers accepting the welfare checks on the lst and 15 also known as mother day. We pulled the rents out before the men came by to visit and try to grab the checks. Give the kids a quick McDonald and the check is gone and it is back to beans and rice for the next 15 day. We stopped that and I have the scars to prove it. We taught construction trades, we taught proper housekeeping and sanitation. I bought so much Boric Acid Powder that the cockroaches complain'd.
I had the Business man, local gang try and HIjacked the rents talked them into sliding me a blade, cause I am so old and ugly. Forgot to tell them I have been a fencer since age five. So I gave a lesson. Then I put them all in my truck took them to the hospital sewed up all their small cuts and we had hamburgers and cokes afterwards while I explained the fine points of how to handle a knife.
But as time went on the violence slowed to a norm for LaLa land. and I sold a few of the buildings to groups of highly successful business men who were also afro-americans. Some I sold to the tenants as Co-ops. Spent almost three years of my life playing in the slums.
Started a headstart school in a 60 unit for females with children only. We used the teaching methods of the Arabic Cultural, lots of memory by rote to songs and humms. worked. All of a sudden the Board of Education wanted to know how come kids just coming into Kindergarten could do elementary writing and reading and had their multiplication tables up thru 12. ? It worked. We had BBQ's every other weekend. Sell to the whole neighborhood. Helped pay everybodies rent. Only the beginning.
The answer to slums, very simple no Absentee Landlords. Give the people a chance to own their own units, come part of the American Dream. It works.
If a tenant cannot pay his rent on time. We check and see why. If it is just not possible because of the character we then swing to BiMonthly or Weekly and we charge a small fee just to motivate them to learn how to save. We use the cookie jar. All monies coming in 25% goes in the jar. I mean all monies coming in. In the 40 units and up we arrange language classes, construction skill classes. Recent imigrants they are intelligent they just dont have the skills. If you spent the first part of your life bent over spading crops you have a lot to catch up. But they are smart. I teach a labor fresh off the coyotes back how to read a tape and measure in about two hours. He is calling out the framing cuts on his first day on the job. They sweep up the nails, they sweep the job site while framing, they are great and fun to be with.
Well I better stop, You touched a nerve and looking back on it. Probably one of the finer moments in my life. You just have to care and if you do they will reward you with love and affection also they will pay their rent.
Cheers all Lucius
Thanks for the feedback everyone. As far as the inconvenience of collecting every week or two, I forgot to add that I use a property manager although I handle most maintenance myself. Since there is someone at the office who is collecting rents, going to every two weeks wouldn't add to my work load. Also, I don't think it would be too inconvenient for the tenants since they could make two payments when they came in if they wished. My experience with low income rental has been good so far but I am always looking for ways to make things easier for both them and myself. The more frequent payments seemed like it might help. The feds obviously think so since they have found it best to collect their share out of every paycheck.
Thanks Lucius
I see you understand these neighborhoods.
We believe we will be holding it for about another 2 years, the city is moving this direction so the neighborhood will improve.
Better to collect rent twice a month than to have it empty becuase of the location, especially with so many vacancies in our area and Landlords climbing all over each other to fill the empties.
Checking National Statistics.
Yip, you are in an area which is being impacted. I should not be suprised to see many families in transit as they travel elsewhere to obtain employment.
Maybe you should have not given General Santa Anna such a rough time. God what a bunch of drunks can do to history.
Cities develop like an Ameba. It is a series of swelling and then a small contraction followed by another swelling. Then it may stop and it swings to another side and repeats the pattern. Like the Ameba it is reacting to stimulae.
Sometimes by riding around the outskirts you can see the pattern. A street starts to become busy and small shops form up in little rows or into small malls. You go to planning and see what they are trying to superimpose upon the city. See where the land is being held and by whom. Now thats a part of the stimulation. Check planning and see what is upcoming in the areas around the fringe.
I have written a lot of dumb academic papers none of which are really applicable because you are trying to reduce to math and formulae a living organism. So to pick up on it you have to go look and see what is really happening. Most profitable.
Sometimes if you see that your area is going stagnet you work out a deal to sell out to the tenants in a Coop for more money then it is worth as just units.
Remember you are achieving for them the American Dream, to overpay for a house and make mortgage payments. You create paper and some cash and move on into an area in which the Ameba is beginning to swell.
Right after the biggy war, I was in WashDC named in memory of Telsa and I bought a slummy house in a slum called Georgetown. Minority owned an outside privy converted to a rough bathroom, the worst. But something was happening. Small little coffee shops, cute little shops etc. just starting. I paid a total of $9,000 and spent maybe $20,000 converting into a cutty pie three story charmer, you know the dark green door, the brass kickplate and door knobs the little gas light etc. Inside I created a modern stairway bending wood, going up three stories in a gentle curve. I mean architects would come and visit instead of going on dates, got the same effect. It was fun. Sold it for $65,000 and I thought I had robbed this poor Brit. Ambassader. Last time I looked it was about $975,000 and climbing.
Now do not laugh you can do the same. Learn to see the Ameba. Make a map and chart what you see on the fringes and in the middle part as it on occasion contracts into itself. Find the reason for that contraction or subsequent expansions and you are rich. But what is even more fun you have excercised your head for more then a hat rack and that is the ultimate goody.
Enough, enough the lady cried. Lucius
I have a number of tenants that pay twice a month and I have them set up for electronic rent collection. I get the money deducted on their payday and direct deposited into my bank account for $5 per month.
I can't post the url here but private message me and I can give anyone more information.
Thanks,
Jack Krupey