Going to the bank simply isn’t an option these days. We each have to do our job fighting the outbreak of COVID-19 by staying at home and minimizing the spread.
If you are a landlord that has relied on receiving paper checks and depositing them at the bank, you are now forced to adjust and find the best way to collect rent online.
A bit of research will likely lead you to wanting to use a payment app. This makes total sense, since apps are extremely convenient. But should you use just any app to collect rent? What about using Venmo and Zelle?
While these apps are convenient, there are a few important considerations when it comes to rent collection which will lead you to not want to use Venmo or Zelle to do so.
Drawbacks of Venmo and Zelle
Venmo and Zelle were created to easily transfer small amounts of money between friends or to pay for certain bills. They were not created to handle large payments.
Here are the general issues using Venmo or Zelle to collect rent:
- Security – since all it takes to transfer money using these apps is a phone number or email of the recipient, it’s no surprise that these apps experience a tremendous amount of fraud by people using fake accounts.
- Transfer limits – these apps have low transfer limits, so chances are you won’t be able to collect the full rent in one transaction. The limit is based on the sender, so your tenants would have to figure out prior to sending rent. Increasing the limit requires divulging sensitive personal information including social security number.
- Room for error – since in most cases you will be relying on your renters to initiate payment, there is a chance that they will make a mistake in the transfer amount using the open systems that these apps use. If you don’t stay on top of every payment there is a chance you could miss an incorrect one. If you do catch a mistake you will have to spend time contacting your renters to remedy the situation.
- Limit on accounts – depending on your bank, you may not be able to add your business checking to either Venmo or Zelle, and you will most likely be limited in the total number of bank accounts you can add.
- Not designed for rent payment – your rent transactions get mixed up with the rest of your payments, making it difficult to track rent payment history and seeing an overview of only rent payments.
- No additional landlord features – landlords require the use of many tools beyond payment, so using one of these apps means having to use other tools for screening renters and taking care of maintenance for example.
These general issues make these apps far from ideal for collecting rent, but there is one larger issue that only experienced landlords are familiar with – partial payment.
The Issue of Partial Payments
If you’ve ever had the unfortunate experience of having to evict a tenant, you know the importance of being able to block partial payments. This is because any payment made towards rent, even a partial one, could be used against you to potentially nullify the eviction process.
Venmo or Zelle don’t give you the ability to block from attempting to pay you, which means any renter with your contact info can send you partial payment at any time, leaving you exposed.
This issue also exists with direct deposit, because as long as your tenants have your bank account and routing information, they are free to send you money at any time.
So how can you enjoy the benefits of online rent collection, without the drawbacks of Venmo or Zelle, and without leaving yourself open for partial payments? Use a rent collection app like Zuby.
Using a Free Property Management App Like Zuby
By using a property management app like Zuby, landlords can take advantage of online rent collection without sacrificing convenience.
Here is what makes Zuby’s great for collecting rent online:
- It’s free – Zuby is totally free for both landlords and renters when it comes to rent payment.
- It’s secure – we take security seriously, and so do our payment partners. Users connect to bank accounts using their online log-in with added authentication to make sure money is being transferred only as it should. This means that you never have to share your bank account number.
- Block partial payment – Zuby makes it easeir than ever to block partial payments with a tap of a button. You can decide to block renters in any given property from making partial payments. Since you don’t have to share any banking information, there is no way for them to send unwanted payments outside of Zuby.
- No room for error – Zuby generates automatic monthly rent payments based on your lease information and sends rent reminders to your renters. That means there is zero confusion about when to pay and how much.
- Automatic late fees – in case your renters don’t pay on time, you can enable automatic late fees to be assessed, as per your lease agreement.
- Collect security deposits – collecting security deposits online is now easier than ever. Get the money in your bank account without ever having to go to the bank.
- Assign specific bank accounts – you can add multiple bank accounts, both business and personal, and choose to assign a different bank per property.
- Easy to use – Zuby is a beautiful, simple yet effective app that is very easy to use for both landlords and renters. Since Zuby was designed with the individual landlord in mind, we made sure to make it as intuitive as possible, saving you time and money.
- Much more than rent collection – Zuby does not stop at payments. Additional landlord benefits include thorough renter background checks, credit reports, digital legal documents, local service professionals, and overall better organization.