Paying more rent then asking, but there's a catch : ezLandlordForms

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Marissa Q

started a topic over 15 years ago

A prospective renter is asking to direct deposit 1800 into our account on the 7th of every month however we are only asking for 1500 rent so she is asking that we pay her 300 back. Weird I know. How would this effect us tax wise... and what other negatives would there be to this situation? Thanks

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Donna

said over 15 years ago

I think that that is very strange and I would ask her why? I personally would not do it. It becomes complicated and the last thing you need is complicated. Be careful, due diligence here......if it sounds strange it probably is!!! More food for thought......I do not practice permitting my tenants to pay via direct deposit. Here is why: If they become late and deposit partial payments, in some cases if you have filed for eviction (depending on your state) that may be considered by a judge as accepting payment, thus negating your law-suit and you will have to start over again.

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Sandhya K

said over 15 years ago

Be careful as this is a common scam technique. A person with stolen or forged checks or stolen online banking credentials will offer to overpay for rent or a security deposit, with you refunding them the overage in cash. Eventually, the bank catches on and voids the bad checks or deposits, removing the deposited money from your account. The tenant gets a free ride and gets to keep the extra $300 you refunded them, while you lose the full $1800 when the checks bounce. This scam is most common with security deposits but it's still worth looking out for in this case.

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Marissa Q

said over 15 years ago

Thanks for the insight guys. Question then...what is the best way to receive payment from a renter? We will be living about 15 miles away from the home.

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Marsha M

said over 15 years ago

cash because sometime cashier checks are a scam too.

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Denise S

said over 15 years ago

Have them mail you a rent check. There are also services out there for a nominal cost that will permit you to collect rent via credit card. Another option is paypal which is becoming more and more popular as a rent tool. Although there are pretty high fees with this option.

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David K

said over 15 years ago

I had a situation like this. The guy's parents ended up paying the rent for him and get got refunded the difference. So, the guy was cheating his parents out of the money. I have since used AutomatedLandlord.com so that his parents can pay his rent online. The website is nice too.