I’m a landlord and I need to try to figure out the best way to get my tenant to pay me electronically. I’m currently using paypal, but the fee is considerable if you are a business. I have two bank accounts, one at B of A and one at a local bank. I was interested in trying to transfer money from B of A to the local bank. I was given 3 options, three day ($3), next day ($10) and wire transfer ($30). They say wire transfer is ideal for mortgages. $30 is more than I want to pay. Now, I don’t mind the delay, but are the 3 day and next day options going by mail? Or are they all sent electronically, but are artificially slowed down. Or, are they actually sending a check to the other bank?
How about Dwolla?
https://www.dwolla.com/about?b=1
Last time I used them, it cost $0.25 per transaction.
My bank has a option on the bank website to go to “my accounts” and add an account at another bank solely to make deposits into. I added my landlord’s account and my rent is electronically transferred every month. There is no fee to me or to him.
So maybe your tenant needs to go to HIS bank and set this up?
Possibly all banks don’t offer this.
A wire transfer is a single transaction from one bank to another, and they happen nearly instantly.
The other options are done by ACH, which is more like bulk mail in that they’re queued and sent off in batches. The price difference is pretty much artificial and designed to get more fees out of people that are in a hurry.
I’m assuming you have checking accounts at B of A and the other local bank, and that the tenant banks with the local bank. You could write a check from the local bank account and deposit it to your B of A account for free at home with B of A’s mobile app. You may find the clearing time is the same or even shorter than the cheapest ACH option, depending on how large the check is for.
You may even be able to have the tenant initiate a transfer from their account to yours - I don’t know about B of A or the local bank, but Wells Fargo calls their version of this “SurePay” and Chase has “Quick Pay”
At some banks, the tenant will need to know your account number to do this. My credit union doesn’t have a fancy name for member-member transfers, but they are instant and charge no fees.
Chase has a system called QuickPay that allows you to transfer money for free to other banks in the US. You have to send an invitation to the other person to accept the funds. Other banks may have similar systems.
BoA has a Bill Pay system that allows you transfer money to other accounts as well. Check their website.
Citibank, U.S. Bank, Ally Bank and others allow person-to-person payments through Popmoney. Chase offers person-to-person payments through QuickPay. BoA, Wells Fargo and FirstBank offer person-to-person payments through ClearXchange. But the tenant would need to initiate the payment through his/her bank, not you through yours. And as I understand the way most of these work, you do not need to know the recipient’s account number. Knowing their email address or their mobile number is enough.
My bank also allowed me to add another’s account #, and I could make several transfers. No fee, instantaneous. It wa$ a good way to tran$fer ca$h to my on while he wa in college.
In Thailand, it is possible to use your ATM card to transfer money from the ATM-card account to an account at same or different bank, You can do this from any ATM machine(*) belonging to the bank of transferor or transferee. (I think you can also do it from any 7-Eleven.) Can you do something like this in U.S.? In Europe?
IIRC, the maximum transfer this way is about $850; the fee is about $1. Young people use this method routinely; to “prove” the transfer they send a photo of the ATM receipt via their smart-phone. (To cope with keying errors, the ATM displays transferee’s name before you click Confirm.)
(* - this “redundant” expression is clearer, gets 500,000 Google hits, and is becoming standard English. Get over it.)
In most of Europe (definitely in the common banking zone) and provided that you have the information for the receiving account, you can do it from any of the ways in which you can access your own funds: ATM, physical office, mobile app, website, phone. You can do it for individual payments or set up periodic transfers.
And if you authorize it, organizations can set up withdrawals - but it needs your authorizing signature, not just your account.
If you can get your tenant to initiate an electronic transfer, I suggest that you set up an account solely for this. This removes the slight risk of him interfering in some way with your current account, but more importantly, it keeps a good record of his payments in one easy to see place.
I have a BOA business checking account and several other accounts.
I have used their $3 3-day transfer option to transfer money to other accounts at other institutions several times. One time the $30 (then $25) option was rejected by the receiving bank, so I never tried it again.
The $3 deal is just an electronic transfer that takes 3 days.
Get your tenant to set up a Standing Order with their bank.
Thanks for all the answers.
I figured this would be the case. It’s pretty silly, but I just don’t want mail or checks involved. I can certainly tolerate the 3 day delay. I’m not real good at checking mail nor cashing checks so I want to make it easy on my tenant and myself.
I’m more than happy to choose another bank solely for the convenience of transfering funds. I’ve got no allegiance whatsoever to the local bank.
I’m not clear about why having your tenant pay you electronically requires you to transfer money between your own accounts. Can your tenant pay into one but not the other, and you want to be able to transfer that deposit into your other bank?
Whatever the case, you or your tenant should be able to find a bank that allows free or cheap transfers to other accounts with little or no delay.
All the kids these days are using Venmo. There’s also Square Cash and FB Messenger Payments. All of them are fee free.
I use Venmo - free for transfers from bank accounts and very simple to use. Just be aware that it takes a few days for the money to actually clear your account: the app tells you the payment is complete, but the money isn’t deposited immediately. This lag makes it popular for Craig’s List scammers - they buy something from an uninformed seller, then cancel the transaction before it goes through. That shouldn’t be as big a risk for rent payments, as long as you understand how it works.
I was just going to test it out with my own accounts. I’ve only done a couple wire transfers in my life, so I was just going to see how much a hassle it was.
Thanks, will check it out.
Don’t pay $3 for an ACH transfer. Most banks will do this for free. Although I have a BofA account that would love to charge me $3, if the other bank initiates the transfer they charge nothing. I transfer funds occasionally from my BofA account to my Ally account, but I do it from the Ally website.
If BofA ever changes that and try to charge me $3 anyway, that will be the final straw for me.