Anyone pay rent via push ACH/EFT?

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Anyone pay rent via push ACH/EFT?

Postby natureexplorer » Thu Feb 25, 2010 5:17 pm

I am currently paying my individual landlord monthly rent using the Person2Person payment feature of ING Direct, which is essentially a push ACH/EFT. So on the first of every month an email is sent from ING Direct to the landlord, who has to "pick-up" the payment. Once she has picked-up the payment, the money is sent electronically to her account. To set this up, I use her account and routing number from a voided check she gave me.

I would like (or am considering) to switch to the Schwab checking though as my primary checking account for other reasons. However, so far, this Person2Person feature of ING Direct to pay for my rent keeps me there.

I noticed that the Schwab checking account allows to set up transfers to third-party accounts from the Schwab checking account. It also allows to specify reoccuring transfers. I like the email paper trail that ING Direct creates with all this so that I have a record of sorts that the rent was paid and received, but I guess the monthly statement should be sufficient. Also, Schwab says in the fine print that this feature is not meant for bill payment:
The Schwab Bank Service is not intended for bill payment and we may refuse to facilitate certain transfer requests.
Since I am sending it to an individual though, I doubt they would know that this is in essence a bill payment.

Does anyone have experience with push ACH rent payments to individual landlords other than with ING Direct? Or experience with the transfer to third party accounts at Schwab? Any feedback or thoughts?
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Postby bob90245 » Thu Feb 25, 2010 5:44 pm

I've been paying my landlord with Bill Pay through my Chase checking account. Chase simply generates a paper check and mails it to the landlord's address.

This is different from my other payers like American Express, which is electronic transfer from start to finish.

The electronic transfer is said to take 1 day. The paper check "transfer" is said to take 5 days. So I always make the Bill Pay in the middle of the month to make sure it arrives at the landlord's mailbox by the first of the month.
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Postby livesoft » Thu Feb 25, 2010 5:52 pm

I paid rent this way in the early 1980s. No problems. Bank was Sparkasse.
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Postby natureexplorer » Thu Feb 25, 2010 6:02 pm

bob90245, thanks for your reply! Yeah, the problem with mailing a check that way is still that the landlord could claim she never received the check and start charge you late fees. After all mail does get lost. Anyway, my landlord travels and also values a rent payment that does not involve paper.

livesoft, :) The US seems to be the last country without widespread use of low-cost (if not free) electronic bank transfers between individuals. ING Direct seems to have tried to change that.

Anyone got some ideas?
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Postby billern » Thu Feb 25, 2010 6:15 pm

bob90245 wrote:I've been paying my landlord with Bill Pay through my Chase checking account. Chase simply generates a paper check and mails it to the landlord's address.

This is different from my other payers like American Express, which is electronic transfer from start to finish.

The electronic transfer is said to take 1 day. The paper check "transfer" is said to take 5 days. So I always make the Bill Pay in the middle of the month to make sure it arrives at the landlord's mailbox by the first of the month.
I'm not sure if there are fees involved but I believe the major billpay system allows companies to set up accounts to receive billpays to them electronically.

A bigger landlord should really offer to do direct debit out of your checking account to pull the money. Many apartment complexes offer or require this. Some either charge a fee for not using this service or reduce the rent for using it in order to incentivise it.
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Postby natureexplorer » Thu Feb 25, 2010 7:31 pm

billern wrote:
bob90245 wrote:I've been paying my landlord with Bill Pay through my Chase checking account. Chase simply generates a paper check and mails it to the landlord's address.

This is different from my other payers like American Express, which is electronic transfer from start to finish.

The electronic transfer is said to take 1 day. The paper check "transfer" is said to take 5 days. So I always make the Bill Pay in the middle of the month to make sure it arrives at the landlord's mailbox by the first of the month.
I'm not sure if there are fees involved but I believe the major billpay system allows companies to set up accounts to receive billpays to them electronically.

A bigger landlord should really offer to do direct debit out of your checking account to pull the money. Many apartment complexes offer or require this. Some either charge a fee for not using this service or reduce the rent for using it in order to incentivise it.
Some greedy apartment complexes see the convenience this offers to the tenant, and actually charge a convenience fee for automatic debit from a checking account. They will also make less money with late fees if they offer that.

Any other ideas on the OP's inquiry?
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Postby kd2008 » Thu Feb 25, 2010 8:09 pm

I am surprised that your landlord gave you a voided check. He/she probably is not aware that you now have their account number and routing number. I would recommend you to pay them via bill pay. that way they get a check from third party without getting you bank info. I personally don't like that ING requires you to get someone else's bank account info to pay them. If someone asked me to give this info to them, I would flatly refuse. I think you can send your landlord a paper check via ING's electric orange. I would highly recommend you do that. Better yet, use paypal.
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Postby natureexplorer » Thu Feb 25, 2010 8:30 pm

kd2008 wrote:I am surprised that your landlord gave you a voided check. He/she probably is not aware that you now have their account number and routing number. I would recommend you to pay them via bill pay. that way they get a check from third party without getting you bank info. I personally don't like that ING requires you to get someone else's bank account info to pay them. If someone asked me to give this info to them, I would flatly refuse. I think you can send your landlord a paper check via ING's electric orange. I would highly recommend you do that. Better yet, use paypal.
Thanks for your comments!

Well, a paper check can get lost in the mail, or the landlord could pretend it got lost, not deposit it and start charging me late fees. With an electronic transfer the arrival of the money cannot be disputed.

Regarding paypal, don't they charge significant fees for such a transfer?

Other than deposit money into my landloard's account, what could one do with it? Doesn't everyone who pays by check carry such a risk? I would trust a tenant more than some store that employs minimum wage.
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Postby livesoft » Thu Feb 25, 2010 8:44 pm

natureexplorer wrote:
kd2008 wrote:I am surprised that your landlord gave you a voided check.

Other than deposit money into my landloard's account, what could one do with it? Doesn't everyone who pays by check carry such a risk? I would trust a tenant more than some store that employs minimum wage.

Of course, you could've given the landlord one of your voided checks and have them suck money out of your account every month. :)
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Postby Jack » Thu Feb 25, 2010 9:10 pm

kd2008 wrote:I am surprised that your landlord gave you a voided check. He/she probably is not aware that you now have their account number and routing number.

This isn't exactly top secret information. I've written thousands of checks over the years to hundreds, maybe thousands, of individuals and businesses. Every one of them has has access to my account and routing number. That is exactly the purpose of a check, to identify your account and give people access to it.
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Postby masteraleph » Thu Feb 25, 2010 9:15 pm

billern wrote:A bigger landlord should really offer to do direct debit out of your checking account to pull the money. Many apartment complexes offer or require this. Some either charge a fee for not using this service or reduce the rent for using it in order to incentivise it.


Our management company does direct debit and provides $150 off per month for using it.
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Postby tfb » Thu Feb 25, 2010 9:22 pm

natureexplorer wrote:Regarding paypal, don't they charge significant fees for such a transfer?

Personal payments using a linked bank account are free to both parties. A fee is charged if you use a credit card, for obvious reasons.
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Postby tetractys » Thu Feb 25, 2010 10:23 pm

My online bill pay is free, guarantees on time payments which covers all late fees, etc., pays by check or ETF, and has a real person working with recipients.

The only problems I've had is when one recipient, a new apartment manager, threw out the check with his other junk mail. It was easily straightened out through the bill pay service. The manager even complimented them for their person to person system, and withheld the late fee even though he could have technically claimed it.

With this system I can always set up my bill payments as soon as I get them, and have all bills payed on the deadline. So I can set up next months rent weeks early, the funds are withdrawn 5 days before and arrive by the last day of the grace period, guaranteed. And with big companies, the payment isn't withdrawn until the day before the deadline.

I would only use an actual bill pay service because of the guarantee. -- Tet
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Postby natureexplorer » Fri Feb 26, 2010 12:07 am

tetractys, thanks! Who do you use for your bill payments? It is my understanding that ING Direct does not provide such a guarantee and one is on his own with late fees if a check gets "lost" in the mail. Even if they pay late fees though, it might still show up as a late payment on your rental history.

tfb, thanks! I will have to look into it, sounds like this might be a solution if my landlord is open to PayPal. I thought I read Alex Frakt complaining about how paypal was taking a cut form the donations, but maybe he doesn't have it set up as a personal account or so. On the paypal website it indeed says that personal payments between parties using a bank account are free. Any catch or something to look out for? Does it allow reoccuring payments?
With PayPal there seems to be a similar caveat as with the the Schwab option, the free service is not intended for bill payment use. Not sure to what degree it is enforced.
Personal transfers to friends and family
(Paypal website explaining the fees)
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Postby natureexplorer » Fri Feb 26, 2010 12:22 am

I took a closer look and it seems with paypal one can only send immediate payments, but not scheduled payment let alone scheduled monthly payments. That makes it really kind of a no go for me. I need to schedule these payments ahead of time, preferably as a reoccuring payment or transfer.
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Postby montesquieu » Fri Feb 26, 2010 12:36 am

I think you have to call Schwab Bank to set up this kind of third-party transfer. Why not call, ask them if your rent payment scheme will work properly, and report back? :)
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Postby natureexplorer » Fri Feb 26, 2010 12:49 am

montesquieu wrote:I think you have to call Schwab Bank to set up this kind of third-party transfer. Why not call, ask them if your rent payment scheme will work properly, and report back? :)
They have a form to.fill out and attach a voided check and mail in. Strangely enought no fax number, let alone email address. I will set it up for my own checking account first to test things.
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Postby natureexplorer » Fri Feb 26, 2010 12:50 am

montesquieu wrote:I think you have to call Schwab Bank to set up this kind of third-party transfer. Why not call, ask them if your rent payment scheme will work properly, and report back? :)
They have a form to.fill out and attach a voided check and mail in. Strangely enought no fax number, let alone email address. I will set it up for my own checking account first to test things.
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Postby Soaker » Fri Feb 26, 2010 12:52 am

My landlord and I both have accounts at Wells Fargo. His WF account number was set forth in the lease; I was supposed to pay rent by going to a branch and making a deposit into his account with my own check. Turns out that you can make a direct Internet transfer between Wells Fargo customers if you have the payee's account number (limit is $1000 per business day). This has worked out well for both of us; no hold on a private check from his side, and from my side, electronic documentation as to where my money has gone with no need to go to a bricks and mortar WF branch.
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Postby OAG » Fri Feb 26, 2010 6:12 am

We pay the Condo fee (sort of like rent) via ACH and have been doing so for almost 5 years now. No problems and it has worked fine thus far.
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Postby natureexplorer » Fri Feb 26, 2010 7:42 am

OAG wrote:We pay the Condo fee (sort of like rent) via ACH and have been doing so for almost 5 years now. No problems and it has worked fine thus far.
Via ACH push or debit? Which bank do you use?
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Postby OAG » Fri Feb 26, 2010 9:57 am

natureexplorer wrote:
OAG wrote:We pay the Condo fee (sort of like rent) via ACH and have been doing so for almost 5 years now. No problems and it has worked fine thus far.
Via ACH push or debit? Which bank do you use?


PULL - Pentagon Federal Credit Union.
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Postby TheEternalVortex » Fri Feb 26, 2010 10:24 am

Soaker wrote:My landlord and I both have accounts at Wells Fargo. His WF account number was set forth in the lease; I was supposed to pay rent by going to a branch and making a deposit into his account with my own check. Turns out that you can make a direct Internet transfer between Wells Fargo customers if you have the payee's account number (limit is $1000 per business day).


Bank of America allows this as well.
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Postby Chuck » Fri Feb 26, 2010 11:02 am

I was under the impression that with online bill pay systems, that they will send a paper check to the recipient. (yes, that's been covered) BUT.... on the check or accompanying it are instructions to the recipient about how to get future payments electronically.

My credit union uses Cash Edge for person-to-person transfers. The recipient gets a secret code that they can use to establish a Cash Edge account (for free) and enter their account info for direct deposit. Then, when I send those people money in the future (via Cash Edge at my CU's web site) the money gets stuffed in their bank account in two days. (Day 1 to ACH to Cash Edge, day two to ACH from Cash Edge to the recipient's account.) My CU doesn't charge me for Cash Edge transfers. Some charge 50 cents or something.

I've always hoped that these services start squeezing out Pay Pal, who currently dominates this field for no discernible reason.
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Postby theduke » Fri Feb 26, 2010 11:07 am

kd2008 wrote:I am surprised that your landlord gave you a voided check. He/she probably is not aware that you now have their account number and routing number. I would recommend you to pay them via bill pay. that way they get a check from third party without getting you bank info. I personally don't like that ING requires you to get someone else's bank account info to pay them. If someone asked me to give this info to them, I would flatly refuse. I think you can send your landlord a paper check via ING's electric orange. I would highly recommend you do that. Better yet, use paypal.


I use bill pay at my bank. If the bank has to send a paper check instead of ACH, the check they send still has my name and account number on the check. If you receive an electronic copy of your checks that your bank sends out, you might want to look at yours to see if they do the same thing.
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Postby Chuck » Fri Feb 26, 2010 11:43 am

Here's another article that says your bill pay checks have your account and routing number on them.

The idea was to send yourself a bill pay check for 1 cent in order to void it to sign up for direct deposit. :)

http://www.bargaineering.com/articles/u ... check.html
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