This month’s article: “Payments made prior to commencement.”
Prior to giving the keys to your new tenant and allowing him to take possession, you need to insist on having the cash in hand through good funds (as opposed to insufficient funds, where a person writes a check and doesn’t have the money to cover it in his account). Most owners do this by requiring cash; a bank cashier’s check, or a money order. But many rental property owners aren’t aware that both bank cashiers checks and money orders can be stopped. Financial institutions and convenience stores allow the purchaser to obtain a stop payment, because these financial instruments can be lost or stolen. However, the bank cashiers check are superior to personal checks because they do represent good funds and will at the very least not be returned to you because there was no money to cover them.
If despite this strong advice, your tenant persuades you (poor decision) to accept a personal check, then at least don’t give him access to the rental property until you have called and verified with his bank that the check will be honored. Your best bet is to physically take the check to the tenant’s bank and cash it or at least have it certified. If the bank will certify the check they are guaranteeing that there are sufficient funds available, then the bank will actually put a hold on the funds. Of course, cashing the check is the only sure way to collect your funds, because a devious tenant can always stop payment on even a certified personal check. Our suggestion: All funds prior to move in must be in a cashier’s check. Our office accepts no other form of payment prior to move in ever.
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Orlando Realty & Property Management
708 E. Colonial Dr., Suite 201, Orlando, FL 32803
Office: 407-641-5049 | Fax: 407-429-3857
orpm@407rentals.com | http://www.407rentals.com
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