Security Deposit and Applications - Should You Accept Cash, Check or Money Order?Posted by Mcconnell Hubbard on June 1st, 2021 If Visit This Link is looking to rent their investment property, they should always charge a software fee along with a security deposit. The application fee is collected to pay the price of conducting a tenant criminal record check as well as a credit check. The security deposit is to pay the cost of any damages the tenant does to the home. The biggest question that landlords ask is whether or not they must accept cash, check or money order for your application fee and the security deposit. Cash There is rarely anything wrong with accepting cash for your application fee. There is no challenge with cash not being accepted anywhere. This cash is non-refundable anyway. Since it's non-refundable then you don't have to provide them with a receipt to the application fee. It is probably not a bad idea to offer the potential tenant a receipt anyway showing that you received the cash for that application fee. I would also recommend that you simply get the security deposit in cash also. Since this financial resources are potentially refundable for the tenant once they transfer, I recommend that you just provide the tenant a receipt if you collect the safety deposit. The best receipt books include the pre printed forms that you just can get at stores like Office Depot. These receipt books have duplicates that allow you to offer the tenant the top copy and you also copy of the receipt stays in your receipt book. Money Order Money orders are universally acceptable. There is a slight chance your tenant might give you a fake money order. You need to be aware of this in the event you accept money orders for the security deposit. You will not are aware that it is fake until after the tenant has moved into your property. Which is worse is that this bank charges you a return check free for your fake money order that you just deposit in your bank account. Checks I wouldn't accept a search for an application fee. The reason is that the check could possibly be bad, the check may be stolen, or check may bounce. Unfortunately you will not know this and soon you present the search for payment from your bank where the check was written. Just like a money order, the financial institution charge which you fee to the returned check if it really is not good. If you accept a check in the application fee then you certainly saddled with paying the price of the tenant criminal background check through your pocket together with fee for the bad check. Smart landlords must always accept cash only for your application fee along with the security deposit.Like it? Share it! More by this author |