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patadams

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Posts: 43
Reply with quote  #1 
Sometimes there are folks that owe money to you and promise that they will pay you but need to make it in payments.  Then, the "promised" payment never shows.  One thing that I have found is when they are making all of these "promises" is to get them to reassure you several times that yea, they'll pay.  Then I hit them with, OK, I'll tell you what, then lets just make this easy and write me xx number of checks for the amount of the payments with the final check being the final payoff amount and date them for the day of your choosing, one for each month.
Then, cash the checks on the date written on the check. If it bounces, give them 2 days to pay up on the payment plus bad check charge or you are calling the sheriff after that.  The sheriff can arrest them on bad check charges.  I have a LL friend of mine who collects 12 checks for the full year this way and he says it has worked great for him.  He has had times where the tenant tracked him down and asked him to delay cashing the check till such and such date. He says fine, just drop off the late fee in cash then and I'll hold the check!  He told me "Imagine that, the tenant tracking me down instead of me looking for them!"
RentalPropertyRepair

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Reply with quote  #2 

it's illegal in most states to take post dated checks


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patadams

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Reply with quote  #3 

Collection agencies do it quit often.  I actually got th idea from a freind of mine who was making good on a debt they owed and the request was poat dated checks.  This was for a govt loan to boot ( a low interest loan due to storm damage .)  In Ohio, and in most, it is not illegal.  You may be required to send them a notice prior to cashing though. Check the laws in your state.

Sam

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Posts: 563
Reply with quote  #4 

This first post is interesting. I can see how that would work with a problem tenant.  Does anyone know if it's illegal in Michigan?  Statutes don't specify anything about post-dated checks that I can find, so does that mean basically nothing has been decided on that subject?

OHlandlord

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Posts: 3,718
Reply with quote  #5 
Taking post dated checks is NOT a good idea for several reasons.
1)  A check, once written, is supposed to be good immediately.  It is always illegal to write a check for which there are no funds.  The holder of the check can attempt to cash it at any time.  Banks don't care what the date is on that check.  If it is from the account and signed by the account holder, it can be cashed or submitted for cashing.  So, each of those checks that are written, needs to have sufficient funds at the time it is written, not later.  Collection agencies don't care about this because their sole business is to get ANY amount of money they can, ANY way they can.  Many sheriffs or police departments will not arrest a tenant for a bad check - many claim it is a civil case and that you must pursue it in small claims court.  (They do not like to get involved in any LL-Tenant relations.)
2)  This does not guarantee that the person who owes the money will actually pay the debt or that funds will be available at the time you want to cash the postdated check.  It is a false sense of security.  A debtor could easily write you a dozen checks on a closed account, or on a legal account - and close it later.  You would still have to take that person to court and prove the debt before you could obtain a judgment for those funds.
3)  You may be unable to evict this person at any time during that period of postdated checks.  You would be holding a check for payment.  That money could be for the debt, for rent, or for something else unless it is marked specifically.  Having already accepted a check and holding their payment can be considered as accepting their rent in advance.  Some states do not allow you to evict except for non-payment of rent.  Some states will not allow you to evict for other reasons if you have already accepted the rent (thereby giving your tacit approval that they may stay in the rental for as long as they've paid.)

A better idea is to have a delinquent tenant sign a delayed payment agreement. Having them pay extra with their rent each month makes it hard for them to forget to pay the money they owed.  Having a signed payment agreement proves that they agree they owe the debt (making any hearing for a monetary judgment a slam dunk - you already have signed proof that they owe the debt.)  Of course, then collecting on that judgment is a whole other story!

I don't accept any post-dated checks.  Those checks had better be good when they write them.  If a good tenant asks me to hold their rent check until a certain date, they need to include the late fees with the rent and pay on the date the funds are available, otherwise they will also pay the NSF fees for that check.
Erezbenson

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Reply with quote  #6 
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prin1113ci

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Reply with quote  #7 
Help entrepreneurs run their business smoothly and efficiently as tax payments are guaranteed and imported raw materials .The guarantee on that scheme is paid for by developers .



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PatseChi

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Posts: 79
Reply with quote  #8 
really stupid idea
just do a background/credit check

why fret through all this crap

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MeanLiens

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Reply with quote  #9 

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NoNonsenseLandlord

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Posts: 178
Reply with quote  #10 
It's easier to just check the credit score, and income of the tenant.  Only rent to people who can demonstrate an ability and desire to pay
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