1st Payment by Cheque or Standing Order

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    1st Payment by Cheque or Standing Order


    I have a prospective tenant who is interested in letting my property. If he passes all of the credit checks/references I would be willing to let my property to him. He would pay the 1st Months rent in advance + a month's rent as a retainer.

    What would be the best way of ensuring that this money went into my bank account for this. I presume that I standing order would be best but I'm not sure how long that would take to set up and what information I would need to give.

    The prospective tenant is happy to pay his rent by Standing Order on a monthly basis. Would he just need to set up a standing order for the 1st Months + retainer, then reduce his standing order for the remaining months?

    I've heard that even if I cash a cheque and it is shown on my bank statement, in reality, the bank could actually be processing the cheque for a number of days, before it is officially cleared.

    I've be interested in hearing your views on the above.



    Why not give him a slip out of your bank paying in book with instructions to pay cash into one of the branches of your bank? If you have online banking and the bank operates a real-time system (i.e. credits appear the instant they are entered - not the next day), you will then see the money cleared onto your account with no chance of it bouncing.


      I give my tenants a pre-filled-out form, which all they need to do is sign and send to their bank, and which will set up a standing payment in the amount of the monthly rent, starting at the beginning of month 2 of the tenancy.

      I ask for the first month's rent and deposit before they move in, either in cash or as a cheque at least 3 working days before they move in.

      I believe it's possible under unusual/unlucky circumstances for a cheque to be reversed after a slightly longer interval than that, however I use this as my standard procedure for several reasons - (a) after the first month is up I have to rely on the tenant paying up anyway each month; if I wanted to start proceedings against him for non-payment of rent it would happen on the same timescale following the first missed payment anyway; (b) I reckon it would be pretty unlikely that the tenant would risk their very first payment bouncing in any event (considering I'm going to wait 3 days for it to clear anyway); and (c) I'm pretty anal about my tenant screening and wouldn't be taking them on in the first place if I was concerned.

      One other 'tip' is that I always run my tenancies by the calendar month; ie, rent is always due on the first of the month. This is mainly for my convenience, eg, I only need to check my on-line statement once a month for rent credits as they all arrive on the same day; but I think it may have a side benefit that the tenant has (hopefully) just been paid, ergo his bank account balance will be at its highest during the month, and his s/o for rent payment gets first call on that!


        I normally expect deposit and first month's rent in cash when the AST is signed and keys handed over. Then it is monthly banker's order for the second and future months.

        Any information given in this post is based on my personal experience as a landlord, what I have learned from this and other boards and elsewhere. It is not to be relied on. Definitive advice is only available from a Solicitor or other appropriately qualified person.


          When I moved into the property i'm presently in, I was given the option of cheque, or credit card, as only a certain amount of cash was allowed to be handled by the letting agency. However these were not ideal for myself as I did not want to have to wait around for the delay in letting the payments clear. So i requested that a bankers draft be used as the method which was duly accepted and kept the time scale down and all parties happy!! Would this be an option for you??


            Going back to cheques - I've been advised by a banker relative that there is no such thing as a clearing period of x days for cheques. Even after weeks, you can have a cheque recalled, or rather if I remember it is the issuing bank who recall that cheque.

            The 'clearing ' period is actually a period of days where if there is anything obviously wrong with the cheque or where it's coming from, those obvious things are spotted and the cheque is refused or returned or whatever.

            I thought my relative was ten sheets to the wind but I checked with one of my banks last week and they confirmed you can have a cheque pulled back weeks afterwards.

            If this is right, why on earth banks can't resolve this, I don't know.

            Cash is king! Apart from forged £20s which is what I had one of last week, and believe it or not, it came from the same bank I was trying to pay it into...


              I have had an abbey national cheque which was paid into my abbey bank account bounced six weeks after presentation. On checking with the Financial Services Ombudsman I was told that the banks have up to six MONTHS to reject a cheque!


                Last year the company I worked for paid us by cheque, after about 4 days I checked and it showed as cleared funds. Five days after that, the cheque bounced and showed as unpaid funds. The company then went into administration.
                The whole system stinks!!!


                  Cheque 10 days in advance or bankers draft or cash on the day.

                  I certainly don't fall for the "I couldn't get all the money" or "I can give you the deposit next month" when it comes to moving in day either.

                  They are politely referred to a nearby hotel untill they come up with the goods!


                    I hate to say this, but a little while ago I heard that there were a number of forged bankers drafts around, and said banks had no hesitation in bouncing them.

                    Any information given in this post is based on my personal experience as a landlord, what I have learned from this and other boards and elsewhere. It is not to be relied on. Definitive advice is only available from a Solicitor or other appropriately qualified person.


                      And like cash, we all thought they were rock solid.....I suppose the only way is to get the payer to deposit cash or transfer money to your account: if your bank accepts the depositor's forged £20s then great, and if it's a bank transfer then nobody can subsequently extract money from your account?

                      I think they must be the best 2 options at the moment. Or take cash in lower demomination notes (used to be less likely to be forged as not as profitable, though I have heard of £10s and £5s now being forged...)

                      And believe it or not, I had a forged £1 coin the other day!


                        This is very true, they also take two days to clear. If in any doubt, don't accept them at the weekend or after bank closing hours, then phone the issuing bank and enquire whether all is well. they won't give you account information, but you should be able to ascertain whether it has been stolen or forged.

                        Also, if you have done your identification checks thoroughly, the draft should match the passport/driving licence and you will also have next of kin and work + NI details if the little blighters are trying it on!!!


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