Money Orders

[RachelEllen]

Ok, totally random question, but there are some smart people here.
I use USAA banking, so I don't have a physical bank nearby.

I just got a new tenant for a condo I lease and he is insisting that he pay with money orders. The only way for me to deposit these with USAA is to mail them in.

Is this safe? At least if a check disappers, there is a paper trail. But a money order feels like mailing cash.

 

[golfgal]

Not really unless you send it certified mail. I would open a local checking account for this. It will be much easier. I would also be leary of a renter that needs to pay with money orders.

 

[RachelEllen]

Yeah, not going to happen. USAA provides prepaid envelopes for mailing deposits. Or, I can just scan checks at home.

I'm not sure what the deal is with the money order. He has a very nice job. And, I know he has a bank account, as he offered to just direct deposit the money each month.

 

[penguin087]

Can you open a local account for it and then just transfer it into your regular account every month? I wouldn't want to mail money orders. Although, I have in the past for small ebay purchases with no problems.
Are you close to the rental unit? Maybe he could just pay cash instead.

 

[kathie859]

Yeah, not going to happen. USAA provides prepaid envelopes for mailing deposits. Or, I can just scan checks at home.

I'm not sure what the deal is with the money order. He has a very nice job. And, I know he has a bank account, as he offered to just direct deposit the money each month.

I am unfamiliar with your bank; however, if you have access to review your checking account online, I'd let him do a direct deposit into your account every month. That way you can track it easily and no chance of "lost in the mail" deposits.

 

[golfgal]

Yeah, not going to happen. USAA provides prepaid envelopes for mailing deposits. Or, I can just scan checks at home.

I'm not sure what the deal is with the money order. He has a very nice job. And, I know he has a bank account, as he offered to just direct deposit the money each month.

He doesn't need to have a bank account to direct deposit. He can just stop by any local branch or bank and they can do the transfer to your account. My guess is that he doesn't have a bank account and having a nice job doesn't mean he is responsible. Did you run a credit report? You might want to if you haven't.

I would still open a local account then deposit a check from that account into your USAA account so you have a trail.

 

[RachelEllen]

Yes, his credit checks out fine.

ANd he says he has an account with a local bank. It's really odd. This is a very upscale condo. The rent is about as much as our mortgage.


I'll just ask him again about checks. I use USAA because I got so fed up with BoA and their fees! I don't even know if they have the sort of account I can leave at 0 balance most of the time.

 

[RachelEllen]

I am unfamiliar with your bank; however, if you have access to review your checking account online, I'd let him do a direct deposit into your account every month. That way you can track it easily and no chance of "lost in the mail" deposits.

In order to do direct deposit, he needs my account number. Now, I realize that this number is printed on every check I write. However, I just felt dodgy giving it out him.

 

[golfgal]

Yes, his credit checks out fine.

ANd he says he has an account with a local bank. It's really odd. This is a very upscale condo. The rent is about as much as our mortgage.


I'll just ask him again about checks. I use USAA because I got so fed up with BoA and their fees! I don't even know if they have the sort of account I can leave at 0 balance most of the time.

Do you have a small, local bank you could use. You could set up the account with his security deposit in that and use that one to deposit the money orders. You wouldn't have to worry about a zero balance then.

We have a renter that pays by money order-which is why I would be leary. So far everything has been good but I don't have any way to prove I never received the money order nor does he have any way of proving he mailed it. He has been giving the roommate cash and the roommate sends a check. I am more comfortable with this arrangement.

 

[Anne MN]

Call USAA and see what they say. I have called them with other small "wierd" questions and they have been GREAT with answers. I called to ask about a couple of debit card purchases- they just looked wierd to me- they were mine for gas- the shoppette on post had some sort of problem and the debit was thru TX. it was wierd, to say another state but then dallas- the very nice lady looked it up and said yes that is what happened.

USAA will work with you on almost every issue! they are AWSOME!

 

[barkley]

i'm not sure but you might want to check with whatever bank you will use and find out how they process money orders. i think they are deposited just like cash, so there's no photocopying of the instrumet like with a traditional check. if this is the case then the renter flakes, you have no paper trail (unless you go to the time and expense yourself of photocopying each one you recived) that can show the date he wrote it out to you (and if it bounces, with a check- that date can be used against his bank records to show if he knowingly wrote a check for which there were insufficient funds or a closed account).

i honestly can't fathom why someone would want to use money orders for their rent-unless they either can't have a bank account (or it's overdrawn and the bank is looking to collect funds) or they are trying to not create a paper trail on themselves (can be the case where child support, student loans or taxes are owed-they get paid under the table and don't want checks paid out that show how much they pay for a certain item of need).

 

[LuvCuteBoys]

Is there a reason you can't scan them? You mentioned that you have a scanner, so I'm not sure why that wouldn't work?

There are all kinds of reasons why people don't like paying by check. It doesn't always imply that there's something to be leery of. Every check you write increases your risk of fraud, and my guess is that is his concern, since it sounds like he's willing to do electronic transactions.

 

[*pixie*dust*]

Money orders are processed just like checks. As long as you endorse the money order with your signature and "for deposit only" it is no different than any other check. Money orders can have stop payments on them like any other check --it's just more of a pain to do it. Some people have the idea that a money order is the same as cash-- this just isn't the case. If made payable to someone they are the same as a check. They really are intended for people that either dont have a checking account or that are uncomfortable sending their own personal check to someone.

 

[RachelEllen]

Is there a reason you can't scan them? You mentioned that you have a scanner, so I'm not sure why that wouldn't work?

There are all kinds of reasons why people don't like paying by check. It doesn't always imply that there's something to be leery of. Every check you write increases your risk of fraud, and my guess is that is his concern, since it sounds like he's willing to do electronic transactions.

The USAA home deposit service doesn't accept money orders

 

[LuvCuteBoys]

i'm not sure but you might want to check with whatever bank you will use and find out how they process money orders. i think they are deposited just like cash, so there's no photocopying of the instrumet like with a traditional check. if this is the case then the renter flakes, you have no paper trail (unless you go to the time and expense yourself of photocopying each one you recived) that can show the date he wrote it out to you (and if it bounces, with a check- that date can be used against his bank records to show if he knowingly wrote a check for which there were insufficient funds or a closed account).

i honestly can't fathom why someone would want to use money orders for their rent-unless they either can't have a bank account (or it's overdrawn and the bank is looking to collect funds) or they are trying to not create a paper trail on themselves (can be the case where child support, student loans or taxes are owed-they get paid under the table and don't want checks paid out that show how much they pay for a certain item of need).

A money order is a negotiable instrument, just like a check. It is absolutely imaged and sent through clearing just like a check would be.

 

[LuvCuteBoys]

The USAA home deposit service doesn't accept money orders

That's odd. Then I would shop around for a local bank. Just because BOA didn't work out for you doesn't mean that there isn't a smaller local bank to meet your needs. I really don't think you can force someone to pay by check. Or you could go the direct deposit route. You said you don't want him to have your account number, but if he pays by check... he's most likely going to have it as soon as the first check clears if you make him go that route. The endorsement is going to have your account number on it.

 

[kaytieeldr]

Several of these http://db.state.ma.us/dob/BankBranchesByCity.asp?city=Arlington local banks have some version of free checking (if you're over 50, look at TD Bank - I know I'm going down there this afternoon to change my checking account to one they never even told me about! ) with no or low minimum balance. If you don't like the checking account conditions, see about a savings account. Anyway, it would be extremely reasonable to open a local/bricks & mortar account somewhere.

 

[kellyg403]

I also have USAA and I can tell you I have had great experiences with them. When my son went to college, I opened an account there for him/I and had the funds from my local account direct deposited to USAA.

I do know that someone told me recently that one of the reasons a lot of people/companies do not accept money orders is because of the lag time. While your account will be credited immediately it can take up to 60 or 90 days for the bank to receive their funds. If there is a lost money order..that could take even longer. I do not know if this *fact* but the conversation was between myself and someone who works at a bank in a higher position so I would think she would have an idea of what she was saying. The conversation came up because at my work we don't cash them (grocery store) yet we cash any other type of checks.

Kelly