Sending water/rates to pm

Discussion in 'Property Management' started by Synergy, 21st Jan, 2020.

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  1. Synergy

    Synergy Well-Known Member

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    I've been paying the water/rates bill as they come. (tenant still pays water+bulk) Pm has said to direct them to him. They pay it in full. And everything will be in the eofy statement.

    Are there pros and cons to this? I guessing seeing less rent money coming through until total bill has been paid could be hard for some ppl?
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    If the water bill (or other bills) are paid directly by the PM, then you don't see the bill - one less bill to worry about paying. However, if there are no funds in your account, payment may be delayed. The advantage is that all of your property related bills are captured by the PM on your annual statement.

    You may select to pay the bill from your line of credit vs the agent only being able to draw on cash in the bank (@Terry_w or @[email protected]) may have a thing or two to say about that.
     
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  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    I think there was a discussion in this thread about agents paying bills:

    Tax Tip 4: Borrowing to Pay investment expenses Tax Tip 4: Borrowing to Pay investment expenses
     
  4. TMNT

    TMNT Well-Known Member

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    tax advice aside:

    Pros of paying it yourself
    Credit Card Points
    Interest free period, put in offset, profit

    Cons of paying yourself
    No chance of forgetting to pay the bill/passing it to the tenant
    time/effort fwding the bill to your agent
     
  5. Synergy

    Synergy Well-Known Member

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    this particular bill is 1700 because they valued the land @ 235,000 but it increased to $247,500 within the quarter. So got stung double for everything. Working my days off to pay it :confused:
     
  6. Fargo

    Fargo Well-Known Member

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    A Pro is, you know whats going on and happening with your property from the water bill. You can tell if the tenant is subleasing from the water bill, while the PM will have NFI. You can tell if their is a water leak , I have picked up a leaking hot water service and a lot of leaking pipes from anomalies in the water bills from past bills and comparison with other properties. You also have a better handle on expenses. If you cant be bothered to spent a few seconds to Bpay a bill perhaps you should outsource everything and investment in a REIT,
     
  7. Bunbury

    Bunbury Well-Known Member

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    I can say from personal experience (burst water pipe at my ppor) that that's a good point. The water company changed the bill and fixed the issue as it was on their end. Those donkeys at the utility companies are too prone to stupid billing mistakes to be trusted. It's easier to pick them up on the spot rather than chase it up months later. I just direct debit and monitor the bills.
     
    Last edited: 21st Jan, 2020
  8. Michael Mitchell

    Michael Mitchell Property Manager Business Member

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    If you want to leverage your PM get them to pay your bills, otherwise do it yourself.
     
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  9. d_walsh

    d_walsh Well-Known Member

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    Can manage cash flow better if you pay on the due date. No benefit in agent paying bills early.
     
  10. Synergy

    Synergy Well-Known Member

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    So you say no if you get asked for same reason?
     
  11. Michael Mitchell

    Michael Mitchell Property Manager Business Member

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    I don't understand your question, can you please try and ask it a different way?

    Save for time;

    » If your PM pays your rates/levies/bills etc it goes through their trust account and your owner ledger (they're essentially acting as a book keeper for you as well), more streamlined come EOFY as your account has one statement with all income and expenses on.

    » If you do it yourself, you pay out of your own money, have to keep these expenses and submit to your accountant along with the info your PM will send, basically it's work you have to do when your PM could be doing it for you and in a lot of cases, it's part of their fee. Some Agencies will have a reduced fee (talking minimal amounts here) if they don't have to do this work for you.

    » I'm a PM, I run a PM business, I offer to do this as standard for my Clients.

    » If you're concerned your PM can't remember to pay the bills on time and you incur late fees,
    1) you've probably got bigger problems to worry about then, and
    2) the PM must pay the late fee or reimburse you the late fee as this is a failing on their end, unless they have communicated to you there is insufficient funds held in trust within a suitable time frame and you have not responded by paying it yourself direct or transferring money to the PM to pay on your behalf in lieu of sufficient rent money from the tenant for whatever reason resulting in the bill not getting paid (don't forget it's the Owner's responsibility - a PM is not a lender for your lack of cash flow/liquidity)
     
  12. TMNT

    TMNT Well-Known Member

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    is that a legal obligation?
    I have had some crappy PMs in the past and even presently worry if they forget to pay/bill the tenant and it gets past the date where it cannot be passed on to the tenant, who's fault is it,
    I can imagine a crappy PM who will say "oh I didnt receive it".
    One of my PM, I have been sending the water invoices to an individual [email protected]
    shes been there for years, but last quarter I checked, and she was still working there but said she never received it
     
    Last edited: 24th Jan, 2020
  13. Michael Mitchell

    Michael Mitchell Property Manager Business Member

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    No, but if you're a business and you don't wear your mistakes your clients won't hang around for very long.
     
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  14. Synergy

    Synergy Well-Known Member

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    Thanks for detailed response. He said he needs the whole bill and to get it sent to his office that way our names are off the bills and soon as the bill comes they can pass on the water charges aswell. It does sounds easy for me which I do like. Guess ill give it a whirl. Thanks everyone
     
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  15. Michael Mitchell

    Michael Mitchell Property Manager Business Member

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    For most cases, I generate my own invoices to bill tenants for their water consumption, but in a few cases I still use the Owner's direct utilities bill. For those, I white out tape all the Owners information + the payment details so there's absolutely no way the Tenant can accidentally pay money to the utility provider and maintains the Owners privacy from the Tenant where possible etc.
     
  16. Truly Exotic

    Truly Exotic Well-Known Member

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    thats actually a great point, and embarassingly ive never considered that,
    I will ask my PMs whether they fwd the copy of the account with my personal detials on it or not

    absolutely do not want tenants with my name and address
     
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  17. Tom Rivera

    Tom Rivera Property Manager Business Member

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    I can't believe how many people can't follow simple instructions. We had to start deleting the payment details off all our Urban Utilities notices to stop this haha!

    Side note though- Doesn't UU only have owners name (which tenants already have from their lease anyway) on page 2?
     
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  18. Michael Mitchell

    Michael Mitchell Property Manager Business Member

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    Not on mine I just put the owner's surname c/- agency and the contact details are all the agency's etc.
     
  19. Scott No Mates

    Scott No Mates Well-Known Member

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    That's how the bills come to me as well, tenant would have no idea where they live.

    I get that occasionally, need to check the Water Board website sad to why there's on bill, oops, double payments, account in credit etc.
     
  20. kennyboi

    kennyboi Well-Known Member

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    With positive credit reporting in effect, do you get hit with your credit score every time your agent failed to pay the bill on time?