Can You Pay Rent With Cash?
Wait -- sorry, that last sentence had a minor typo. We meant to say everyone loves chomping down on their favorite snacks. No one likes making rent payments. Unfortunately, unless you own your own real estate, paying rent is probably going to be a part of your life.
Depending on your income source and banking situation, it might be easiest for you to pay rent with cash. But is this even allowed?
The answer is: It depends on your rental agreement. However, if you decide to go this route, you need to be diligent about receiving a record for your payments.
Rental property rules
Both federal and state jurisdictions have rules that govern the relationship between renters and their landlord or management company, including nondiscrimination measures, eviction standards, and in some areas, rent control. Within the bounds of those laws, the lease agreement between tenant and property owner outlines the specifics of the time frame in which the tenant will live in the property.
Lease agreements often specify whether pets are allowed in the apartment or house, if modifications can be made to the property, and other rules the tenant must follow. The agreement should also cover the dollar amount of each month’s rent, when it will be due, and how much the tenant will owe in late fees if they don’t pay on time.
The lease may also outline how to deliver rental payments, or that might be a process you work out separately with the property manager.
So are cash payments an option?
While individual states may have their own specific laws, generally a landlord or property manager can choose how tenants submit their rent payment. While you may try to suggest a payment method that works best for you, if you sign a lease that contains a specific requirement, then you’re locked into paying your monthly rent that way unless the property owner decides to be flexible.
A landlord may allow cash rent, give you a discount for paying with cash, or may even require it. The latter option is less common, and is curious, to say the least. We wouldn’t say they’re definitely trying to avoid having to report that income for tax purposes, but it certainly wouldn’t be impossible.
Assuming you do pay your rent in cash, it’s absolutely vital to get a receipt so you have a paper trail proving the payment was made, should it ever come to that. There are receipt forms online that you can use, but if a property management company or landlord is expecting rent money in cash and not offering rent receipts, that’s a big red flag.
It’s even possible someone could scam you by requesting a cash payment for an apartment they don’t actually own. We wrote an article to help you avoid that possibility.
Your rent amount is probably more than you’d like to be carrying around in your pocket at any given time, so unless you do not have a bank account that allows you to pay by personal check or electronic transfer, paying in cash is likely to be more trouble than it’s worth.
Other payment methods
As we said previously, the landlord has a lot of leeway when determining how rent payments should be made, but here are some options that you can propose:
If you don’t have a bank account and need to pay your bills with some sort of cash-funded system, a money order may do the trick. Aside from banks, money orders are available for purchase at the post office, currency exchanges, and certain convenience and grocery stores. As long as you hang on to the receipt, the money order is trackable.
Of course, there are some downsides to money orders, as well. They can’t be purchased in large amounts -- $1,000 is the limit -- so depending on your rent amount, you may need to pay with multiple money orders. There is also a small fee to purchase a money order, but typically under a couple of dollars.
Electronic payment through a bank
Many landlords and management companies collect rent through direct deposit or ACH transfer that you can set up to deduct automatically. While this method of payment requires a bank account, it is a good way to avoid the risk of missing the due date.
Other forms of electronic payment
Some landlords may also accept other electronic forms of payment like Venmo, Zelle, or Paypal. While certain methods of online payment are free, others may have fees associated with them that either you or the landlord would have to cover.
One service called Plastiq allows you to pay your rent through a credit card or debit card for a fee. While it might make your rent a little pricier, it will allow you to bypass a required form of payment that might otherwise be too inconvenient.
Regardless of which method you favor, make sure to investigate and confirm your choice with your landlord or property manager before trying to make your rent payment this way.
A cashier’s check
Finally, there’s always the rent check, which you can drop off or mail to an office somewhere. Although this also requires a bank account, it comes with a built-in record of the payment. Just be sure you have money in the account to cover the check amount, otherwise you risk having a bounced check, which can cost you a lot in fees.
Ease your monthly burden
Paying rent is already a pain. Before you sign a lease, try to work with your landlord to find a method that is convenient and well-documented so you won’t have additional troubles.