subject: Use a system for paying real estate bills [print this page] Use a system for paying real estate bills
If we could go through life without them, we probably would. But we cant. Theyre always there.
They are never ending and they come in to our office every day in one way, shape or form. They get dropped off by the mailman, sent to our PO Box or faxed in. People expect them to get paid right away too.
We pay the bills every Wednesday.
Contractors are at your throat to pay them as soon as they get the job done. But we can train them.
The first time they bring a bill in on a Wednesday, we inform them that the checks have already been written for that week and that theyll have to wait until next Wednesday. They might try to get a bill in on Tuesday night, but the checks are written on Wednesday morning, so this trick does not work.
When I was new to this business and the contractors would ask to be paid on the spot, I would write them the check they were demanding. I would carry a packet of check with me and stand there, writing them their check.
I started out writing checks out of a checkbook. I had one plastic file box and a dinky two bedroom apartment. When I wasnt writing the checks on site, I wrote them in front of my TV in the living room.
I outgrew this as time went on. Soon I had an office and I was out and about making offers on bank repo homes and doing my flipping houses for profit thing. The contractors were calling me up or dropping by the office, wanting to get paid every day.
In order to keep the chaos from growing, I had to develop a new payment system. It was going to be tough to change this and get everybody I have worked with to be accustomed to my new system, but I had to make a change. I set the new pay date to be Wednesday. I have been doing this ever since.
Why Wednesday? It just happened to be the day that I picked.
When I first got into this business, it took me about 30 seconds to handwrite one check for one property. It grew into me spending a couple hours doing checks. Then it turned into a half a day doing checks.
With our system today, we have the checks written and finalized by lunchtime. I sign the checks on Wednesday and my people are off to the bank.
My team is quick. This gives us time to do other things.
We also have a system set up for when the bills come in. They are put in a basket on one of our desks. They sit there until Wednesday morning. Then an administrative assistant will input them into Quick Books Pro as bills. Then we go through and pay them. If they are not yet due, then we have a drawer in my desk that they go into. That drawer has folder for each day of the month.
If we get a credit card bill and its not due for three weeks, we dont pay it then because its not due. It goes into that desk drawer.
If todays the first and its not due until the 21st, we dont pay today. We input it into Quick Books Pro as a bill that needs to be paid, and then it goes into a file folder in that desk drawer.
Every Wednesday, when we pay bills, we pay from that day through the next Friday.
Then next Wednesday well pick up due Wednesday through Friday of the following week. We try to put credit card bills in a week earlier then when theyre due because you dont want finance charges on something that gets stuck in the mail. Its best to stay ahead of the game with credit card bills.
These methods are great time savers. By the way Quick Books Pro has a feature that can help you save time. Its called, Memorize Transaction.
This lets you put in a recurring bill or recurring check that you need to write. When it comes due, it automatically shows up in the program seven days early. This way we know that the check has to be written, it has automatically clicked in and it will print the check that is needed out.
The rent is done that way. We also use this system for mortgage payments, private lender checks, invoices, tenant rents, land contracts and trash bills. Add all of that up and you can see that we save a lot of time.
