New to PM!

Question

Hello! I am a new member of Hinsdale Properties where we use CRE, and I mostly use Property Management! I am looking for tips and tricks to what makes your life easier when using PM! A few direct questions that have come up: 
 What are the pros and cons of a prepayment vs. open credit? I have looked in the Help section but would like some opinions as to when these certain options are appropriate. A tenant paying rent a month ahead of time, as well as a current bill, all on the same check--does it make more sense to enter the entire check, creating an open credit for the rent amount? That's what I have been doing, but then it seems to create some confusion when a tenant receives an open item statement with an open credit of $850, for example. Any tips and pointers about using Property management would be greatly appreciated!!

Art Minds · Answer

Use Prepayment when you can allocate the payment to a specific Charge Type and a specific future billing date. When the automatic future charge is created the charge will be matched with the prepayment automatically. Both the prepaid amount and the charge will be closed out and not show on an open item statement. If you post a payment to an open credit, you must manually apply the open credit to charges when they are created in the future. Use open credits when a tenant overpays or prepays an unusual amount and you don't know the reason for the payment.

Art Minds · Answer

Usually you want your accounting system to track the legal structure of your lease. The situation you describe, with three roommates in a three bedroom apartment, would typically be all included on a single lease, with each roommate jointly responsible for all obligations under the lease. So I believe your current method of billing the "lease" for the full amount of the rent and processing the 3 separate payments against the single rent charge for the lease is the preferred way to go. Identifying the "Drawer" for each check you receive may be useful for answering inquiries from the tenants. But any one tenant's payment is actually payment for the joint liability of all tenants, and from the landlord point of view, you don't really care whose check pays the rent.

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