SherlockFan

Hi All

We're about to move into the bay area, California, and we've won a lease on a property, and we're now trying to decode the online banking system so we can transfer the security deposit and regular rental payment.

Does the concept of a standing order exist? According to a discussion with a teller at the bank, the idea is to use something called a "Direct Deposit" but when searching online that seems to be a mechanism by which you send cheques to the bank and they automatically add the to your account?

The fallback seems to be sending an online cheque (which I suspect literally prints and mails a cheque?), but they also that you have to allow for 5-7 business days for the cheque to arrive.

Advice appreciated, we (or at least my wife currently is) with CitiBank for reference.

MidAtlantic

Welcome to the world of American banking!

Electronic payments are called ACH (which stands for Automated Clearing House) payments.

There are payment systems like the UK direct debit system, where the creditor initiates the payment. I pay my monthly electric and water bills like that and it has worked well for several years, although my co-workers either know nothing about paying like that, or they say "there is no way they would let anyone take money from my account".

Most on-line banking systems allow you to set up a regular payment of a set amount, which would be equivalent to a UK standing order. That would probably be the way to deal with your regular rental payment. I believe payments are normally sent electronically, but I have also seen references to a check being printed and mailed, which seems to defeat the purpose.

The problem is that there are so many banks and credit unions, ranging from vast nationwide set ups to one branch community banks or credit unions, and they operate a wide variety of systems.

Marc_ely

The same basic things exist over here.
Look up ebills and autopay.
You can also make direct bank transfers between banks easily too.
The only people you routinely hand flappy bits of paper to are gardeners etc.

SherlockFan

Thank-you for the replies.

From looking at the details we're assuming that when you setup a new Payee they have some kind of automatic system to determine whether it gets sent by cheque or electronic payment, probably based on this routing number?

So I guess the next step is to check that the routing number is for the electronic account..

SherlockFan

Actually scratch that, the citibank help portal seems to imply that ALL payments to an individual or merchant that isn't the directory will happen by check.

I understand that if it was some small credit union on the other side of the country, by this is to the Bank of America.

The eBills and Autopay look useful, but as this if for a rent payment, I assume that unless the landlord enlists in a service that sends us these, it won't be an option.

Pulaski

I can't be bothered to wade through the advice given so far, but what you probably need is Zelle, which is used by most of the major banks and allows the recipient to link a phone number or email address to a bank account. Then the intended recipient, e.g. your landlord can give someone his phone number or email address as a proxy for his bank account and the payer then uses their online banking to send a payment by text or email. Problem solved!

Zelle works, I don't know how it works, but it does work. Sometimes I get an email from my bank to tell me I have received a payment before I get the email with the payment attached from the person paying me.

SherlockFan

Well I think this is just the start if some cultural realignment.

We just assumed there was some mechanism by which people can arbitrarily transfer money electronically to anyone else for free, but it sounds like that option is only available if the payee has set that up.

As a side point, I instinctively have no objection to anyone having my bank payment details as I feel that effectively it just allows people to send me money! I'm assuming the main concern is privacy and control?

'winning the lease' refers to the fact that multiple people were all chasing the same property. We've been in this situation before and list out, hence the feeling of winning.

petitefrancaise

I think I have all my bills paid automatically. I give the company concerned my bank account number and routing number and they take whatever I owe.
If I need to send money to the kiddo in the US then I can use FB or just straight transfer from my Wells Fargo account to hers and it's instantaneous.

Pulaski

ACH is closest to the UK BACS system, used for bulk payments, most commonly payment of salaries.

I am inclined to agree with them - it is scarily easy to create a check, unsigned, and send it for clearing. I avoid sending checks to anyone who isn't a legit business, because of the potential for lifting the details and spoofing checks against my account.

That used to be the case, before Check 21. I suspect some are still mailed, but they can now be sent electronically. It was part of the same technological leap forward that created photo deposit for checks.

Pulaski

The US banking system is set up to allow anyone, almost literally anyone, to take your bank details and spoof a cheque against your account, and your bank won't even notice if you don't complain. While it works for others, I would caution against giving anyone, even businesses, your bank details if possible.

Mrs P has most of our regular bills set up on an independent payment website, called Mycheckfree, which allows us to pay utilities and credit cards without sending our bank details to the payee. They have been around for donkey's years, and we started using them back when US banks still charged a fee to access on-line banking!

sherbert

Some banks (mine: credit union) don't allow you to transfer money to other accounts unless they are in your name. To pay bills, I use the online chequing facility which prints out and physically sends a cheque to the recipient's home address.

Never heard of Mycheckfree but I'll look into that. OP could also use papal/venmo etc. Paypal is free in the US between US bank accounts.