Paying the rent with PayPal, Venmo, or Zelle might sound tempting. It’s quick and easy to set up, you can pay with a credit card, and all you need is your recipient’s email or phone number to transfer the funds. But watch out for additional fees and transfer times, and take care: none of these options include purchase protection.
Read on to learn when paying your rent through these apps might be a good option, and when it’s best to avoid them.
Paying the Rent with PayPal
Sending your monthly rent payment through PayPal certainly seems like an enticing option. You can attach a credit card, debit card, or link your bank account to the app to transfer funds to your landlord. Once your account is set up, you can make payments in just a couple of clicks.
But, there are a couple of reasons why paying your rent with PayPal may not be in your best interest.
PayPal doesn’t charge fees when you transfer directly from your bank account, but it does add a 2.9% charge when paying via debit or credit card.
Free transfers are meant for transactions between friends and family only. If PayPal catches wind that you are using this feature for business transactions, such as paying your landlord, they could shut down your account for violating their user agreement.
Additionally, there is no PayPal purchase protection for the money you send to family and friends, nor is there protection for real estate purchases. Basically, if you make an error and send the money to the wrong place PayPal has no obligation to help you get it back.
Not all landlords accept PayPal. Those that do might still be wary of delays before the funds become available to them. Prepare for your landlord to request your PayPal transfer be sent a few days ahead of the payment due date.
Paying the Rent with Venmo
Venmo is an app owned by PayPal that acts as a “digital wallet,” making it easy for friends to split expenses. You probably already use Venmo to split brunch bills or reimburse friends for joint travel expenses.
You can link debit cards, credit cards, and your bank account to your Venmo account to transfer funds. All you need is your friend’s phone number or email address to add them to your list of payees in order to transfer funds.
There is no fee for making payments through Venmo from your bank account or debit card however, payments from a credit card incur a 3% fee.
Venmo is not typically meant to be used for goods or services such as paying rent, and no purchase protection is offered if you do this. With this in mind, Venmo should only be used to pay people you know and trust.
In their user agreement, Venmo states that they may “impose limits on the amount and/or the number of payments you can send and receive.” So, if you use the app to pay your rent every month, this could be a red flag for Venmo and may jeopardize your account’s good standing.
It typically takes 1-3 business days for funds to transfer from the recipient’s Venmo account to their bank account. However, an instant transfer is available for a 1% fee, to a maximum of $10.
If you opt to pay your rent with Venmo, plan to send the payment a few days ahead so your landlord doesn’t give you grief about the hold period.
Paying the Rent through Zelle
Zelle is a service that enables you to send payments directly from one bank account to another within minutes. Like Venmo, all you need is the intended recipient’s email or phone number to initiate the transfer of funds.
Unlike PayPal and Venmo, Zelle allows fast transfers without a fee. If your bank or credit union has a partnership agreement with Zelle you can send money through the service from your bank’s website or app.
If your bank doesn’t have a partnership with Zelle you can still use the service. Simply download the Zelle app and enroll that way. But note, if your bank doesn’t offer Zelle, there will be a sending limit of $500 per week.
Once you send your payment, your recipient will receive instructions on how to enroll with Zelle to accept the money. After your recipient accepts the money it will be in their bank account within minutes.
Once your recipient is enrolled in Zelle you are unable to cancel payments, so there’s no room for error when transferring funds through this app. There is also no purchase protection through Zelle.
You should only use Zelle to send money to a landlord you already know and trust. Avoid using this service to send an initial deposit or payment for a rental, as you could be subject to a scam.
Zelle’s User Service Agreement states, “the Service is intended for personal, not business or commercial use” It is not clear whether paying rent falls into this category. If paying rent is deemed “commercial” use, Zelle could opt to terminate your account.
PayPal vs Venmo vs Zelle: Comparison
|PayPal||Free when sending money via bank transfer||• No purchase protection|
• Transactions take 1-3 business days to clear
|2.9% when paying with credit or debit card|
|Venmo||Free when paying with a debit card or bank transfer||• No purchase protection|
• Recipient pays a fee for instant withdrawal
|3% when paying with credit card|
|Zelle||Transfers only take minutes||•No purchase protection|
• Transactions may be capped at a certain amount depending on your bank
• No ability to pay with credit card
What is the best way to pay rent?
While it may be tempting to pay your rent with PayPal, Venmo, or Zelle, these services aren’t necessarily the best option. Between the lack of payment protection and the vague language around whether paying rent falls under accepted uses on these platforms, they aren’t reliable methods for transferring your rent payment.
The most reliable and efficient way to send money is through a bank to bank transfer. It may take a little more time to set up than a PayPal or Venmo account, but there usually isn’t a fee and the transfer will complete within minutes.
Another way to send money without fees is by writing a check. It may seem old fashioned, but it’s simple and free.
If you find yourself in a pinch and need to pay your rent with a credit card, paying through PayPal or Venmo is a good backup plan if your landlord is amenable. Zelle is another good backup if you forgot to drop off a check and need to get your funds to your landlord in a pinch.