As a general policy, most utility companies will charge real estate agents and brokers several fees to setup services. Such fees may include a deposit, membership fee, admin fee, connection fee, or service inspection fee. While some fees are general and required without exception, there is one fee you should try to negotiate and that is the deposit.
Utility companies generally change on average between $75.00 and $350.00 to open a new account. For the small agent, anything above $100.00 can take a huge chunk out of the budget. Of course, a broker or agent with great credit can save a lot but when the account is setup as a commercial account, it takes a little more. One utility company suggested to an agent to get a Tax ID and setup his business as a LLC or Corporation.
Does this help, sometimes? But, you will need negotiating power to avoid paying the fees upfront, paying the fees on the first bill, or paying the fees at all. Sometimes, all it takes is a bit more communication and negotiation with the customer service representative, supervisor, or manager.
In your communication with the customer service rep, supervisor, or manager negotiate the following:
· The best advice is the check the asset company policies regarding the utilities. Several will pay the utility bill if you set the utility account up as a vendor in the asset portal. The account will remain under your name but the asset company will pay the bill.
· Provide references from a third party willing to ride the account with you if your credit is questionable.
· Obtain written, legal, and reliable references from the other utility companies regarding your payment history. Provide to the utility manager or supervisor for consideration.
· Talk to the manager, honestly let them know that you will be establishing multiple utility accounts and would like to waive the deposit fee but will pay the connection/membership fee. Don’t blow a lot of smoke, they will see through the smoke screen.
· If you maintain the first five accounts in excellent standing from turn on to transfer to the new buyer, can all following account be setup without a deposit charge?
· Ask if the first deposit initiated be transferred to another account once the property is sold. By doing so, you will need to pay ALL utility bills on time including the final bill. A benefit is you will only have paid one deposit.
Remember, you can make or break your relationship with the utility company. It is not necessary to rant or rave over the deposit, and negotiation will not work with all utility companies. If it does not work the first year, keep a log of all account numbers you have established with the utility company and ask them to consider your history as a means to negotiate. It does work!
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