The collection of rent is a major worry for most rental property owners. One of the most significant decisions any property owner will make, along with determining how much rent to charge, is determining how to manage it. The greatest strategy to encourage on-time rent payments is to have a good rent collection technique set up and ready ahead of time! Let’s take a look at some of the most effective methods of collecting rent from tenants, as well as ones that should be avoided at all costs.
Best Methods for Direct Rent Payment
- There are a variety of options available for collecting rent. But, these days, with so many individuals making use of the convenience of online payment systems, online rent payment is by far the most popular rental payment method. Paying rent online is convenient for tenants, and it allows property owners to get their cash into their bank accounts much more quickly.
- Payment App. Payment apps like Venmo, Zelle, and PayPal are another up-and-coming option for paying rent. Many tenants find these services to be extremely convenient, as they may make asking and sending money quick and simple.
- ACH Debit. In addition, some Crowley property managers are now setting up ACH debit for their tenants, which can be another way to make sure rent is paid on time. If the tenant is satisfied with it, they can supply their bank account details and have their rent withdrawn automatically each month. Some tenants may object to this arrangement, therefore providing them with a choice of two or three options may be beneficial. It’s also worth noting that each payment option has its own set of fees. Because fees vary, it’s crucial to complete your research before deciding on a payment option.
Payment Methods to Avoid
On the other hand, there are some payment methods that you should not let your tenants use. You should avoid accepting rent payments made in cash, for example, because keeping a paper trail is difficult. It would be difficult to show when and how much your tenant paid if a dispute arose. Personal checks are particularly problematic since they take a long time to clear and can bounce if there is insufficient money, causing you and your tenant to incur bank fees. When collecting a security deposit, money orders and cashier’s checks are frequently accepted. Simply pick whatever approach you prefer and have a method for documentation ready to generate a solid paper trail.
While you might need to utilize one or more of these approaches on occasion, it’s normally advisable to avoid them. In addition to being difficult to document, this approach is riddled with errors. You might wish to include a clause in your lease contracts prohibiting these payment methods to make it clear that you won’t accept them.
Collect Through a Property Management Company
Rent collection can be a time-consuming element of owning rental homes even in the best of conditions. It doesn’t have to be that way, especially if you engage a rental property management company to take care of everything. We offer tech-enhanced processes, such as online rental payments, at Real Property Management Trailhead.
Hiring a property management company is one of the best ways to keep your rent payments coming in on time, month after month. Contact us today to learn more about our quality services!
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
