A solid rent collection strategy is fundamental for anyone owning rental property. Selecting a proper rental rate and managing rent payments are pivotal decisions for property owners.
Implementing an efficient rent collection system and preparing beforehand can motivate your tenants to pay on time. Let’s investigate the optimal approaches to collecting rent from tenants and pinpoint strategies to avoid.
Best Methods for Direct Rent Payment
- Online. In the current era, multiple methods exist for collecting rent from tenants. However, as online payment systems gain popularity, online rent payment has become the preferred method of rental payment. By this method, tenants enjoy the comfort and protection of making payments online, and it guarantees that property owners get those payments punctually. Online rent payment is now recognized as a dependable and handy choice for both tenants and property owners.
- Payment App. Rent payment has been modernized with the use of applications like Venmo, Zelle, and PayPal. The convenience and user-friendliness of these services have made them highly popular among tenants and landlords. The ability for tenants to swiftly request and transfer funds makes rent payments fast, efficient, and free from hassle.
- ACH Debit. New approaches are being implemented by property managers to guarantee timely payment of rent. ACH debit stands as one example of these methods. This method allows tenants to submit their bank details for automatic rent deduction every month. However, this arrangement may not appeal to all tenants, so it’s essential to offer a few different payment methods as alternatives. Moreover, it’s pertinent to mention that usage fees are typically charged by each payment method, and the amounts can vary extensively. Thus, conducting thorough research before selecting a payment method is imperative.
Payment Methods to Avoid
You ought to nudge your tenants towards designated payment methods for their rent. It’s advisable to steer clear of cash payments due to their record-keeping difficulties. In case of disputes, evidencing the timing and amount of rent paid by your tenant might be challenging. For this reason, preferring payment methods that provide a clear and easily accessible record.
The use of personal checks is not advised, given their protracted clearance times and the possibility of bouncing, which can result in bank fees for both parties. Consequently, money orders and cashier’s checks become more appealing choices, especially for security deposit acquisitions. Clearly articulating your payment preference and implementing a documentation strategy is essential for creating a strong paper trail, thereby averting future disputes or perplexities.
There might be instances requiring the adoption of these suboptimal payment methods, yet it’s wise to keep away from them. These approaches are generally complex to log and riddled with issues. Forbidding these payment methods in your rental agreements could help clearly communicate that you do not accept rent payments through these mechanisms.
Collect Through a Property Management Company
Investing in rental properties can be financially rewarding, however, rent collection can become a tiresome and prolonged process even in optimal conditions. However, if simplification of the process is desired, the recruitment of a rental property management company might be the solution needed. Utilizing their proficiency and experience, an esteemed property management company can skillfully navigate the rent collection process, thereby freeing you to focus on other imperative components of property ownership.
Renting is made easy with Real Property Management Three Bridges! Our property management services, enhanced by technology, offer online rent payment options. Contact us online or call 636-542-8852 today to learn more about our quality services in St Peters and nearby!
Originally Published April 1, 2022
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