Owners of rental properties must prioritize creating a strong plan for rent collection. Managing rent payments, alongside determining a fitting rental rate, is a crucial decision for property owners.
With an effective rent collection strategy and prior preparation, you can prompt your tenants to submit their payments promptly. Let’s examine the most effective rent collection techniques from tenants and identify which strategies to avoid.
Best Methods for Direct Rent Payment
- Online. In the current era, multiple methods exist for collecting rent from tenants. Nonetheless, due to the growing appeal of online payment systems, online rent payment is now the most popular method for rental payments. By this method, tenants enjoy the comfort and protection of making payments online, and it guarantees that property owners get those payments punctually. The online rent payment option has established itself as a credible and convenient method for both tenants and property owners.
- Payment App. Apps like Venmo, Zelle, and PayPal introduce a modernized way to handle rent payments. Due to their ease of use and convenience, these platforms have gained significant popularity among both tenants and landlords. The ability for tenants to swiftly request and transfer funds makes rent payments fast, efficient, and free from hassle.
- ACH Debit. Property managers are currently utilizing novel techniques to ensure rent is paid promptly. One of these methods includes ACH debit. This method permits tenants to supply their bank account info for rent to be automatically withdrawn each month. However, this arrangement may not appeal to all tenants, so it’s essential to offer a few different payment methods as alternatives. Additionally, it’s important to note that each payment method typically incurs usage fees, which can differ significantly. Therefore, it’s important to conduct careful research before opting for a payment method.
Payment Methods to Avoid
Recommending specific payment methods to your tenants for rent payments is prudent. Refraining from accepting cash payments is beneficial, as they can hinder proper tracking. In the event of a conflict, it could become tough to demonstrate the specifics of your tenant’s payments. Thus, adhering to payment methods that provide a clear and easily accessible record.
Opting for personal checks may not be favorable due to their slow processing time and risk of bouncing, leading to bank fees for both you and your tenant. In scenarios like these, money orders and cashier’s checks are more advantageous, especially for securing security deposits. Specifying your preferred payment method clearly and ensuring a documentation process is in place for a solid paper trail is critical to preventing future disputes or misunderstandings.
Situations may necessitate employing these less preferable payment methods at times, but it’s recommended to avoid them. These methods often present recording complexities and are associated with various issues. Excluding these payment methods from your lease agreements may be prudent to explicitly indicate that rent payments through these channels are not accepted.
Collect Through a Property Management Company
While rental properties offer a profitable venture, the process of collecting rent can prove to be laborious and time-intensive in any situation. However, for those aiming to streamline the process, enlisting the services of a rental property management company could provide the solution. Leveraging their expertise and experience, a distinguished property management company can adeptly manage the rent collection process, affording you the opportunity to concentrate on other crucial elements of property ownership.
Renting is made easy with Real Property Management Vanguard! Online rent payment is a feature of our technology-enhanced property management offerings. Contact us online or call 407-681-7802 today to learn more about our quality services in Sanford and nearby!
Originally Published April 1, 2022
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