The collection of rent is a major concern for the majority of rental property owners. Along with deciding how much rent to charge, determining how to manage it is one of the most critical considerations any property owner will make. The most effective way to encourage on-time rent payments is to have a good rent collection method in place and ready to go 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 choices available when it comes to collecting the rent. However, with so many individuals making use of the conveniences of online payment systems these days, online rent payment is by far the most popular rental payment method. Tenants like the security and simplicity of making payments online, and property owners benefit from having money placed into their accounts more quickly.
- Payment App. Payment apps such as Venmo, Zelle, and PayPal are other methods of making rent payments that are becoming increasingly popular. For many tenants, these services are also incredibly useful, as they allow them to request and send money quickly and easily.
- ACH Debit. Finally, some Huntersville property managers are now allowing their renters to set up ACH debit, which can be a wonderful way to ensure rent payments are made on time. It is possible to have the rent automatically debited from a tenant’s bank account if they feel comfortable doing so. Some tenants may be uncomfortable with this arrangement, therefore providing them with a choice of two or three options may be beneficial. As a side note, it’s also important to note that each payment method usually charges a fee to use them. Because fees vary, it’s critical to conduct your research before committing to one payment option.
Payment Methods to Avoid
On the other hand, there are a few payment methods that you should avoid encouraging tenants to use. For instance, you should avoid receiving rent payments in cash because maintaining a paper trail is quite difficult. It would be difficult to show when and how much your tenant paid if a disagreement developed. Personal checks are particularly problematic since they take a long time to clear and can fail if funds are insufficient, costing you and your tenant money in bank fees. Money orders and cashier’s checks are generally accepted, especially when a security deposit is being collected. Simply pick whatever approach you prefer and have a method for documentation ready to generate a solid paper trail.
While one or more of these approaches may be necessary on occasion, it is normally advisable to avoid them. These methods are difficult to document and are riddled with flaws. 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, even in the best of circumstances, may be a time-consuming aspect of owning rental properties. It doesn’t have to be that way, especially if you engage a rental property management company to help you with the process. At Real Property Management Charlotte Metro, we provide technologically advanced methods such as online rental payments.
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!
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