Owners of rental properties must prioritize creating a strong plan for rent collection. In addition to setting the right rental price, managing rent payments stands as a key decision for property owners.
By setting up an effective rent collection process and getting ready in advance, you can persuade your tenants to make their payments on time. We’ll look into the best practices for gathering rent from tenants and outline the tactics to avoid.
Best Methods for Direct Rent Payment
- Online. Presently, several approaches are available for tenant rent collection. Nonetheless, due to the growing appeal of online payment systems, online rent payment is now the most popular method for rental payments. This technique allows tenants to benefit from easy and secure online payments and assures property owners of timely payment reception. Online rent payment has risen as a trustworthy and easy solution for both tenants and property owners.
- Payment App. The use of apps like Venmo, Zelle, and PayPal represents a contemporary method for rent payment. The user-friendly nature and convenience of these services have made them favorites among both tenants and landlords. The facility for tenants to rapidly request and dispatch money facilitates a speedy, efficient, and smooth rent payment experience.
- ACH Debit. Property managers have started to embrace innovative strategies for securing rent payments on time. One of these methods includes ACH debit. This approach enables tenants to offer their banking information, leading to their rent being deducted automatically each month. Some tenants may feel uneasy with this setup, thereby necessitating the availability of two or three payment options. It’s also crucial to recognize that each payment method often comes with its set of fees, which can greatly vary. Consequently, it’s imperative to thoroughly research before deciding on a payment method.
Payment Methods to Avoid
It is wise to guide your tenants towards particular payment methods for rent. Avoiding cash payments is preferable as they complicate record-keeping. If a dispute occurs, proving the exact amount and payment date from your tenant could be difficult. Consequently, it’s best to choose payment methods that provide a clear and easily accessible record.
Personal checks might not be ideal due to their lengthy clearance time and potential to bounce, incurring bank fees for both you and your tenant. Therefore, money orders and cashier’s checks prove to be superior options, notably for gathering security deposits. It’s vital to explicitly designate your chosen payment method and prepare a documentation system to forge a strong paper trail, helping to eliminate future disputes or confusion.
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. Prohibiting these payment methods in your lease agreements might be beneficial to make clear that these are not acceptable means of rent payment.
Collect Through a Property Management Company
The ownership of rental properties has the potential for high earnings, but the act of collecting rent can be painstaking and slow, even in the most favorable conditions. Nevertheless, if simplifying the process is your goal, engaging a rental property management company might be the answer. 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 Charlotte Metro! Online rent payment is a feature of our technology-enhanced property management offerings. Contact us online or call 704-919-1344 today to learn more about our quality services in Huntersville and nearby!
Originally Published April 1, 2022
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