Developing a dependable rent collection plan is imperative for rental property owners. Apart from setting an appropriate rental fee, overseeing rent payments is essential for property owners.
Establishing an effective rent collection scheme and preparing ahead of time can lead to timely rent payments from your tenants. Let’s investigate the optimal approaches to collecting rent from tenants and pinpoint strategies to avoid.
Best Methods for Direct Rent Payment
- Online. Today, a range of options is available for rent collection from tenants. As online payment systems become more prevalent, online rent payment emerges as the top choice for rental payment. This method provides tenants with the convenience and safety of online payments, while ensuring property owners receive payments promptly. Online rent payment has risen as a trustworthy and easy solution for both tenants and property owners.
- Payment App. Utilizing apps such as Venmo, Zelle, and PayPal offers a novel and modern approach to rent payment. The user-friendly nature and convenience of these services have made them favorites among both tenants and landlords. With the capacity to promptly request and send money, tenants find that paying rent becomes quick, efficient, and trouble-free.
- ACH Debit. Property managers are now introducing new tactics to secure prompt rent payments. ACH debit is one method among these. Through this method, tenants can share their bank account details to enable automatic rent deductions monthly. Some tenants may feel uneasy with this setup, thereby necessitating the availability of two or three payment options. Also, it should be noted that fees are commonly associated with each payment method, and these can widely vary. 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. Best practice is to eschew cash payments to simplify tracking. Disagreements could make it hard to confirm the payment details from your tenant. Consequently, it’s best to choose payment methods that provide a clear and easily accessible record.
Personal checks could be a poor choice as their clearance can be slow and they may bounce, causing bank fees for both the landlord and tenant. Under these circumstances, money orders and cashier’s checks may be preferable, particularly for security deposit collection. It is crucial to unambiguously state your preferred payment method and to have a method for documentation to establish a robust paper trail, thus preventing future disputes or confusion.
There might be instances requiring the adoption of these suboptimal payment methods, yet it’s wise to keep away from them. Payment methods like these are typically difficult to record and are beset with challenges. It could be advantageous to disallow these payment methods in your lease contracts to affirm that rent payments via these avenues are not accepted.
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. Nevertheless, if simplifying the process is your goal, engaging a rental property management company might be the answer. Through their specialized knowledge and seasoned experience, a credible property management company can competently take charge of the rent collection process, enabling you to dedicate your attention to other important aspects of property management.
Renting is made easy with Real Property Management All Connect! As part of our tech-savvy property management services, we include the capability for online rent payment. Contact us online or call 512-806-0606 today to learn more about our quality services in Round Rock and nearby!
Originally Published April 1, 2022
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