One of the most necessary areas of maintaining a profitable rental home is collecting rent payments on time. However, to obtain those payments, property owners first have to decide on how that rent should be paid. There are completely different ways to collect rent payments. Nevertheless, the best ones are those that fit your style of property management and your tenant’s wants and needs. To make your selection a whole lot easier, here’s what you need to figure out to select the most suitable rent collection method for you.
Variables to Consider
Identifying the best rent collection method for you depends on a whole lot of different factors. For instance, take into account how many tenants you will need to collect from each month, how far away you are from your rental property, and how comfortable you are with incorporating technology tools to help you manage rent payments. Each of these details can assist you to narrow your options down well. You may equally have to think of how often and in what way you want to interact with your tenants. While frequent positive communication is very beneficial for Harrison property managers, showing up each month only to collect the rent could send your tenant the wrong message.
Convenient and Well-Documented
Another necessary thing to go into prior to deciding on a rent collection method is whether it qualifies two key criteria: convenience and the ability to document each transaction. Now more than ever, today’s renters are looking for tech-driven conveniences to make their lives uncomplicated. A recent study identified that 83% of consumers prefer to pay their bills online. But certainly, in keeping with convenience, it’s additionally essential to have good records of all rent payments and other transactions. Having a payment method that can bestow both is relevant for a well-managed rental property.
Payment Methods
There are two key forms of payment methods: traditional and electronic. Traditional payment methods reflect property management approaches and methods of the past and are just what you’d expect: cash, personal check, cashier’s check, or money order. Conceding that there are valid reasons to request a money order or cashier’s check – in payment of a security deposit, for example – obtaining cash or personal checks isn’t the best for most situations. Cash payments are toilsome to document, and personal checks come with multiple issues, from slow delivery to long wait times as checks clear the bank.
On the other hand, electronic payment methods have certainly become more distinctive over the last few years. Property owners can choose from electronic payment options like ACH transfers and Square, but now money can easily be sent through payment apps like PayPal, Zelle, and Venmo (to name a few).
Quite a lot of electronic payment methods will bestow a record of each transaction, making documentation automatic. Though some tenants may be concerned about the safety of sending money online or prefer not to use payments apps for monthly bills. The major downside for property owners is the fees; all electronic payment methods frequently will have added costs, so it’s vital to research each one before ever making a decision.
Automate and Communicate
With countless payment methods, it is essential to choose how you’d like to handle rent collection before it ends up being a problem. The more automated the rent payment method you choose, the easier the entire process may be for you. However, tenants may feel restricted if you accept only one payment method, especially if it relies on a technology they aren’t comfortable using. For this reason, it’s relevant to communicate with your tenant and think of providing two or maybe three ways to pay the rent. This combination approach may be an excellent compromise, as long as each method grants the convenience and documentation you need.
Collecting rent payments doesn’t have to be so difficult, but it can indeed be a problem to find everything out all by yourself. On the other hand, check out the rewards of appointing a property management company that offers convenient online rent payment options. If you’re ready to turn the day-to-day tasks of managing a rental property over to the professionals, give us a call at 866-820-9913.
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