A significant concern of most rental property owners is collecting the rent. Apart from how much rent you should charge, knowing how to manage it is one of the most important decisions any property owner will make. The best strategy to encourage on-time rent payments is to have a good rent collection method set up and ready in advance! Let’s talk about some of the best methods to collect the rent from tenants and a few methods that are better to avoid.
Best Methods for Direct Rent Payment
- Online. When it comes to collecting the rent, you have several alternatives. But with several people tapping into the affordances of online payment systems these days, the most in-demand rental payment method is – by far – online rent payment. Tenants choose the security and convenience of making payments online, and property owners can get those payments deposited right away.
- Payment App. Another up-and-coming method for rent payment is payment apps like Venmo, Zelle, and PayPal. These technologies are also pretty useful for several tenants and can make requesting and sending money quick and uncomplicated.
- ACH Debit. Ultimately, some Caldwell property managers are now establishing ACH debit for their tenants, which can be another effective strategy to guarantee rent payments arrive on time. If the tenant is comfortable doing so, they can provide their bank account information and have their rent automatically deducted each month. Some tenants may not be comfortable with this arrangement, so it may be helpful to give them a choice between two or three methods. It’s also important to note that each payment method usually charges fees to use them. Fees vary, so it’s important to do your homework before choosing one payment method.
Payment Methods to Avoid
There are a few payment methods, on the other hand, that you should restrict your tenants from using. As an illustration, you have to avoid collecting rent payments made in cash since creating a paper trail is very difficult. If a dispute arose, it would be difficult to prove when and how much your tenant actually paid. Personal checks are especially tricky because they take a long time to clear and can bounce if there are insufficient funds, resulting in bank fees for you and your tenant. Money orders and cashier’s checks are usually accepted, especially when collecting a security deposit. Just make sure to specify which method you prefer and have a documentation method ready to create a solid paper trail.
While you may need to use one or more of these methods sometimes, it is usually recommended to ignore them. These methods are hard to document and rich with problems. You may even want to exclude these payment methods in your lease documents to explain that you won’t accept rent payments in this fashion.
Collect Through a Property Management Company
Even under the best circumstances, collecting rent can be a time-consuming part of owning rental properties. But it doesn’t need to be that way, especially if you hire a rental property management company to handle the process for you. At Real Property Management Nampa, we offer tech-enhanced processes that include online rental payments.
Selecting 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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