One of the most relevant attributes of retaining a profitable rental home is receiving rent payments on time. Though, to have those payments, property owners first will have to opt for how that rent should be paid. There are very diverse systems to collect rent payments. But in fact, the best ones are those that fit your style of property management and your tenant’s wants and needs. To figure it out more easily, here’s what you need to understand well to choose the appropriate rent collection method for you.
Variables to Consider
Discovering the best rent collection method for you depends on many different factors. For example, take into consideration 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 really help you manage rent payments. Each of these factors can aid you to narrow your options down greatly and easily. You may similarly need to look into how often and in what way you want to interact with your tenants. While frequent positive communication is very beneficial for Chicago property managers, showing up each month only to collect the rent could send your tenant the wrong message.
Convenient and Well-Documented
Another relevant thing to take into account in preparation for determining a rent collection method is whether it correlates with 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 worry-free. A recent study detected that 83% of consumers prefer to pay their bills online. But, together with convenience, it’s similarly vital to have good records of all rent payments and other transactions. Getting a payment method that can grant both is important for a well-managed rental property.
There are two chief styles of payment methods: traditional and electronic. Traditional payment methods reflect property management ways of the past and are just what you’d expect: cash, personal check, cashier’s check, or money order. Notwithstanding there are reasons to request a money order or cashier’s check – in payment of a security deposit, for example – getting cash or personal checks isn’t best for most cases. Cash payments are tedious to document, and personal checks come with countless troubles, from slow delivery to long wait times as checks clear the bank.
On the other hand, electronic payment methods have really become more diversified 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).
Many electronic payment methods will grant a record of each transaction, making documentation automatic. Nevertheless, some tenants may be nervous 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 generally will have added costs, so it’s necessary to research each one just before making your last decision.
Automate and Communicate
With multiple payment methods, it is significant to pick out how you’d like to handle rent collection before it turns into trouble. The more automated the rent payment method you choose, the easier the entire process may be for you. Then again, 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 essential to communicate with your tenant and look into presenting two or maybe three ways to pay the rent. This combination approach may be an ideal compromise, as long as each method offers the convenience and documentation you need.
Collecting rent payments doesn’t have to be hard, however, it can be troublesome to discover everything all by yourself. Preferably, take into account the returns and rewards of enlisting 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 312-265-0660.
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