Developing a dependable rent collection plan is imperative for rental property owners. In addition to setting the right rental price, managing rent payments stands as a key decision for property owners.
With an effective rent collection strategy and prior preparation, you can prompt your tenants to submit their payments promptly. 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. Currently, various strategies for collecting rent from tenants are available. However, as online payment systems gain popularity, online rent payment has become the preferred method of rental payment. By this method, tenants enjoy the comfort and protection of making payments online, and it guarantees that property owners get those payments punctually. The online rent payment option has established itself as a credible and convenient method for both tenants and property owners.
- Payment App. A fresh and modern method for paying rent involves the use of platforms like Venmo, Zelle, and PayPal. 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. ACH debit is one method among these. By using this method, tenants have the option to give their banking information for the automatic deduction of rent monthly. However, since some tenants might find this arrangement unsettling, it’s vital to offer a choice of two or three payment methods. Furthermore, it’s significant to acknowledge that each payment method usually involves charges, which can substantially vary. Hence, doing your due diligence prior to choosing a payment method is crucial.
Payment Methods to Avoid
Recommending specific payment methods to your tenants for rent payments is prudent. Avoiding cash payments is preferable as they complicate record-keeping. In case of disputes, evidencing the timing and amount of rent paid by your tenant might be challenging. For this reason, preferring payment methods that provide a clear and easily accessible record.
Using personal checks can be less than optimal because of the extended time they take to clear and the risk of bouncing, which can lead to bank charges for you and the tenant. For these reasons, opting for money orders and cashier’s checks can be more suitable, especially in the context of security deposit collections. Clearly indicating your preferred payment method and maintaining a reliable documentation method are crucial for establishing a solid paper trail and avoiding future disagreements 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. 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 Chicago Group! Our property management services, enhanced by technology, offer online rent payment options. Contact us online or call 312-265-0660 today to learn more about our quality services in Palatine and nearby!
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