Receiving rent payments on time is one of the most crucial aspects of running a profitable rental property. However, before receiving those funds, property owners must first decide how the rent should be paid. There are numerous methods for collecting rent payments. However, the greatest ones are those that fit your property management style and the desires and demands of your tenants. To assist you in making a decision, here is what you need to know about selecting the best rent collection technique for you.
Variables to Consider
The optimal method of rent collection for you is determined by a number of distinct factors. Consider the number of tenants you will need to collect rent from each month, the distance between you and your rental property, and your comfort level with using technology solutions to assist you in managing rent payments. Each of these factors can help you narrow down your options significantly. Additionally, you may wish to evaluate how frequently and in what manner you wish to interact with your tenants. While frequent positive communication is very useful for Blythewood property managers, going up each month simply to collect the money could send your tenant the wrong message.
Convenient and Well-Documented
Before deciding on a rent collection technique, be sure it fits two critical criteria: ease and the ability to document each transaction. Today’s renters are searching for tech-driven amenities to make their lives easier now more than ever. Consumers prefer to pay their bills online, according to a recent study. But along with convenience, it’s also crucial to retain solid records of all rent payments and other transactions. For a well-managed rental property, finding a payment method that can do both is critical.
Payment Methods
Payment methods are divided into two categories: traditional and electronic. Traditional payment methods are consistent with historical property management practices and include cash, personal check, cashier’s check, and money order. While there are times when a money order or cashier’s check is required – for example, to pay a security deposit – accepting cash or personal checks is not always the best option. Cash payments are notoriously difficult to document, and personal checks provide a slew of issues, ranging from slow delivery to lengthy wait times for checks to clear the bank.
Electronic payment options, on the other hand, have gotten increasingly diverse in recent years. Electronic payment options such as ACH transfers and Square are available to property owners, but money can also be delivered via payment applications such as PayPal, Zelle, and Venmo (to name a few).
The majority of electronic payment methods keep track of each transaction, making paperwork simple. However, some tenants may be concerned about the security of sending money over the internet or choose not to use payment applications for their monthly bills. The fees are the main drawback for property owners; all electronic payment options have additional fees, so it’s vital to examine each one before making a final decision.
Automate and Communicate
With so many payment options, it’s crucial to figure out how you want to manage rent collecting before it becomes a problem. The more automatic the type of rent payment you choose, the simpler the entire procedure will likely be for you. At the same time, tenants may feel confined if you only accept one payment option, particularly if it relies on a technology with which they are unfamiliar. As a result, it’s critical to keep in touch with your tenant and consider providing two or three payment options. This hybrid strategy may be a good compromise, as long as each method provides the necessary convenience and documentation. Rent collection does not have to be complicated, but it might be challenging to sort it all out on your own. Know the benefits of selecting a property management firm that takes rent payments online. If you’re ready to hand over the day-to-day management of a rental property to the specialists, call us at 803-403-8838.
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