As a property owner, receiving rent payments on time is vital for maintaining a successful rental home. Nonetheless, before receiving those payments, you must look into some rent collection methods available and pick the one that best suits your management style and tenant’s requirements.
With numerous options, properly choosing a suitable rent collection method can be dispiriting. Hence, it’s necessary to understand the available methods and consider their pros and cons to make an informed decision. This will guarantee that you receive rent payments on schedule without any difficulty.
Variables to Consider
If you’re trying to know the best way to collect rent, there are some things you should take into consideration. By way of example, how many tenants do you need to obtain from each month? Do you feel good using technology tools to manage rent payments? Looking into these factors, you can swiftly narrow your options and identify an excellent fit.
When managing a property, you must think of the frequency and manner of your interactions with your tenants. While, many times, engaging in positive communication can be beneficial, only turning up to collect rent each month can give off a false impression. It is necessary to strike a balance between being actively involve and giving your tenants the space they need.
Convenient and Well-Documented
Before you opt for how to collect rent, ask yourself two things – is it trouble-free, and can you keep track of every transaction? Presently, renters want tech that makes their lives lighter.
Did you know that, according to a recent study, 83% of consumers prefer online bill payment? It’s no surprise, as online payments are accessible, quick, and easy to work on. But remember, keeping track of all rental payments and other transactions is also important. Finding a payment method that extends both convenience and accurate record-keeping is vital to managing your rental property correctly.
Payment Methods
There are two main categories of payment methods: traditional and electronic. Traditional payment methods include cash, personal checks, cashier’s checks, and money orders, which have been administered and used in property management for quite some time. However, electronic payment methods have become progressively popular and diverse in recent times. Nowadays, property owners can opt for several electronic payment options in particular ACH transfers and Square. Equally, payment apps like PayPal, Zelle, and Venmo have made sending and receiving money electronically effortless.
Accepting cash or personal checks for payments can be complex. Cash payments don’t really come with proper documentation, while personal checks can take a while to clear the bank. For that reason, it’s usually better to go for money orders or cashier’s checks. They are oftentimes more dependable and effortless. When your tenant is paying a security deposit, it’s greatly reasonable to use a money order or cashier’s check.
Electronic payment methods offer a good advantage over traditional payment methods, as they give a detailed record of each transaction. This attribute makes documentation automatic, eradicating the need for manual documentation of each payment. This not only saves time but also helps keep track of your expenses and maintain financial records for later reference.
Automate and Communicate
In the matter of collecting rent, opting for a suitable payment method is vital. By picking a more automated rent payment method, you can streamline the total process and make it easier for yourself. By doing so, you can dwell on other important aspects of managing your property without worrying at all about rent collection.
It’s vital to offer tenants many payment options to prevent restricting them to a single method that may count on a technology they are not comfortable using. We suggest granting two or three payment methods and transmitting the options to your tenant to safeguard ease of payment and proper documentation. A combination approach can be a realistic compromise as long as each technique meets your requirements for documentation and convenience.
Take into account the benefits of hiring a property management company. Real Property Management North Puget Sound provides tenants with simple online rent payment options. If you’re ready to turn the everyday functions of managing a rental property over to the professionals, contact us online or call us at 425-527-6562.
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