Surprisingly Easy Ways to Collect Rent Payments on Time

Are you a landlord struggling to collect rent payments on time?

Whether you do this on the side, or as a full-time job. Collecting rent payments on time can be a difficult job to do. Luckily, there are several stress-free ways to collect rent payments on time.

Ways to Collect Rent Payments on Time

Are you wondering how you can collect rent payment diligently? Here are the ways to collect rent payments on time:

1. Set Up Online Payments

This is one of the best ways so far. Online payments are easy and convenient, especially if you are collecting payments from Gen Z. There are several apps where you can collect rent payments on time such as Cozy, Venmo, Zelle, and PayPal.

• Cozy.co: Cozy offers a wide variety of services for free. Cozy lets you collect rent online, tenants can pay for free if they have a checking account, or they will have to pay a 2.75% transaction fee with a debit/credit/prepaid card. Cozy helps you stay organized and keeps your data all in one place. Cozy has an Automatic Late Fees option, which lets more tenants pay on time. Cozy is a platform that is very safe and affordable to use.
• Venmo: Venmo is a user-friendly system where you can get paid from tenants effortlessly. However, one big drawback of Venmo is that it charges a 3$ transaction fee (for businesses.) Therefore, if you do not find large transaction costs suitable for you, then this option may not be the best for you.
• Zelle: Zelle is a fantastic app where you can transfer money through most major banks. The best part is that transfers through Zelle are free! It only requires a cell phone number or an email address.
• PayPal: PayPal is convenient because almost everyone has people and has their account already set up on it. Although PayPal does charge fees.

2. Collect Rent in Person

Collecting rent in person is a great way to collect rent because you get to see your property, look out for any issues, and get to talk to your tenants which is an effective way to remind them to pay.

However, if you have a lot of properties, this may be a bit difficult for you to personally go to each house and collect payments from them.

Be careful not to give your address to your tenants because this could end up against you.

3. Set up a Drop Box

The third way to collect rent on time is by setting up a drop box. You can place a drop box in a common area (close to your business and theirs) to make sure that you are placing the drop box in a safe and secure place. 

4. Have a Property Manager

Property managers are an assistant to help you manage your properties. Property managers will do all the work for you, from collecting rent to dealing with any issues that may come up. You should consider hiring a property manager if you have a lot of properties and want to save time and effort.

This comes with a cost, you will have to pay the property manager 8-12% of the monthly rental value of the property, including expenses.

5. Reporting Rent Payments

Reporting rent payments is keeping the history of the tenants who paid you on time. Studies have shown that 73% of tenants say that reporting monthly rent payments would motivate them to pay rent on time. Reporting rent payments is a very simple, but effective process to increase the percentage of your payment.

6. Clear and Open Communication

This is probably one of the most important ways to collect rent payments on time. Have clear and open communication between you and your tenants. Be welcoming and easy to talk to. Be open to talk about any of the issues that they may be going through. Being welcoming is a good way to make tenants feel good about you. It also ensures that you have an atmosphere of respect for your tenants. It is also smart to give your tenants several ways to contact you. If you have tenants from different age groups, be sure to provide all forms of contact such as your email address, phone number, and a full mailing address. You should however inform your tenants which way you respond faster. 

Anything else I can do?                                                                                                

Try your best to build a good relationship with your tenant once they begin to rent your property. You should also be straightforward with your tenants by setting your rules and regulations from the start.

7. Send Payment Reminder Alerts

Send alerts to tenants before payment day. Tenants may be caught up with their life, that they may easily forget to pay rent! A great way to remind them before payday is to send alerts days before rent day. If you find sending alerts helpful, you can use a service like DialMyCalls to send text messages to tenants to remind them to pay rent.

8. Deferred Rent Payments

You can agree with your tenant to have a deferred rent payment if you both agree to do so. You should keep in mind that tenants may struggle to pay rent on time all the time. Therefore, having a rent-payment extension may be helpful. Additionally, here are the steps you can take in dealing with rent payment issues especially during COVID19.

9. On-Time Payment Incentives

Offering an incentive or a type of reward to your tenants on time Is a smart way to get your full rent payment on time. It does not have to be something big, simply anything you think that would encourage your tenants to pay on time will do. Some examples of payment incentives are pay early and get a discount, pay on time, and continue working with me, and pay on time and avoid late fees.

• Pay on time and avoid late fees means that your tenants will pay you on time so that they will not have to pay a ‘’late’’ fee. Which is about a 5% fee.
• Pay early, get a discount is offering a discount to your tenant that pays early. This encourages your tenant to pay early if they have the financial ability to do so.
• Pay on time, continue working with me. This means that if you pay on time you will continue to work with the landlord and have a good relationship with him/her.

Summary

At the end of the day, there are many ways to collect rent payment on time, however, there is one method you most likely should not follow which is by collecting payments through cash. Collecting payments through cash is not suggested, because it can be difficult to keep track of it (whether you keep track of the address, date, or who paid for it), and it can get lost/stolen easily. Keep in mind these ways to collect rent payments on time and we are sure you will not worry about it next time.