Processing rent checks manually is both time-consuming and costly. It usually takes about five minutes and $2-3 per check. If you are expecting 500 checks monthly, this could take almost 42 hours and $12-15,000 every year. If you want a more cost-efficient and timely manner to collect rent, you can implement an online rent collection system with the help of your web-based property management software, which allows you to cut costs in half. It also lets you avoid the dilemma of waiting for checks to appear in the mail or personally collecting the rent.
All you have to do is encourage your residents to agree to this program. You will probably not have any issues with your technically advanced tenants who already use online banking.
On the other hand, other tenants may not be in favor to this idea. In this regard, here are 10 ways to encourage your tenants to opt for online rent payment:
Give an incentive for paying online. You can reduce the rent by $20-30 to encourage your more thrifty tenants.
Give a 2-payment date option for online payments – for example, on the first and fifth of every month. This flexible payment option can motivate residents.
Offer an incentive for signing up such as a $30 gift card from a restaurant.
Create a raffle to win $100 gift certificate from a local store, and let all those who sign up for online rent payment join.
Tell them that rent payments are reported to credit agencies nationwide, allowing them to boost their credit standing.
Explain why online payments are environmentally friendly. Nowadays, more people choose to go green.
Create an FAQ sheet and hand out to tenants. List the advantages given by online payments, which include the convenience of saving time on writing checks and avoiding late payment fees.
In the rental agreement, include the requirement to pay online (California and other states have laws that prevent this).
If they refuse to pay online, charge an additional service fee per month.
As a landlord, be responsible. Whenever there are customer issues, respond immediately. Maintain your property well. When you look after your tenants, they will cooperate and more likely give in to your request to pay rent online.
Just like other issues, the most effective way to convince your residents to pay rent online is to have constant communication and be transparent with them. The moment they realize how beneficial this could be to them and of course, you, they may be convinced to sign up.
If your tenants would be able to pay rent with credit card, the process would be much faster and simpler for everyone involved. It’s about time to start thinking about this and find an online rent payment service.
Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses from 2007 up to the present of experience in real estate investing and property management in the Memphis and Nashville markets.
