Unless one is firmly rooted in a 20th Century mentality, chances are they write very few checks anymore. With the emergence of debit cards, online banking, online bill payments and direct deposit, many people rarely even handle cash. In many cases, the only check people write is for rent. As a landlord or property manager, collecting rent by check isn’t the worst way you could go about it. You could accept cash and struggle to maintain accurate records, you could allow installment payments which require more time on your end to keep track of.
But if you are still requiring tenants to write a check each month, you’re waiting for them to arrive in the mail or at your drop box. You’re logging them in a ledger so you can keep track of who has paid and who has yet to pay. You’re writing out deposit slips and schlepping all of those checks to the bank. Then, you’re waiting for the bank to process them and let you know which ones bounced—every month.
Collecting Rent Without Checks Is Easier than Ever
Collecting online rent payments eliminates all of the above. The money is transferred directly from your tenants’ bank account to yours. The funds are credited instantly and it all appears on your bank statement automatically. Bounced checks are a thing of the past and your tenants can set up the rent payment as a recurring event so rent is paid on time every month.
Stolen or lost checks are completely eliminated and you get a solid paper trail. Your ledgers are updated without human intervention and best of all; you don’t have to go out of your way to make any of this happen. This is why the best property management companies operate this way. In fact, because this is such a superior way to accept your rent payments, Onerent offers online rent collection as a standalone service.
When you’re considering going this route, the ideal situation is one within which your payment processing integrates with all of your other digital tools. This way, every transaction is tracked across your entire system and your property management software can issue late payment notices if funds have yet to be credited to a tenant’s account by a certain date.
The best time to implement online rent payments is when new tenants move in. This way you can require it as one of the tenets of the lease agreement, because you are perfectly within your rights to require a specific form of payment. For existing tenants, you can implement it as a requirement at lease renewal and offer it on a voluntary basis for leases that still have several months to go. Ultimately though, you’ll want all of your payments coming in this way to eliminate redundancies.
By the way, if you’re currently accepting cash rent payments, you should rethink that policy. Every other form of payment creates a paper trail. But with cash, disputes over payment and the potential for fraud leave you vulnerable to controversy. Accepting cash payment can also make you a target for robbery.
Of course, along with every convenience comes a cost. Most services do charge a fee for providing this service. Some base it upon a percentage of the amount collected, while others charge a flat fee. Here, you’ll have to do the math to determine which way is the most cost effective for your situation. More often than not, the flat fee is the preferred way to go, but this depends on how many units you have, the average amount of rent you charge and a few other factors.
Either way though, collecting online rent payments will streamline your renting processes, get your payments credited more quickly, save you time and reduce your effort.