To run a successful rental business, it is important that your tenants pay rent on time. Rent collection is the backbone of a landlord’s income. It is crucial to find a rent collection method that works best for your real estate business.
Landlords have traditionally accepted monthly rent payments via cash or paper checks, but in recent years, much of the property management business has shifted online and taken the rent collection process with it.
You might be considering making the change to collecting rent online and wondering what the advantages might be. This article outlines multiple ways in which making the change to online rent collection will help your business find success and make the rent collection process smoother and easier.
Reduce Late Payments
Late or missing rent payments are a headache to take care of and can be harmful to your business. It’s best to do whatever you can to avoid them. Moving rent collection to an online platform can help to reduce late payments in multiple ways.
One way is that the stress of trying to make a last-minute payment with a paper check goes away. Online rent collection means that tenants can make their payments from anywhere with an internet connection. If the software you use is also available as a mobile app, they don’t even need to rely on a steady internet connection to get their rent paid on time.
Property management software will also allow a tenant to set up automatic rent payments. Automatic payments eliminates the possibility of a tenant simply forgetting to pay their rent. Not only does this help you by letting you know your payments are coming on time, but your tenants can also take comfort in avoiding late fees.
Communicate from Anywhere
With traditional offline methods of payment, if a landlord wants to remind their tenant of upcoming rental payments, it becomes a strenuous manual task that involves each individual tenant.
Online platforms make communication easier and ensure a tenant will get the message. Property management software allows a landlord to send notifications out to a tenant from anywhere. If you want to reach your tenants to remind them about upcoming payments a week in advance, you can make it happen in an instant.
This also becomes much easier if the software that you use is available as a mobile app. Having no need for internet connection makes it even easier to send and receive notifications from anywhere. People also spend much more time on smartphones than on desktops or laptops, so mobile notifications are also much more likely to be seen.
Make Paying Rent Transparent and Secure
Monthly rent payments are a business transaction between you and your tenants. It can be helpful to be as transparent as possible when it comes to the exchange of money.
Whenever a transaction is made, online rent collection software automatically creates payment records for you to view at your convenience. On top of doing the work of record-keeping for you, the software also sends copies of the invoice and receipt to the tenant, meaning they have a record of their spending for future reference. This offers a level of security that can improve the trust between you and your tenant.
If your rent collection software has a mobile app, this is also a secure way to process payments. Mobile apps are often under more scrutiny to be secure and reliable in order to be approved for app stores. For this reason, it is a good sign if a property management software has a good mobile app.
Conclusion
Having your tenants pay rent online simplifies the payment process for every party involved, and a streamlined, hassle-free process may be a big factor for a tenant deciding whether or not to renew their lease.
Through automation, clarity and consolidation, online rent collection software is a step in the right direction toward making the stress of the rent payment process a thing of the past. It allows you to reallocate the time and effort you would’ve put into rent collection to other needs of your business.
The decision of how-to layout your rent collection process is an important one, but hopefully this article has made the choice a little easier.