Landlords and property managers bear the task of collecting rent from tenants, and while it often happens like clockwork, property owners will deal with the occasional late rent payments or even transaction difficulties. In the modern age, there is an easy solution that can help streamline rent collection, and that's providing a digital payment method.
Benefits of Online Rent Collection
Convenience
Arguably, the best thing about online rent collection is the convenience. The tenant won't need to go to banks or meet the landlord for physical exchanges. As long as they have a smart device and an internet connection, tenants can make rent payments anywhere, any time.
Efficiency
The payments usually reflect instantly with online rent payments, making it an efficient way to track your financials and reduce administrative burdens. It might depend on the platform or the kind of bank account you have, but online payments usually go through as soon as they are sent.
Security
Third-party payment platforms like online rent collection services already have built-in security measures, so you wouldn't have to worry about risky transactions or fraud. An online rent collection service, app, or software usually comes with verification methods to ensure the person's credibility.
Accessibility
Online rent collection platforms aren't only easy to access, some also have features that accommodate various payment methods such as credit card payments, direct bank transfers, or cash transfer apps such as Venmo or Apple Pay. Some options like a bank transfer might charge transaction fees, but it would be a small price to pay for some tenants who don't have access to certain options.
Automation
Collecting rent payments can be a hassle, especially when you own several properties. With the current technology you can access, it's now easy to automate rent collection. You can receive automatic payments directly into your bank account, eliminating the need to manually collect rent.
Record Keeping
Just as you can check the transaction history of credit or debit card payments, records are also kept for those who pay online. This can be beneficial for both landlords and tenants. It would be easier to track when landlords receive rent payments, as well as when and if tenants pay rent.
Integration
Online rent collection tools can easily be integrated with property management software, which can take care of recurring payments, late fees, and other monthly fees. Provident Property Management, for instance, has a 24/7 tenant portal for online rent payment.
Reduced Late Payments
Tenants might be more inclined to settle their dues when they can pay rent online. Seeing as online rent collection is more convenient, it can significantly contribute to on-time rent payments and reduce the need to collect late fees.
Online Rent Collection Methods You Can Use
Online Rent Payment Services
The mentioned service usually comes in the form of a rent collection app, and there are tons you can choose from such as Rentvine, Buildium, and AppFolio[1]. There are even certain platforms that offer features for automatic charges for recurring rent payments, or rent reminders for timely payments.
Depending on the service, there are options where you can also allow partial payments, fees for late payments, and other rent-related transactions you might need. The provided payment controls can help you with a more comprehensive overview of your rental business.
Property Management Software
Just like dedicated apps or services used to collect rent, there are property management software you can use to do the same along with other features that can help landlords or property managers. Some are best for maintenance requests while others lean more into collecting rent online.
It's better to do your research first to find which property management software fits your management style best. Do you need rent collection tools more? Do you need features that notify you about maintenance requests?
Cash or Banking Apps
This might be the most accessible rent collection method you can use since the payment will come straight from the tenant's bank account. A direct deposit on your checking account will be quicker, but you will miss out on certain features that an online rent payment service or property management software can provide.
You also have to account for fees that ACH payments usually charge, and you'll have to clarify whether you or the tenant will handle the fee. It also helps that some bank and cash apps have features for automatic rent payments, eliminating the possibility of forgetting to pay rent.
Tenant Portal
There are companies like Provident Property Management that have in-house tenant portals. It's usually used to collect rent online and keep records of those transactions, which is something both landlords and tenants can view.
Other than integrating rent collection, property managers send rental income to bank accounts after they collect rent payments. You can access the portal at any time to monitor your rental property business and its cash flow.
Digital Rent Payment FAQs
Are digital rent payment platforms secure?
- Most are, given that they use advanced security measures to avoid potential fraud and data theft. It's still important to research which options are reputable to protect your financial information.
Is there a transaction fee for online payments?
- That depends on the platform and the transaction. ACH bank transfers, for instance, can charge up to $10 per transaction. Some platforms only require a one-time fee while others are subscription-based.
How long does it take for the payments to be processed?
Cross-platform transactions might take between 1 and 3 days, but most payments reflect on the recipient's account instantly.
Utilizing a Property Management Company's In-House Portal
Provident Property Management uses an in-house tenant portal to manage payments, which gives us a more hands-on approach to handling financials. It also means that you can contact us directly when issues arise, as opposed to raising your concerns to platforms with millions of users to attend to.
When your tenants are late on their rent, we'll send notices or charge late fees on your behalf. We are just as diligent with our other services such as marketing, tenant screening, maintenance, and more. Contact us now to find out just how our company can maximize your property's value, or how you can earn passive income as you focus on other opportunities.
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