As a landlord or property manager, the most important thing about your rental property is rent collection. Paid rent determines your income and has a profound effect on the ROI of your rental business.
Whenever you are a DIY landlord or a property manager, you have to collect rent. And obviously, collecting physical rent checks is a giant headache. The issues are endless: checks bounce, tenants pay late, the need to physically collect and cash the checks.
Surprisingly a lot of property owners continue to collect rent offline driving for rental checks thus wasting precious time, despite the fact that there already is a great solution that solves this problem. This is cloud-based rental management with online payment tools or, in other words, property management software. These rental tools can cut your time and money spent on rental management dramatically — less headaches for yourself and for your tenants. However not all tenants are ready to pay rent online and that's mainly because they don’t have enough information on how they work. The most common myths about online rental payments are potential cost, losing track of money and low security of online transactions. But all these problems are tales of the past.
So why do online payments make this process so much easier and more efficient?
For property managers and landlords, it eliminates the need to control tenants when rent is due, drive to collect rent checks, and it cuts down the time it takes to keep track of who has paid and who hasn’t as well as avoid late fee issues. For tenants, it allows them to “set it up once and forget it.”
Related: How To Collect Rent From Tenants: Top Tips For New Landlords
But how to get this message across to tenants and start requiring them to pay online:
- Tell tenants about it in person. This gives you a chance to clarify everything: tell them that they are going to get their own account with the ability to store all transactions and pay rent securely in time.
- Test it out on a small scale. If you’re not sure whether you are ready to change your rent policy yet, try it with a subset of your tenants first. It is very likely that you won’t meet as much resistance as you might think; cloud property management software is not only a great tool for landlords, but it's also a cloud office for tenants with a bunch of additional useful features (like an option to submit visual maintenance request), so don’t be afraid, they will love it!
- Encourage them, at least to try it. Give tenants a credit if they are paying online, or even add an additional flat monthly fee for tenants not willing to pay online. You can also write a requirement to pay online into the rental agreement, but remember that some states have laws preventing this. So make sure you're not being too persistent and keep it on the right side of the law.
- Let them know it is free. Tools like TenantCloud allow you to move money absolutely free. TenantCloud uses a secure payment network Dwolla which securely connects with their bank account enabling safe account-to-account transfers. TenantCloud allows to move money without any transaction fees. It allows you to collect or pay rent for free and forget about the rent checks.
- Set it up for them. If you take care of your tenants, it is more likely that they are going to agree to pay online. Help them as much as you can. You can simply set up an account for them and they will only need to fill in their payment information (You can also invite them to connect by sending an invite from your TenantCloud account). This not only makes the process easier for your tenants, but allows you to control the process completely.
Related: Best Way to Collect Rent: Cash vs Online Payments
Once your tenants realize there are a lot of benefits for them (as well as you), they may be more willing to start paying online. Thankfully, there are services which allow to set up online payments in a few clicks and use them for free. Don’t miss the opportunity to cut costs and save time, get your TenantCloud account now!