Did you know that around 65% of Americans own at least one piece of property?
Collecting rent on time is crucial for landlords, but it can be difficult to get tenants to pay on time.
It's not uncommon for landlords to experience late rent payments from their tenants. This can cause a lot of stress and frustration, especially if you're relying on that rent money to cover your bills.
But don't worry. Keep reading and use one of these three effective strategies for timely rent collection and you'll be able to rest easy knowing that your rent money is coming in on time each month.
1. Set Expectations with a Written Agreement
Clearly outlined rules and expectations are important to have a successful tenancy agreement. Having a written agreement at the start of the tenant's residency is essential, as it will ensure that both parties are aware of the requirements for staying in their rental unit.
A signed agreement should include expectations around rent payments and any associated fees if rent is past due. When tenants know exactly what is expected of them in terms of rent payments, both parties can avoid misunderstandings or problems in the future.
By creating an explicit explanation of tenants’ rights and responsibilities from the beginning, landlords can promote responsibility, reliability, and transparency when it comes to collecting rent each month.
2. Automate Payments
Automating rent payments can give you the convenience of not having to manually collect each month. It's also a great option for your tenants, as they have a wide range of options to choose from, such as direct debit or even ACH transfers. This saves them time and money on postage, checks, and bank fees.
Automation provides more reliable payments and ensures that your rent is paid every month on time. Not only that, but it's safer and more secure than traditional payment methods as your tenants do not need to personally provide their financial information to you.
Overall, automating rent payments is a great way for both landlords and tenants to take advantage of the convenience and security it offers without sacrificing any accuracy or quality in the rent collection process.
3. Respond Quickly to Late Payments
Setting (and enforcing) clear payment expectations is a vital part of being a landlord. No renter wants to miss a payment, but it may sometimes happen. When this happens, the best policy is to respond quickly and decisively. Reach out directly when the payment is overdue so tenants are aware that the late payment isn't going unnoticed.
You should also let them know what action you expect to be taken (i.e. when they can make up the missed payment). While it may not be pleasant to have this conversation, having clear standards around late rent will help foster good tenant relationships in the long run – and protect your investments.
Need Help With Rent Collection?
After reading this rent collection article, you should know what to do when collecting rent payment from tenants. Be sure to use these tips to collect tenant payments on time every single month.
If you're having trouble collecting rent and you'd like some help from a property manager who can handle rent payments for you, let us help. Apply online for a consultation today.