Collecting rent from your Howard County tenant is no easy feat. Especially if you have more than one rental property.
Remember, you must keep accurate records of all rent payments accepted and balance any other financial transactions that may dip into this rent collection income for when tax time comes. In the end, this adds up to a lot of work that many property owners or their property management companies do not want to deal with.
But did you know there is an easier way?
Have you ever considered collecting rent in the form of an online payment?
Well, if you haven’t, you are in the minority. In fact, a recent survey taken by TransUnion states that 6 out of every 10 property owners prefer to collect rent online.
If you are wondering why online rent collection is becoming increasingly popular, or are just looking for some property management tips that will help make your life a little easier, keep reading to find out the top five reasons why you should start collecting your Howard County rent payments online.
Leading Reasons Why You Should Collect Your Howard County Rent Payments Online
1. It Will Save You Time
Collecting rent online from all of your Howard County tenants will save you loads of time. Instead of frequenting your P.O. Box at regular intervals (especially if rent payment due dates differ for all tenants) or picking them up from your property manager’s office, all rent is sent directly to you. And don’t forget, physical rent payments equate to multiple trips to the bank for depositing.
With online collection, the money deposits right into your bank account. In the end, there is nearly zero effort on your part. Just wait for the tenant to pay and watch your bank account grow.
2. It Makes Rent Collection Easier
Not only does online rent collection act as a great property management tip that is beneficial for property owners, it makes things easier for tenants as well. Remembering to send a rent check or grab a money order and drop it off with Howard’s leading property management company can be tough sometimes. This often leads to late rent payments that not only upset tenants (because of late fees) but also delays the process of you getting paid. With online payments, especially those that are automated, this doesn’t happen as often.
Additionally, you should not be surprised to find that your tenants tend to deal with most of their financial matters online. Therefore, adding the option to pay rent online is a welcome feature for many. In fact, for some tenants, writing you a check for rent is the only time a check is needed, which can be annoying for them. So, save some paper and make things easier for everyone by collecting rent payments online.
3. It is More Secure
Have you ever thought about the information that is printed on the front of a paper check? That’s right, your tenant’s name, address, bank account information, and even their signature appears on the rent check they physically send your way.
This means there is a chance their identity may fall into the wrong hands en route to you and cause lots of problems for both you and your tenant. Think about it: if your tenant is the victim of identity theft and loses all of the money that is in their bank account as a result, what do you think the chance is of you getting your rent payment on time?
By collecting payments via a secure online payment system, you lessen the risk of any personal or sensitive information getting lost and mishandled.
4. Increased Organization
One of the greatest things about collecting online payments is that it streamlines the rent collection process. This is especially helpful if you are managing more than one property. By sending all payments to one localized online payment software, not only do you create digital payment records showing how much was paid and when, you have definitive proof payment was (or was not) collected in the case you find yourself facing a landlord-tenant confrontation.
In addition, these recorded payments help you evaluate your progress as a property owner. Depending on the software you or your property management company decide to use, you may be able to gain insight into your property rental business like never before:
- See upcoming rent payment due dates
- View past charges that tenants owe
- Determine annual profit/loss values
- See detailed payment information
- Export payment information during tax season
- Record and view offline payments made by tenants
All of these valuable metrics will allow you to determine if you need to increase your rent come lease renewal time, if your tenants are the high quality type you want to offer a renewal to, and if there are any rent payments that are behind that may require legal action to collect.
Moreover, you can often add in other numeric expenses that can coincide with your collected rent payments such as maintenance and repairs, insurance fees, HOA fees, upgrades, and more. Altogether, utilizing this type of software provides property owners an easy way to input their rental property finances and make better sound decisions in the future.
5. Reduces Rent Collection Hassles
Implementing online rent payments with your tenants will lessen your stress dramatically. No longer will you have to manually send a monthly invoice, go door-to-door collecting rent, pick up checks continuously from your management company, or even make phone calls that most tenants tend to ignore anyway.
Instead, set up automatic invoices and email reminders for all tenants that opt to receive them and let the online payment software, and your tenant, take care of the rest. If your tenant fails to pay, the online payment hub will automatically calculate any necessary fines and fees as well as alert you.
Rent collection becomes even easier if you have an experienced Howard County property management company collecting rent for you. This is because they will be the ones alerted when tenants are behind or simply not paying, and it will be their responsibility to handle the situation according to state and local law.
If you own Howard County rental properties and are considering online rent collection, take this bit of advice: include all information regarding the collection of rent via an online portal in not only the signed lease agreement (that should always be thoroughly explained in detail to your tenants prior to move-in), but also in the tenant move-in handbook as well. This way there is no confusion as to how you want rent to be paid and your tenants have no excuse for not paying on time.
If you need an experienced property management company in Howard County to help with your rent collection needs, contact Bay Management Group today. Understanding that rent collection is how you make your money, and knowing that collecting rent can be stressful if not conducted through an online payment system, Bay Management Group has you covered when it comes to collecting your money. Let your property management company deal with the small hassle of collecting your rent payment while you rest assured your money will appear in your bank account every month on time.
Thanks for this post – you nailed the pros of online rent collection. As a property owner I’ve been trying to get my tenants to move to online rent payment, but it’s not always easy to get everyone to cooperate (some people seem to be too set in their ways and aren’t eager to change..) So resources like this are very helpful. I would love it though if you could include recommended platforms – which online systems do you use? I’ve tried out Cozy and recently started using Rentigo – any other good (free) solutions out there?
Hi Amy, Thanks so much for your message. Glad you found the article useful! We often use Appfolio to manage a number of rental activities, including rent collection; granted this tool is a paid feature. We hadn’t used Cozy or Rentigo yet, but have heard great things!