A huge factor in the success of the rental property is timely rent payments and an efficient collection system. So, what can landlords do to help ensure on-time rent payments? After all, no landlord wants the hassle of chasing down tenants to try and collect, or worse yet, hearing the payment was lost in the mail. Furthermore, as technology in the rental industry evolves, so does the option to offer efficient online rent collection. Moreover, modern tenants have come to expect the convenience of online rental payments. With that in mind, continue reading below to learn some of the benefits and resources for online rent collection.
The Benefits of Online Rent Collection
Landlords should carefully consider any opportunities they have to streamline and improve operations. In addition to efficiency, online rent collection has several other benefits for landlords and tenants. For example, technology frees up landlord’s time because they can avoid chasing payments in the mail, depositing checks, and recording paper ledgers. Let’s review some of the other benefits of online rent collection below.
- Improved Landlord-Tenant Relationships
- Added Security
- Enhanced Record Keeping
- Save Valuable Time
- Protection Against the Unexpected
- More Options Equal Less Late Payments
- Streamlined Year-end Taxes
Improved Landlord-Tenant Relationships
Online rent collection helps with tenant satisfaction in a couple of different ways. First, the added convenience allows tenants to track their balance easily. Secondly, this helps eliminate disputes over when or if a payment was received thanks to straightforward and transparent records.
Online payments mean checks cannot get lost or stolen in the mail, and landlords are not responsible for keeping payments safe until making it to the bank. Instead, online rent collection provides safe and more secure processing in minutes.
Enhanced Record Keeping
Traditional paper records are inherently susceptible to errors or disputes. Whether it is missing a decimal point or transposing numbers – mistakes happen. Furthermore, not catching these mistakes when they happen can lead to larger issues down the road. Therefore, using an electronic format such as online rent collection helps combat human errors. Landlords and tenants can both clearly see payment history and any pending balance. Additionally, owners can download key financial reports to help make informed decisions about their investments.
Save Valuable Time
Efficiency is the backbone of any successful business, including the rental industry. With online rent collection, owners save time on manual processing and recording. Thanks to technology, software programs handle in minutes what would take owners far longer. So not only is online rent collection faster and more efficient, but it also saves money.
Protection Against the Unexpected
Manually collecting and processing rent requires a great deal of time and effort from the landlord. But what happens if you fall ill, have an emergency, or just want a vacation? Without any property management software, owners must be present to process payments. However, accounting software means owners can follow up and view financial information anytime and from anywhere. That said, this convenience goes both ways, and tenants also benefit from easily accessing and sending payments from anywhere.
More Options Equal Less Late Payments
When an owner accepts manual payments, they are limited to the standard checks, money orders, or cash. However, online platforms offer added flexibility regarding the types of available payments. Additionally, studies indicate more tenants are willing to set up automatic payments through secure platforms. Thus, helping to cut down on forgetfulness and late payments. Online rent collection software typically accepts debit cards, credit cards, or ACH transfers, depending on the chosen platform.
Streamlined Year-end Taxes
Taxes can be a dreaded and complicated time for landlords, especially for those with a large portfolio. So, whatever you can do to make daily operations more efficient will help at year-end. For example, owners can generate cash flow, delinquency, and expense reports instead of spending hours going through paper records. In addition, real-time updates allow owners to see metrics across all properties at once more accurately.
Top 3 Online Rent Collection Software Options
Modern technology has come a long way and can help landlords and property managers complete a variety of tasks. Now that you understand the benefits of using online rent collection software, how do you know which is best? Whether you have one property or 1,000, there is a solution out there for you. Check out our top 3 picks below –
- Cozy/Apartments.com – At a variety of price points, Cozy offers landlords customizable options on a user-friendly platform. This begins with a free version that accepts online payments via a checking account. That said, if tenants prefer a credit card payment, they have that option for an added fee. From there, funds are available to the landlord in 5 days or as little as 3 with the paid version of the platform.
- PayRent – PayRent includes added services such as tracking and reports, rent reminders, and full or partial payment options for a full-service approach to rent collection. The platform has convenient options ranging from $0 to $49 per month. In addition, PayRent charges a small fee based on the type of transaction of each payment. That said, this software accepts e-check or credit card payments, and funds are available to the owner in 3 business days.
- RentTrack – Accepting both e-check or credit card payments, RentTrack is popular with tenants. The main reason is that RentTrack reports payments to all three credit bureaus. Thus, providing incentive for on-time payments since it will help build up a good credit history. Additionally, this platform provides same-day funds to landlords, which is a great bonus. While fees are associated with this service based on payment type, many landlords agree it is worth it.
How to Choose the Right Online Rent Collection Software
When choosing a paid or free service to assist with online rent collection, understanding the features offered is essential. Based on a landlord’s individual needs and budget, some providers may be better than others. That said, below are some of the key features that will help you get the most from your investment.
- Mobile-Friendly Website or a Dedicated Payment App
- Option to Make a One-Time Payment or Set-up Autopay
- Automated Calculation and Applying of Late Fees
- Notice of Missed or Late Charges
- Various Types of Payment Options (Credit, Debit, ACH)
- Ability to Process Full or Partial Payments
- Automatic Rent Reminders
- Real-time Financial Reports for Owners
Top Software Programs with Expanded Management Services
Maybe rent collection is the area of concern for your business. Now, with that problem solved, you are good to go. However, for landlords looking for a bit more help, technology also provides more in-depth software to handle a variety of daily operations in addition to payments. So, if you are interested in a more full-service approach, check out our top 3 choices for property management software below –
Appfolio is popular industry-wide among landlords looking for digital answers to several rental dilemmas. So, for landlords with larger portfolios of 50 or more units, this software may be the perfect one to handle all of your administrative needs. With prices starting around $1.25 per unit plus a monthly subscription fee, Appfolio has several price points to suit your needs. Advanced options include strategic accounts management, performance insight, and data export, just to name a few.
With plans starting at $50/mo, Buildium offers landlords the chance to easily manage accounting transactions, maintenance requests, violation processing, and tenant communications on one easy online portal. Additionally, tenants have the option to set up automatic payments. Online rent collection will cost users a set fee for EFT and a percentage for all credit card transactions.
Rentec Direct has one of the highest customer service ratings in the industry. Thanks to a convenient web or mobile app tenant portal, tenants can easily log in to pay bills or track sent payments. Furthermore, owners can apply late fees and collect both full or partial payments for no additional fees. This software helps landlords handle accounting, reporting, marketing, leasing, tenant screening, renters’ insurance, and much more from one easy-to-use platform.
The Easiest Solution to Effective Property Management
Technology is a useful resource for landlords when utilized in the right way. It offers conveniences for both landlords and tenants alike. However, property owners still need to follow up with tenants, market the property, process applications, field maintenance calls, and many more tasks even with the best technology.
However, there is a no-stress solution to the day-to-day running of a rental property portfolio. Bay Property Management Group bridges the gap between tenants and owners. Our experienced team handles every aspect of rental management. Therefore, freeing investors up to do what they do best, find the next big deal! Give us a call today to learn more about our full-service approach to modern property management.