Being a landlord isn`t an easy job, especially if you are new to the job. Dealing with tenants can be easy if you are lucky enough to come across good people, but in some cases, it can become a true nightmare. It is best to carefully rethink whether you want to perform the job by yourself or hire a company that will take care of the whole thing for you. Also, being a landlord isn`t a simple job, even though it sounds like it is. Of course, the primary job you need to take care of is collecting rent. Even though you might think that all you need to do is show up and collect rent, in reality, there are a couple of rent-paying options for landlords, and it might be hard for you to decide which is the best one. So, if you are wondering what are the best rent-paying options for landlords, check out the following text below.
1. The Importance
While you might think that there is no need to choose a payment method, in reality, the way you plan on collecting rent can make a big difference. Although most tenants want to mail the check and get it over it, you should think about persuading your tenants to play by your rules. Now, we`re not saying that you should be a dictator and order your tenants to pay the rent by using your preferred method. So, the key is a compromise, so make sure to explore all available options in agreement with your tenants.
2. Bad Ideas
Let`s talk about the worst ideas for paying rent. We`ll gladly explain what rent-paying methods should be avoided in order to follow thru with the process in the best possible manner.
Although paying with cash is the oldest and the most traditional method of paying rent, we recommend avoiding this rent-paying option at all costs. Why? The risk of complications is the highest because there are too many things that can go wrong. First and foremost, there is no record of the payment, leaving a lot of space for disputes with tenants. So, as you can see, fraud is the worst problem you can face, and unfortunately, it happens very often. Furthermore, you`re risking theft.
Even though you might think that cash is the worst rent-paying option for landlords, you`d be surprised how bad paper checks are simply because of possible fraudulent activities. The check can bounce, get lost in transit, and is easily manipulated. You won`t know if the check is valid until you try to cash it.
So, what is the best rent-paying option for landlords? Any online rent-paying method. There are two online options to pay rent, including using an app or a digital wallet. It would be wise to choose some kind of digital payment that will allow tenants to pay rent by debit card, credit card, or even directly from their bank account.
Using an app is a good method but not ideal. Even though you`ll get a notification for every payment that comes into your account, and there is a very transparent transaction history, unfortunately, there are also numerous downsides that might not be tolerable for some. However, it`s still a pretty good rent-paying option.
So, if you are in a dilemma about whether to use apps or not, check out the downsides below:
- You`ll have to pay a pretty high transaction fee for absolutely every received payment.
- You can`t block partial rent payments.
- There is absolutely no payment protection for any rent payments.
- In numerous cases, tenants pay their rent to the wrong person leading to complications when you have to prove the money is yours. In fact, if the tenant pays the rent to the wrong person, there is no way to get that money back.
- Tenants can`t, in any case, set up recurring payments.
- You can`t send reminders to tenants.
- You can`t automatically calculate late fees.
4. Features of The Best Rent-Paying Systems
Now, to choose the best online rent-paying systems, you need to learn about the best features we`ll gladly talk about below.
Blocking partial payments
The possibility of blocking partial payments is very important in order to protect your rental income and cash flow. When is blocking partial rental payment necessary? For instance, you need to block a partial payment when evicting tenants. The only way to stop a tenant is by forcing them to pay the rent in full.
The best online rent-payment systems are free, meaning that neither the landlord nor the tenant has to pay a transaction fee which is a big plus when all rents add up at the end of the year. The reason why this feature is so important is that it functions in a way that allows both sides to save up money.
No Subscription Fees
Related to the previous issue, by using the best rent-paying systems, you won`t have to pay a subscription fee which is very important to tenants. This way, it will be way easier for you to persuade the tenants to switch to an online rent-paying system.
Also, these systems allow you to automatically calculate late fees, which is very important for landlords, especially if you are dealing with a tenant that is frequently late with payments.
In any case, make sure to explore the best rent-paying options for landlords and make a mutual agreement with your tenants in order to collect the rent in the best possible manner while respecting both sides equally. Perhaps the easiest way for landlords to manage their rentals and collect rent from tenants, among other things, is to hire an experienced NYC apartment management agency to do all the hard work in your best interest.