According to the Joint Center for Housing Studies, 12.1 million American renters spend over half of their income on housing. Understandably, rent can be hard to make in some months, but it's still not an excuse to miss it completely.
As a landlord or property manager, you may be getting frustrated with late or unpaid rent, and you're having tons of stress when the end of the month draws near. Something needs to change with your rent collection approach, and it needs to change now.
Those who need effective rent collection strategies are in luck. Here, we'll discuss some things you can try.
Set Clear Policies in the Lease Agreement
This won't help with current tenants, as they've already signed a lease agreement, but revising your document now can save you trouble later.
Your lease agreement should clearly outline:
- Rent due dates
- Late fees
- Grace periods
- Acceptable payment methods
All these things can reduce confusion and help you avoid future disputes.
Implement Online Payment Portals
One of the best landlord rent collection tips we can offer is to use payment portals. Not only does this make rent collection easier on you, but it'll also help attract tenants in a tough market.
This is because the option to pay rent online simplifies the process while also adding convenience. Tenants can:
- Set up automatic payments
- Receive reminders
- Make real-time transactions
You'll receive benefits as well. It can streamline accounting, which then reduces errors and keeps records easily accessible.
Offer Multiple Rent Payment Options
Online portals already add lots of convenience, but take it one step further by offering multiple payment options. This can get tenants to renew leases!
Have a good mix of payment methods, such as:
- Bank transfers
- Checks
- Debit cards
- Credit cards
- Payment apps
Make sure to cater specifically to those who may not be comfortable with online payments.
Enforce Late Fees Consistently
Having a late fee is great, but if you don't enforce it, then renters won't think anything of it.
Communicate these fees clearly to your renters and enforce them across the board. After a few times of eating the fee, tenants are sure to keep up with on-time payments.
Consider Incentive Programs
On the other hand, positive reinforcement can pay off too. Rewarding those who make timely payments will encourage them to keep doing it.
One easy way to reward them is to give discounted rent. In addition, you can give them raffle entries for a monthly prize.
Don't Struggle With Rent Collection
Rent collection can be one of the most difficult issues to deal with. But if you work with tenants instead of against them, you'll find it much easier to get your money on time.
Plus, another benefit is you'll foster good relationships with your renters. As a result, you'll build meaningful connections that'll increase tenant satisfaction, which in turn will increase retention and your profits.
Get in touch with PMI Frisco today if you'd like efficient rent collection. We also offer a free rental analysis for additional assistance.
