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Cash flowSteady cash flow is a must-have to stay afloat and thrive in this economic free-for-all.

Fortunately, that’s one problem that’s easy to solve: An electronic payment program that allows you to debit a tenant’s credit card or bank account each month, automatically. Payments are deposited into your bank account on time, every time. Imagine that!

You can schedule any number of transactions depending on your lease agreement, or, if you rent out month-to-month, you can schedule a single transaction.

Taking control of your cash flow has never been more important than during this cycle of high unemployment and sudden layoffs. You need to hedge your bets that you will be the creditor who gets paid.

Electronic collection also lowers your overall expenses because you no longer need to waste time following-up, sending reminders, or disputing late fees.

As easy as electronic rent collection is to implement, some landlords still don’t follow this smart strategy. Why? “Because electronic rent payment is usually an ‘add-on’ item charged to the tenant,” Jim Adamek of explains.

If it’s an afterthought, left to the individual tenants to choose, some will decide against it, or forget about the option five minutes after you explain it to them. But landlords can profit from taking control and establishing a mandatory policy right from the start. A policy that applies to all applicants, and states up-front ‘this is how we collect rent’. You can work the fees into the overall lease agreement. Ultimately, you’ll benefit, and so will the tenants. It’s a win-win.”

The Problem:

Do-it-yourself electronic collection requires establishing your own website, and maintenance can be expensive. Payment services like PayPal are also problematic, because their specific policy rules may allow them to freeze your funds for subjective disputes, for example, if you don’t maintain a positive seller(tenant) feedback rating. Then, you are at the mercy of your tenants. Also, these systems can be difficult of set up and to navigate.

The Solution:

Instead, you should look for programs like that are streamlined and easy to learn, are tailor-made just for the rental industry rather than adapted to it, and that can support a policy of electronic payments for all of your tenants.

Check out AAOA’s new web page dedicated to Rent Collection. Visit Rent Collection or click on the Rent Collection tab at the top of any AAOA website page.

Have old tenant debt files? See our feature Are You Leaving Money in Your File Drawer?

American Apartment Owners Association offers discounts on products and services related to your rental investment including REAL ESTATE FORMS, tenant debt collection, tenant background checks, insurance and financing. Find out more at

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  • Brian K

    what provisions are made for tenants that have no bank account and receive their SSI on a mastercard/Visa type card? Can the system tap those cards automatically for rent?

  • Many of our tenants do not have bank accounts or have computers. I dont see how electronic collection could work.

  • Kim Ezzell

    Jim Adamek of AutoRentPay has this suggestion:

    You are describing a debit card that can be loaded with funds, in this case from Supplemental Security Income, and those funds can be used to pay rent. Our program accepts both credit cards and debit cards from MasterCard and Visa. Just make sure when you apply for our program that you check the Visa Check and MC Debit card boxes on your application. We show this in the example application form that is provided to you The transaction fee for a debit card is 1.7% which is lower than a credit card. Thanks for asking, Jim

  • Kim Ezzell

    Electronic rent payment may not work in every situation, but there are some steps you can take to help tenants get started using electronic rent payment. First, do they receive any federal benefits? The Social Security Administration reports that more than 4 million recipients of Social Security and Supplemental Security Income do not have bank accounts. Now the U.S. Treasury has made arrangements for a prepaid MasterCard debit card for recipients to receive their benefits and spend them. Any recipient of federal benefits can receive this card by calling the Direct Express Card Enrollment Center at 1-877-212-9991. You can get more information and printed applications at their website: Once tenants have a card, you can withdraw rent payments from their debit card with proper authorization.

    Second, it is no problem at all if tenants do not have a computer. We provide you with a payment authorization form that tenants can sign when they apply to rent. Existing tenants can also sign the form. Once you receive payment authorization in writing, you can schedule rent payments through your virtual terminal.

    Third, if tenants cannot get a bank account because of a Chexsystems or Telecheck report, go to and click on the link for “Services.” Find your state and print out the information on how to work with financial institutions in your area to open a bank account. You can offer this information to tenants who want to open a checking account.

    Jim Adamek

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