Steady 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 AutoPayRent.com 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.”
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.
Instead, you should look for programs like AutoPayRent.com 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 www.joinaaoa.org.
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