If you're a property owner with one or more rental properties, rent collection is a big part of making money.
Being a landlord isn't an easy task. You've got to maintain the property, make sure your tenants are satisfied, market vacant properties, and collect rent from your tenants. Unfortunately, the latter isn't always a walk in the park...but it could be.
In this post, we're going to give you a quick guide to collecting rent for landlords. The end goal is to get all of your rental payments on time every month, but you have to work with your tenants to make it happen. Read on and you'll see that getting your money doesn't have to be like pulling teeth after all.
Laying Out Expectations
When you're writing out the rental contract that you use for all your tenants, make it clear what you expect of them in terms of rent payment. The clearer you are about your expectations, the less likely you're going to run into confusion down the road. It also helps to discuss how you expect to be paid when you're signing the lease with new tenants.
If tenants are clearly told what rent is, how much utilities are, and when you expect to be paid every month, then you have grounds to take action when your needs aren't met. There's no such thing as being too specific when it comes to rent payments.
Giving Your Tenants Rent Collection Options
One of the best landlord tips that we can give, as a property management firm, is to give your tenants numerous payment options. A common one for younger renters is to do everything online, so make it easy for your tenants to pay you by getting to know the various money transfer apps that are out there. Choose one that works for you and have your tenants sign up for easy monthly payments.
Older tenants, on the other hand, might not be comfortable or equipped to send online payments. Make it possible for them to give you post-dated cheques, or if you're in the area, give them the ability to drop cash or cheque payments off to a dropbox. If you're feeling generous, you could even pick up the payments from them directly.
Grace Periods for Late Rent
When you're establishing the ground rules in your rental contract, come up with a grace period for late payments. Usually, 3-7 days is a good amount of time to give a tenant, but there will always be extenuating circumstances that you have to take into account.
If you've got a tenant that you suspect of taking advantage of the grace period, paying late on a consistent basis, you may need to take action. We'll save the eviction process for another article.
Property Managers Can Help
Now that you understand a bit more about how to do proper rent collection, you can get your rent payments on time, every time. Managing your own properties is a full-time job, so you need all the help you can get. If you feel that you're falling behind on managing your properties, it might be time to hire a qualified property manager.
Precision Realty is a Houston-based, full-service property management company that can take the chore of finding tenants, collecting rent, performing maintenance, and maximizing profits off your hands. To learn more about what we do, visit our site and when you're ready, contact us to talk to someone about how Precision Realty can help you.