Last post we discussed steps to use for finding a good tenant. Let’s now discuss how to go about collecting the rent as there are some methods that will make life easy and some you will come to regret.
Do’s And Don’ts of Collecting Rent
The Don’ts
Collecting Cash in Person:
There are several reasons this is a no-no
- Carrying a large sum of cash on you at a predictable time makes you a target for theft.
- It’s an inefficient use of time as you have to go door to door collecting funds
- There is no official record of the transaction taking place
The above points speak for themselves so why waste time, resources and possibly your safety when you do not have too.
Tenants Dropping Cash off at your home
Personally, I do not want my tenants knowing where I live. They may be great people, but you never know what people will do until something goes south. Last thing we want is an angry tenant showing up at the front door of your home. Or worse yet, vandalizing your home out of anger.
The Do’s
Online Payments
The way technology is today this is the easiest and most efficient way to collect rent. There are various options such as:
Paynearme – This is a great service for tenants that want to pay in cash, while still allowing it to be an online transaction for the landlord.
Basically Paynearme provides you unique barcodes to supply your tenants. The tenants takes their cash and the barcode to a 7-11 (or any other approved retailer) to make the payment and receive a receipt of it.
Paynearme then sends you an email or text that payment has been received.
The services doe not cost the landlord anything to use after a initial setup free. It does cost the tenant a small transaction fee to make the payment though.
Cozy.co - Is a service that accepts online payments for you. Tenants get setup automated payments that get withdrawn from their bank account or use a debit or credit card to make payment.
This service is also free for landlords and free for tenants that are using ACH payments directly from their bank account.
Otherwise there is 2.75% fee on payments done with a credit or debit card.
Cozy also offer other services like background checks, credit reports, etc. for a nominal fee to help screen tenants.
Mailing Rent
The old fashioned mailing the rent check still works, but be sure you secure a P.O. Box to have rent checks mailed to. By doing this you don’t have to give out your home address and you can just go to the post office to pickup all of you rent payments.
The only negative to this one is tenants can always give you the classic “the check is in the mail” excuse when you have not received it in time. Other than that, this is a traditional method that has worked for many landlords in the past.
Conclusion
In the end it’s a matter of preference, but clearly we now live in a time where you can automate rent collection as opposed to chasing down your dollars.
Regards,
Mitchell J
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