If traditional methods are the only way you allow your tenants to pay rent, you are missing out on an abundance of benefits both for you and your tenants that make the process easier, faster, and more effective. The rental industry has seen a trend towards online rent collection through property management software, and there a number of reasons why.
Though it may seem like traditional cash, check, or money order rent payments are reliable and easy, they are actually a big strain on your business. Rent collection is a very important part of sustaining your rental business, so let’s look at five reasons why switching to online rent collection is undoubtedly the correct choice.
- Saves Time and Effort
It is important whenever a payment is made to keep accurate records, and with cash or check payments you will have to do this accounting work manually. This can take a lot of time that could be better spent focused on other parts of your rental business.
Fortunately, property management software does a lot of your job for you, and this includes this important accounting work. Whenever a payment goes through, records are instantly and automatically generated by the platform. Important records are created in a timely manner, and in return, you get a little more time to invest into other priorities.
- Prevents Disputes
Another key benefit of automatically generated records is that a copy in the form of a receipt is sent to the tenant. When both the landlord and the tenant have access to information regarding the transaction, there is much less of a chance that there will be disputes between the two of you concerning them.
A delay in record-taking or the mismanagement of a cash payment may make it easier for a dispute to be raised about a tenant being late with rent or not paying the full required amount. Fast, accurate records without the risk of human error increase transparency and can consequently strengthen your business relationships.
- Easier for Tenants
Features like automatic records definitely make the process easier for you, but it is also much easier for tenants to pay rent with property management software. They are able to set up automatic payments that withdraw funds directly from their bank account whenever rent is due each month. These are called ACH rental payments, and once they are set up, the process of paying rent becomes completely hands-off.
Compared to needing to deliver a payment either by hand or through the mail, this method is incredibly easier, and it takes some pressure off of your tenants.
- Avoids Late Payments
Among these pressures are getting payments in on time. You want to avoid late or missing payments because you rely on the funds each month to support your rental business, but a tenant also wants to avoid disputes, late fees, and even eventual eviction.
Once paying rent becomes totally automatic, though, the prospect of being late with rent is all but eliminated. ACH payments ensure that rent comes on time, because even if a tenant forgets that the due date is approaching, the payment will still be submitted.
- More Secure
You may be concerned that compared with a face-to-face transfer of payments, online transactions aren’t as safe. However, it is important to keep in mind that cash can easily be mishandled, misplaced, or even stolen. You need to find a place to store it while it is being accounted for and until you are able to take it to the bank.
Compare this to online payments, which use state-of-the-art encryption software to protect sensitive bank account information from any cyber-attacks or hackers. With this technology behind the payments, online transactions actually become a lot more reliable and safer than in-person payments.
Perhaps the biggest benefit of adopting online rent collection is that it does not have to be a final decision. You can offer it as a method and still allow tenants to pay via traditional methods. However, this article should make it clear that for every tenant that makes the switch, you are able to take further advantage of how property management software makes one of the most important parts of your job a more streamlined and flexible process.
Because these platforms are standard and accessible, there is nothing keeping you from making the switch and helping to sustain your rental business.