Two Drop Dead Easy Ways To Collect Rent Online
Do you collect rent online to make it easier for your tenants to pay every month? Collecting rent on time from every single tenant every month is the goal of all landlords and property managers on the planet.
In order to have a chance of reaching this goal of collecting all of your rent on time, you need to make it drop dead simple for your tenants to pay their rent. I have used many different methods to collect rent money from tenants over the years and none of them were perfect.
Collecting rent on time from every single tenant every month is the goal of all landlords and property managers on the planet. Click To Tweet
Before the internet was available and before everyone had debit cards and credit cards, cash, money orders and checks were the preferred payment methods. But times are changing and you can easily use payment processors like Pay Pal and Venmo which allow you to easily collect rent online every month.
Popular Payment Methods Before The Start Of The Internet
Cash payments were very common and many landlords actually preferred to receive cash payments. The only problem is that there is no way to trace the payment if it is lost or credited to the wrong tenant. In this day and age, there is also a chance that it is counterfeit money.
Money Order Payments
Money orders are better than both cash and checks. The tenant pays for the money order with cash and the money order is guaranteed money. It can’t be counterfeit like cash and it won’t bounce like a check.
Tenants love to write checks as well. After all, they can get it in the mail box and get is post dated for the date the rent is due. They know the mail takes at least a few days to deliver the payment. This give the tenant a few extra days to actually get the money in the bank account to cover their rent payment.
All three of these once popular payment methods, cash, money orders and checks, require you to handle the money in some fashion. Click To Tweet
But, if the money isn’t actually in the bank account when you present the check for payment, it will be returned as NSF. Then you have to pay fees on your end and go through the aggravation of starting the eviction process to get your money. Checks really are not the best way to get paid in this day and age.
All three of these once popular payment methods, cash, money orders and checks, require you to handle the money in some fashion. You are then responsible for making sure the payment gets to the bank and credited to the correct account. There is always the chance that the cash or check are no good. Plus the fact that the bank will hold the checks and money orders until they clear before the money is credited to your account.
Two Popular Internet Payment Methods
With the invention of the internet, you can now collect rent online using either Pay Pal or Venmo. You never have to touch the money and are not responsible for getting it to the bank. The tenant is solely responsible for getting their payment to you on time.
Advantages of online payments:
- Online rent payments save time for everyone.
- Your tenants can pay their rent at their convenience.
- Credit card and debit cards can be used to pay the rent.
- The tenant doesn’t have to hand you their rent payment.
- You don’t have to wait on the mail to arrive to get paid.
- The money is in their bank account or it will be declined much faster.
- You get the money into your bank account much faster.
- It improves the chances that you will collect late fees.
- Disputes are minimized as it is a digital transaction.
Collecting Rent Online Is Easy
Online payments are very popular and accepted now. Almost everyone living in the digital age has bought something online. This makes it easy for you to transition your tenants so that you can collect rent online.Online payments are very popular and accepted now. Click To Tweet
Consumers are accustomed to whipping out a credit card and paying online. Paying rent is no different. If the tenant doesn’t have enough money in his bank account to pay his rent, a credit card can be used instead. Someone else can actually pay rent for the tenant as well. This means that you get paid regardless of whether they have the cash on hand.
Using Pay Pal To Collect Rent
Pay Pal is one of the most common ways to collect rent online. You can get an account for free and so can your tenants. Just give the tenant your email address so the payment will go directly into your account.
Tenants just have to log into their Pay Pal account, input the landlord’s email address, choose “Friends And Family” and put in the payment amount. There is no fee if the “Friends and Family” option is used and the money comes out of their bank account.
Pay Pal is one of the most common ways for you to collect rent online. Click To Tweet
If the tenant uses a credit card or debit card through Pay Pal, there is a 2.9% transaction fee as of right now. That fee can always change in the future. But, it is worth it to the tenant because they can pay you on demand. Tenants still love it because there is a cost to them no matter what. Keep in mind that if the payment is mailed, an envelope and stamp still have to be purchased. Given how much time it takes to wait for the mail to arrive, this option is hands down faster and easier for the landlord. You, as the landlord, no longer have to open the mail, handle the check or money order and go to the bank.
Using Venmo To Collect Rent
Venmo, like Pay Pal, allows money transfers between you and your tenants. Your tenant must link a credit card, a debit card or a check account to Venmo to use the payment service. Using this service is usually free when transferring money from a bank account or a debit card. If the tenant uses a credit card to pay their rent, there is a 3% transaction fee charged as of right now.
Again, while there are transaction fees involved for the tenant with both Venmo and Pay Pal, it isn’t free to mail a payment to you or drive it to you. The convenience this offers the tenants usually outweighs the cost of any fees they incur.
Convenience For Your Tenants
When you collect rent online, it allows your tenants the convenience of paying their rent from their home while still in their pajamas. Rent can be paid at 3 am or while the tenant is sitting at work in a meeting. It allows your tenants to be in control of when they pay the rent and you get your rent much faster.
Getting Started Collecting Rent Online
Switching your tenants to an online payment method is easier than you think. But don’t expect 100% compliance right away. Even though it is easy, most people are resistant to change.
The first step is to go to Pay Pal and Venmo and set up accounts for yourself. It is very easy to do! They are willing to help you set everything up if you need assistance.Switching your tenants to an online payment method is easier than you think. Click To Tweet
The next step is to notify your tenants that you now accept payments online. Call each of your tenants and tell them you are now accepting online payments using Pay Pal or Venmo.
If you have email addresses for your tenants, email them and tell them the great news. You can also send them letters in the mail. Give them your email address and instructions on how to make the payment. Most of them will be thrilled that they now have this option.
Start Collecting Your Rent Online
Then sit back at the first of the month and watch the rent money hit your bank account.
Most of your tenants will be thrilled that they can pay their rent online. Again, you may find that you have a few hold outs that still want to mail their rent or hand you their rent. But, you can gradually phase this out and eventually you will get almost all of your rent payments online.
Do you know what to do if your tenant doesn’t pay the rent? Find out here.