Over 48 million households in the U.S. rent places to live. As a landlord, this offers job security for your business.
To have a profitable rental property business, you must focus on several things, including the following:
- Choosing great tenants
- Keeping your units occupied
- Effective rent collection techniques
As you look at this list, which task stands out? Many landlords struggle with all three things, but a common one is developing effective rent collection techniques.
If so, here is a guide to help you learn the best tips for collecting rent from your tenants.
Create a Rent Collection Policy
One of the best landlord tips you'll ever discover is creating a clear rent collection policy for your tenants. A clear policy states the following things:
- Rent amount
- Due date
- Grace period
- Late fee amount
- Ways to pay rent
Collecting rent is easier when you have a policy in place. You can include this policy on the lease you require when tenants move into units. If you don't have a policy yet, you can create one and mail it to your tenants.
Using certified mail is vital when creating new policies for your tenants, as this confirms they have received the letter.
Enforce the Late Payment Fee
Next, you must enforce the late payment fees with all your tenants. However, having this policy offers no benefits if you don't implement it.
Enforcing it encourages your tenants to pay on time. After all, if they pay late and incur a late fee, they won't want to let this happen again.
However, if you don't enforce it all the time, your tenants might take advantage of this loophole.
Talk to a property management firm if you need other tips for creating a rent policy or enforcing the late fee. When you talk to them, you can also ask questions about their services and the benefits.
Offer Multiple Options for Collecting Rent
The other vital step is to offer multiple options for collecting rent. What options do your tenants have right now to pay rent? If they don't have multiple options, you should add some.
Here are two great ways to accept rent payments that you can consider adding to your list if you don't already use them:
Offer a Drop Box
If you install drop boxes in several locations, your tenants can drop their rent in the boxes when it's due. Of course, you'll have to go to the drop boxes to pick up the rent checks if you offer this option.
Provide Online Payment Options
People today handle most financial tasks online. Therefore, you might collect more rent if you offer online payment options.
Hire a Property Management Firm
Having a clear rent collection policy that you enforce might make a difference in the amount you collect each month. However, you can also subcontract this duty.
You can hire a company to handle your rent collection if you prefer. River Group is a property management firm in Miami, FL, and we offer this service and others. You can contact us to learn more about these services.
