Of all the tasks of a landlord, rent collection is probably the most important and stressful. Collecting rent in a timely manner is not only important for your bottom line or managing your rental business with success, but it's the ultimate peace of mind.
It's no secret that not all tenants are created equal. While some are super diligent at paying their rent on time, some are either forgetful or take advantage of your kindness.
Well, if you want to avoid delays in your rent collection, it's important to lay down some ground rules. Read the rest of this blog for more.
Rigorously Screen Your Tenants
Even if a tenant seems like a decent person when you first meet them, a rigorous screening process is still important in choosing the best tenants for your property. Tenant screening is necessary for gauging their rental history, financial stability, and creditworthiness.
Always include these crucial steps when evaluating new tenants:
- Get a good idea of their renting behavior from previous landlords, i.e. obtain references
- Take a good look into their credit report and determine whether they're financially responsible
- Make sure to verify their salary/income to ensure they can actually afford your rent
Choosing a reliable, trustworthy tenant with a good rental history can make all the difference in successful property management.
Make Rental Payment Simple
Convenience is one of the best ways to ensure your tenants pay their rent on time. It's your priority as a landlord and property owner to offer your tenants several suitable ways to pay rent, that suit them:
- Online payments via a tenant portal
- Automatic online transfers
- Payment via a mobile app
- More traditional means, i.e. cash or money orders
Even if some of these payment methods are not exactly convenient for you, it's all about making the life of your tenant easier so they're encouraged to pay their rent promptly.
Don't Be Afraid to Impose a Late Fee
At the end of the day, securing your rental income is your number one priority. In order to be a successful property manager, don't shy away from laying down the law and imposing late payment fees where necessary.
Ensure you clearly outline the late fee grace period and the charge in your lease agreement. Ensure that your tenant agrees to this late fee before signing the lease.
Keep in mind that you must follow state and local late-free restrictions and regulations to minimize any legal concerns.
Incentivize Timely Rental Payment
Tenants love nothing more than an incentive, so what better way to ensure they pay their rent on time? Rewarding their on-time payments only reinforces this behavior, encouraging them to pay on-time in the future.
You could even take things one step further and offer tenants who regularly meet rental deadlines discounts and additional perks. Not only does this ensure you receive your rent on time, but it fosters a good relationship between tenant and landlord.
Need Assistance with Rent Collection?
Streamline your rent collection process with the help of PMI Property Management. We take the stress and hassle out of dealing with difficult tenants and ensure your rent makes its way into your bank account, on time, every time.
Want to learn more about how our rent collection services work? Click here for more!
