Getting Paid on Time
As a landlord, the most significant factor in managing your cash flow is to collect the rent on time! While being a landlord isn’t just about getting paid, consistently collecting the rent payments each month is one of the most important things when owning one or multiple rental properties.
When dealing with tenants and collecting rent, here are a few tips for success and helpful ways to increase the likelihood of getting paid on time
Tip #1: Choose Quality Tenants
The tenant screening process is the first step to getting consistently paid each month. Setting the criteria and sticking to it during the application process is the number one way to make sure rent is being paid each month on time! As a landlord, you are less likely to have a renter that is fiscally irresponsible if you take the time to vet out those who do not fit the predetermined criteria. One way to choose quality tenants is to gather the right information during the application process.
- Have an income requirement to rent your property
- Check references and make sure to contact previous landlords
- Check credit scores and make sure the individual is financially set to handle a monthly rent payment
- Pull a background check and verify employment
For more information on finding the perfect tenant, take a look at the following blogs:
- 4 ways to find the perfect tenant for your rental property
- 5 ways to get a potential renter for your rental property
Tip #2: Automate the Process
Another way to help with collecting the rent is to make the process as easy as possible. Allow the opportunity for renters to pay using an auto-pay process or allow them to auto-deduct the fee from their bank accounts each month. When you automate the process, the likelihood of someone forgetting and providing excuses is greatly reduced.
Tip #3: Have a Rent Collection Policy
Have the rent collection policy clearly outlined in the lease and make sure to review it with the tenant before move-in day. Ensure the lease states: 1) the date the rent is due each month, 2) the total amount charged for rent, and 3) where/how the payments must be submitted each month. If you allow a “grace period,” make sure to also outline that information in the lease, while also stating when rent is considered late. If you have a charge for late payments, don’t forget to add that information to the lease as well.
Tip #4: Consider Offering Rewards
Holding on to good tenants is just as important as getting the rent money each month. One way to keep those tenants in your current rental property is to consider offering rewards. If you have a tenant that is consistently paying the rent and respectful of your property, think about rewarding them with a gift card or small token of appreciation. This will potentially motivate them to renew the lease and continue the relationship.
Tip #5: Bonus Tip
Think you might need some help navigating the rental collection process? Check-in with a Property Management Company. At Oak City Properties, we have been taking care of rental properties for years! Our full-service property management company will help you find and buy new rental properties to grow and diversify your portfolio. We will also market the property, locate prospective tenants, and show the home to qualified applicants. Once a tenant is placed in your rental property, we will: collect rent payments, assess and collect late payment fees, provide 24/7 maintenance, help with accounting/tax services, and deal with any court appearances in the event of an eviction.
Want to read more about property management services? Here are a few blogs that may interest you: