Collecting the Rent: What Form of Payment Should You Accept?
By John Nuzzolese
In today’s changing times, technology plays a larger role in the way we do business. More options are available to us in banking, communication and in collecting the rent from tenants.
Just as every property is unique, so is every landlord and his business. How landlords and property managers choose to collect rent varies greatly depending on experience and circumstances. There are a number of payment methods available for you to choose from when it comes to collecting rent from your tenants.
You can accept your rent:
Accepting rent payments in cash normally means personal contact with the tenant, which can be quite involved at times. You may be thinking, “Cash is the simplest form of payment”, but in reality it can be a royal pain in the neck! Think about the pros and cons and you decide.
The Pros of collecting rent in cash
The Cons of collecting rent in cash
You can accept your rent:
Collecting rent by check is the method most landlords prefer. It also has its pros and cons, but so does every method.
The Pros of collecting rent by check
Tip: Professional landlords have tenant mail the rent to a PO box or a management office, not their home.
The Cons of collecting rent by check
Accepting your rent by Money Order
The Pros of collecting rent by Money Order
The Cons of collecting rent by Money Order
Electronic Rent Collection: Direct Deposit
More and more landlords are making the arrangements with their banks (with their tenants’ cooperation) to automatically withdraw a monthly sum from the tenant’s bank account to be transferred into the landlord’s bank account on a set day every month. This can be an effortless method of rent collection as long as the tenant has the required money in the bank at the time of the transfer. It is an even better situation for the landlord when the tenant is qualified for sufficient overdraft protection.
The Pros of collecting rent by Automatic Withdrawal
The Cons of collecting by Automatic Withdrawal
Electronic Rent Collection: Credit and Debit Cards
Many property management companies and even private landlords are accepting the payment of rent by credit and debit cards. Access to this is normally restricted to businesses with merchant accounts to be allowed to accept the major credit cards, but now in today’s high-tech environment, just about anyone can have a PayPal account to enable them to accept credit card payment.
The Pros of collecting rent by Credit and Debit Cards
The Cons of collecting by Credit and Debit Cards
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