Best Ways for Renters to Pay Their Landlords

7 years ago | Posted in: Business, Properties | 862 Views

There are quite a few ways that your renters can pay you, but they’re not all created equal. Some will be instantaneous, while others will need to be sent a few days in advance. Some keep you safe from stolen rent, while others provide little protection. To find a good option that fits you and your renters, here are several of the best ways to have your tenants pay rent:

  1. Electronically

Electronic payments are the best option when it comes to collecting rent, because they process quickly and there’s no risk of the payment being stolen or lost, as long as they send the money to the correct account. You’ll also have a record of every rent payment, which makes accounting and tracking much easier.

Direct deposit is the most effective and efficient option. It allows the renter to simply transfer money from their account to yours. Another fast, free option is PayPal, you’ll just need to set up your own account.

If you choose not to offer either of those options, your renter can also use a service that mails a check to you, such as Plastiq. These services also may let them pay using a credit card, so they can earn rewards on your rent. However, there will be a fee for credit card payments, so they need to make sure that the value of the rewards they’re earning is more than the fees they pay.

Another benefit of receiving rent electronically is that you may also be able to set up automatic payments. This gives you and your renter one less thing to worry about every month, and eliminates the possibility that they’ll forget to pay rent and get stuck with a late fee. However, this isn’t an option if you also collect utilities every month with your rent, as you’ll need to wait until you read the electric submeter and determine you exactly how much you need to pay for those utilities.

  1. Personal Check

Writing a check is one of the most common ways to pay rent. It’s not quite as convenient as an electronic payment, but it works well if that isn’t an option for you or your renter.

With a check, you and your renter will have a record of the payment once you deposit it. This method of payment works much better if your tenant pays you rent in person. If they mail their rent, there is the possibility that your rent could get stolen. One way to mitigate this risk is to write “For Deposit Only” on the back of the check, so it must be deposited into an account in the recipient’s name and can’t just be cashed.

In the event that a personal check is stolen and cashed, they can dispute the transaction with their bank. While they should get their money back, it could take weeks or longer.

  1. Money Order or Cashier’s Check

A money order or cashier’s check both work very similarly to a check, except the renter will pay for them in advance instead of having them deducted out of their account upon deposit. The risk with these payment methods is also the possibility that they get stolen, and if that occurs, the dispute process will likely be more difficult with the issuer than it would be with their bank. They should still get your money back, but they could be waiting several months.

If at all possible, you should have your renters pay their rent electronically, as it’s the safest and most convenient option. Personal checks, money orders and cashier’s checks are all valid options, as well, and they work even better if they can drop off their rent in person. Whatever you do, avoid letting your renters pay in cash unless they’re getting a receipt right away to verify the payment.

 

By:  Vincent Stokes

Tags: , , , ,

Share it.

Leave a Reply

Related Posts