Published on December 22nd, 2021 | by Ali Dino0
5 Reasons Landlords Need to Use a Rent Collection App
Rent Collection is a primary responsibility for landlords. However, many landlords don’t have an efficient method to collect rent. Instead, they’re using old and outdated rent collection methods such as cash or checks. There’s a better way, online rent collection allows tenants to easily transfer their rent to their landlord in a fast and secure fashion. It’s more convenient for both parties, can help improve landlord-tenant relations and even reduce late payments.
In this article, we’ll take a look at five reasons for landlords to explore purpose-built rent collection software, like Landlord Studio.
Five Reasons to Use a Purpose-Built Rent Collection App
1. Save Time
When running a rental business you don’t want to spend hours each month checking payments, visiting the bank, and chasing up late payments. With a good online rent collection system, the entire process can be automated. Tenants can even set up automatic payments saving them time and ensuring their rent get’s paid on time every month. Plus, landlords can create automated rent reminders so they don’t have to manually chase late rent.
2. More Secure
Cash and checks can go missing, get lost in the post, or even be stolen. If this does happen, there’s no record of the transaction. Meaning neither you nor your tenant can’t prove whether the payment was actually made and there’s no recourse for reclaiming the money.
Using an online rent collection system there is a clear record of the transaction and there’s no chance that the payment will go missing or get stolen. If either party is a victim of fraud most payment platforms also offer a payment protection service.
3. Improve Landlord-Tenant Relations
One of the biggest factors that cause conflict between landlords and tenants is late and missed rent payments. For landlords, it’s more work, more stress, and it can cause serious cash flow issues. For tenants, there’s the threat of eviction. And if they don’t have an easy way to pay the rent online these late payments are statistically more likely.
By making the process as quick and easy as possible, by using tools to automate, you can remove a lot of this friction. Instead of the tenant going to the bank and the post office, they can simply log in online and make the payment in less than a minute, or even set up a recurring payment.
4. Reduce Late Payments
More often than not a late payment is simply due to forgetfulness or because the tenant did not have time. As we’ve mentioned already by making the process easy and by allowing automatic payments, you can reduce or even entirely remove the potential for rent payments being late.
5. Better Accounting For Tax Time
If you’ve got multiple properties, with multiple tenants paying rent it can be difficult to keep track of everything. It involves potentially hours of manual data entry at the end of each month. Instead, with online rent collection and automated income tracking, all you need to do at the end of the year is to generate a report.
What to Look For in a Rent Collection Software
An Online Portal
An online portal allows the tenants to view historical and upcoming payments so they have a clear record of what has and hasn’t been paid, what payments are upcoming, and what they need to do to ensure they miss their payment due dates and any late fees that might be applied. This is also useful if a dispute arises around payments.
Set Recurring Payments
Your rent collection software it should allow your tenants to set up automatic payments so that they don’t have to remember to log in every single month to manually initiate the rent payment.
Control the Amount that is Paid
Landlords should have full control over the amount that is paid. Partial payments can lead to issues around collecting the full amount of the rent and in the worst-case scenario delay or derail eviction proceedings.
With Landlord Studio, tenants have to pay the rent in full unless the landlord enables the partial payments feature, in which case the tenant will temporarily be allowed to pay less than the full amount in rent payments. The system will then track the payments so that both parties have a clear record of payments made and amounts still owed.
Having a purpose-built online recollection software is an important step for landlords in order to run a professional rental business. With a system like Landlord Studio, you can integrate your rent collection app with your income and expense tracking. So, instead of having to manually input all of your income transactions against the relevant properties and chase up any late payments it is all automated and done for you. The tenant initiates the payments, the income is tracked and logged against the relevant property. Late fees and rent reminders can also be automated to encourage on-time rent payments.