After finally saving up enough money to use as a down payment, I decided that it was time to hit the market. I met with a lender, got pre-approved for a loan, and then started visiting different properties. However, I quickly realized that I didn't know as much about real estate as I would have hoped. I wanted to find a great neighborhood and know what to ask the professionals, but I could tell that I needed a little help. To point me in the right direction, I started working with a great real estate agent who was familiar with the area. This blog is all about educating the general public on real estate matters.
When residents don't pay rent on time, it not only screws up your accounting, but it also creates a hassle since you then have to track them down and make sure they write that check. Luckily, there are some things you can do to encourage your residents to pay on time so you're not left banging on doors and threatening eviction.
Offer online payment options.
If you're still requiring residents to pay with checks, this might be one reason why they're frequently late. People are less accustomed to writing checks these days, since online payments are so prevalent. Your residents might be simply forgetting to sit down and write a physical check when they pay all of their other bills online. Setting up a system by which your residents can send an online payment through a popular online billing service will help ensure you're paid on time. Residents can schedule an automatic payment to be made each month, or they can request email reminders a few days before rent is due so they don't forget to login and make the payment.
Offer discounts for rent that's paid early.
The discount does not have to be large. Even a $10 or $20 per month discount will motivate residents to pay their rent on time, since it will save them money. Make sure it is outlined in your lease that this discount only applies if the residents pay their rent a certain number of days early. (For example, if rent is technically due on the 15th, offer a discount if they pay on the 14th or sooner).
When residents do pay rent late the first time, have a heart-to-heart with them about how it affects everyone.
If you just accept the late check and walk away, residents may not realize what an inconvenient late payments present for you. Don't yell at them or make a scene, but do mention that late payments make more work for you, and that frequent late payments increase your expenses because there's more work involved in processing them and managing the related accounting. Kindly and calmly explain that you'd appreciate if the residents could pay the rent by the due date from this point on, and that doing so will benefit everyone by keeping costs (and thus their rental rates) down. If residents understand why paying rent on time is important, this will help motivate them to do so.
To learn more, contact a residential property management company like Foreside Real Estate Management.Share