Nowadays, most people prefer to pay rent online using their debit or credit card. With technology advancing so quickly, paying and receiving rent is easier than ever.
Why Use Electronic Payments?
Pretty much everybody has some sort of electronic device — whether it’s a computer, tablet, or mobile phone. Mostly everything is done online, since it’s hassle-free, easy, and paperless. Having your tenants pay rent online will streamline the payment process and make it easier on both you and your tenant.
This way, all of the payment information is in one place and you don’t have to deal with receiving mail, cashing checks, or processing direct deposits. Depending on which electronic payment method you choose, tenants may also be able to receive notifications for when their rent is due. They may even have the option of setting up auto-pay, meaning the full rental payment will always be on time.
If your tenants are currently using another method to pay their rent, and you’d like to switch over to online payments, make sure to discuss the matter with them. Make sure to inform them of the benefits of online payments. You may also even instill online payment as a policy of the rental agreement. Remember, sometimes online rental payments aren’t the best option. It all depends on you and your tenant. For instance, if you have an elderly tenant who prefers to pay in cash or by check, you should consider accommodating them.
Online Rental Payment Tools
There are countless tools online that you can use to have your tenants pay rent. These services will help you easily streamline your property management:
- ClearNow: ClearNow automatically withdraws the rental payment from a tenant’s bank account every month. It also doesn’t process partial payments, so if all of the money isn’t in their account, nothing will be collected.
- ClickPay: This is a platform with a user-friendly interface that allows property managers and landlords to bill and collect rent online. They accept credit cards, eChecks, and paper check payments.
- PayYourRent: This platform offers tenants the options of paying with eChecks, credit cards, and even cash. Tenants can log on to make individual payments or schedule recurring automatic payments. Payments can also be made over the phone. Landlords can expect to receive the money the same day too. In addition, PayYourRent builds a rent payment credit history and reports the information to both TransUnion and Experian RentBureau. There are also a wide range of other services like tenant screening and online rental applications available.
- TurboTenant: TurboTenant is a completely free service that makes paying and receiving rent super easy. Tenants can quickly pay their rent using an eCheck. Funds are deposited into the landlord’s bank account within 2 business days.
PayPal, Venmo, and Square Cash
There are also some online payment options out there that aren’t made specifically for rent. PayPal, Venmo, and Square Cash are some notable online applications that make it simple for people to pay each other for virtually anything. For PayPal, you can create a PayPal.Me link and share it with your tenant. Then, they can pay you directly. For Venmo and Square Cash, you can make an account and share your username with your tenant.
Although this kind of peer-to-peer payment system seems easy and efficient, there are some drawbacks. With these tools, people can send any amount of money they wish and you will automatically accept that amount. This may become a problem because you will not be able to effectively enforce your lease terms. In the event of a legal dispute, you may also lose some power to go after a tenant for late fees and/or missed payments. As a landlord, you do not want to lose control over your rental business. So, for this reason, it’s essential that you identify which method is right for you.