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Collecting rent is a core function for a property owner. Everything else you do in this process - like finding tenants and handling maintenance requests - is only worth it if you can collect rent payments month after month.
As experienced rental property owners know, collecting rent is not always as easy as it should be. Countless issues can come up along the way, including late payments, high payment processing fees, and more. Marble wants to help you streamline the process of collecting rent from your tenants, so we’ll take an in-depth look at this important topic below.
Establishing Some Goals
Before you start looking at practical options for how you can collect rent, the first thing you need to do is consider what your goals are with this process. Once you know what you want to achieve, you can then look at solutions that will allow you to achieve all of your goals, or at least as many as possible.
Here are some things you might want to set as goals for the rent collection process -
This framework will help you compare various forms of collecting rent so you can decide on something that is suitable for your needs. In this process, make sure the last point on our list - accounting - gets plenty of attention. A somewhat haphazard system of collecting payments can quickly turn into an accounting nightmare, and that’s the last thing you want as a landlord.
Fortunately, there are many options available to get your payments organized and keep track of the relevant records. On the most basic level, you could set up some folders within your email account to place confirmations after payments are made. A step up from that would be a spreadsheet that you create to track payments on your properties - and you might decide to use email folders in combination with a spreadsheet or two to get a better handle on everything.
For property owners with a growing portfolio, using a tool like QuickBooks to formalize your accounting process is recommended. There is a short learning curve to get up and running with QuickBooks if you want to do it yourself, or you may choose to outsource some of your accounting work to save time and make sure it is done correctly.
Three Distinct Options
The world of rental payments has changed quickly in recent years thanks to ever-evolving technologies. As a result, property owners now have a long list of options at their disposal, and it’s easy to get a little overwhelmed when trying to make a choice.
So, in this section, we are going to use our criteria above to go through three popular approaches to rent collection.
#1 - Physical Payments
First up, we’ll talk about taking physical payments in the form of a check. These can be collected many ways, including through the mail, in a drop box, or in-person at the property. As you would imagine, physically collecting payments is the most demanding approach on your time. You’ll need to get the checks, sign them, and deposit them into the bank. That might not sound like a big deal, but it may grow tiresome as the months wear on.
On the plus side, this approach will allow you to get around the fees that might be associated with other methods. When you do the work of getting the checks and taking them to the back, transaction fees are avoided and you keep every dollar of the rent. So, it’s a matter of weighing the value of your time against the convenience of an automated payment option like those listed below.
#2 - Payment Apps
Most people use payment apps regularly in their personal lives, whether to pay a friend back for lunch or to chip in to a cause at their kid’s school. Whatever the case, most people are familiar with these various apps, which means they are easy to use for most tenants. Examples of such apps that you might consider would include Venmo, Apple Pay, or PayPal.
While you might be able to use some of these without incurring a fee, they don’t always feel as secure as other options - especially considering the monthly rent might be for a significant amount of money. And, your tenants might not like the casual nature of this type of arrangement, either.
#3 - Online Payment Portals
Likely the most popular option at this point is an online payment portal that has been designed specifically for use by landlords and tenants. There are several of these on the market today, and while they vary in terms of features and fees, they all make it easy for tenants to access their account each month and submit the rent payment.
As an added bonus, you can look for features like the ability to communicate with your tenants through these platforms, and some will allow you to manage maintenance requests. This helps make the use of the platform more valuable to you, and might justify the cost.
The Marble Solution
In the end, however, there is no need to patch together a network of tools and platforms to manage your property when Marble can do it all. Not only does Marble allow for automated collection of rent payments and deposits into your account, but every other element of managing a property is accounted for, as well.
We make it easy for tenants to pay their monthly rent, as we offer three options - ACH payments online, credit card payments (with the tenant paying a transaction fee), and mailed checks that arrive at Marble’s mailing address. Not only does this approach keep you out of the rent collection process entirely, but it also gives your tenants the flexibility to use whatever approach works best for their situation. And, as an added bonus, a summary of income and expenses for the year will be available at tax time, so you don’t have to scramble to bring those numbers together.
Rental property owners can secure Marble’s services for a flat monthly fee that is just a fraction of what would be charged by a typical property manager. Whether you are looking for a management solution for a single property or you are in the process of building out a portfolio of rentals, Marble is the trusted manager you want on your side. Start your free trial today!
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