The Pros And Cons Of Online Rent Collection
Go Back To Previous PageDid you know that 27% of Americans are so stressed they feel like they can’t function? Being a landlord is stressful and adds to the worries you have from day to day. If you’re an aspiring or existing landlord, you must carefully manage how much stress you take on. Whether you’re feeling the burden of property management stress yet or not, online rent collection could be a precious asset. Read on as we explore the pros and cons of online rent collection.
What Is Online Rent Collection?
An online rent collection is an automation tool that makes property management easier. It manages rent payments without intervention from the landlord. Here are some of the features of an online rent collection platform:
- Online payment platform: Instead of making cash deposits, paying in cheques, or making a bank transfer every month, your tenants can set up automatic payments and manage them using an online portal. The portal tracks their back payments and any fees so they know how much they owe without needing to call, email, or text you.
- Payment reminders, alerts, and warnings: The platform reminds your tenants when their payments are due, overdue, or in arrears. You can establish how many alerts the tenant receives until the matter is passed to you; at this point, you can choose to communicate with the tenant and make an arrangement or pass the matter on to the police.
- Mobile accessibility: Many rent collection apps are optimized for mobile, allowing both landlords and tenants to access rent payment information from anywhere, whether it be their local cafe, work, or gym.
Once you have implemented an online rent collection platform, you won’t have to manage payments as tightly or strictly, and you can experience many benefits.
Pros Of Online Rent Collection
Are you unsure whether this is the right landlord automation tool? Therefore, let’s clarify some undeniable advantages of online rent collection.
Convenient For Tenants
It’s not always intentional when tenants don’t make a timely payment. Often, it’s simply forgetfulness or finding the time to drop off a check. By implementing an online rent collection platform, you make things easier for your tenants, which makes them more likely to pay on time. The automated reminders mean that they won’t forget when rent is due, and they can even set up automatic direct debits to reduce their monthly workload.
An online platform also allows tenants to take a self-serve approach when understanding their rental obligations.
If they are unsure whether they overpaid last month, they can review their payment history using the app. This reduces the amount they need to communicate with you, and tenant communications can be one of the most hefty responsibilities for a landlord.
Reduces Your Workload
Your workload is more significant than you’d think as a landlord. You must list vacant properties, manage rental contracts and taxes, and keep tenants happy by performing the necessary maintenance.
With online payment platforms, there’s one less thing to worry about. If your tenants don’t need to contact you whenever they have a payment-related question, your duties will be reduced tenfold. And you won’t need to send any more payment reminders.
Documenting Payments Effectively
Evidencing payments and rental arrears can prove incredibly useful in a stressful legal matter. You can easily download the relevant files to send to your lawyer and pursue the legal route to evict the tenant if necessary.
Integration Potential
Most online rent collection platforms have open API integrations that allow you to connect them with your accounting and property management solutions. This way, you can quickly transfer the rental payment data into your books and tenant records on your property management system.
With such limitless integration potential, there won’t be any data transfer issues or errors caused by manual data entry, and you can transfer data without any manual intervention. This is particularly beneficial for managing off-market properties, where streamlined operations are crucial.
Cons Of Online Rent Collection
There are some hiccups and drawbacks to consider regarding online rent collection.
Digital Nomads
If you set up an online rent collection platform, this does not accommodate digital nomads. You should incorporate a method that will allow people who do not have a phone, laptop, or access to the Internet to make their rental payments.
System Failures
System failures can cause late payments and make paying property taxes and bills on time challenging. Opting for a reputable platform with positive reviews can help you avoid costly system failures.
Summary
Innovative and developing technology solutions are the best way to optimize your life as a landlord. You have family to see, errands to run, and a house of your own to spruce up. Delegating tasks like payment management to technological tools will free up your time effortlessly, allowing you to enjoy a stress and hassle-free schedule.
Georges has been working in Wall Street for the last 16 years trading derivatives with hedge funds. He has been an active real estate investor for over a decade. Georges graduated from HEC Business School in Paris and holds a master in Finance from ESADE Barcelona.
