Reduce Delinquencies and Increase Cash Flow with These Easy Tips!
On-time rent collection is critical to make daily operations run more smoothly and add profitability to your property’s bottom line. It starts, of course, with properly screening residents prior to renting to them and diligently checking their references.
Once they have moved in, however, it's important to make it as easy as possible for them to be "good citizens" and pay their rent on time. The easier it is for residents to pay lessens your rent collection efforts as well.
What follows are methods other properties have used successfully to encourage on-time rent payments:
1. Stay open an extra hour the first three days of the month. Most residents probably work during the day. This means they must pay their bills in the evenings. At the first of the month, your residents will appreciate and take advantage of the convenience of being able to drop off their rent payments at your management office after regular business hours. By keeping your office open an hour or two later as each month begins illustrates your willingness to support your residents' requirement to pay their rent on time and improves rent collection.
2. Provide convenient rent payment envelopes. This seems like a small thing, but providing residents with a year's supply of pre-addressed payment envelopes is a convenient time-saver that residents appreciate. The envelope serves as a reminder that they haven’t made their payment yet. Everything you can do to encourage on-time payment is worth the effort.
3. Display temporary reminder signs on exit gates days before rent is due. Today, lives are busier than ever. It's possible for even responsible residents to get tied up with other demands and forget that it's rent collection time. Putting a secure rent drop box inside the door of your management office with a slot on the outside allows residents to drop their payment off anytime of the day or night. Rent drop boxes remove the barriers of residents writing out their check but having to wait for your office to open before they can pay it. Because rent drop boxes are secure, residents can use them with confidence.
5. Add a secure rent drop box on the wall of your management office. If residents come to your office to pay their rent while you and your staff are busy, you can make it easy for them to deliver their check by mounting a secure rent drop box on the wall of your office. Make sure this secure rent drop box is well labeled and emptied daily. 6. Set up a portal so residents can pay their rent online. This is a more costly option, but, with the fast-growing use of online banking, residents welcome the convenience of paying online. Having their payments automatically deposited in your property's account saves you time and gives you faster access to your money. 7. Encourage residents to set up automatic bill payment (ABP) at their bank. Most online banking bill pay features allow bank customers to set up automatic payments of their rent. At no cost to your property, automatic payments make rent payment easy for residents, making rent collection a big time-saver for you. To encourage this practice, just hand out an Automatic Payment Deposit Form to new residents as they move in and make the forms always available at your office. You can periodically remind residents of this payment option.
By reducing your residents' efforts to pay, you reduce your efforts to conduct rent collection activities. Take some or all of these steps and both sides win.