3 Ways to Ensure Renters Pay Before the Deadline - What to Know
Property management in New York City can be hard to do when your renters don't pay on time. Not only does it destroy your financial planning activity for the next month, but it also endangers your mortgage payment if you are low on funds. If tenants fail to immediately pay one month of rent with a one week delay, it would be good if the situation changes when they are already behind for several weeks.
Here are three ways to make sure your renters pay rent on or before the deadline.
1. Screen Potential Tenants Similar to a Job Interview
As the saying goes, prevention is better than cure. If you don't screen your potential tenants, you might end up with the worst kind. The best way you can stay away from renters that make your life a living misery is by ensuring you choose the right people to live in your property. Remember that aside from those who fail to pay rent, you might have allowed people with destructive tendencies inside, which could potentially destroy your assets in the future.
With all those considerations, it is vital to conduct a screening. If an applicant declines to have an interview and screening process, you should immediately cross them out of your list. They might be doing something illegal or anything morbid for them to fear a simple background check.
2. Allow Tenants to Pay Rent Online
If you're a traditional landlord who prefers receiving payment through check, you should consider going digital and moving up with the times. In the US, 97 percent of people prefer other forms of payment aside from check. Take note that not only check processing is time-consuming, but it is also on the expensive side of payment options available today. Switching to online payment is the smartest decision because not only are the fees lower, but the transfer is almost instant as well. Remember that it is essential to adapt to the changing times to become successful in property management.
The first thing you should consider when switching to digital methods of payment is a payment platform. Make sure you choose one that is accessible from all devices. It is better to select a service that has a feature specially catered to rent collection. Popular digital payment options like PayPal or Venmo are not the best options out there. They do not offer secure protection in case the transaction fails.
3. Establish a Zero Tolerance Policy for Late Rent
Tough love exists for a reason—some people do not respond well to simple conversation and reminders. If your tenant is one of them, it's best to exercise some form of disciplinary action like sanctions. For example, if your rent is due on the first day of the month with a three-day allowance period, you can charge fees for missed payment on the fourth day, which also scales the longer they do not pay.
You must orient them about late fees before you start implementing them. It is best, however, to still regularly update them, so they also become aware of their unpaid invoice.
As a property owner, you must not fail to realize that you are responsible for setting the standards of the rent collection. Remember that you are the property owner, and if tenants fail to meet your expectations, you have the legal right to evict any undesirable tenant out of your property. However, if you do not want to resort to extreme measures, follow the three steps mentioned above to improve your current rent collection process.
Do you need help with property management in New York City? Get in touch with us today to see how we can help.