There are many different options for rent collection in 2023. Landlords no longer have to collect rent manually and can now do so from the comfort of their homes via their computer or mobile device. Online rent collection also allows you to collect rent quickly and efficiently via debit or credit cards or direct transactions from your tenant’s bank account to yours. This article outlines why accepting rent via credit cards is the way to go, and what benefits you can expect from making the switch.
Credit Cards Offer Flexibility
When considering alternate ways to collect rent, credit cards are a strong choice. Why should you have to be constrained to your office on the first of each month to collect rent checks or count out cash payments? Offering other ways to pay rent besides paper checks not only offers flexibility to your tenants, but also to you.
Tenants may ask to pay their rent payment with credit card because it is more convenient for them. If you extend this option to them, your renters are more likely to get their rent payments to you on time and in full, since they are able to pay the way they want.
Also, if you allow credit card payments through online property management software, your tenants can pay rent from anywhere. They don’t even have to be in the state to pay their bill. You also have the convenience of receiving all these payments wherever you may be at that particular time. The flexibility that online rent collection provides is unmatched.
They Can Boost Your Tenant’s Credit Score
If your tenants pay rent online with credit card transactions, they may want to have their rent payments count towards their credit score. This can be extremely advantageous for your renters since, if they pay on time consistently, their credit score could benefit. For younger tenants who are looking to establish a strong score or for those who are looking to bounce back from a hit to their credit, reporting rental payments is a fantastic way to do so.
Tenants must opt-in to a reporting service to have their payments count, and they must be able to pay online, such as with a credit card. If you decide to collect rent with property management software, you may already have this functionality through the provider you chose.
They Are Safer
In terms of fraud, credit cards are one of the safest payment options. If your debit card number is lifted and a fraudster suddenly has access to your funds, that real money can be lost forever. In contrast, suspicious charges on a credit card can be disputed immediately, and any money lost can be more easily recovered.
If you or your tenants are wary of online rent payment options for fear of being scammed, communicating this fact may help them feel better about participating in whatever online payment method you choose. If they use a credit card instead of a debit card, they can more easily recover any lost funds if they are unlucky and a victim of a scam.
They are Quick and Efficient
Credit card payments are easily deposited into your account within only a few business days. Some companies, like Innago, deposit your funds within 24 hours. With credit cards, you don’t need to worry about cashing bounced checks or trying to chase down money.
A common misconception about collecting rent via credit cards is that credit card chargebacks occur frequently and are difficult to remedy. This is untrue. Rental credit card chargebacks occur when a tenant disputes a rental payment with their bank. If successful, this tenant would not have the payment go through, and you could have those funds taken from your account.
However, it is very easy to combat any potential chargeback claims. First of all, it’s important to note that very few rent payments are ever flagged for a chargeback. If they are, all you have to do is provide some of your detailed transaction records or any tenant signatures that dictate your ability to charge rent from that account. The bank will investigate and most likely side with you if you provide evidence that the charge was legitimate.
Conclusion
So, what are you waiting for? If you don’t already collect rent online, you’re living in the past and need to make the switch. If you are collecting rent online but don’t yet allow your tenants to pay via credit card, the benefits listed above should make the choice much easier. Credit cards are safe, quick, and efficient. Use quality property management software for an easy and streamlined implementation process and start collecting rent via credit cards today.
