6 Tips for Collecting Rent on Time Every Month

In an ideal world, tenants would pay rent on time each month and experience no hiccups when submitting their payments. However, there is always a chance that they may forget to pay rent by the set due date or experience financial hardships while renting. 

If you’re struggling with tenants who aren’t paying their rent on time, there are some things you can do to help remedy the situation and encourage on-time payments. Here are six tips to ensure rent payments are paid by the set due date. 

1. Communicate With Your Tenants About Late Payments

If your tenants are consistently paying rent late, it’s important to talk with your tenants to ask the following questions:

  • Why is the payment late?
  • When will they be able to pay?
  • Are they going to pay in full?
  • How are they going to pay (check, cash, online, etc.)?

Straightforward communication about rent, due dates, late fees, and possible consequences for late rent will help prevent any confusion during the lease term. Establishing a paper trail of communication can also be helpful during the eviction process, as it proves you did make an effort to notify the tenant of the expectations regarding rent. 

2. Have Consequences for Late Rent Payments

Charging a late fee ensures that tenants are financially motivated to pay on time. The exact rules about how much you can charge vary by state, so check local landlord-tenant laws before charging them.

Some landlords choose a late fee that’s enough to motivate tenants to avoid paying late, but not too high that it would impose a financial burden on tenants. However, some states limit how much you can charge in late fees and require landlords to allow a grace period for tenants to submit the payment. This grace period and late fee should be stated in the lease agreement for both to be enforceable. 

3. Make Use of Online Rent Payments

Paper checks, cash, and money orders are outdated methods of collecting rent that pose their own problems (lost mail, lack of receipt, etc.). Since many tenants already pay the majority of their bills and other expenses online, consider letting them pay their rent online, too.

Collecting rent with platforms like Avail makes it easy to streamline the rent collection process for more than one rental property. You can set up late fees to automatically generate once a payment is considered late, schedule upcoming payments, and track your rental income with the rental property accounting tool. 

Tenants are also able to leverage Autopay to automatically withdraw the funds from their account, or manually submit payments with their preferred payment method in minutes. The easier it is for tenants to pay rent, the less likely you’ll experience late rent payments. 

4. Send Your Tenants Rent Reminders

Thanks to advancements in technology, it’s easy to get in touch with your tenants in minutes. To ensure tenants collect rent on time each month, you can send rent reminders a few days before the due date. 

You can manually send reminders yourself or leverage a property management software platform to automatically send reminders each month. Our system sends automatic rent reminders to tenants each month, and will also automatically generate a late fee if one is set up and outlined in your lease.

5. Choose Your Tenants Carefully

Being proactive about how you select your tenants is another aspect of getting paid on time. Having a consistent screening process that you use every single time you’re assessing a prospective tenant is essential to determine if a tenant will likely pay rent on time.

You can assess a tenant’s income to make sure it’s appropriate for your rent rate by requesting a credit check (if allowed in your state), verifying their employment, requiring a credit reference, or reaching out to their previous landlord. 

6. Offer Rent Concessions For On-time Rent Payments

As important as negative reinforcement for late rent is, so is positive reinforcement for timely payments. Offering rent concessions to tenants can be one way to encourage on-time rent payments during the lease and reduce hiccups. 

Tenants can also boost their credit score with on-time rent payments. However, tenants aren’t able to report on-time rent payments to the credit bureaus on their own. As a landlord, you can set up a system to report your tenants’ on-time payments to the major credit bureaus to encourage them to pay on time.

If you don’t want to go through the process of setting up rent reporting yourself, Avail can report tenants’ on-time payments to TransUnion for you. Tenants can sign up for CreditBoost* to report their on-time rent payments to help them improve their credit.

Collect Rent Online With Confidence

Following these six tips will help you streamline the rent payment process while encouraging on-time payments from your tenants. 

Create an account with Avail to set up automated reminders and fees, streamline rent collection, and track your rental income in one place. 

*CreditBoost terms and conditions may apply.