(800) 253-1482Should Landlords Collect Rent Online in Texas?
Collecting rent is an obvious, yet important step in being a landlord, but how you collect your payment can make all of the difference. Beyond the need for payment, there are many different factors to consider including security, proof of transactions, the speed in which you receive your payment, and more. Furthermore, there are more ways than ever for receiving payment including the option to collect rent online. Discover the ins and outs of rent collection to avoid pitfalls and mitigate potential losses of income.
Best Way To Collect Rent as a Landlord in Texas
The best way to collect rent from a tenant is to collect rent electronically. It’s secure, it’s convenient, it’s fast, and it helps you keep track of payments. Here are some of the top reasons landlords should collect rent online:
Consistency
Online payments help build consistency among tenants. You can have online alerts to remind them of payment, the convenience helps tenants make payments, and provides an opportunity for auto-pay so that you’re paid in full and on time.
Speed
Time is money and landlords who use the Internet for rent collection get more of both. The faster you have your money, the better, and online payments from tenants help your rental business maintain a healthy cash flow.
Security
Having tenants leave cash means you’re vulnerable to theft without a trace. A wire transfer can leak sensitive information. Checks bounce, credit card services get hacked…the list goes on and on. Security issues always exist but online payments are the most secure option available to landlords. Thanks to encryption, private information remains private for all parties.
Cover Your Bases
Using the Internet to collect rent from your tenants allows you to keep a transaction history. Disputes can arise between tenants and landlords. Having proper documentation can help you avoid these issues and provide better transparency with your renters.
Risky Methods of Rent Collection
Collecting rent through other methods can be done, but each comes with its own set of risks. These risks can harm your business, create lapses in security, and prevent you from fully collecting all that is owed to you. Learn the risks you may incur when you fail to collect rent online:
Cash
Collecting rent using cash can mean a lot of negative ramifications for your business. For starters, it’s virtually impossible to track, which could mean trouble should disputes arise. Many landlords also struggle with tenants who may not pay or may only partially pay.
Credit Cards/Debit Cards
There are ways to collect rent through credit cards or debit cards, but they are time-consuming and costly. Using a third-party service can add on fees that cut into your profits. If you pass them on to your tenants, you may outprice your market. Furthermore, these transactions may take time to process, and using card readers in person is beyond a hassle for everyone.
Wire Transfers
Transferring money between bank accounts isn’t as secure as you might think. Sensitive information being shared with the wrong people means security vulnerabilities for your business and personal accounts. Even if your bank will help protect you, it’ll be quite the hassle to get everything straight.
Checks
Checks provide tenants with the opportunity to forgo payment. There’s never a guarantee that you’ll be receiving the full amount, if you don’t cash it immediately their account could fluctuate, and the time it takes to process these checks can be frustrating. Many banking apps do offer digital deposits but there can be issues reading the checks and it may still delay the process until a visit to your local bank.
How To Collect Rent Online
There are many different rent payment systems available for online payments. The basic idea is almost always the same. You set up an account, have your tenants register, and request payment through the platform.
Some online payment systems are more general while others are crafted specifically for landlords and tenants. You’ll notice that each brand has its own unique features in terms of auto-pay, applying late fees, security, payment processing, costs, and more. Here are some of the most popular ways landlords collect rent online in Texas:
Each rental business is different. If you are simply renting a home or two, you might not need a rental-specific online payment service with all the bells and whistles. For property managers in charge of tens or hundreds of properties, the additional features can help you stay organized. Find what’s right for your business and use it for faster, more secure payment.
Renting to College Students Throughout Texas
It should be no surprise that college students and other younger demographics are much more inclined to pay their bills online. Student credit, debit, and mobile payment statistics show that mobile payment methods continue to trend upward with as many as 86% of all college students using this method for transactions.
Using the Internet to pay rent has become more of the norm over the years as the previously listed benefits make it a better experience for all parties. Texas has the second-largest population of college students in the country. Cities such as College Station, Bryan, Austin, and Waco are testaments to the impact of college renters in our state.
This is often a transition period for kids working their way into adulthood, which means things can be a bit different. Streamlining your rental revenue can help you receive your payment on time and in full while providing a favorable experience to your tenants. If you’re renting to college students, using an online option is the best choice for your rent collection.
Collecting Rent Online Isn’t the Only Way To Protect Your Finances
Being a landlord means wearing many hats and at the end of the day, generating revenue and turning a profit on your investments is the goal. But a lot can go wrong in the meantime and without the right landlord insurance policy in place, you may not be properly protected and could also be losing money.
Good landlord coverage will provide your rental properties with reliable protection at an affordable rate. It’s sometimes difficult to find such insurance policies as rates can fluctuate from provider to provider leaving investors to decipher the best course of action.
Here at Freedom Insurance Group, we’ve been helping landlords throughout Texas since 2005 find coverage that works for their rental needs. Our insurance products are vast because we work with 25+ top-rated providers through our insurance center.
These partnerships allow us to compare your coverage among more brands and deliver the cheapest option on the market without cutting corners. Our agents also have access to more discounts to maximize your opportunity to save.
Insurance companies are looking to manage their risks when taking on clients. Landlord insurance is higher because of the increased risk involved in renting a property. Still, through comparison shopping, the best options can be explored resulting in the protection you need while managing costs.
From helping landlords in Texas collect rent online to providing high-quality landlord insurance solutions, our team is here for you. Ask an agent about how much you can save today or get an accurate landlord insurance quote using our online tool.
