Rent Collection: How to Deal with Late Payments Decisively

Rent Collection: How to Deal with Late Payments Decisively

As a landlord, there's almost no bigger headache than late rent payments. When tenants fail to pay on time, you might be unable to pay the mortgage and other bills on time.

The question is, what can you do about tenants who turn their payments in late every month? We have a few rent collection tips that actually work.

Continue reading for landlord advice that will help you prevent you from falling into financial ruin in New Jersey.

Choose a New Rent Collection Method

It's possible that you may be receiving a late rent payment or two because your collection method is too outdated. While checks are a valid form of currency, they do come with their drawbacks.

For one, you must wait for the check to clear before you can do anything with the money. If the tenant already paid late, waiting on a check could make you fall behind on your bills.

It would be best if you considered using an online portal instead. As soon as your tenants submit their payment, it will drop into your business bank account. Tenants can even set up direct deposit to ensure their rent payment comes out at the same time every month.

Remind Your Tenants

There's another benefit of online payment portals and apps. You can use them to send your tenants payment reminders. You would be surprised at the number of people who pay late because they forgot.

If you don't have the money to invest in an online payment portal, you can schedule reminder emails to go out a few days before rent is due. This will give tenants the heads up they need to scrounge up the required funds.

Have a Conversation

Most of the time, tenants aren't late on their rent out of maliciousness. In truth, they don't have the funds. That's why it's important to sit down with repeat offenders to find out what's going on.

Working with the resident will help improve tenant relations, and it will allow you to collect what you're owed eventually. Fixing the problem could be as simple as changing the tenant's payment due date.

The resident may be going through a financial rough patch. Showing understanding and helping the tenant get caught up could ensure that they renew their lease when it's time for them to do so.

Charge Late Fees

The last way you can reduce the number of late payments you receive is by charging a fee for it. You will need to check New Jersey laws to find out how much you can charge.

If you are planning on having a late payment policy, you'll need to detail it in your tenant's lease. The last thing you want is to catch them off guard.

Late Rent Collection Methods That Work

Late rent collection is one of the biggest problems for landlords in New Jersey. When tenants are late, it means that the property owner can't pay their bills on time.

Try some of the rent collection methods on this list and consider hiring a property management company to help you get the money you're owed.

PMI Property Service has extensive experience with helping landlords with their accounting needs. Click here to check out our services and set up a consultation.