For rental properties to be profitable, landlords need to see cash flow. And that means having tenants who pay rent on time, all the time.
As a landlord, one of your most important responsibilities is collecting rent from your tenants. But if you’re constantly chasing down late payments, it can be tough to stay on top of your finances. Luckily, there are a few property management strategies you can use to encourage your tenants to pay on time. For example, you can sign them up for FrontLobby, which will report their rental payments to the Landlord Credit Bureau and Equifax. You can also offer a discount for early payments, or charge a late fee for payments received after the due date.
By incorporating these strategies and others below into your property management plan, you can help train your tenants to pay on time, and minimize the financial stress of late rent payments.
Rent Reporting Strategies for Landlords and Property Managers
- Report rent payments to the credit bureau – This will help build your tenants’ credit scores and encourage them to pay on time. We recommend using FrontLobby to report your Tenant rent payments. FrontLobby is a national organization that provides Landlords with the tools they need to screen tenants, manage their properties, and collect rent. FrontLobby also offers a variety of other services, such as tenant screening and debt reporting. Landlords who use FrontLobby report higher levels of satisfaction with their tenants, and lower levels of tenant turnover. FrontLobby is a great resource for any landlord looking to improve their property management. Find our more at https://frontlobby.com
- Incorporate late fees into your lease agreement – Landlords who incorporate late fees into their lease agreements may be surprised to find that it actually deters tenants from paying late and offsets any lost income. Landlords can report Tenants who pay late to the Landlord Credit Bureau and Equifax, which will negatively impact the tenant’s credit score. As a result, tenants are more likely to make on-time rent payments if they know that there is a late fee associated with their lease. In addition, late fees help to offset any lost income that the landlord may incur as a result of the tenant’s late payment. As a result, landlords should consider incorporating late fees into their lease agreements in order to encourage timely rent payments.
- Offer a discount for early payment – Landlords who offer a discount for early payment may find that more tenants are willing to take advantage of the offer. This is because tenants who are able to save money on their rent are more likely to be able to pay their rent on time and avoid late fees. Landlords who use the Landlord Credit Bureau may also find that offering a discount for early payment helps to improve their credit score. Tenants who are able to save money on their rent are more likely to be able to pay their rent on time and avoid late fees. Landlords who use the FrontLobby may also find that offering a discount for early payment helps to improve their credit score. As a result, offering a discount for early payment can benefit both landlords and tenants.
- Set up automatic payments – Landlords who are looking for a reliable way to get their rent paid on time may want to consider setting up automatic payments. With this option, tenants can have their rent automatically withdrawn from their bank account each month. This can be a convenient way for tenants to ensure that their rent is paid on time, and it can also help landlords to avoid late fees.
- Send reminders via text or email – As a landlord, one of the most important things you can do is stay on top of rent payments. Not only does this help to ensure that you are making a profit, but it also helps to maintain your relationship with your tenants. One way to stay on top of rent payments is to send reminders via text or email. A simple reminder can go a long way in prompting tenants to pay their rent on time. In addition, you can also sign up for the FrontLobby, which will help you keep track of rent payments for your tenants and report them to the Landlord Credit Bureau and Equifax. By taking these simple steps, you can help to ensure that your tenants are always up to date on their rent payments.
- Accept online payments – Landlords who accept online payments enjoy several benefits. For one, it can be more convenient for tenants, who can pay their rent from anywhere at any time. This can be a great selling point for potential tenants. In addition, online payments can help landlords avoid late payments, as tenants can set up automatic payments. Landlords who use the FrontLobby can also enjoy the benefit of having online payments reported to the Landlord Credit Bureau and Equifax, which can help boost their credit score. Overall, accepting online payments is a win-win for both landlords and tenants.
- Have a drop box for payments – Landlords who are looking for a convenient way to collect rent payments from their tenants can consider installing a drop box. This can be especially helpful if tenants work odd hours or are often away from home. Drop boxes provide a secure place for tenants to drop off their rent payments, and landlords can access the payments at their convenience. Landlords can also use drop boxes to collect other payments, such as late fees or security deposits. Drop boxes are generally available for purchase at hardware stores or online. Landlords should be sure to choose a drop box that is big enough to accommodate all of the payments they expect to receive. They should also make sure to place the drop box in a location that is easily accessible to tenants but not visible to passersby. By using a drop box, landlords can make it easy and convenient for their tenants to make rent payments on time.
- Give tenants the option to pay in cash – Some tenants prefer to pay their rent in cash, and landlords should make this option available to them. There are several benefits to paying rent in cash, including the fact that it is often cheaper than using a check or credit card. Additionally, paying in cash can help to improve your credit score, as long as you make your payments on time. And finally, paying in cash can help to build positive landlord-tenant relationships, since it shows that you are willing to work with your tenants to accommodate their needs. If you do decide to offer the option to pay rent in cash, be sure to have clear policies in place regarding payment deadlines and late fees. This will help to avoid any misunderstandings down the road.
- Use a collection service – If you find yourself consistently struggling to collect rent from your tenants, it may be time to consider enlisting the help of a collection service. While this option may seem extreme, it can be very effective in ensuring that you receive the rent you are owed in a timely manner. Collection services specialize in tracking down delinquent tenants and collecting payment on behalf of the landlord. In most cases, they will charge a percentage of the total amount owed, but this is typically worth it in order to avoid the headache of chasing down payments yourself. If you are having trouble collecting rent from your tenants, consider using a collection service to get the money you are owed.
- Take legal action – In some cases, a tenant may refuse to pay their rent, despite repeated attempts to convince them to do so. If this happens, you may need to take legal action in order to get the rent money that you are owed. This can be a complicated and time-consuming process, but it is often the only way to get the money that you are owed. Before taking legal action, be sure to consult with an attorney to ensure that you are taking the right steps. Once you have consulted with an attorney, you can file a lawsuit against the tenant and take them to court. This should be seen as a last resort, as it can be very costly and time-consuming. However, in some cases, it may be the only way to get the rent money that you are owed.
By following these tips, landlords can ensure that they collect rent from their tenants in a timely manner. By making it easy and convenient for tenants to make rent payments, landlords can minimize the risk of late or missed payments. And by using a collection service or taking legal action, landlords can get the money they are owed even if tenants refuse to pay. By taking these steps, landlords can protect their investments and ensure that their rental properties are profitable.
The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.
In October 2021, the LCB organization re-branded some of the services it offers under FrontLobby. Until this point, the LCB organization has consisted of two companies handling different services under the umbrella trademark of Landlord Credit Bureau. The introduction of FrontLobby enables each company to maximize its focus and impact. Read More
Rent Reporting Benefits Landlords and Tenants
Landlords, Property Managers and Tenants can report rent payments and rental history data to Landlord Credit Bureau through FrontLobby.