5 Tips for Getting Residents to Pay Rent On Time
Digested from AppFolio Blog
Consistent rent collection is the biggest factor in maintaining a healthy bottom line for your apartment community. Here are five steps you can take to help your residents pay on time every month.
1. Institute a thorough screening process. The first step in getting regular on-time rent payments is making sure you are choosing residents who are most likely to do this. If you are considering taking over management or ownership of a community, carefully review the last two years of income and expense statements to see if there are many problem payers.
2. Emphasize a carrot instead of a stick. Consider offering a small on-time or early payment discount to help residents prioritize paying rent. You could offer a “bonus” after 12 consecutive months of on-time or early rent payments.
3. Report rent payments to the credit bureaus. Let residents know that you will be reporting their rent payment activity to the credit bureaus. Frame it as a way residents can build a good credit history or improve an already good one. Of course, unstated is that residents who consistently pay rent late will be hurting their credit.
4. Make paying rent easy. Give residents an online or automatic payment option. Offering a monthly discount of as little as $5-$10 can motivate residents to sign up for automatic rent payments.
5. Communicate with residents. If you have a resident who chronically pays late, talk to that person about why this is happening. Consider putting him or her on a different payment schedule.