In many ways, the financial success and longevity of your rental business depends on a successful method of rent collection. The money that you receive every month from rent payments is a significant source of your income, so whatever method you use, you want to be sure that it’s reliable.
Traditional methods of collecting cash rent payments fall short of this requirement. Compared to contemporary methods that rely on property management software, cash payments are more trouble than they’re worth. Let’s take a look at some of the reasons why you should consider switching to online rent collection.
It Takes Up A Lot of Time
As a landlord, you have a lot of different things that need your attention and a limited time to address them, so it’s important to be as efficient as possible. When it comes to rent collection, how long the actual transaction between you and your tenant takes is an important thing to consider.
Cash rent payments take much longer than digital alternatives for a couple of reasons. First, when a tenant pays in cash, the money has to go from their hands to yours via either a hand-off, by dropping it in your mailbox, or by delivering it by mail. Compared to property management software with which iu can view the payment as soon as it has been paid, there is a considerable delay that keeps you from starting the necessary bookkeeping process, especially if a tenant is late with rent.
Second, once you start bookkeeping, a cash payment means that you have to undergo the process manually, which takes a lot more time than an automatically-generated alternative. Online platforms will produce and keep records for you instantly.
There’s a Risk for Accounting Error
Leaving the job of keeping records to the software is not only beneficial because it can save you a lot of time. If you are in charge of a lot of tenants and all of their rent comes in at the same time, manual bookkeeping can be a big job all at once. The more there is to do of it, the more risk you run of making a mistake.
This can lead to disputes and problems down the road, which are best avoided. Property management software will get the job done in an instant and will do it with precision and accuracy. Because the tenant also has access to a rent payment receipt, there is an added level of transparency that can prevent the kind of disputes you want to avoid.
Money can be Stolen or Lost
A big factor to consider, especially if you have a lot of tenants, is how to keep track of physical cash as it comes in at the same time every month. Because cash is physical, it is much easier to mishandle than money that passes directly from a tenant’s bank account to the software via encryption.
You’ll have to keep close track of where the money is, and this means taking time to designate a space for it so that you’re not leaving it lying around. While it stays with you, it can run the risk of being lost or stolen if you aren’t diligently careful.
Furthermore, you will also end up having to gather this cash and make a trip to your bank to deposit it, which lends to the argument that it is not a time saver. With online rent collection, software keeps track of everything for you, and depositing all of the money into your account is as easy as pushing a couple of buttons.
Taking all of the effort to manage cash is superfluous and unnecessary when a viable and superior option not only exists but is increasingly becoming the standard for rental businesses. Property management software not only does the job for you but does it instantly and in a way that isn’t vulnerable to human error.
Cash rental payments are more trouble than they’re worth. Once you’ve made the switch to property management software, you’ll find that the time and effort you needed to invest in keeping track of cash is freed up so you can focus on improving other elements of your business.