Landlords of yesteryear put pen to paper then migrated to spreadsheets, and now today trend towards adopting property management software. The real estate industry, in general, is pivoting away from older methods for in-person tasks to virtual alternatives such as video inspections and electronic lease signing.
Alternatives are available for accepting money orders, cash, and checks — isn’t it time to try a modern rent payment option instead of accepting currency in your rental office? You’ll gain valuable time and cost savings and your tenants will thank you.
- Paper currency, from cash to money orders, inherently comes with drawbacks.
- Although electronic online rent payment options work well for those with bank access, there are 14 million unbanked American adults who rely on cash and money orders to pay for expenses.
- A Cash Payment Network resource such as PayNearMe using Rentec Direct property management software is the solution to transition from cash, money order, and check payments. It comes with many benefits for landlords as well as the tenants they serve.
Out with the Old Rent Payment Options
Why should landlords stop accepting cash, money orders, and checks as rental payments? Inherently, there are negatives to many rent payment options available. Let’s take a look at each and why it may be time to try something new in your rental office:
- An easy temptation for embezzlement.
- Holds bacteria and germs longer than other paper options.
- Paper trail is difficult if lost or stolen in the mail.
Check (personal check, cashiers check, and certified checks)
- Personal checks and some cashiers checks, the funds may not be in the account at the time of deposit.
- Personal checks can expose the check writer identity theft by exposing personal information such as account numbers, address and name, and oftentimes driver’s license and phone numbers.
- All checks can be forged or counterfeit.
- Although the funds for money orders are available immediately as these have been purchased, they are not immune to cancellation after it has been deposited.
- Money orders are prone to be considered invalid if illegible or information such as payee is incorrect. Incorrect date, mismatch on amounts, and missing or difficult to read signatures or information may delay or negate the check validity.
- Just as checks can be counterfeit, money orders are also vulnerable to scams and forgery.
What Paper Money has in Common
All paper money and papers of exchange for currency such as checks and money orders can be forged or faked. Cash, checks, and money orders all require you to physically handle them and perform data-entry into a bookkeeping system.
All but cash and a certified check have the unfortunate ability to be canceled or reversed leaving a landlord scrambling to collect the overdue rent. And of course, there is always the off chance that a mailed rent payment can be lost or stolen, or the transportation time simply used as an excuse why it might be arriving late or not at all.
A Move in the Right Direction with Electronic Rent Payments
What a glorious move for property managers and landlords when merchant services came to the scene to offer online rent payments. Online rent payments could now fly from the tenant’s bank through merchant services to the landlord’s account faster than a check could be mailed, processed, and cashed.
From there, credit card processing became available for those that would either rather pay with a credit card to build credit, gain points or miles, or simply because they didn’t have funds available in their bank account.
Both online payment types changed how many property managers and tenants interact with each other for paying and receiving rent. Tenants log into a tenant portal to schedule payments, landlords pull settlement reports and can pay expenses faster now that funds are flowing.
However, a segment of the population can not enjoy the ease of traditional electronic rent payments as more than fourteen million American adults do not have a traditional bank account and rely on cash and money orders to pay for expenses. Others choose not to participate with financial institutions.
A Modern Rent Payment Option
The good news is that now, a modern landlord can provide an easy alternative to residents who do not have access to or choose not to use traditional banking by embracing a Cash Payment Network solution instead of accepting cash, checks, or money orders.
Your rental office can sit back and allow those cash network locations to accept rent on your behalf while the funds transfer to your bank account.
Cash Payment Network Landlord Benefits
As the world continues the debate of a cashless society, and rental offices move closer to going paperless, there are moves to processing cash payments (including money orders) electronically without the inherent downsides of physical currency.
Receive funds after-hours
Cash payment networks act as an extension of your office by being available at times and days perhaps your office might be closed. Meaning tenants can pay their rent at midnight or perhaps a weekend or holiday.
Landlords don’t need to wait for the mail, process a payment, go to the bank for a deposit.
Rent payment transactions will show in the property management software automatically avoiding costly data-entry errors.
Processing concerns eliminated
No more counting, sorting, storing currency and checks. No more worry about germs associated with handling cash, money orders, and checks.
Benefits for Tenants Using a Cash Payment Network
Can you imagine the relief your tenants will feel knowing they will no longer need to take all those steps to purchase a money order? You’ll be taking away their concern about mail delivery times, legible check writing, late fees, office hours, etc. Lastly, they might even save a little money as using PayNearMe has a very small transaction fee.
Interestingly, many cash payment locations also sell money orders so your tenants might already be going to these locations and now can cut out many of the previous hoops and hurdles to paying rent. Tenants get peace of mind that the funds will show up within 15 minutes to their tenant ledger and portal. No more wondering if slow mail delivery will cost them a late fee.
Often tenants need to first go and purchase a money order and then take it to another location to deliver or mail in the payment. Using a system like PayNearMe allows tenants a one-stop convenient solution.
Tenant Cost Savings
Typically paying rent at a cash network location is equal to or less expensive than purchasing money orders or cashier’s checks. Not to mention the cost of postage and/or gas money to deliver the rent payment.
Speed of Payment
Tenants can avoid potential late fees as they don’t have to wait for their payment to arrive at the rental office, get processed, deposited, and hope that the funds clear before a late fee is imposed. PayNearMe with Rentec Direct takes approximately 15 minutes for the software to be updated with the transaction details.
Property Management Software with a Cash Payment Solution
Rentec Direct property management software gives clients the ability to signup to offer their tenants a payment alternative through PayNearMe.
As a Rentec Direct client, after you’ve enrolled in the cash payment option, tenants get a code from their tenant portal and go to a local cash payment location in their neighborhood to pay their rent. It really is that simple to transition away from accepting rent by money orders, cash, and checks to a modern time-saving rent payment alternative.