If you’re like many landlords, you’re well aware of the problems inherent in collecting paper rent checks every month period in fact, you may even be looking for alternative solutions because paper checks just aren’t cutting it for you anymore. This guide discusses paper rent checks, as well as why it may be time for you to modernize your operations.
Is it Time to Stop Taking Paper Rent Checks?
For many landlords, taking paper rent checks is more of a hassle than it’s worth. Generally, taking paper rent checks means poor cash flow, extensive waiting times, and the risk of check fraud. First, sometimes tenants forget to drop the check in the mail; now, with postal service slowdowns (see the next section For more information on this), it can take even longer to get your money. After you do receive your check, you may scan it into your banking app and deposit it that way. However, many landlords don’t use banking apps, and if your bank doesn’t even have the capability of depositing checks through an app, you’ll end up standing in line at the bank. Then, you still have to wait for the funds to clear. If the check bounces, you’re back at square one.
Postal Service Slowdowns and Your Paper Rent Checks
As of October 1st, 2021, the U.S. Postmaster General announced that first class mail delivery will begin taking up to five days to arrive at its destination. That means mail that once arrived within three days will now take two additional days. Unfortunately, that will affect you if you accept paper checks by mail.
What Are Your Options?
Rather than accepting paper checks, you have many online options. You can use major payment providers, such as PayPal and Zelle, or you can ask your tenants to set up a direct deposit from their account to yours each month.
Related: Should you hire a property manager?
5 Reasons to Switch From Paper Rent Checks
Paper rent checks are often more of a hassle than they’re worth, and for many landlords, these are great reasons to switch to online payment methods:
- Online payment saves time for you because you don’t have to cash checks. Even better, you don’t have to wait for them to arrive or figure out what to do if a check bounces. Collecting digital payments saves your tenants time, too. Tenants are able to set up recurring payments or make one-off payments, whichever is easier for them.
- You can accept many forms of rent payments. If a tenant needs to pay with a credit card, debit card or money directly out of their bank, you don’t have to worry about any of it. Having an online payment system for your rent enables tenants to use whatever payment method they choose.
- You never have to worry about postal delays or things getting lost in the mail. Postal service slowdowns are real, and they’re causing all kinds of problems for a number of business owners. You don’t have to be one of them, though. Digital payments function completely independently of the U.S. Postal Service.
- You don’t have to worry about fraudulent payments by way of check. Online payments are secure, and the service you use will take measures against fraud. You don’t have to worry about a thing.
There are a number of other reasons, too. The main one is typically convenient. You and your tenants can worry last and save more time when you use an online system to collect rent.
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