Rent Week Pain Relief: What’s the Best Online Payment Solution?
Posted on 24. Mar, 2010 by Jim Semick in Technology
It’s rent week again, and all hands are on deck. If you’re like many other property management firms, you have an unwritten rule: no vacation during rent week. You realize that rent checks cost your property management company time and money with unnecessary handling, data entry, errors, staff frustration and other inefficiencies. Surely there has to be a better way.
Even if you have invested in check scanning, implementing the right online payment solution can streamline your operation, improve your cash flow, increase resident satisfaction, and most importantly, minimize your staff’s pain during rent week.
Most online rent payments are made using electronic transfers from a bank account (ACH). Credit cards are a less popular choice for rent payments. You can find these online rent payment options from several vendors:
- Online rent payment companies. You can partner with a solution that specializes in property management payment processing. With these solutions it’s important that you be able to integrate the online payment data with your accounting solution.
- Property management software provider. Your current or future property management software vendor may offer online payment capability. The benefit of using this service is that it is often tightly integrated with your accounting system.
- Your bank. You can work with your bank to send and receive electronic checks and credit cards. This is often the most cost-effective solution, but the most time-consuming for you to implement.
Here are a few essential questions to ask when evaluating any solution:
- How much does it really cost? Evaluate the total cost for setup fees, monthly fees, and per-transaction/convenience fees. Even if you expect your residents to pay the convenience fee, keep in mind that the higher the fee, the lower your adoption rate.
- Does it integrate with your accounting? Look for a solution that seamlessly integrates with your AR system. Many systems can generate an export file you manually import into your AR system, but this adds another step and delays reporting.
- Does it provide real-time access? Does your resident get real-time access to their upcoming charges and payment history? If you need to manually upload charges and payments to the system, the information is outdated almost immediately.
- How easy is it to use? Don’t overlook this one. A solution that is unintuitive or packed with bells and whistles may actually decrease adoption by residents. How easy is it for your back office staff to use the reports, NSF notifications and data without training?
- What is the settlement time? After your resident pays, how soon are the funds deposited and available in your operating account? The most common settlement timeframes are 24-72 hours depending on pricing.
- Are there a variety of payment options? Make sure residents have the option of one-time or automatic recurring electronic funds transfers (ACH). If you give residents the option of paying by credit card, keep in mind that credit card fees can be as much as $10-30 per rent payment, so you may want to find a solution that allows you to pass these fees on to the resident.
- How flexible is the solution? Will the solution match your monthly processes? Ask whether you can select which operating bank account(s) the payments should be credited to, whether the system can be incorporated into your Website, and how much marketing support the company provides to increase adoption by your residents.
In the end, the choice you make depends on how quickly you want to get up and running, ease of use, how seamlessly it integrates into your accounting system, and how much you want to pay. Choose the right solution, and who knows, you might be able to take a vacation day during the next rent week.
Related Posts
Ditch That Rent Check: A World of Online Payment Options
Your Paperless Office: Five Great Reasons to Move Payments Online
Seven Reasons Why Rent Checks Cost More than You Think
How to Get Your Residents To Pay Rent Online
Choosing the Right Property Management Accounting Software
One Response to “Rent Week Pain Relief: What’s the Best Online Payment Solution?”
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Johnny Karnofsky
02. Apr, 2010
As a resident, I would NEVER use a payment method that charges ME for the convenience of spending MY MONEY! If you choose a method that charges a ‘convenience fee’; find a way that you pay for that, otherwise expect a low adoption rate…..
As a resident, I have a free option that pays my rent on time, is convenient, and costs me nothing additional. Since I bank with Bank of America; I establish my property as a payee under the online bill pay system. Since the property is not listed, I only need to enter the name, and address of the property PLUS any additional informaton that I need to have printed on the check. I also indicate how much my monthly payment is to be, and when I want the check to arrive in the office by. This took me less than 10 minutes, and my bank sends me an email that the process has begun. They actually cut a check and drop it in the mail for me so that it arrives on time. I have never paid a late fee, an NSF fee, or a bank fee (my account is free with direct deposit).