Ask A Property Manager: How to Deal with Rent Collection in Chattanooga
Regardless of where you own a rental property, getting tenants to pay up in full and on time can be challenging. Some renters have a knack for disappearing whenever the rent is due, leaving their landlord frustrated and out of pocket.
Unfortunately, this is the nature of the beast, experienced landlords will tell you. You are unlikely to get through running a rental property business without encountering at least one of ‘those’ tenants. Therefore, having accepted that it will in all likelihood happen, what can you do to minimize its impact?
Professional help
Chattanoogan landlords who approach month-end with dread knowing that they need to start asking tenants for rent money, should engage Chattanooga property management services. Large international residential property managers like BH Cos and Cortland or their commercial counterparts, such as JLL and Colliers, operate in the area and assist. However, a more localized approach might be your preference, and Chattanooga has many property managers ready to help. Local residential property management companies include Rock Point Real Estate and Chattanooga Property Management. Commercial property owners have enterprises like Pointe Property Group and Sentinel Commercial and Second Story Real Estate Management to consider.
Evernest is a residential property management company with a strong presence in the Chattanooga area. It makes rental property ownership in this area a breeze by managing various aspects of the tenant-landlord agreement, including rent collection, evictions, applications and vetting, and maintenance and repairs. The company has systems and processes to ensure that tenants pay rent and do not cause any undue problems.
Know your market
Chattanooga has a growing economy, with many younger people making the city home due to its vibrant tech market. Younger people prefer to rent a house instead of buying one as a mortgage may tie them down should work opportunities further afield beckon. Nearly half of Chattanooga’s residential properties are landlord-owned.
This generation of renters has grown up with tech at their fingertips and enjoys the convenience it offers them. They do not favor working with cash and prefer to conduct financial transactions remotely. As a property owner, cater to this need by having an online payment system or app that makes paying their rent a matter of a few clicks. You can sign up for one of these options and ensure that it sends tenants friendly reminder texts or emails as their rent payment due date approaches.
Getting everyone on board
Older renters or tenants who prefer working with checks and cash might be somewhat resistant to your online system. However, you can overcome this by incentivizing it. For example, offer a small discount for prompt rent payments using your approved rent collection mechanism. Like anyone everywhere, Chattanooga renters will be intrigued by the idea of paying a little less in exchange for using your preferred payment mechanism.
Rules about rental contracts are known to evolve, meaning you need to ensure your agreements comply with the law. Consult a property manager to determine if Tennessee allows landlords to stipulate electronic payments in a rental agreement. Then you will not need to worry about tenants who might be resistant.
Late fees
Tenants who fail to pay their rent on time must understand that their actions, or lack thereof, have consequences. The easiest way to bring this home is by hitting their pockets and charging late fees. Set a grace period for late payments in your rental agreement. If payment is not received after that, apply the late fees without fail.
Sent notices of late rent to tenants electronically and via mail. Keeping records of how frequently a tenant made late payments could assist you in an eviction case.
Work with tenants
While a landlord’s relationship with tenants should remain professional, understanding who your renters are and what makes them tick can help you improve your rental collection rate. If a tenant has paid their rent late more than once, sit down to discuss finding a way forward to benefit both parties.
If a tenant is paid weekly, paying their rent in such installments might be more manageable than saving it up until the end of the month. A little give and take go a long way in the landlord-tenant relationship, provided you do not get personally involved.
