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Top tips to get your rent paid on time everytime

Its the Australian dream to own your own home, even better when you have an investment property as well.
Investing in and managing rental properties can be a profitable business as long as your cashflow is well managed. One important key to this is your tenants’ ability to pay rent on time.

Here are our tips to ensure your rent is paid on time and methods to handle tenants who have trouble paying rent or pay rent late:

Make Payments Automatic
Requiring tenants to pay rent via direct debit or an automatic weekly direct deposit is the best way to ensure rent paid on time. The major benefit is that this eliminates the factor of human error – i.e. tenants “forgetting” to pay rent.

Enforce Your Strict Rent Payment Policy
To ensure regular, timely payments, keeping your payment policies firm and consistent is the best practice and this should be explained to the tenant prior to signing the tenancy agreement. By outlining the process of what happens if payments are made late / not made, the tenant understands there is a firm policy in place with no deviations from the beginning.

Choose Your Tenants Wisely
Ensure you thoroughly check all applicants. You should screen each individual’s income source, past rental history and ALL referees. This will give you a great idea on how they will make payments to you. If they have good references and a solid rental history, you can nearly always assume they will be good in the future.

Exercise a “No Cash” Policy
Accepting cash as a form of rent payment is not a good idea although you cannot turn it away. Cash is easily lost and leaves no paper trail (for the landlord or the tenant). You can eliminate these risks by establishing a policy in which you do not accept cash as a payment for rent. You will need to ensure you explain the “no cash” policy to your tenant and advise of the acceptable payment options.

If Rent is Late, Ask the Necessary Questions
It is crucial to ask these questions as soon as the tenant is one day late with rent. If there is any issue you want to know about it as soon as possible. Don’t just sit, wait and hope the tenant will pay. The questions you should ask your tenant are:

• Do we have a problem?
• When do you expect to make a payment?
• Where will you be submitting your payment?
• What is the exact amount that you will be paying?
• What will be your method of payment?

Make the Repercussions Known If Rent Is Late
This comes back to our first tip, advising tenants of your payment policy prior to the beginning of the tenancy agreement. Let the tenants know that you are following the Residential Tenancies Act. For example, in Victoria if a tenant is 15 days late with a rent payment, the landlord can send a 14 day notice to vacate to the tenant. Ensure you know the regulations around this.

If you, or know someone who does, have a tenant who constantly pays rent late and you would like further advice on how to get on top of this please be sure to call Shannon Callanan on 0413 050 606 and I will be more than happy to assist.

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