Recommendations for the Successful Collection of Rent

rental agreement collections
Being a successful rental property owner or manager requires the prompt collection of rent. Unfortunately, this can sometimes prove difficult.  

Here are recommendations to improve your collection of rent.

Screen Tenants

Tenants should be carefully screened. Individuals that have shown responsibility in the past will likely be responsible in the future. Consider very specific criteria to apply to potential tenants.  However, be careful that the criteria does not conflict with applicable laws against discrimination. Criteria should be applied equally and regardless of gender, race, or other such discriminatory methods.


Review credit reports. Although a credit report will likely not include rent payments, it will show how well an individual paid other creditors and will reflect past judgments and debts.


Check references. Although previous landlords are not required to provide information to you, you can ask them if they would rent to the tenant again.


Require an income that is at least three times the amount of the rent. 

Create a Rent Collection Policy

Create a written rent collection policy that helps ensure the equal treatment of all tenants and to confirm what is expected of them. It should include the exact rent amount each month, how rent payments are made, if there are any grace periods, and the consequences of a bounced check or default. All of this information should be included in a lease agreement with the tenant.

Automate Payments

Consider rent payments via an automated system, such as auto-pay or auto-deduct. There are several ways to automate payments.


An Automated Clearing House (ACH) will automatically withdraw money from your tenant’s bank account. To set up an ACH, you will need to have the tenant sign an agreement that allows you to withdraw the money.


You can also ask your tenant to pay their rent by setting up recurring online bill payments with their bank so that a check is automatically issued and mailed to you each month. 

Recognize Responsible Tenants

If you have a tenant who always pays in full and on time, cares for the property, and follows the rules, consider giving them a gift card or gift basket as a thank you during the holidays or when they are ready to renew their lease. Make sure that the property is well maintained for them and that their concerns at the property are addressed on time and properly.

What to do When a Tenant Fails to Pay

Talk to your tenant if they are delinquent in paying their rent. Ask them when they will make their rent payment, how much they will be paying, and what method of payment they will be using. Try to work with your tenant before further action is necessary.

Eviction

Ultimately, if a tenant will not pay rent, or is in default of your lease in other ways, it may be necessary to file for an eviction. Evictions seek to remove the tenant from your property and seek the collection of any amounts that may be owed to you. Strong leases that are in conformance with applicable law, and making sure you follow the very specific legal requirements for the eviction process, including a notice to quit, are necessary for a successful result.



Give the experienced collections attorneys at Bingaman Hess a call at 610.374.8377 or find us online. We can help you determine your best course of action.  We can review your existing tenant lease or draft a new one. We can also assist you with the eviction process and the collection of amounts owed to you. If filing a lawsuit is necessary, we will always 1) do our best to settle out of court (saving you legal fees), 2) assertively represent you if your case goes to court, and 3) help you collect amounts you are owed if a judgment is entered in your favor.

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