Rent payments

Online Rent Payments

It’s 2018 and rental cheques should be a thing of the past. The benefits of online payments are so numerous and the bonuses of cheques are so few it’s hard to see why rental cheques still seem to be the most common rent payment method in the US.

Maybe it’s due to tenants and landlords not wanted to change or rock the boat or maybe people are concerned that using the internet for financial data is still a sketchy business.

But, with banks and finance houses so switched on in terms of security and the multiple benefits associated with a process as simple as online payments I fail to see why we shouldn’t be aiming to wipe out the rental cheque forever. I mean do you use cheques for any other purchases?

Rental Cheques

Rental cheques are America’s number payment method when it comes to rent and the least common financial service used for any other purchase or payment. That simply doesn’t make sense.


Using cheques to make rent certainly seems antiquated and in my eyes offers no benefits at all. They can easily be forged, tenants can give you cheques knowing that they will not clear thus getting you off their back for a few days and even if they do clear they can take up to five days for the funds to land in your account.

All of these on their own seem like fairly good reasons to discontinue cheques, but collectively it’s actually amazing that we continue to prefer a service that has so many limitations.

Add to this the fact, that you have to go out of your way to collect the cheque or else your tenant has to go out of their way to pay it into your bank. Plus, they can genuinely get lost in the mail (falsely too) and they provide your tenants with a multitude of ready made reasons to excuse late or missed payments.


As you can tell I’m not a big fan and there are more reasons too. The unreliable nature of cheques is something that you as a landlord should be seriously concerned about. It puts you in a very vulnerable position when it comes to collecting rent.

If you collect the rent check yourself from your tenants you cannot be sure until it clears that the cheque you were given is good. This means you have to wait up to five days to find out that your tenants have fallen into arrears.

Add this to the fact that should the cheque bounce you will have to chase the tenants down again, get them to give you another cheque and then wait a further five days (maximum) to find out if the second cheque was any good. Repeat this process a few times or over the space of a few months and you will soon start to see why I have a grievance with this method.


Further to the above, cheques are a mind numbingly slow option. You are putting yourself in a position whereby you are accepting a payment without knowing if it is any good. In any other section of your life would you give out something you were selling and just accept the buyer’s word that they will come back in five days to pay you?

This lack of clarity when accepting cheques puts you in a vulnerable position as you are potentially losing money and not knowing it. You are wasting your own time collecting the cheque and you are wasting time you could spend chasing arrears as you don’t even know that you are in arrears yet.

Why Online?

In comparison to the above online payments offer simplicity and lots of protection for you and your tenants. Providing you inform your tenants of the intention to change payment methods or make them aware via the contract at the beginning of the process I fail to see why any tenant would have an issue with something that will invariably make their own life and your far easier.


Online payments for rent are an incredibly quick way to make the transfer funds and can be instant if you and the tenants share the same bank. This gives you peace of mind that even when chasing rent arrears the tenants can get you the funds quickly rather than the process being drawn out due to waiting on funds clearing.


One of the bigger logistically problems with cheque payments is transparency. With cheque payments it is hard to clarify what the cheque payment is for. Of course you can put a reference on the payment, but you are then relying on the person paying in the cheque to do this.

Should you need to prove payments via bank statements, etc. you may find yourself having to do a fair amount of legwork to prove that the payment in your account is for what you or the tenants are saying it is for.

With online payments the payment is linked to someone else’s account, clearly showing where the money has come from and making it easy to prove what the payment was for.

This is also great for record keeping, which in turn helps when completing your tax returns. You can simply pick out each of the references and payments you are adding to the return and as everything is available online you don’t have to risk keeping files or losing payment receipts, etc.


Online payments are so simple to process that it takes a matter of minutes. Plus for rent you only have to do it once. Why not have the tenants set up a standing order to be debited from their account at the same time each month. You don’t even have to remember. All you will have to do is provide your tenants with your account details or that of your property management firm and they can do the rest. Simple.

No Excuses

By using online payments you seriously limit the amount of excuses for missed payments that tenants have. By making the payment process so quick and simple it means that your tenants will find it hard to dodge payments.

They can set up standing orders so they can’t forget, they can’t try and avoid meeting you to hand over the cheque as they can make the transfer without you being present from anywhere in the world and no more “the cheque is in the mail”.

By stopping your tenants from being able to easily brush you off and avoid rent you are helping yourself in the long wrong. Once it is harder to avoid paying you will find that most tenants will pay on time as they know they have no logical reasons not to.

With cheques, there are a number of ways that tenants (should they wish to) can dodge paying rent. Limit these excuses and collecting rent will be easy.


You can set up very simple reminders as part of the rent collection process on your own bank account. These can be set so that your bank contacts you if the payment you were expecting doesn’t come in.

This is very helpful as it means that should your tenants miss a payment you are aware of it immediately. This would not be the case with a missed cheque payment as you would not know that the rent was in arrears until the cheque bounces. This can sometimes be five days after you accepted the cheque.

Tips for Online Payments

In this section we will talk briefly about some simple tips and tricks that you can put in place when using online payments to ensure any change over from accepting cheques is a smooth one.

Check for Transaction Fees

Some banks will charge tenants to send online transfers, this can be seen as a negative by tenants and could lead to them trying to avoid online payments. My advice would be to have one account set up to accept rent; this way you can manage payments easier as you know that what is going in and out relates to that property only. All you have to do is choose an account that offers free transactions meaning that your tenants shouldn’t have to pay to send you money.

Instruct a Property Manager

Using a property manager will make not only rental payments easier, but all aspects of renting a property. Having a property manager to manage the rent collection process online means that your account details are protected as the management company would collect the rent on your behalf and then transfer it to you.

This also means that the tenants would never be given your bank details, something that can understandably be an issue for some landlords.

Tell Tenants ASAP

Inform your tenants as soon as you can if you intend to change the way you collect their rent. This will give them enough time to get their heads around the process and explain any issues they have to you.

If you are starting a fresh lease, have this noted in the contract as the way to make rent payments and don’t give tenants the option to use cheques. Should this payment method be noted in the contract it is unlikely that a tenant will make a fuss as they will just see this as the standard way that you collect rent.

Explain Why

If you are asking your tenants to change their payment method it pays to explain to them why you are trying to do this. Should you just demand a change from your tenants you may find that they are not particularly receptive.

You need to avoid causing any issues around rent collection, so explaining calmly why you think it is best to switch to online payments from their previous method would be your preference.

You should look to push the benefits to them as well as yourself. Explain to tenants how paying online gives them protection and is far simpler than having to meet up and exchange cheques, etc.


Having read this article it must seem fairly obvious to you that I am firmly behind online payments as a method of rent payment. It’s easy, quick and offers you as a landlord multiple layers of protection from missed payments, etc.

If you aren’t already my advice would be to ask your tenants to begin paying via bank transfer as soon as possible. Setting up standing orders makes the process incredibly simple and once you are safe in the knowledge that your rent collection is being handled online it leaves you free to look after other aspects of your rental business.

Get working with your tenants and property manager on this change today and I feel sure that you will find this method of payment very rewarding from both a logistical point of view and from the added peace of mind this process offers.

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