How to prevent your tenant from falling behind in rent – Tip 3

Direct Debit and BPay rent payments

If the rent does not get paid on time you need to follow up your tenant’s straight away. This means monitoring your bank account on the day it’s due which is tedious and a very inefficient way to spend your time!

The other problem having your tenant schedule their own rent transfer is you have no control if the rent is paid or not. You just hope that they pay it.

What you need to do is set up your tenants on direct debit rent payments. This is where the tenant agrees for you to take the rent out of their bank account on the day it’s due.

This is well known in the industry as the best way to ensure the rent is always paid on time.

In my experience having rent paid by direct debit reduces late payments by 50% compared to normal bank transfers. This is because you are in control of taking the money out and not relying on the tenant to transfer the money.

The extra hidden benefit is late payment fees. By law in Australia you can’t charge tenants for paying their rent late however on Direct Debit tenants can be charged a fee for not having enough money in the bank when the rent is due. Although you don’t get this fee it is an added reason for the tenant to ensure enough money is there the day rent is due.

Tenants can set up a Direct Debit in RealRenta. By law, you must provide your tenant one freeway to pay rent and this is free for your tenant. No complaints.

As another option, if your tenant receives Centrelink payments – Centrelink offers a free direct bill-paying service (called Centrepay) where the rent is paid straight to you from their Centrelink payment without them ever receiving the money.

With RealRenta Tenants can pay their rent via BPAY or Direct Debit (one-off or automated payments).

RealRenta will automatically notify your tenants and the owner by email and text message if the rent payment is late and will even send out a breach notice when necessary.

RealRenta will track the rent, raise invoices and receipts which is a legal requirement. And much more


Check out more tips on how to prevent your tenant from falling behind in rent, in the next blog



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Jason Gwerder
Friday, 21 August 2020

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