Collecting Rent from Tenants

Set things up right from the start and you'll have less trouble collecting rent from tenants. Cash is good. Otherwise, I had no problem taking checks. If you get one bad check, though, demand cash or money orders from that renter from that point on. The renters paid me directly when I was there. It is difficult to avoid the landlord when you live with him.

Since I traveled a lot, I always left a stack of deposit slips filled out on top of the refrigerator. That way the renters could just run their rent to the bank a mile away. If I was gone for long, I could easily check my account online, to see that the rent was deposited. Oh, and I let the renters know that I would be doing this, of course.

Collecting Rent: Weekly or Monthly?

I always collected rent every week or two weeks, according to when the renter received his or her paycheck. You will often be renting to people who are very decent people, but who can't figure out how to save a portion of their checks to pay monthly rent. That may even be why they are renting a room by the week. It's better to make paying rent easier, because it makes life easier for you.

There is another advantage to charging weekly rent. Renters think that $75 per week equals $300 per month. It doesn't. I didn't lie about it to them. In fact, I even explained that it is more than $300 per month, but they still "felt" like it is $300.

$75 per week is actually $325 per month, because there are more than four weeks in a month. You can do the math easily. Just multiply $75 by 52 weeks and you get $3,900. Divide this by 12 months and you get $325. Another way to figure what you are getting per month is to multiply the weekly rent by four, and then add 8.33% (or just round it off to 8%).
Enough math!

The point is that when you charge by the week, it appears cheaper than it is, and it is easier for most renters. That makes collecting rent easier for you.