A Different way to Charge Rent on your Tenants when they don’t have any Cash Available
Let’s learn about the different options you could have when it comes to charge rent. We are in the middle of a difficult situation, a lot of landlords have found ways to help out their tenants, but at the same time realize that they also need to charge rent in spite of this difficult situation because you also have your own responsibilities to commit to where you have to pay your mortgage, you have to pay property rent, insurance, and others.
You have to know how to manage difficult situations and crisis like the one we are living right now. The result of these situations could result in your tenants losing their jobs.
We have always run into the use of credit cards, because credit cards are a good way to provide liquidity to actually help out or help yourself out in a difficult situation. It is not good, for sure, when you’re utilizing credit cards to buy purses or expensive shoes or things that don’t appreciate over time or don’t add value at any time.
Charge rent on your tenants: They can use credit cards to pay for rent
If you need to pay rent so that you can make sure you have a roof over your head and make sure you have a place to sleep, this is an excellent tool. This is definitely one of the many solutions you can help work out with your tenant.
If you lost your job or maybe you’re going through a difficult situation, is there a way that you can actually create some liquidity, create some access to cash? This is definitely a great resource to do it. You might be wondering, how do I do this? How do I leverage this simple tiny piece of plastic into paying rent? That’s very simple.
It’s using tools like Square. You’ve probably seen it in a lot of the Apple stores, with people walking around with their cool iPhone. It’s a little square that you simply poke into the phone. All you have to do is take the card, swipe it, and voila, you can charge rent. In order for you to be able to use Square, you have to have a legal entity in place. If you want to know more about Square, click here.
If you want to download it, you have to go to the Apple store or to the Google store and just simply type in the word “Square”, and download the application. You’re going to go ahead and tap into it. Then, once you have downloaded it, you have to type in the amount that you want to charge, whether it’s $700, whether it’s $900, whatever is it that you’re charging for your rent.
If you want to charge an amount, for example, 1$, you enter $1, you’re going to hit “charge”, and all you got to do is just to simply swipe the card through and voila. Now you have $1 charge on the App. You can also choose to either text a receipt to your tenant, you can choose to actually email it to your tenant.
Different ways to charge rent on your tenants: Importance of an LLC
Square will be very useful to you, but you must meet some requirements to be able to use it
This is why it’s always important to have an LLC to place your rental because not only it helps you run your property like it is a business, you’re treating it like a business and, at the same time, it will allow you to get access to tools like Square.
This does not work on a personal level. It’s not like you can attach it to, let’s say, for example your social security number. No. It has to be attached to an EAN. An EAN, that’s basically the equivalent of a social security number but for your business. You can get an EAN with an LLC, you can get an EAN with a corporation.
- If you are out of town:
Let’s say because of the pandemic, or let’s say you are out of the country, you’re in a different circumstance, but you still want to be able to have the flexibility to charge rent using a credit card. What you will do is you will actually log onto your account on your computer. You log into your Square account, square.com, and you log in with your credentials.
What you’re going to do, you’re going to go straight where it says “invoices”. You can choose to create an invoice. You can either charge rent when you are miles away or maybe it’s another situation, you don’t want to physically go into the location, so you can actually go in, create an invoice and send it over to your tenant, and pay.
You can even create payment plans on Square by creating an invoice, for those who have actually worked out a deal, with your tenants. Either minimizing some of the rent payments for this month and then working out a payment plan so that they can pay you in the future.
Whatever the circumstances are, if you need to create an invoice in order to collect rent without having to physically be at the location, you can actually do that. All you got to do is:
- Hit the icon, “new invoice“, which will take you straight to a new window.
- You will see where it says “@customer“. You’re going to @ the name, @ the item, whatever services that you are creating.
- You will just simply @ the amount that you want to do.
When is this invoice due?
Especially in times of pandemic, digital tools will be very useful for you
It’s due upon receipt, it’s due upon a certain day. Let’s say for example, it’s due at the end of the month or it’s due at the beginning, you want to customize it. So you want to make it July first. You select that day and you go back. Now you have an invoice that is due at the first of every month. You’re going to go ahead and enter the items that you want to charge.
You want to create something that it’s with a customized amount. Then you’re going to type “rent due“. If you are charging July. You’re going to type in the amount that you typically charge for rent. For example, $900. Then you’re going to add that to it, and then you’re going to go ahead and hit “continue”.
You’ll make sure that there’s a new invoice. You hit the button “save” and your tenant will get access to that invoice, it will be delivered into their inbox. They will be able to pay the rent, and you will be able to get access to rent money so you can continue to fulfill your financial responsibilities with the lenders, with the county, and with anything else that it’s involved in the operations of that rental.
At the end of the day, the options are numerous and you are the one who decides which tool or which way you will use to charge rent on your tenants depending on what is most convenient for you, for your tenant and for your business.
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