August 27, 2015
3 Collections Techniques You Can’t Afford NOT to Use
Late rent payments and collections are problems faced by nearly every property management firm. Besides delaying or negatively impacting revenue, late payments and collections can run up significant costs due to administration time, in-house collection and reminder calls, or worse, the expense of third-party collections.
Property managers face the dilemma of how to best communicate with residents the importance of on-time payments while still managing costs and customer goodwill.
The rapid growth of mobile devices and advances in as-a-service web-based technologies have opened new avenues for property managers and their Accounts Receivable departments to quickly and efficiently contact delinquent and even “pre-delinquent” residents with a history of late payments.
These new automated systems leverage multi-channel communication methods like SMS (text messaging), email and interactive voice response (IVR) notifications. Here is an overview of how each can help you improve revenues and reduce late rent payments.
SMS is one of the least expensive and most effective resident communication tools. Unlike traditional mail – which can take days to arrive, be expensive, and has the potential to get lost amidst a pile of junk mail – it is fast, economic and, according to research, 90% of all text messages are read within 3 minutes. Also, when using an as-a-service web-based platform, your Accounts Receivable team can reach overdue renters with little or no administration time required. Payment reminders and overdue notices can be fully automated.
Digital email costs a fraction of traditional snail mail. This low-cost method reduces the amount of time that property managers must spend on the phone or in person contacting residents about past due rent amounts. Using a fully CAN-SPAM/CASL third-party option ensure that your company stays on the right side of spam laws that could incur thousands of dollars of debt. Property management companies can easily send an automated email alert to remind tenants prior to rent being due, ensuring on-time payment and potentially decreasing the number of late payments outstanding.
Outbound IVR technology helps advance your residents’ ability to pay their rent whether your offices are open or closed. Administrators can program the telephone reminders to be sent at 6:00-8:30 when residents are more likely to be home. Renters can use the IVR system to make payments on their own or connect to an in-house Accounts Receivable staff member if they wish. IVR technology also allows property management companies to automatically place payment reminder calls, reducing overdue accounts and increasing your collections rate.
Do More With Less
By leveraging multi-channel proactive rent reminders, you can actively have a positive impact on collections, revenue and customer life cycle. These new technologies can be used to remind your residents of rent payment dates.
To help reduce rent outstanding or late payments, property management companies can take a “message early and often” approach. Using automation driven by business rules, property management companies can escalate reminders as required. For example, 5 days prior to due date, the due day, 7 days past due, etc.
And, perhaps the best part is that the collections process can be fully automated using existing technology. Because Property Vista is a web-based as-a-service software, property management companies do not have to invest in any special hardware or software. They simply take advantage of the “plug and play” nature of the solution.
Also, within the first three months of implementing Property Vista’s solution, typically our customers experience a:
- 45% increase in collections
- 75% increase in online payments
To explore how you can reduce late rent payments, sign up for your free account today or give us a call to learn more.