Paying Rent with an App
As millennials are becoming rent to own buyers and sellers, it's time to put traditional payment methods aside.
Traditionally, rent payments are made by cash or check, which can be mailed dropped off, picked up or deposited directly into the landlord's account.
Old Payment Methods
Through old methods, someone had to leave the house to make a rent payment possible. Often times, both parties needed to as the landlord needed to cash the checks or deposit them into a bank account.
Today, if you're a tenant dead set on mailing a check, the landlord can snap a photo of the check through a banking app and deposit it instantly. However, the same is not true for those who send cash.
According to the New York Post, only 41 percent of Americans still carry cash.
How Do Modern Tenants Pay for Rent?
As technology has progressed, society has become accustomed to instant. Many tenants have taken to paying for rent through cash transfer apps like Venmo, Cash app and Zelle.
Through these mobile applications, tenants can take money out of their personal accounts and send them to the landlord's corresponding app account. Then, the landlord can transfer the money into their own account.
While the transfer from the tenant's app to the landlord's is instant. Most apps take a few days to transfer the money from the landlord's app to the landlord's bank account.
Users pick their own usernames to ensure that they're paying the right person when they make a transaction (think @BestLeaseOptionBuyer or $ImAGreatLandlord).
As the seller, having the buyer pay rent installments through an app is ideal because it removes barriers to payment and makes it easier for tenants to pay on time. As the buyer, it makes it easy to pay on time in the midst of a hectic schedule and avoid invalidating the agreement.
What Should You Do?
As lease-option tenants and buyers, have an open conversation together about how you want the payment process to go. While using mobile apps to transfer money is convenient and no one has to leave the comfort of their couch, it's not the right move for everyone.
In the case of regular tenants, many don't have bank accounts. As a rent to own tenant, you likely have a bank account to hold the money you're saving for your down payment.
However, the buyer or seller may not have access to a smartphone to make these payments possible. Or they may not have the tech confidence to make a payment like this happen.
Having a conversation with your rent to own counterpart is the best way to ensure that all parties are comfortable with how payments will be made.