By Pamela Alton
Collections are one of the biggest parts of a self-storage manager’s job. No matter how good a manager is at renting units, he must also be able to collect the rent in a timely manner.
Collections are definitely not considered fun. No one likes to make or receive calls saying an account is past due. So what can a manager do to make this part of his work a little less painful for him and his tenants?
Get the Facts
Collections actually begin at the time of the rental. Start by getting proper photo identification of tenants when they rent their unit. Ask the customer for a valid photo ID such as a current driver’s license, military ID or passport. If you use a card reader to record the information, don’t assume the address on the ID is current. Ask. If it’s not, add the correct address in the computer system.
If you don’t have a card reader, check the address the tenant put on his rental agreement and the one on the ID to ensure they match. Also make sure the photo ID looks like the person standing in front of you!
Always have the tenant complete the rental agreement in his own handwriting. If you ever have to go to court, you’ll have proof the customer gave you the information. If you can’t read someone’s handwriting, ask for clarification; then have him correct the information and initial the correction.
If your rental agreement doesn’t include a place for a tenant to list an alternate address, such as work or a relative, or a spot for emergency-contact information, use a separate form. If a tenant asks why you need this information, let him know it’s in case you're unable to reach him by his initial information. In reality, you may need it in the event of non-payment, for example, the stated phone numbers get disconnected or the past-due letters are returned.
In addition to getting current phone numbers, addresses and emergency information, get an e-mail address. This is just another way to make contact.
Just remember: When making collection calls, never discuss the past-due account with anyone other than the person who signed the rental agreement. You may leave a message asking the tenant call you, but do not disclose the reason for the call. Any collection efforts can only be discussed with the tenant.
Explain the Rental Agreement
Now that you have the tenant information, it’s time to explain the rental agreement. This means taking the time to clarify items including:
- The monthly rental rate
- When rent is due
- What happens if the tenant becomes past due
- When the gate code will be deactivated
- When past-due letters are sent
- Any fees involved
- When a unit will be overlocked and access to the unit denied
- When the unit will be inventoried
- When the unit will be auctioned and the costs involved
- What happens if the tenant still owes money after the auction
Of course, the tenant is going to say, "Oh, that will never happen. I always pay my rent on time." I’m sure you've all heard that a time or two! But as they say, "stuff happens," and sometimes even those best-paying tenants can end up past due or sold at auction.