Updated Sept 2026
There are over 10 million(opens in new tab) individual landlords in the United States, each with their own methods for rent collection. How a landlord collects rent, what they charge, and how they deal with late payments has to do both with personal preference and the laws in their state.
Renting is a great way to earn side income or even a full livable income, but there are many things to consider before you begin looking for tenants. If you have a property you’re interested in renting, you need to understand how rent collection works and what options are available. You’ll also need to know how you plan to handle late fees and related issues.
We’ve compiled some of the most important information about these topics below, so keep reading if you’re ready to start learning what you’ll need to know.
Determining Your Rent Price
A common rule of thumb is to set rent somewhere between 0.8% and 1% of your property’s value. You’ll also want to know what others are charging in your area, since you’ll have a far harder time finding a tenant if your asking rent is noticeably higher than the competition.
An easy way to compare your prospective rent to local trends is to check sites like Zillow, where you can quickly see common asking prices for properties like your own.
Depending on which state you live in, there may be guidelines for what you can charge. Check your local laws before finalizing your rent decision, since there could be limits or requirements you need to know about.
Colorado has also recently tightened the rules around what landlords can advertise: starting January 1, 2026, a new state law requires landlords to include all mandatory fees, such as amenity or parking charges, in the advertised base rent, rather than adding them on later in the leasing process. Make sure your listings reflect the full, true price of renting your unit.
Our Colorado Landlord Tenant Laws page is a helpful resource for landlords and tenants that provides information regarding legislation and the laws affecting landlords, tenants, and housing industry professionals.
Choosing a Rent Collection Method
Most landlords accept more than one form of payment, which lets the renter choose what works best for them. Some methods are better than others, but what you decide to use will depend on you.
Cash
Collecting cash takes the wait time out of receiving funds, but it has its own downsides. These payments are difficult to track, and disputes over what was paid and when can easily come up if you don’t have a good system in place. You do get access to your money instantly and don’t have to worry about bouncing checks or failed deposits. Still, if you accept cash, be aware of how quickly it can get complicated. In most cases, we recommend choosing a different method.
Direct Deposit
If you choose, your renter can set up direct deposit from their bank account to yours, though there’s typically a transaction fee. Like checks, this method can bounce when sufficient funds aren’t present, and payments aren’t usually immediate. You may wait up to a week for your money to arrive.
Online Platforms
This method is ideal if you’re looking for something automated and digital. With online platforms like RentTrack and Rent Merchant, your renters can pay via credit or debit card. By setting up an account through one of these sites, your renter can view their balance, pay, set up automatic payments, and check any late fees or charges. These sites are safe and easy to use, though they’re more tech-involved than cash or check payments.
Check
Checks are a classic form of rent payment, and plenty of landlords still accept them. Many banks now offer mobile apps that allow for instant digital check deposits, so you may not even have to leave home to cash your renter’s payment. If you accept checks, remember that funds can take time to clear, and it’s always possible a check will bounce.
Payment Apps
Apps like PayPal, Venmo, and Zelle allow for easy person-to-person transfers. They may be convenient for your renter, but they aren’t built to be long-term payment systems. You may have a hard time viewing payment history, and transfers can take a day or two to complete.
Once you’ve determined your rent and the payment methods you’ll accept, the next step is setting a due date. Rent is typically due on the day the lease begins, and since most leases begin on the first of the month, that’s the most common rent collection date.
Late Fees and Grace Periods
Most landlords charge a late fee for rent paid after the due date but check whether your state allows this and how it’s regulated, since some states prohibit the practice or cap the amount.
Colorado law sets specific rules here. Landlords can’t charge a late fee until rent is at least seven calendar days past due, and the fee itself is capped at $50 or 5% of the past-due rent, whichever is greater. The fee also has to be disclosed in the written lease to be enforceable, so charging one without a written agreement in place can create real legal problems.
What you charge within those limits and how lenient you’ll be is up to you. Just be sure your lease clearly spells out your grace period and late fee policy before a tenant ever moves in.
Being firm and clear about how much rent is and when it’s due is the best way to avoid confusion and keep your income on a dependable schedule.
Finding the Best Rent System for You
Making the most of your renting property means setting the right prices, finding a reliable rent collection system, and dealing with issues such as late fees. Whatever options you decide to go with, make sure you’re choosing what works best for you and your renters.
By making careful choices, you can easily start your renting venture out on the right foot and avoid a few stumbling blocks.
Want to learn more? Take a look at our videos designed for landlords or browse the rest of our articles.
