Chances Of Collecting Loss Rent
Hi, I've just evicted the tenant and have come up with the amoun they owed me which include loss rent of 2 months and all damages and legal fees etc., totaling to $3880. I am going to file for a judgement.
My questions are :
1. Is it better to use an attorney or a collection agency? the attorney charges 25% of the collection amount, can I add this to the total. Whtat is the pros and cons of using an attorney vs collection agency?
2. What is the chances of collecting money as a landlord? What is the best way to collect the money?
3. Any referral for good collection agency or attorney? I'm in Columbus Ohio.
Thanks!
In my experience the best way to collect is to get the judgement and record it at the county clerk's office. If you want to be extra safe, send a copy of the judgement to the 3 credit reporting agencies (they will usually pick it up anyway from the recorded judgement). Then wait. Forget using attorneys or collection agenices.
If you had to evict them, then almost always they don't have the money to pay, judgement or no judgement. So there is little that an attorney or collection agency can do, short of racking up more fees for you to pay. Remember tenants almost never have non-exempt property against which a judgement could be enforced.
However, eventually that person will get their life back on tract and want to buy something for which they need credit, like a house, car, boat, or some other asset they will need a loan for. The judgement on their credit record will prevent them from doing this until they resolve the debt with you, at which point they will become very motivated to pay you off.
Don't be at all surprised to get a call from your long lost tenant a year or two down the road expressing remorse for not paying the rent or judgement, and offering to do so if you'd just remove that nasty blemish from their credit record. Happens to us all the time.
Thank you! Does the judge usually challenge the cost of repair? Do I need to provide evidence such as picutres? If the vinyl flloor has been made very dirty so I have to replace it, is this a reasonable?
I actually used to have pretty good luck with collecting when I used the same attny for the collections as I did for the eviction. Once the tenant was out the hourly rate stopped and he took a percentage of what he collected, usually by garnishing the now-ex tenants wages.
commercialking,
Just curious, can a landlord garnish an ex-tenant's wage without the use of attorney?
OverAnalyzer,
In response to your second question. In my experience the judge usually does not challenge your claim for repairs and cost, but the tenant or the tenants attorney may if they show up. So it is a good idea to bring all documentation as proof.
As a matter of practice, I always bring a digital camera to a post move-out inspection. If its clear there is damage above and beyond "ordinary wear and tear," I photograph everything very thoroughly and have the pictures time stamped (I also photograph the premises immediately before they move in). Then if I have to go to court I bring the pictures along with all the invoices for repairs and copies of the canceled checks to pay them and/or credit card statements. Using this, I have never lost in court.
Two caveats though. First, don't try and charge for ordinary wear and tear (i.e. small holes in the wall from pictures, dirty bathrooms, etc.), that is the landlord's responsibility under most state's laws. Second, don't try and gouge tenants on the repair costs. If the judge deams these unreasonable, or the tenants attorney can show that they are, the judge will usually ding you by throwing out the charge all together. The key to success here is know the law, be reasonable, and look like the victim as much as possible!
you can garnish without an attny. go to small claims court and get judgement against the tenant. then garnish....kenmax
? #1 - Neither. Spend the time & filing fee at the court and do it yourself.
? #2 - Slim to none. My experience is, even if you get to the garnishment stage(which you can do on your own at the court), the ex-tenant will file bankruptcy and you will lose out on your judgement (you'll get to file loss on your taxes).
Note on garnishment - In Indiana, you need to know place of employment to file for garnishment. If you don't know, you will have to use locate service (extra money out of pocket)
as for garnishing, keep copies of their rent checks. when you get your garnishment order (whatever it's called in your area) place it on their bank account and watch how fast they call with their account frozen. if you know they have direct deposit of pay checks or ss, time it accordingly to hit a day or so prior to their regular deposit - you hopefully will get 2 checks that way as it usually takes a week or so to stop automatic deposits.
naturally, this is not legal advice and you should check with an attorney in your own area
Hi, thanks for the responses. I am really not to try to be unreasonable, but here is the dilenma. I don't want to fix some of the stuff, like scratch on the hardwood floor, large area of uncleanable stains on the carpet, but I want to still claim it as damanges. So I have got some estimates such as amount needed to replace teh carpet etc. I also have phone no. and company's name that provided the estimate. Is this ok?
You can start trying to collect the judgment by garnishing wages or bank accounts, or trying to locate the personal property of the person who owes the judgment.
By invoking different legal theories and applying them to the particular facts involved, the judgment-debtor will often be forced to shed his layers of deception and pay the judgment. This is especially true when the judgment is for a significant amount. Often, after the judgment is entered against the judgment-debtor, the "standard" steps to collect it yield nothing: The judgment-debtor has no bank account, automobile, or other asset in his name, so there is seemingly nothing to attach to collect the judgment. But there are ways to indirectly reach the judgment-debtor’s assets and income. For instance, if the judgment-debtor runs a business, that business is usually an excellent place to start looking. The judgment-debtor may be using the company to pay all of his personal expenses, rendering the company the judgment-debtor’s "alter ego." If the judgment-debtor’s household expenses are routinely paid by a friend, scrutinizing that friend’s finances can often shed light on the judgment debtor’s assets or income. And if the judgment-debtor’s personal expenses are paid through an account held in the name of the judgment-debtor’s spouse, the spouse may be conspiring with the judgment-debtor to defraud the latter’s creditors, making the spouse potentially liable to pay the judgment. Very often, exposing the judgment-debtor’s nefarious schemes brings him to his knees, obviating the need to return to court.
If you know where your judgement debtor works garnish!
If you know where your judgement debtor banks attach!
I do both at the same time.
If you have no assets to go after then first of all update your rental application.
You can also do what's called a debtor's exam:
judgment debtor’s exam can be done either through written interrogatories or in an examination under oath much like a deposition before a court reporter. In order to take a judgment debtor’s exam, you must first attempt to execute on the judgment by attempting to collect on the judgment through the sheriff. This procedure will be described in more detail below.
The advantages to a Judgment Debtor's exam is that it reveals more assets and more particularity of each asset. You can require a debtor to state in detail the assets and income the debtor has. Another advantage is that it puts the debtor in a very uncomfortable situation during the exam.
The disadvantages to a Judgment Debtor's exam is that it is only as good as the truthfulness of the judgment debtor. Also, if you have an attorney, it may be more expensive to have an attorney take a Judgment Debtor's exam than in trying to find the judgment debtor’s assets and income in a different way. Another disadvantage is that you lose the element of surprise with the judgment debtor and he/she may begin hiding assets knowing we are trying to get at them.
If a judgment debtor fails to appear for the judgment debtor’s exam as required by the Court, the debtor can be held in contempt of court which could include imprisonment.
Good Luck