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Updated about 1 month ago, 10/21/2024

User Stats

41
Posts
24
Votes
Diran Deukmajian
  • Contractor
  • San Diego, CA
24
Votes |
41
Posts

Evicted Tenant - owes me money

Diran Deukmajian
  • Contractor
  • San Diego, CA
Posted

My rental property is in Los Angeles county. I hired a lawyer to get her evicted.  She didn't pay rent the last 3 months, plus I paid all the lawyer fees. 

do I hire a debt collection service to follow them until I get my money back?  Is it worth it? 

User Stats

40
Posts
20
Votes
Andre Brock
  • Rental Property Investor
  • Cleveland, OH
20
Votes |
40
Posts
Andre Brock
  • Rental Property Investor
  • Cleveland, OH
Replied

It’s probably not worth it. 

User Stats

27,414
Posts
40,343
Votes
Nathan Gesner
Property Manager
Agent
Pro Member
  • Real Estate Broker
  • Cody, WY
40,343
Votes |
27,414
Posts
Nathan Gesner
Property Manager
Agent
Pro Member
  • Real Estate Broker
  • Cody, WY
ModeratorReplied
Quote from @Diran Deukmajian:

Yes, you should send them to collections.

Andre is correct that you may not get anything back. However, there's always a chance. 

The best part is that the debt will be reported to the credit reporting agencies and it will stay on the tenant's credit report for up to seven years. That will prevent them from qualifying for other rentals, a personal loan, or a home loan.

I have sent nearly 60 tenants to collections. A few of them came back years later and paid everything they owed because my claim was preventing them from qualifying for a home loan.

  • Nathan Gesner
business profile image
The DIY Landlord
4.7 stars
151 Reviews
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1,132
Posts
1,190
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CJ M.
  • Rental Property Investor
  • Canton, OH
1,190
Votes |
1,132
Posts
CJ M.
  • Rental Property Investor
  • Canton, OH
Replied

@Nathan Gesner

Can a landlord report a tenant to collections on their own?...or do they need to use a company? What is the average cost of reporting to collections?

User Stats

17,038
Posts
14,582
Votes
Chris Seveney
Lender
Pro Member
  • Investor
  • Virginia
14,582
Votes |
17,038
Posts
Chris Seveney
Lender
Pro Member
  • Investor
  • Virginia
ModeratorReplied
Quote from @Diran Deukmajian:

My rental property is in Los Angeles county. I hired a lawyer to get her evicted.  She didn't pay rent the last 3 months, plus I paid all the lawyer fees. 

do I hire a debt collection service to follow them until I get my money back?  Is it worth it? 


 you need a judgment first, so first you would need to file a lawsuit to get the judgment then the collection agency will take 1/3 - 1/2 of it. so in reality its not really worth it.

  • Chris Seveney
business profile image
7e investments
0.0 star
0 Reviews

User Stats

27,414
Posts
40,343
Votes
Nathan Gesner
Property Manager
Agent
Pro Member
  • Real Estate Broker
  • Cody, WY
40,343
Votes |
27,414
Posts
Nathan Gesner
Property Manager
Agent
Pro Member
  • Real Estate Broker
  • Cody, WY
ModeratorReplied
Quote from @CJ M.:

I don't know the answer. The landlord may need a judgment. The OP said the tenant was evicted through court, so I assume they have a judgment and can turn that over to collections.

@Chris Seveney says it's not worth it, but I disagree:

1. 60% of $1,000 is better than 0% of $1,000.

2. Even if you get nothing, you at least get the satisfaction of knowing it will hurt their credit and may prevent them from scamming another landlord or qualifying for a loan.

  • Nathan Gesner
business profile image
The DIY Landlord
4.7 stars
151 Reviews

User Stats

1,132
Posts
1,190
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CJ M.
  • Rental Property Investor
  • Canton, OH
1,190
Votes |
1,132
Posts
CJ M.
  • Rental Property Investor
  • Canton, OH
Replied

@Nathan Gesner

Correct, sorry I was asking for my own knowledge and not necessarily the OP's. Also, asking under the assumption the Second Cause/Writ was signed off on from the court. In those instances, what is the next step you usually take for filing with collections?

User Stats

1,650
Posts
960
Votes
Adam Bartomeo
Property Manager
Pro Member
#2 Managing Your Property Contributor
  • Real Estate Broker
  • Cape Coral, FL
960
Votes |
1,650
Posts
Adam Bartomeo
Property Manager
Pro Member
#2 Managing Your Property Contributor
  • Real Estate Broker
  • Cape Coral, FL
Replied

@Chris Seveney

We put tenants into collections without a judgement or involving an attorney. It cost $0. Maybe its different where you are but I have never heard of needing a judgement to put someone in collections.

@Nathan Gesner

business profile image
Bartomeo Property Management
4.7 stars
92 Reviews

User Stats

312
Posts
94
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Brandon Carlson
  • Real Estate Consultant
  • Glendora, CA
94
Votes |
312
Posts
Brandon Carlson
  • Real Estate Consultant
  • Glendora, CA
Replied
Quote from @Diran Deukmajian:

My rental property is in Los Angeles county. I hired a lawyer to get her evicted.  She didn't pay rent the last 3 months, plus I paid all the lawyer fees. 

do I hire a debt collection service to follow them until I get my money back?  Is it worth it? 


 What did your property manager do when the tenant didn't pay the first month's rent?

User Stats

27
Posts
12
Votes
Audrey Scott
  • Flipper/Rehabber
12
Votes |
27
Posts
Audrey Scott
  • Flipper/Rehabber
Replied

Of course yes I agree this is a business for goodness sake not a charity debt seeking organization in the first place. 

User Stats

27
Posts
6
Votes
Replied

If you are evicting a person, they have more issues than rent payment. The court will issue a judgement and that is a form of collection and can allow you to place lien on anything valuable they have.

User Stats

8,265
Posts
4,861
Votes
Drew Sygit
Property Manager
Agent
#2 Managing Your Property Contributor
  • Property Manager
  • Royal Oak, MI
4,861
Votes |
8,265
Posts
Drew Sygit
Property Manager
Agent
#2 Managing Your Property Contributor
  • Property Manager
  • Royal Oak, MI
Replied

There are two distinctly different collection strategies you can pursue:

1) Collections Company: there are several that ALL they do is pester the debtor for payment with calls, texts, emails, letters, etc.

2) Collections Attorneys: they will get a money judgment for balance owed and then pursue garnishment as necessary - including garnishing any state tax refund (if the state allows).

Both will take a percentage of what they collect.

business profile image
Logical Property Management.
5.0 stars
1 Review

User Stats

41
Posts
24
Votes
Diran Deukmajian
  • Contractor
  • San Diego, CA
24
Votes |
41
Posts
Diran Deukmajian
  • Contractor
  • San Diego, CA
Replied
Quote from @Brandon Carlson:
Quote from @Diran Deukmajian:

My rental property is in Los Angeles county. I hired a lawyer to get her evicted.  She didn't pay rent the last 3 months, plus I paid all the lawyer fees. 

do I hire a debt collection service to follow them until I get my money back?  Is it worth it? 


 What did your property manager do when the tenant didn't pay the first month's rent?


 I don't have a property manager. This is my first rental property that I invested in. I can handle the 1 property myself. 

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User Stats

41
Posts
24
Votes
Diran Deukmajian
  • Contractor
  • San Diego, CA
24
Votes |
41
Posts
Diran Deukmajian
  • Contractor
  • San Diego, CA
Replied
Quote from @Adam Bartomeo:

@Chris Seveney

We put tenants into collections without a judgement or involving an attorney. It cost $0. Maybe its different where you are but I have never heard of needing a judgement to put someone in collections.

@Nathan Gesner


 Yes, i CA, it's a lot harder to get stuff done. Legal system here only helps the wrong side!