Tenants Caused $4500 of Damage! Collections or Court?

Question

Is Court the best route or Collections Agency?

My tenants broke their lease 1 month early, damaged my property that exceeded the deposit with a grand total of $4500, including leaving me a $260 water bill. Now they blocked my number and don’t have a mail forwarding address. I text them the following message from my google voice number and to all of the phone numbers I had for them on file. I wanted to see if you guys think I should proceed with wasting time and resources for a lawsuit or should I find a collections agency? I honestly don’t think they’ll pay, they are also self employed with a tree business so can they even garnish their wages? Any advice would be appreciated.  Here’s what I sent them:

“I see you blocked my current number. Attached is your invoice statement for the damages and rent for the month of June 2019. The total damage exceeds your security deposit in the amount of $4862.00.  I am giving you the option to make 4 monthly installment payments of $1215.50.

However, legal action will be taken if payment arrangements have not been made by July 15th, 2019. The Law Offices Of Brandon R. Celigan will be representing me and arrange a lawsuit and court date on my behalf.  I will also be sending this to your phone and other mailing addresses on file.  A private investigator will be hired to find you if needed. Please respond as soon as possible to remediate this. If I do not hear back by July 15th, we will proceed with a lawsuit.

Landlord,

Jason Ngo

Pat L. · Answer

We always get a judgment then file it with the collections agency. It's amazing how many will ask for relief years later when they are trying to lease a vehicle etc etc. Otherwise they have to live with it.

We had one guy that owed $2800 in back rent then abandoned the wife & daughter & moved in with the GF & told us "to go forth & multiply". (We worked with the wife & daughter to help them get a more affordable apartment so she kept us up to date on his miserable life). He worked off the books for years but then got nailed for years of unpaid child support, so no hope of any tax return credits or Soc Sec payments credited. 3 years go by & his GF tossed him out & we received full payment plus interest minus the collection fee. All because he had to buy a vehicle on credit (he had used the GF's old truck). He then ended up renting a slum property room from a buddy of mine.

KARMA!!!

Brian Wolf · Answer

From another number call their tree service and order $4862.00 worth of services for one of your other properties. When they send you their invoice, respond with yours.

Mark Fries · Answer

@Jason Ngo

Just move on. Turn your frustration into energy to find your next deal. Learn from your mistakes and find a better tenant next time.

Your never going to see this money. Attorneys,  collections, etc...all a big waste of time and energy.

Jason Ngo · Answer

I have rented it out, only lost out on 15 days.  So now it was time to focus on this issue.  I want to prevent them from doing this to another landlord and make it difficult for them to buy a house or anything of that nature.

So Thanks @Pat L. ! I will take your advice and take it to small claims court and get a judgement to send to collections since that doesn’t require any money out of my pocket and the least amount of time.

Joe Splitrock · Answer

File a suit in small claims court and hire a process server to serve them the paperwork. The process server can call them and ask to meet them at a property for tree estimate. When they show up, the process server can hand them the paperwork.

If they don't show up in court, you have the signed affidavit from the process server stating they were served and you will get a default judgement.

As far as collecting the money, if you know bank they bank at, you can pull the money from their account. But you need judgement., even if you pass it off to collections.

The judgement will sit on their credit report until they deal with it. Landlord judgement make it harder to rent a property and impossible to purchase a home until the judgement is settled.

Given the amount of money, I would pursue. If it was a couple hundred dollars, I would move one because it is not worth the time.

Anthony Wick · Answer

@Jason Ngo . So what happened? I'm sort of in a similar boat coming up. What I absolutely won't be doing is "letting it go", and the amount the tenant owes me is more like $1,000. Not a huge amount of money, but if I'm not going to collect what is owed me, then I sure as heck will crush their credit and everything else to make sure they feel the pain.

Tom S. · Answer

@Jason Ngo @Anthony Wick  Yes, curious on this too what happened.

Anthony - as others have posted, and what I do is always go to small claims court and at least get a judgment.  It doesn't take too much time or expense.  Then depending on the tenant you may get all of it or none of it.  My ratio is around 60%.  Sometimes they will settle right before court, sometime agree to a payment plan while in court, and unfortunately sometimes you have no way to collect.

Ii wouldn't send it to collections, I personally found that to be a waste of time.  Rather, follow the rules in your state (if you win in court, they should mail you paperwork on how to legally collect).  Many states allow you to garnish wages, seize bank accounts, or have the sheriff serve the judgement personally and demand money on your behalf.

Good luck!

- Tom

Nathan Gesner · Answer

My recommendation: take them to Small Claims court where an attorney is not needed. Get a judgment and then hand that over to collections. You'll probably never see a dime of it anyway so why spend all your time chasing after them? Let Collections handle it, move on, and be thankful if you collect any portion.

Jonathan W. · Answer

@Jason Ngo I wouldn’t waste money on attorneys. Collections/small claims court, get a judgement it seems is the best answered I’ve read throughout these threads. If they have good credit and want to save it they will probably pay you if a judge rules in your favor but if not, yeah you’re likely not to see any money so don’t waste em paying an attorney. This is all from what I’ve read on this app, nothing from experience.

Definitely fix it up and rent it out ASAP because people like that typically won’t pay no matter what you do.

Jason Ngo · Answer

@Caleb Heimsoth at that time it was Thanksgiving/Christmas time so my screening process was pretty lax since I didn’t want it to stay vacant. Now looking back that wasn’t the best idea in the long run.

Tenants Caused $4500 of Damage! Collections or Court?

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