Site Navigation

Investor Information
 Home
 Monthly Update
 Real Estate Articles
 Real Estate Videos
 Real Estate Success Stories
 Real Estate Blog
 Free Investing Books, Audios
 Real Estate Books
 Investing Glossary
 Investing Abbreviations

Real Estate Products
 No Risk Guarantee
 Best Sellers
 All Investing Products
 Real Estate Courses
 Real Estate Audios
 Real Estate Ebooks
 Real Estate Books
 Real Estate Seminars
 Special Offers

Investor Resources
 Hard Money Lenders
 Real Estate Agents
 Handyman Services
 Property Managers
 Real Estate Clubs
 Cashflow 101 Clubs
 Business Tools
 Tax Appraisal Districts
 State Foreclosure Laws
 State Property Codes
 Proof of Funds Letter

Discussion Forums
 Networking Forum
 Beginners, Carlton Sheets
 Bird Dogs, Wholesaling
 Foreclosures, Short Sales
 Sub2, Lease Options
 Rehabbing, Landlording
 Financing, Hard Money
 Asset Protection, Legal
 Commercial, Mobile Homes
 Real Estate Marketing
 Random Ramblings

Site Information
 About Us
 Advertise on REIClub
 Contact REIClub
 Link to REIClub
 REIClub Facebook
 REIClub Twitter
 REIClub YouTube
 REIClub ITunes
 REIClub Testimonials
 Press Releases


Bill Bronchick

Collecting Money Owed by a Tenant
by Bill Bronchick

 
Did you ever have to evict a tenant for non-payment of rent, then get stiffed for the bill? You may be able to collect what is owed to you, even years later.

First, you need a court-ordered money judgment. If you filed for an eviction in court, you received a judgment and order of possession. The actual name of this court order may change slightly from state to state, but it's the same thing - a document signed by a judge that permits a local sheriff or constable to forcibly remove the tenants from the property. In most states you can also get a money judgment against the tenant, but this requires one of two things:

1) the tenant must have been personally served with the court papers or...

2) the tenant must have shown up in court. If the eviction papers (the court papers, not the notice to rent) were posted on the door of the unit and/or mailed to the tenant, you generally do not get a money judgment from the court.

What About Security Deposits?

If you have a security deposit from the tenant, you can apply that against anything he owes you for back rent or damages. However, you still must comply with state law for notifying the tenant of your intent to keep the deposit. Even if you return the security deposit, you can still sue the tenant for actual rent owed and/or damages incurred to the unit. If the tenant left before the court date or you did not otherwise get a money judgment, you can always sue the tenant in your local small claims court for money owed and any damages to the property. The process is quite simple, and does not require a lawyer. You have to file the claim before the end of the statute of limitations, which generally ranges from three to six years, depending on which state you live in.

Once you have a money judgment, you can collect it against all non-exempt assets of the debtor. Certain assets, such as retirement accounts, are exempt from collection by creditors. Also, keep in mind that assets of the debtor's spouse may be attached as well in states that recognize community property (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin). Cash in bank accounts is the easiest target. If you have a copy of a recent check from your tenant, you can file for a "levy of execution" on their bank accounts through the local sheriff (this is why it is a good practice to make copies of your tenants' checks each month to make sure you know where they are banking).

If the tenant is working, you can garnish wages, but most states limit garnishment to 25% of the wages of the debtor. Still, if they have a steady paycheck, you will get your money back, plus interest. If you get a transcript and record the judgment in county records, the tenant will not be able to buy a house in that county without paying you off. If the tenant owns other real estate in his name (not likely, but always possible), the judgment will create a lien on that property as well. If you do not know where the tenants assets are located, you can start a debtor proceeding in court to make him appear in court and answer questions regarding his assets. Failure to comply may result in a warrant issued for the debtor's arrest. Depending on the amount of money owed and likelihood of collecting, this process may not be worth your effort. But, considering a judgment may be valid for as long as 10 years and you get interest on your money, why not make it a part of your business practice?


Bill Bronchick
William Bronchick, CEO of Legalwiz Publications, is a Nationally-known attorney, author, entrepreneur and speaker. Mr. Bronchick has been practicing law and real estate since 1990, having been involved in over 600 transactions. He has appeared as a guest on numerous radio and television talk shows including CNBC Power Lunch. He has been featured in Who's Who in American Business, Money Magazine, the Los Angeles Times and the Denver Business Journal. William Bronchick has served as President of the Colorado Association of Real Estate Investors since 1996.


Bill Bronchick Products (9)
CoursesHow to Create a Bulletproof Corporation
CoursesHow to Create Your Own LLC and Family Limited Partnership
CoursesStep by Step Guide to Land Trusts
CoursesUltimate Guide to Buy and Hold
CoursesUltimate Guide to Fix and Flip
CoursesUltimate Guide to Owner Financing
CoursesUltimate Guide to Wholesaling
SpecialsWealth Protection Library
CoursesWealth Protection Strategies


Copyright Notice
Copyright 2002-2014 All Rights Reserved. Published with Permission of Author. No part of this publication may be copied or reprinted
without the express written permission of the Author and/or REIClub.com.

Back to Top

Free Newsletter
Name:
Email:

Article Options
Printer Friendly Page
Send This to Friend

Author's Articles
10 Inexpensive Ways to Spruce Up Your Rental or Rehab Property
60 Days To Your First Bargain Purchase
7 Real Estate Contract Buyer Clauses Checklist
7 Reasons to Use a Land Trust
9 Mistakes New Real Estate Investors Make
A Review of the National Consumer Law Center
All About Property Disclosures
Are Real Estate Seminars Worth the Money?
Are You a Newbie at a Real Estate Club?
Are You Clear On What is a Good Deal
Are You Waiting on the Sidelines?
Bankruptcy, Foreclosure, & Credit - How it Affects You
Bankruptcy, Foreclosure, & Credit - Part II
Basics of the Real Estate Contract
Be a Smart Investor... Do the Math
Big Brother Is Watching You, New (Bad) Legislation Coming Your Way
Bubble, Schmubble - Flipping Works in Any Market
Bull vs. Bubble
Bulletproof Your Wealth with Family Limited Partnerships and LLC's
Buy A House - Get Thrown in Jail?
Buying at the Foreclosure Auction
Collecting Money Owed by a Tenant
Common Investor Legal Mistakes
Common Sense Mortgage Tips
Create Monthly Cash Flow Without Any of Your Own Money or Credit
Dealing with Real Estate Agents
Dealing with the Dealer Issue
Dealing With the Due on Sale Clause - Part II
Do You Need a License to Flip Real Estate?
Essential Contract Clauses
Essential Contract Clauses II
Explaining Foreclosure Options to the Homeowner
Five Big Mistakes Newbies Make
Flipping Properties for Cash Profit
Flipping Versus Holding - Which is Better?
Get That Property Out of Your Name!
Getting Started as a Real Estate Entrepreneur
How to Create a Real Estate Cash Cow
How to Determine Property Values in Today's Market
How to Get a Hard Money Loan
How to Save Up to 90% on Title Insurance
HUD Properties, FHA & Title Seasoning
Illegal Flipping and Lender Seasoning
Investing in a Changing Market
Keep a Positive Perspective in a Negative Market
Know Your Real Estate Laws
Learn the Landlord-Tenant Rules!
Lease Option a Junker!
Lease Option Tips & Strategies
Lease/Option 101
Lease/Option vs. Contract for Deed
Lease/Options & the Equitable Interest
Mortgage Broker vs. Mortgage Banker
Non-Income Verification Loans
Owner Financing Mechanics
Personal Property Trusts
Real Estate Investing is Just Like Weight Loss
Reduce Taxes By Investing In Real Estate
Risks of Buying Real Estate in Emerging Markets Out of State
Scripting Common Objections from Foreclosure Sellers
Setting Your Financial Goals
Seven Ways to Flip a Property
Should the Government Bail Out People in Foreclosure?
Should You Disclose on Short Sale Flips?
Should You Do Real Estate Full-Time?
Should You Use an Attorney's Fee Clause?
Tax Issues on a Subject 2 Deal
Tax Lien Investing 101
Ten Myths Preventing People from Succeeding in Real Estate Investing
The Basics of “Short Sales”
The Bona Fide Purchaser
The Ethical Real Estate Investor
The Forgotten Owner Carry
The Mortgage Elimination
The New Limited Liability Company
The Not-So-Handy Man's Guide to Fixing and Flipping Properties
The Property Recording System
The Role of Insurance in Asset Protection Planning
The Wrong Way to Invest in Real Estate
There is No Due on Sale Jail
Top Ten Ways to Get Sued - Guaranteed!
Understanding Loan Terms
Understanding The Mortgage Loan Market
Using A Home Equity Line Of Credit To Buy Properties
Using a LLC IRA for Real Estate Investing
Using Trusts for Personal & Business Privacy
What Every Landlord Should Know About Discrimination
What to Do if a Tenant Abandons the Property
Where to Incorporate: The Answer May Surprise You!
You Have to Sell a House to Get it Sold
Zero In On Motivated Sellers


Author's Products

How to Create a Bulletproof Corporation

How to Create Your Own LLC and Family Limited Partnership

Step by Step Guide to Land Trusts

Ultimate Guide to Buy and Hold

Ultimate Guide to Fix and Flip

Ultimate Guide to Owner Financing

Ultimate Guide to Wholesaling

Wealth Protection Library

Wealth Protection Strategies


 
Anti-Spam Policy | Compensation Disclosure | DMCA Notice | Earnings Disclaimer | External Links Policy | Privacy Policy | Terms And Conditions | View Cart
©2002-2014 All Rights Reserved. REIClub.com