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Click Here for the audio only version on the Lady Landlords Podcast
Evictions. Damage. Lawsuits. 😱
Unfortunately, all of these situations can happen to you as an investor.
But have no fear! Each can be navigated successfully.
Regardless of if you are just starting out or a seasoned investor, there are plenty of reasons that you could end of in court. Listen into this week's episode of the Lady Landlords Podcast to learn about the 5 different times I have been to Small Claims since becoming a Landlord (Spoiler Alert: Only 2 cases involved tenants!)
Winning the case can be easy, but collecting your money can prove more challenging.
Once you get your judgement in court, you have 2 options:
1. Do it yourself:
You CAN do this yourself! The question you want to ask yourself though is do you want to? It can be very time consuming and the legal system can have a lot of red tape that you have to navigate. If so, you could save yourself a couple of bucks collecting on your own. A great place to start is speaking to the court to see what information they can provide you. They can help you get a list of assets to go after and also put you in touch with resources that can help you along the way. Also, during my tenant lease signing, I collect a copy of their Social Security Card and their Driver's License for credit checks and to verify they are who they say they are, but these documents can come in handy when you win a judgement. Keep reading to learn how you can use these to collect below!
2. Hire someone:
If going it alone wasn't for you, hiring a professional may just be right then. They will know the right steps to take and how to cut through some of that red tape much easier, but their expertise will cost you a pretty penny. Their fees could be 30-50% of the judgement....but 50% of something is better than 100% of $0 so keep that in the back of your mind when picking your path.
What you can go after:
Whether you do it yourself or hire a 3rd party, now it is time to take a look at the assets you can collect from. With a Social Security number, you can look into garnishing wages right from a tenant's paycheck. You can also retrieve payment from their tax refund as well. With their driver's license information, the DMV can put restrictions on their registration and driving privilege's in some situations. Also, their car is considered an asset that they could be forced to sell in order to settle the judgement. In the case where the other party owns property, you can also go after that by placing a lien against it.
No matter which strategy you go, remember the wheels of justice turn slow. It will take months, more likely years to collect what you are owed. If you have the opportunity to settle with the other party, there might just be an incentive to get money in your pocket today rather than lose hair, sleep and time collecting every penny over time.
Listen to the full episode for more tips and tricks on the Lady Landlords Podcast here.