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6 Debt Collection Tips For Property Owners

6 Debt Collection Tips For Property Owners

For property owners, rent payments are typically made on time. This is due to a standardized and streamlined payment process with high expectations. However, there are still tenants who don’t pay or fall into debt. However, landlords and property owners have options when it comes to collecting debt. Below is our debt collection advice for tenants and property owners.

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1. Check Documentation

After a payment becomes overdue, check the lease agreement. Check if the lease agreement includes specific information, such as the rent amount and days for due payment. If this agreement is signed by both parties, the tenant has a legal obligation to pay on time. Other suggestions for a lease agreement include:

  • Acceptable forms of payment
  • Where rent is paid
  • Late fees if payment isn’t made on time
  • Fees charged if rent check is returned
  • Other consequences if payment isn’t made on time, including collections and eviction

Also see: When Is It Time to Hire a Debt Collector?

2. Contact the Tenant

Any contact with the tenant must follow FDCPA rules and regulations. More often than not, all it takes is a friendly phone call from the landlord or property owner to influence the tenant to pay. If the tenant is in an understandably tough situation, the landlord or property owner may think of other ways to accommodate. Both the tenant and the property owner are encouraged to come up with ways to make ends meet and pay rent on time. If, however, the tenant isn’t responding or cooperating, the landlord may do what they believe will work best.

3. Legal Notice

If the tenant seems like they’re not going to pay at all, try a legal notice. A legal notice is essentially a demand letter that informs the resident of their debt, late fees and contract obligations. This “pay or quit” type of legal notice may be the push needed to get the tenant to pay. This legal notice must also follow legal standards.

4. Eviction

If there’s no success, the landlord or property owner may file a legal judgement against the tenant for not paying rent and violating their lease. However, property managers can’t take any of the tenant’s property, lock them out, shut off their utilities or physically take the tenant without getting a court order. For landlords and property owners to get a court-issued order, they must appear in court with all the documents.

Also see: 6 Debt Collector Myths Debunked

5. Monetary Judgment

For certain situations, property owners or landlords may file a claim in small claims court. This will address all past due rent and necessary evictions. However, the monetary judgement remains a challenge—the tenant may still not pay. If this happens, their credit will still be affected and their wages often garnished. If the court ends up not allowing the claim, the landlord or property manager may file a separate claim for the overdue rent.

6. Property Management Debt Collections

Evictions and legal action may not yield your money back, but a debt collection agency specializing in property management and apartments can. Apartment collection agencies have a much greater chance of finding the tenant and getting payments from them. Their tools and technology, along with professional training, prove a much greater chance of collecting debt. Apartment collection agencies need information to get started, including:

  • Tenant application
  • Lease agreement
  • Itemized list of past due amounts
  • Any attempts to contact and notes
  • A timeline of attempts to contact and when notice was given of late payments or eviction

A property manager or landlord has a much better chance of collecting debt with a collection agency rather than trying themselves. Collecting apartment debt is especially likely if the collection agency has personal experience with property management collections. A contingency-based collection agency is an even bigger bonus—they don’t charge unless they collect.

Southwest Recovery Service

If attempts to collect debt from a tenant don’t work, don’t give up. Southwest Recovery Services is a highly-trained debt collection agency specializing in property management collections. We don’t ask for anything until we collect your debt—and with us, that’s highly possible. For information on property management debt collection, contact our office today.

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We make it fast and easy to refer past due and delinquent accounts to our professional recovery agents. You decide the range on what you will accept on each case, and you ONLY pay a percentage of what we actually collect to resolve the case. Ready to get started, or want to learn more? Fill out this form and a dedicate account manager will call you to get started.

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