What is best way to go after a tenant for rental debt?

Question

I have a tenant that owes me about $30K in rental debt in San Diego. I will pursue through small claims court after March, 2021. The problem is this.

1) when tenant moves out, they don't have to provide me a forwarding address

2) they could also change their email and or cell phone number as well

3) my attorney says it's a conflict of interest to try and get the tenant's forwarding address from the tenant's attorney (they will most likely not provide this information)

4) I do have the tenant's driver's license and US passport

So how do I go about obtaining the tenant's present address when there's no obligation on their part to provide it. Since small claims court requires you to know their present address in order to serve them.

So just wondering how previous landlords have gone about this.

1) do you hire a private investigator? If so, please provide some contacts in Southern California (Los Angeles, San Diego) for me.

2) do you hire a profession collection agency? If so, please provide some contacts in Southern California (Los Angeles, San Diego) for me.

3) also, what database or website do landlords use to place this tenant on the list of tenants that landlords should avoid at all cost? I would like to include this tenant on the list as well.

Thanks for reading and hopefully some people will reply with good insight to this.

Michael Plante · Answer

I got a hefty judgment against a renter after I evicted them

Over 5 years later I received a nice check including interests when they went to buy a house and was told they needed to pay off the judgment first

That was some sweet money

Karl B. · Answer

Small claims limit is 5K so you would need a lawyer to sue. To find their current address try this:

Do this: https://www.landlordology.com/...

"Using the last known address of your deadbeat tenant (which is probably your rental property), mail a letter addressed to your old tenant at that address. Before mailing, write on the envelope, “Address Service Requested” as such:

(image of what the addressed letter should look like - the photo is on the link above)

In doing so, your letter will be forwarded to your old tenant’s new address, and the post office will let you know what that new address is. This method works only if the person left a forwarding address, however.

I would also try to look them up on social media. Let's say you find them on Facebook. Now you have a general idea as to where they live. Look them up on the local FB marketplace - you may need to join a few local seller groups for this. Let's say they're selling a couch - have a friend message them asking where to buy the couch - you could get the tenants' address that way too - it's a long-shot but would be worth a try if the USPA method doesn't work.

Shiva Bhaskar · Answer

Hi David, I'm an attorney and landlord (though my focus is not landlord-tenant issues). What I have stated below is not legal advise, as I am not representing you (have to give that disclaimer). A few thoughts on this:

1. If you can obtain a judgment against this tenant (whether Small Claims or Civil) that will be helpful. Keep in mind that, to be frank, your chances of recovering any money from this tenant is fairly low. However, with a judgment in hand, you do have leverage. This will show up (probably) on tenant's rental screening reports, and can make it difficult to rent. If he or she ever goes for a job with a credit check, an unsatisfied judgment will also cause issues.

2. With this judgment in hand, it might be possible to garnish their wages, or levy their bank account. That will likely require the involvement of an investigator or someone who can locate them. If you have their SSN and DOB, that will help a lot.

3. Judgments don't directly appear on most of the 3 bureau (Experian, Equifax and TransUnion reports). However, the judgment can be turned over to a debt collector, who can report the debt to credit bureaus, and that will get the tenants attention. It will also help future landlords avoid this headache.

4. The law firm of Kimball, Tirey & St. John does report to credit bureaus, and has other strategies to help landlords collect debts (i.e. they can probably help you with garnishment etc). Many large landlords in southern California use them for debt recovery. I have no affiliation with them, and have not used their services, but quite a few people seem to use them. Pacific Credit Services in northern CA is another option, though they are not a law firm, so I doubt they can do as much.

5. Either way, a judgment is a good place to start. It gives you some really meaningful leverage here.

Dan H. · Answer

Here are a couple of rent recovery services.  I believe your odds of collecting through these services is small, but it will ding their credit score and make it difficult for them to rent a decent unit in a low vacancy area.  The info on each service is from when I last researched them; it may have changed.

• Rent Recovery Service: offers flat fee service starting at $20.  3 letters start at $30.  Reports to credit bureaus.  Also offers contingency based collection but price was not obvious. 
AOA Debt Reporting Service: letter sent w 120 days to pay (with credit bureau reporting) after which it rolls over contingency plan with collection agency getting 38%.

Make sure the eviction and lack of payment gets reflected on their credit report.

Good luck

Cody L. · Answer

This isn't want you want to hear but the best way to go after a tenant for bad debt is to not let a tenant get that far behind.I have well over $1m of bad debt with collections agencies.  They collect almost nothing.  And even if you sue and win, you just get a judgement.  I have way way way over $1m in judgements against tenants.  But making good on those judgments is also almost never successful.

The only reason to go after a tenant for bad debt is spite (and the .1% chance you get something from it)PS:  Not saying spite isn't itself a good reason -- but don't think you'll see any of that $30k.  That's the downside/cost of investing in a tenant friendly state.   In Texas they wouldn't get to $30k as you'd have tossed their a*s out well before then

Karl B. · Answer

*ears perk up*

She inherited a property?

That's great! For her... and you! If you sue her get a lien against her. On the real, if you sue her I doubt she'll even show up to the hearing and you'll get a judgement in a few minutes.

I'm assuming the money owed is more than 5K. If it's not, take the tenant to small claims yourself. If it's over 5K...

...if this was me, even if you sue her for the large, full amount, put together the entire case yourself (basically the proof you're owed this money) and find a lawyer who is cool with simply reviewing all of your proof and showing up in court so you can sue without having a 5K small claims limit (while also limiting the hours the lawyer will charge you by putting everything together yourself).

Then after you win you get a lien against the tenant. When I did this (I filed at the local Prothonotary's Office) it cost me $14-something dollars and lasts for 5 years. Prior to expiration I will go back and renew. It screws up the tenant's credit score, appears on their credit record and in the event a tenant receives an insurance claim or sells a home that was inherited to them I get paid.

And oh, what a coincidence, you stated your tenant inherited a property so in the event your tenant ever sells the place you get paid. It's your call but I figure if you have a chance at receiving your money (it appears this tenant actually has an asset now) you should take it if you can keep the lawyer cost low.

David To · Answer

Small claims court will be unlimited going forward for people pursuing tenants that didn't pay due to covid eviction moratorium.

Cody L. · Answer

Or put it in an LLC.  I realize there are tools to look up that LLC (which can be defeated by having an attorney as the registered agent, or having the LLC report to a Delaware LLC which doesn't disclose).   I put each property into it's own LLC.  Which is silly/overkill but a left over process from 10 years ago when I did a Freddie refi on a bunch of properties and they required each property to have a single entity ownership. So one trick people do to find your properties is look up 'similar owner name' to the LLC that owns the subject property.  That doesn't work when you have multiple.  Another is to search the mailing address.  Which also doesn't work when it goes to an attorney or quasi PO box.

Will Kenner · Answer

@Karl B. Your thoughts are exactly what I was thinking. She owes just over $10k in back rent, so just above small claims for WA state. And the likelihood of getting any of that is poor. However, if I can find out what property she inherited and put a lien against it as you described, it will at least be a reminder any time she tries to pull credit, take a loan, or sell the place. I looked into those people-search resources from the Cozy site. Ended up getting the most information from simply scouring Facebook and looking at all the relatives! Still no address on the property though. May take some time for those utility and cable accounts to start showing up and link an address to her!

Taylor Walsh · Answer

Following as I am in a similar situation here in CT.  Served notice to quit in March 2021, and they are supposed to move on October 25 (but they won't).  Professionals I have.  HARD learning curve for sure.  Thanks for the nuggets, everyone.  "Address Service Requested" is brilliant.  @Karl B. Landlordology.com must have been bought by Apartments.com too, and there is no article.  Do you recall any of the original suggestions?  Thanks!

What is best way to go after a tenant for rental debt?

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