Welcome to Strategy Saturday; I’m Charles Carillo and today we’re going to be discussing how a tenant we evicted a couple of years back, just bought a house and what we’re doing about it.
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Welcome to Strategy Saturday; I’m Charles Carillo and today we’re going to be discussing how a tenant we evicted a couple of years back, just bought a house and what we’re doing about it. So insurgency Saturday, I try to explain and talk about different topics that are relevant to us today that will most likely be relevant to you today or in the future. And they can help you when you’re building your real estate business. So when the episode [inaudible], I spoke about non-paying tenants and evictions, and I mentioned getting a judgment against a tenant is really worthless. And that’s really foresee class and below tenants, which is still pretty true. But in this situation, we’re now able to have the ability of possibly getting our money back. So what happened was this is a tenant we evicted, I think, two or three years ago. And my property manager was handling with our eviction attorney and they got a call on my property manager, got a call from collections company saying, Hey, a tenant that we evicted years back who owed us about $2,200, just bought $150,000 house, a town over from where this apartment complex is now the collections company asks if we want to spend the $275 to put a lien on the property.
And we said, yes. So let me kind of go over a little bit about if you evicting someone, you guys, the judgment and number one with the eviction, just to, just to kind of reiterate what I was saying in SS 20 is that you really want to get the person out. The whole thing about the eviction is getting the person out. The judgment is great. And, but in most, in most you’re not going to get a penny back. So it’s kind of worthless in this situation. We might be able to collect some or if not all of our money. So if the tenant fails to defend the lawsuit, once they’re served or is unsuccessful in their defense, then the court will order the tenant to vacate the premises within a certain number of days, which is exactly what we want. The tenant will also be ordered to return to court for damages hearing after vacating.
Now getting a judgment is part of the eviction process in this pretty straightforward. I have negotiate with tenants through an attorney about having them move right out if we didn’t seek a judgment, but normally you will get one and collecting the judgment though is another story. So when you’re, when I, when I’ve evicted appeal before, like we just did one now and we, we negotiate she with the tenant and said, we will not have a judgment against them if they return keys. And this is kind of the stuff you have to do during COVID two years ago, we would never have done that, but now it’s a different story. But when we’re talking about collecting the judgment, we have a few different things. It’s placing a judgment lien. So there’s a few different ways you can do this and, you know, wage garnishment, it takes time and money.
And if they change jobs, you need to start the process all over again and common with C class tenants. So you have a tenant working at a, just above minimum wage job or minimum wage job, let’s say, and you garnish their wages. They’re immediately just going to go get another job at the same level probably within a week or two. And you’re out of luck. You’ve got to do the whole thing again, bank garnishment. Do they even have a bank account? You know, there’s a lot of tenants in C class that are, that don’t bank in traditional sectors, like normal banks. And a lot of them are unbankable, as they say in the industry. And many tenants do not even have one. And you might not even know if they’re paying with money orders where their bank account is. Most of our tenants in C class properties pay with money orders and that, so that’s something where you don’t even know if they have a bank account and where you would attach a home though is a sure-fire way of collecting a judgment since I will need to be made whole before they can sell it.
Downside is that many people who have been evicted do not purchase homes. Okay. That’s, that’s the thing that goes along with everything in this is that if they’d never buy one, you’ll never be able to put a lien on one. So it goes to show you that sending your judgments to collections, even though it may seem like a waste of time and effort is actually worth it. And it should be something that you’re commonly doing. And if you have a professional third party, property manager is probably something they’re already doing. And if not, it’s something that I would suggest they start doing for you. Now, the information here may vary per state, and I use an attorney for evictions, and I suggest you do the same. This was on a property. I owned 100%. This property is in Connecticut. And there also may be personal property exemptions in your state. So just take this with a grain of salt. But the main thing is that when you’re getting those judgments, don’t think that they’re worth nothing. Make sure that you’re throwing them into collections. And hopefully, who knows 2, 3, 5 years down the road, you might be able to collect some of that money. So I hope you enjoyed it. Please remember to rate, review, subscribe, submit comments, and show topics at global investors, podcast.com. Look forward to two more episodes next week. See you then.
Nothing in this episode should be considered specific, personal or professional advice. Any investment opportunities mentioned on this podcast are limited to accredited investors. Any investments will only be made with proper disclosure, subscription documentation, and are subject to all applicable laws. Please consult an appropriate tax legal, real estate, financial or business professional for individualized advice. Opinions of guests are their own information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of Syndication Superstar LLC exclusively.
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