I have two rental properties in the mid-west. They were supposed to be cash-cows but with lousy tenants that keep moving out, I’m not cash-flowing at all. The last tenant was terrible.
Despite having a decent job as a nurse, she stopped paying the rent. I had to pay $500 to get her evicted and another $800 to get a judgment against her. Not only did she live rent-free for 3 months, but she trashed the place. I had to spend $3,000 on new carpeting and paint. The good news is that I now have a judgment for $11, 428.32 against her.
The bad news is that its going to cost another $500 to get her to pay. I have to file a petition that she hasn’t paid the judgment amount and issue a bench warrant against her. If she has a job, then I get to garnish her wages. Of course, if she’s changed employers and I can’t locate her, that means I can’t serve her. And if I can’t serve her, the judge won’t issue a warrant or garnish her wages. Even if I do locate her and she doesn’t have a job, there’s nothing to garnish against, so I’m back to square one.
If I get her to pay her $11,428.32, I not only get to cover my losses, I only stand to make about $4,500.
Is it worth the additional expense? When do you come to the point of diminishing returns and cut your losses? I probably will fight it out because she has a job. I let the last tenant walk away because he developed cancer and diabetes and didn’t have a job.
Why don’t they have a debtor’s prison like they used to in England prior to 1867?