As a landlord, an eviction is one of the most stressful events you and your tenants may experience. Even after an eviction, many tenants leave homeowners with lost rental income, whether they intend to or not. If your lease agreement has specific terms in your favor, you almost always have a right to recover unpaid rent from an evicted tenant.
However, the eviction and collection process are not simple, cut-and-dry processes—and they can be expensive. In California, filing and lawyer fees alone can cost up to $2,450. In small claims court without an attorney, landlords in the same state might expect to pay $30 to $100 just to file a claim.
These expenses can make some people throw in the towel before the collection process ever starts. Luckily, if you’re informed on the process of how to collect rent post-eviction, you can find a solution and lift the financial burden.
Here, you can learn about relevant laws and explore methods you can use to collect unpaid debts post-eviction.
TL;DR
Collecting rent after an eviction is challenging. You may need to rely on sending collection letters, using a collection agency, or seeking a court order for wage garnishment to recover lost income. Make sure to remain compliant as a landlord during the eviction and rent collection process.
What to Know About Eviction Laws and Unpaid Rent Collection
As a landlord, collecting post-eviction unpaid rent requires compliance with applicable laws. These laws can vary depending on the city, state, or area your rental is in.
In most places, you have the right to collect past-due rent from a former tenant, along with late fees and other costs incurred during lease enforcement. But you always need to follow landlord-tenant law when you collect payments.
Pro tip: For advice about your specific situation, consult a legal professional or local housing authority in your jurisdiction.
Relevant Eviction Laws to Abide By
Post-eviction rent collection laws in the U.S. and Canada generally allow landlords to recoup:
- Unpaid rent
- Utilities
- Damages
- NSF (overdraft) check fees
- Reasonable legal fees
In the U.S., eviction and some post-eviction collection activities are subject primarily to state and local laws. In Canada, the Residential Tenancies Acts (Ontario and B.C.) and provincial tribunals regulate post-eviction collection.
Some of the generally allowed collection methods include:
- Demand letters
- Debt collection agencies
- Wage garnishment (court order required)
- Bank account seizure (court order required)
To legally collect through wage garnishment or collections, you may need to get a court judgment (U.S.) or tribunal order (Canada). And, when you opt for a debt collection agency, they are bound by relevant debt collection laws.
Debt Collection Laws That Can Apply to Unpaid Rent
In the U.S., federal law mainly applies to third-party collectors, but state laws can apply to creditors collecting their own debts. Meanwhile, in Canada, landlords who collect their own rent are often exempt from collection agent licensing but must still comply with legal requirements, such as giving proper notice and avoiding harassment.
Post-eviction, landlords can generally pursue options like:
- Small claims court lawsuits
- Legal services
- Reporting debts to credit bureaus
If you’re in the U.S., the Federal Trade Commission (FTC)’s Fair Debt Collection Practices Act (FDCPA) applies.
Key provisions of the FDCPA include:
- Limitations on when collectors can initiate contact (between 8 a.m. and 9 p.m.)
- A ban on harassment
- A requirement for debt validation
- The right for consumers to take legal action against those who violate the act
In Canada, debt collection actions fall under the jurisdiction of individual provinces and territories. Legislation such as B.C.’s Business Practices and Consumer Protection Act and Ontario’s Collection and Debt Settlement Services Act sets the standards.
Canada’s regional frameworks are designed to:
- Prevent harassment
- Establish permissible contact hours
- Mandate that collection agencies maintain valid licensing
You may also be subject to local debt collection laws that govern how creditors and collection agencies can recover money. Consult an attorney if you have questions about your circumstances.
How to Handle a Tenant’s Abandoned Property
If you find yourself in possession of a previous tenant’s personal belongings after an eviction, you can’t necessarily do whatever you want with them. You must follow legal processes, and handling abandoned property needs to be done with care.
Both the U.S. and Canada have strict laws regarding personal property. Several jurisdictions have rules requiring landlords and property managers to store items for 7 to 30 days. Consult a legal professional in your jurisdiction to make sure you properly follow the legal procedures for storage and disposal.
Some best practices for dealing with a tenant’s property post-eviction include:
- Document everything.
- Don’t prematurely lock the tenant out.
- Dispose of unsafe items.
Consider creating a written inventory of any items left behind in the unit and taking photographs that clearly show their condition. Do not dispose of abandoned property until legal possession of the unit is returned at a court hearing. You may be able to dispose of unsafe, perishable, or destroyed items without waiting for the storage period to end.
Whether the tenant owes you money or not, if you fail to follow the rules as a landlord, you could end up returning the security deposit funds—plus damages.
Tenant Screening is Your First Line of Defense
The best tool you have to prevent eviction and avoid stressful rent collection processes is a solid tenant screening process. By the time you’re looking to collect lost rental payments, you’ve already passed this point; however, it's important to keep this in mind for the future.
In short, you can screen a tenant by:
- Setting specific rental criteria
- Requesting a rental application
- Running a background check
- Calling references
- Verifying application information
- Meeting with the applicant
Landlords generally have the right verify certain things about a potential renter:
- The tenant’s contact information
- The tenant’s credit score
- The tenant’s wages
- The tenant’s employer
- The tenant’s rental and payment history
- The tenant’s eviction history
These factors can tell you about the applicant’s general ability to pay rent.
In many cases, landlords and property management companies can also check a prospective renter’s criminal background. This is true as long as they conduct a non-discriminatory approval process. Keep in mind that implementing across-the-board bans based on any criminal history is likely a violation of fair housing regulations.
You can deny tenants based on specific rental criteria that you set in advance to protect your rental property in legal compliance with local, state, and federal rules. Well-written and properly presented rental criteria can also help you manage expectations and possibly preserve the long-term landlord-tenant relationship.
Sometimes, even when you vet a renter perfectly, you still end up with rent owed after an eviction is successful and a tenant vacates. The next step is usually to write a formal demand letter.
How to Write a Formal Demand Letter
Once the eviction has occurred and the owed funds remain unpaid, a formal demand letter can help you collect the unpaid rent. In many jurisdictions, written notice is required before a court order can be issued.
A formal demand letter should include:
- The total amount owed
- Proof that the debt is owed (lease agreement and eviction order)
- The tenant’s last known address or in care of address
- A reasonable payment deadline (7-14 days) to either pay in full or enter a payment plan
- Consequences of non-payment (landlord’s intent to make further collection efforts)
Possible consequences may include your intent to hire a collection agency or to file a lawsuit. In some jurisdictions, consequences may also include interest accrual or fees. For example, California allows a late fee of up to 10% of the amount due if specified in the lease.
In the best-case scenario, a formal demand letter will be enough to get the tenant to take action. If this is the case, you won’t need to worry about additional steps. But, if your evicted tenant fails to pay after they have been properly notified, you may need to take further action.
Enlisting a Debt Collection Agency
When you need to collect rent post-eviction, collection agencies can come in clutch. They can help you by taking over debt collection processes, and may not require court proceedings. A professional debt collector can successfully demand immediate payment or offer possible payment plans to the tenant.
However, if you choose to work with a debt collection agency, you are not as likely to fully cover the unpaid rent owed to you. Collection agencies require a fee for their service.
Some possible ways you might expect to pay a collection agency:
- Contingent payment: You pay between 25% to 50% if they collect.
- Tiered percentage: You pay a higher percentage for a more difficult-to-collect case.
- Flat fee: You pay a set amount whether the debt is collected or not.
- Debt buyout: You sell the debt to the collector for between 2% to 50% of the amount owed.
While you won’t get the full rent payment owed to you, a collection agency may be able to help you avoid legal proceedings. Always check with consumer protection bureaus to make sure a business is legitimate before you hand over sensitive financial information.
If you’d rather aim for the full payment, and you don’t mind stepping into a courtroom, you can present unpaid rent issues to a relevant court.
Consider Filing in Small Claims Court or Requesting a Civil Resolution
If you want to pursue options such as wage garnishment or seizing funds from the tenant’s bank account, you will need a court order. Here's how it works:
- For debts under $10,000, in the U.S., you can generally file a lawsuit in small claims court.
- In Canada, depending on your province, debts from $5,000 to $50,000 may be eligible for a small claims court hearing.
- For claims under $5,000, you may need to file online via a Civil Resolution Tribunal (CRT) or Binding Civil Dispute Resolution.
Consult with a legal professional who practices in your area or your local courthouse to find out which options are available to you. If you opt for a lawsuit or civil resolution in court and win, you might be able to garnish wages or collect directly from the tenant’s bank account.
Is Wage Garnishment a Good Option?
If the evicted tenant is employed and has failed to make timely rent payments despite a final court order, wage garnishment may be an option. To do this, you will need to obtain an additional order from a court. In the U.S., you may need a “money judgment” or “Writ of Garnishment.”
While it takes a bit of work to enforce, it can be convenient because you can work directly with the tenant’s employer rather than chase them for funds. In many areas, wage garnishment may be applied to unpaid rent, damage to the unit, and legal costs.
Speak to a legal professional or your local court to find out if wage garnishment is a viable option for your situation. You may be able to seize funds from the tenant's bank account simultaneously.
Can You Seize Funds From the Tenant’s Bank Account?
If the evicted tenant has a bank account, you may be able to seize funds when legally collecting overdue rent. Similar to wage garnishment, and often enforced simultaneously, bank account seizure requires a court order.
As with wage garnishment, bank account seizure will require a money judgment or Writ of “Garnishment in the U.S. and a court judgment or Monetary Order in Canada.
Rather than working with the tenant’s employer, this process enables you to work with their bank. The court order gives you access to collection directly from the bank.
To find out if you can rightfully seize funds directly from your tenant’s bank account, consult with a local court or legal professional in your jurisdiction.
Conclusion
Learning how to collect rent post-eviction can be overwhelming. But if you know what to expect, some of that weight is lifted. The best defense is a good offense, so screen your tenants thoroughly. If you still have to collect unpaid rent, you can start with a demand letter. Then, if needed, you can explore debt collection agencies, court orders, and garnishments.
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Collect Rent Post-Eviction FAQs
Can a landlord sue a tenant for damages if the security deposit doesn't cover the full cost of repairs?
Yes. If repair costs go beyond the security deposit, a landlord can sue for the remaining balance. This often happens when the damage is beyond normal wear and tear. The landlord will need proof, like photos, receipts, and repair estimates. If the case goes to court, a judge will decide if the charges are valid and reasonable.
Can a landlord win a post-eviction rent collection lawsuit if they failed to keep payment records?
It is possible, but harder. In most cases, the landlord must show clear records of what the tenant owes. Without payment history, lease details, or notices, the case is weaker. A tenant can challenge the claim by presenting their own proof, such as bank statements or receipts. Judges tend to rely on documentation so that missing records can hurt a landlord’s case.
Can a landlord speak to previous landlords when screening a tenant?
Yes. In most places, landlords can contact past landlords as part of tenant screening. They often ask about rent history, property care, and lease behavior. The tenant usually permits this when they fill out a rental application. It is a common and legal step in the screening process.
Can landlords keep security deposits for unpaid rent?
Yes, it is legal for landlords to keep some or all of a security deposit collected at the beginning of the tenancy. Typically, security deposits can be applied toward unpaid rent, damages beyond normal wear and tear, and cleaning costs needed to return the rental to move-in condition. Terms should be specified in the lease agreement.
Can a landlord sue for unpaid rent?
Yes, landlords can sue tenants for unpaid rent. They typically will file in small claims or civil court and may even garnish wages or use a collection agency to recover unpaid rent.
