Unlocking the Hidden Profits of Property Management With a Collections Department (introduction)

This workshop is about collecting the money owed you and your owner/client from tenants that move out owing a balance.

For the first 20 years of my management business I did what other property managers did (and do today) regarding balances owed by tenants after moving out … I gave it back to the owner; gave it to a collections agency or just filed it away. I was to busy managing properties to give it much thought or energy.

Ten years ago we managed 300 single family homes with average rent of about $1200. Tenants had been taught (by the apartment industry I guess) that property managers could be stiffed at the end of the lease and nothing would be done about it. They often left Crown owing the last months rent, property damages, outstanding late fees, NSF charges, move out fees, warrant charges and more. It was not uncommon for a tenant to leave owing $2,000 to $4,000. Occasionally, it would amount to $5,000 to $8,000 and owners felt we should do something about all these unpaid charges. Much of the money belonged to the owner but plenty of it belonged to Crown. Like other managers we heard “it was your tenant …you leased to them … you managed them … you collect it .. and send me my share”. We didn’t know anything about the collections business but felt we should be doing something more than just turn it over to a collections company.

In 2001, with not knowledge whatsoever about collections, we started learning our way through the process of collecting the money tenant’s left behind when they moved out. We started with a series of letters, getting increasingly harsh as time went on; then one from our attorney, then filing with magistrates court for a judgment, then getting a fife, then interrogatories, then garnishments and finally attaching assets both personal and real. We learned how to prepare for court, what judges wanted to see, what they threw out and what they thought was fair. We learned how to respond to letters from attorney’s, fought though the Fair Debt Collections Act and settle balances for notes and payments.

This workshop is for private investors and professional property managers. The strategies we teach apply to anyone managing rentals and have tenant leave owing money. What ever you have to pay to attend this class (or view the video) will come back to you a hundreds fold over the rest of your career as a landlord.

Authored by: Robert M. Locke RPM, MPM

GREC # 62145 3hr CE

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