What Are a Landlord's Legal Rights When a Tenant Skips Town Without Paying Rent & Utilities?

As a landlord, you have the right to collect rent from your tenants. If your tenant moves out without paying the rent, you have several options for recouping the money owed you, including holding back all or part of the tenant's security deposit, hiring a collection agency or suing in court.

Tenant Abandonment

If you believe your tenant has simply abandoned his home, check your state or local landlord-tenant laws for information on handling tenant abandonment. In some states, you are required to go through an elaborate legal process before you can enter and clean out the rental unit. The process often involves waiting until rent is overdue for a certain amount of time, serving the tenant with notice that you believe that he abandoned his home, and only then entering the premises so that you can make it fit for a new renter. It's important that you take these steps, because if your tenant returns to find that you have been in his home, removed his belongings or re-rented the property to someone else, he could sue you or report you to the police for theft.

Once you have followed your state's process for ascertaining whether your tenant has abandoned the property, you may be able to sell your tenant's possessions and keep all or part of the proceeds to cover any money you are owed. Again, this issue is determined by state and local law, so it is important that you understand the process in your area before you dispose of your former tenant's belongings.

Deduct From Security Deposit

If your tenant paid you a security deposit, you have the right to deduct from it any rent that your tenant owes. State laws vary on this issue, but you usually must send an itemized list of all deductions along with any balance to your tenant within a specific time frame after her tenancy ends. If you do not know where your tenant lives, state law may give your tenant a limited amount of time to send you her new address. If she doesn't, she forfeits her right to the return of her deposit.

In many states, you are required by law to make a good-faith effort to find a new tenant for your old tenant's abandoned home. You can't keep the entire security deposit and make no effort to find a new tenant, nor can you "double dip" by keeping the security deposit money if you have already rented out the unit to a paying tenant, according to attorney Janet Portman in her article "Top Ten Legal Mistakes That Can Sink Your Landlord Business" on Nolo.com.

File a Lawsuit

You have the right to file a lawsuit against your tenant. If you win your lawsuit, you have several options for collecting your judgment (the money awarded to you) including garnishing the tenant's wages, levying his bank account or even taking a lien out on any property that he owns.

Hire a Collection Agency

An alternative to filing a lawsuit is hiring a collection agency. Some collection agencies specialize in collecting on behalf of landlords and handle administrative tasks such as making reports to credit bureaus, tenant screening services and filing lawsuits. Many collection agencies operate on a contingency basis, so you won't have to pay them up-front for their services. Instead, the agency takes an agreed-upon percentage of any back rent it collects.

References

About the Author

Lainie Petersen writes about business, real estate and personal finance, drawing on 25 years experience in publishing and education. Petersen's work appears in Money Crashers, Selling to the Masses, and in Walmart News Now, a blog for Walmart suppliers. She holds a master's degree in library science from Dominican University.