Landlord Rights: Collecting Unpaid Rent and Property Damage

First, assuming that the tenants provided a security deposit, that security deposit can be applied against either or both of (1) damage to the rental premises—i.e. the cost of repair or replacement; and (2) unpaid rent. (Though note: routine end-of-tenancy cleaning, or repairs that would have to be done anyway, such as replacing a roof or water heater that’s reached the end of its service life, cannot be charged against a tenant.)

Second, if there’s no security deposit, or there is one, but it’s inadequate (i.e. too small to cover the damages or unpaid rent), then the landlord’s recourse is to sue the tenants. Lesser dollar amount claims could be handled in small claims court (check your local small claims court for the maximum amount), which will reduce legal costs substantially; for larger amounts, retaining an attorney and filing a suit in “regular” county, municipal, or state civil court would be the way to go. Depending on the terms of the lease, the landlord may or may not be able to also recover some of his, her, or its attorney fees and other legal or collections costs—e.g., a landlord can recover these if the lease the tenant signed said the tenant would pay them. Landlords forced to sue on this basis should also sue for any late fees or interest permitted under the lease.

Of course, suing is one thing; collecting money is another. Many tenants may not have the assets to pay a judgment; e.g. they do not have any money in the bank. Winning a lawsuit but being unable to be paid does not help anyone. There are mechanisms to help a winning plaintiff (person suing) recover from a defendant, such as the ability to garnish (or take) part of the defendant’s income, but at a certain point, a tenant may simply have or earn too little to make it worthwhile to sue. In those cases, it may be better to speak with your tax preparer and see whether there is any tax loss you can take. (Not also that not all enforcement mechanisms are available in all states—for example, certain states do not allow income to be garnished.)