The economic downturn in our country has devastated many businesses. This is a real problem for commercial business management companies who lose money because contracts were broken. Taking legal action is a positive step in the right direction. Debts are commonly collected from:
- Property owners who have been foreclosed on
- Property owners who have had legal action taken against them
- Tenants who were evicted
- Tenants who broke their contracts
- Government clients who ran out of money
- Nonprofits who lost their funding
Clients Out Of State
It is an unfortunate when you discover that a
client cannot be properly apprehended because the both of you are not
in the same state. Of course, you want to avoid face-to-face contact
at all costs. It is very important to have to consult with a lawyer
to figure out what your best plan of action is. In some cases, this
may mean taking a loss. This depends on what the state's laws are
concerning debt and what the laws are concerning debt across state
lines. There also may be other laws that prevent you from collecting
your debts for a certain period of time. However, as a commercial
property management business, you're entitled to any monies that are
owed to you.
Collecting Debts From Government Debtors
Of course, nothing is more frustrating than
dealing with governments and bureaucracy. If you are a commercial
property management business, it can be difficult to go to the
government when it is the government that is in trouble. Often, you
will need to go to court and deal with the bureaucracy that follows
your case. Most often, instead of paying you directly, other benefits
are offered. For example, they may choose to waive all of the taxes
for all of your properties. This way, you can make your money back
from your clients when they pay the taxes. Of course, anything that
changes will need to be discussed with a property owner in the
tenants.
Collecting From Businesses That Have Gone Out Of
Business
When a business goes out of business, it can be
difficult to collect from them. The owners may move out a state or
simply not return your communications. Taking someone to court in
order to restore your debts may be difficult. More often than not,
the tenant will file for bankruptcy at some point in time. In order
to recoup some of your losses, it is best to speak with your
accountant about options for a commercial property management
business that has lost significant funding. There are often tax
incentives that help you to recoup at least 50% of the loss that you
have experience. It is helpful if you can talk with your lawyer to
see if bankruptcy is the best option for this tenant.
Choosing A Debt Collection Service
There are many Federal regulations that keep debt
collectors from harassing debtors. However, the same is not
necessarily true for commercial property management businesses.
Although a debt collector service may be somewhat helpful, it will
still cost you money and you may not get your debts anyway. It is
better to seek out legal services and talk with your accountant. You
may save more money in the long term by filing this on your taxes as
a loss.
How Much Can You Expect To Collect?
In most cases, you will not get everything that
you are asking for when you try to collect from a tenant who has been
evicted or has gone out of business. In general, you can file with
your governments through a lawyer to be part of the debts in case the
tenant decides to file for bankruptcy. This may allow you to have
access to some of the collateral. However, depending on what state
you live in, commercial property management businesses may not be
entitled to collateral forfeited in a foreclosure or bankruptcy. In
most cases, you can expect to collect between 100% to 25% of what is
owed to you.
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