Every month we gear up for Eviction Day. It is the anti-holiday that comes about every 30 days or so. It is around the 6th or 7th of every month depending on the weekend schedule.
Just as the sun will rise, eviction day will be active.
Tomorrow I think we have over 40 notices to go out. All are hand delivered and that costs us money.
A typical month will include anywhere between 25-40 notices handed out. It takes at least one day for a full time employee and sometimes two days. Typically, the driving mileage is about 120. Then we need to spend all the time dealing with the excuses about why payment can't be made on time and requests for extensions. If we extend, that means more than 1 trip down to eviction hearings for the month for both me and our attorney. This costs money too.
Our clients ask us why we charge for eviction management. Our tenants ask us why we charge them late fees.
40 notices at 2 pages each x $.10 per copy = $8.00
6 gallons of gas at $3.00 = $18.00
16 employee hours at $14.50 = $232.00
10 employee hours managing excuses = $140.00
15% SSI ++ general employee overhead costs = $27.00
Parking at the courthouse twice = $10.00
Attorneys fees for eviction figuring 15% of notices are evicted = $1512
My time at court x 2 = $500
$2250 +/- per month in costs just to deal with evictions ???
Tenants - You are going to be paying those late fees if you want to stay. You are going to be paying on time or you are going to need to leave.
Some of these costs we get back, but not all. First of all, we can't get back the time we spend. We can't make money while dealing with these silly issues, so there is lost opportunity cost.
Please Mr. Tenant, don't ask me to be reasonable. What do you think my bank is going to tell me when I am late?
I can't begin to tell you how much I hate eviction day !!
Do you have questions about distressed assets, receivership or bankruptcy sales, auctions? Email me at rfk@gryphonusa.com and I'll try to answer it in an upcoming post.
Richard F. Kruse is the President of Columbus, Ohio based Gryphon USA, Ltd. (www.gryphonusa.com). The Gryphon Organization includes Gryphon Asset Management providing receivership and consulting services in the distressed marketplace, United Country Gryphon Realty & Auction Group (www.ucohiorealty.com & www.ucohioauctions.com) providing real estate brokerage and auction services throughout Ohio and OnlineAuctionUSA.com (www.onlineauctionusa.com) providing commercial asset liquidations from the Midwest to East Coast.
United Country Gryphon Realty & Auction Career Opportunities Available. Call 614-885-0020 x 17
Rich,
It's gopo0d to see the figures broked down like this...but I was wondering about the $14.50 an hour employee...can't you send him to court and save the $500?
Now Have a Blessed Day,
John Occhi, Hemet CA REALTOR®
Mission Grove Realty
I understand............now.
I had to do my first eviction a couple of months ago.
Detainer warrant to begin process........$126.50
Parking for court.......................$5.00
3 hours of my time........................$450
Back to court to file for Writ of Posession..........$52.50
Parking again......................$5.00
Hiring locksmith to rekey doors and 2 movers to remove tenant's possessions...........luckily my tenant moved 2 days before we were scheduled to execute our Writ with Sheriff's deputies.
Although it was a good learning experience and I'll be far less reluctant to use this tool in the future as needed.
The potential expense alone would prevent most people from being a landlord.
I ve never seen the breakdown before and have a new appreciation for the costs that exist with getting someone out.
40 notices at 2 pages each x $.10 per copy = $8.00
6 gallons of gas at $3.00 = $18.00
16 employee hours at $14.50 = $232.00
10 employee hours managing excuses = $140.00
15% SSI ++ general employee overhead costs = $27.00
Parking at the courthouse twice = $10.00
Attorneys fees for eviction figuring 15% of notices are evicted = $1512
My time at court x 2 = $500
Throwing a deabeat out in the Street............... PRICELESS!