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Roni Pidcock
  • Homeowner
  • 34655
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Advice regarding cash for keys-possible broker breach of contract

Roni Pidcock
  • Homeowner
  • 34655
Posted May 13 2022, 19:47

If anyone is familiar with how a cash for keys contract works, please let me know.                                                                 My daughter rented a house for 3 years and her LL sold it to a broker. That broker decided after 2 months to give her and her family, 4 kids, one a baby, an eviction notice to pay 5200.00 dollars (they had no lease for this to be determined from) and vacate in 3 days or a  cash for keys offer to accept 1500.00 and leave in 10 days and they would wire the funds the day after they vacated.                                                                                                                                                                                                                                                                                                                                                     The original cash for keys contract was pre dated by the broker and had an invalid date (the year was 2002) that they were going to wire the funds. I advised that they have a new contract drawn up with a corrected date and no pre dated signature lines. They vacated the house on 5/11/2022 and have not received the funds as the contract stated they would. They left the house in better shape than it was in when they moved into it.                                                                                                                                                                                                                                                                     The brokers are going to be doing extensive work on this house inside and out so it's not a damage issue.  It is going to be a complete remodel. What rights do they have to get the money owed to them? They have been forced to live in a hotel until they can find a place to live. 

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Nathan Grabau
  • Realtor
  • Longmont, CO
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Nathan Grabau
  • Realtor
  • Longmont, CO
Replied May 13 2022, 20:58

I am not a lawyer and this is not legal advice, but as I understand what you are saying, there was a contract that was a cash for keys deal, with a clerical error, and then they had a replacement contract, but that has not been signed and now they have not been paid? If I understand that correctly, I would assume the former tenants could take the new owners to small claims court, but the contract is likely not enforceable. 

This is probably good advice for everyone, but you probably want to have keys for cash deals exchanged simultaneously. You do not want to give a squatter cash before they leave and also should not surrender the premise until you have cash. 

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Roni Pidcock
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  • 34655
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Roni Pidcock
  • Homeowner
  • 34655
Replied May 13 2022, 21:49

Thank you so much. This is what I was thinking as well, but was just wanting to see if anyone else felt that this was going to be the route they may need to go.  You are correct, they refused to amend the paperwork even though they said they would and sent someone that did not speak English to do the final walk thru and to pick up the keys. The 3 day notice they gave to pay rent or vacate seems invalid because they were the brokers who bought the home 2 months prior and had never initiated, asked for a previous copy of a lease (which did not exist because they  had a verbal agreement) nor did they ask for rent to be paid, in fact the messages exchanged were that they would meet to come up with a plan and also would try to assist with getting my daughter cash to relocate since the landlord sold the house and did not notify her about the sale until after it was done. The landlord had told her not to pay rent starting in January to be able to save up for when they had to move out because she was going to rent the house to her own family, then changed her mind and a few months later quietly up and sold it.  Thank you again!           

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