I have evicted tenants before but here in Illinois it is time consuming and costly. Looking for creative ways to get tenant out legally. Buy them out, etc.
Cash for keys. The agreement doesn't need to be long winded, just state that the tenant is voluntarily returning possession of the unit to you, state the amount of money exchanged and dates of when things will happen, and get them to print, sign and date. Preferably all adult occupants in the unit or whoever signed the lease. You can also state that you won't go after them in small claims/collections or if you'd like the matter to stay confidential but I don't know how enforceable a court would view a breach.
The toughest part of cash for keys is the timing. People need time to move and you risk giving them another 3-4 days of free time if they back out of the agreement. When it works, giving the deposit back and even plus some money can be cheaper than the time and money spent on an eviction. I feel your pain as CA is very slow as well.
Thanks Matt. That was the first thought. A few days is nothing. Evictions take time in Illinois 90 days or longer not un- heard of to take 3 - 4 months of lost rent, court cost, attorney, etc. Luckily its not in Cook County. They are the worst. Last one took 5 months. That was over a $5000 loss.
@Kenneth Garrett The best approach would depend on a number of factors.
What is your motivation for wanting the tenant out?
What is the tenant's temperament and education level? How long has the tenant lived there and what is their rental history? What goals does the tenant have? What resources does the tenant have?
I believe everything is negotiable. The key is in understanding the position of the other party, your own position, and finding what it would take to get a win-win result.
Instead of talking about eviction.... talk about a move-out plan. Take into consideration what is best for all parties concerned. Every tenancy eventually ends. From the beginning of tenancy to the end, be clear about how you want that to look like.
We've only had to do three evictions in over 22 years of owning and managing residential rental properties. When a tenancy has gone south, we've had more success with negotiating a move out plan whereby the tenant leaves on their own accord, doesn't cause damage upon exit and without us needing to pay them to leave. The approach one takes influences how it will go. Good luck!
Thanks for the response. We inherited this tenant who has been late each month. No rent for August. Promised to pay then couldn't. They agreed to move out by September 1st, but show no signs of doing so. They were going to rent a storage building last weekend, but said they couldn't find one, Really! They have a 10 x 10 storage room packed with there belongings in our building. They also have an abandoned vehicle on our property. You asked about temperament, its starting to go bad with the boyfriend. She is the only one working and is easier to work with. At this point we're only communicating with her. They are both on the lease.
I discussed cash for keys with my business partner who is against this philosophically. We discussed renting a storage unit for one month on there behalf just to get them out. The cost of having a tenant not pay and the length of time to evict in Illinois is not in our favor. I was just looking for alternate solutions to the issue. I still think cash for keys is the best solution.
Appreciate any input.
With that additional information, here are my thoughts....
First, some more questions.... when did you purchase the property? What kind of rental agreement do you have and are the terms clear? How many times have they paid rent late since you took over? How late were their previous payments and why? How did you handle those late payments? What was their rent history with the previous owner? What is their reason for not paying rent when it is due? Have you served the legal notice to pay rent or vacate for August and if so what has transpired since? What barriers they are facing? Why aren't they leaving? How well are you all communicating and in what manner?
Getting a judgement in your favor for eviction based on the tenant's failure to pay rent is a slam dunk in most jurisdictions. You need to have a clear rental agreement and serve legal notices appropriately. You should proceed with the proper legal notices, even while negotiating a voluntary move-out. Tenants can use the "pay rent or vacate" notice to get temporary help from aid agencies, while they are in the process of moving and finding lodging elsewhere.
The tenants need to understand their tenancy is ending. At this juncture I stop talking with them about when they're going to pay rent. I shift to talking with them about the move out process. My goal is to regain possession of my property, in the fastest manner, with the least amount of damages.
Beware... the tenant may try to pay all the rent for August or partial rent, to delay the inevitable move out. You need to understand the laws for your jurisdiction and how accepting rent now will affect the process. If you served the Pay Rent or Vacate notice for August and they pay all of the rent now, take it. Be aware they most likely won't have the rent for September. Don't delay in serving notice if they fail to pay rent when it is due in September. If they pay only partial rent, serve a Pay Rent or Vacate notice for the remainder. However, after you've filed in court for unlawful detainer (eviction), accepting any rent payment might put you back at square one.
Here's what I would do.....
Arrange to meet with the tenants at their place. Have an open and honest and discussion with them, delivered with care and concern.
These are phrases I've used successfully with tenants. "This isn't working for us and I can see it's not working for you. So let's talk about a move out plan." "Staying is not an option if you don't pay rent when it is due." "I'm prepared to proceed with eviction, but it would be in your best interest and mine if you moved out voluntarily." "What would it take for you to be out by the end of August?" "Your time has run out." "Delaying this any more is not an option." "What you choose to do will determine our course of action."
"Here are the steps you need to take to move-out......"
1. Complete and sign/date a "Notice to Vacate". [Present such a form to the tenant and ask them to complete it for you. This gives them a sense of having some choice in the matter. A typical Notice to Vacate form will have a place for the tenant to put the date when they plan to leave. Psychologically, this is a critical step.]
2. Gather together your packing supplies. Pack up what you are going to take with you. [We provide moving boxes and 3mil thick contractor type plastic bags.]
3. Dispose of the trash. [We place a large garbage on site and supply garbage bags. We even offer to haul their trash and junk to the dump.]
4. Decide where you will be going and where you will be taking your things. [Encourage the tenant to seek out reasonable options. Never rent a storage unit for a tenant in your name. The contract must be between the tenant and the storage facility. If you decide to pay first month's rent for a storage unit, have the tenant open the rental agreement in their name. Then you can pay the storage facility directly to avoid handing cash to the tenant.]
5. Secure a vehicle for making the move and people to help you with the move. [Talk with the tenant about their resources. Only offer yours as a last resort. We once got a U-haul truck and workers and physically helped a tenant get their stuff out and transported to the front yard of her grandmother's house. Two other times we loaded up our station wagon and shuttled the tenant's things to their next destination. This was all done per the tenant's wishes and the bonus for us was that we saw where the tenant was going and got an address where we were able to send end of tenancy correspondence.]
6. Close your utility accounts and change your mailing address. [If you haven't already checked about how current the tenant is with their utility bills, better do so now. Most tenants stop paying for utilities long before they stop paying for rent. Some unpaid utility bills might end up as a lien against your property, so heads up.]
Note: We've never handed cash for keys. Instead, we've helped guide tenants with doing what is necessary for them to move out with the least amount of stress. We've helped tenants "save face" and continued to treat them fairly, professionally and with respect while they were leaving on their own or even through a court ordered eviction process.
@Kenneth Garrett First, issue the proper 5-day notice. Then ask the hard questions face-to-face:
"So the owner has informed me that you are past due on rent - what is it going to take to get you caught up...how much time do you need, or do you have a dispute?" Many times, they'll claim a silly dispute - ie that the sink doesn't drain fast enough.
"Then if I send in my maintenance crew to fix that, can you pay me the rent right away when they are done?" Usually you'll get a stutter because the tenant can't and the maintenance issue was bunk. Or they'll say yes, and you can use that when you continue the script to negotiate a lower amount.
"Ok, so then what do you need from us to help you move in the next week?" PAUSE. If they don't answer...
OR - if they say they need another week, then continue the same as above to this...
"Would $500 help make that happen? I could likely get you that money in cash once your things are moved out, and it'd be a written agreement so you know we aren't trying anything funny with you. But the reality is that ownership is ready to pass this off to their atty to start an eviction, and once that happens I can't do much for you. How soon can you get me an answer on how much you need to move out this week?" Then follow up 3 days prior and every day after that.
If your partner doesn't want to do cash-for-keys, frankly, he or she is a fool who runs their business based on emotion, and that's dangerous. If it costs me $2500 to get a tenant out via eviction or $1500 via cash for keys, I'll take that ego-hit all day and give them the $1500. Plus, w/ cash-for-keys you've got a lot better chance of being left a clean unit vs one destroyed w/ $15k in damages.