Cash for keys. Why would any tenant want that?

Question

Just wondering, if they're dead set on being a bad tenant, why would they accept your petty cash for keys if the rent costs a lot more and they can stay in your home for free?

If you've done this before, how much was your rent, and how much was your cash4keys  offer ?

Michele Fischer · Answer

we paid a tenant $200 for keys, she needed gas money. Rent was $500. A lot of our tenants don't understand their "rights" to stay without paying.

Pat L. · Answer

The highest we paid was $40,000 for a deed in lieu of vs foreclosure.

She even left all the new high end appliances. We went from a 1800 sq ft home we sold for $120,000 to taking back a completely renovated 2400 sq ft home worth at least $225,000. It was one of the best 'impulsive' (according to my wife) deals we did.

Jon K. · Answer

Why is it already trashed? If you screen tenants, why are they trashing the place when paying? When they stop paying and have nothing to lose (they're not paying and know they'll have to move anyway) is when I would worry.

A month eviction is quick.

Some couple in Colorado, I think it has, has had squatters in their vacant house for a year. They still haven't been able to get the squatters out of their own house.

Steve Babiak · Answer

If you already have the eviction started with the courts, they know that their time will run out at some point; getting money before that point can seem like a good deal to them.

Tim G. · Answer

I've paid $10,000, $2,000 twice and $1,000 once. Everytime it made me more money than what I spent to get them out.

None of this was for deadbeat tenants though, all paying I just needed them out to get the deal done and start rehabbing. The $1,000 deal was a heroin dealer but they knew their time was up and they didn't want to be at my place anymore, I just made it easier and faster.

Derek W. · Answer

I'd love to get an eviction completed start to finish in 30 days. Can I buy your system? With the budget cuts on court employees, over crowding of court schedule, free legal services now advertising to all newly filed unlawful detainer and representing the tenant free of charge (on our tax dime) I haven't had an eviction go that smooth in a year. I always offer cash for keys as I hand them the 3 day notice.

Mike Franco · Answer

Usually the place is already trashed.

Here in CA, eviction takes about a month start to finish, so it doesn't seem worth it for cash4keys.

Jon K. · Answer

Cash so they won't trash the place before an eviction and will willingly leave.

Cash so they won't stay months and months losing you many thousands in  lost rent.... before they finally get evicted and take the light  fixtures/appliances with them, then trash the place.

Joel Owens · Answer

Depending on the class of the tenant they might need money for many things.

Drugs, alcohol, food, bailing someone out of jail, car payment, illness and on and on.

They can usually find somewhere to crash so if they get money today they might want to move and figure out things later on. Many of these types of tenants live in the moment.

With cash for keys you have to analyze how many other units you have vacant. You might want them there to decrease breakins for damage until you can fill the other units. If you give a multifamily tenant cash for keys others in the building will get wind of it so it works better on SFR houses.

Look at how many months to get them out through eviction and costs rather than offering cash for keys. It could be a timing issue if you want to sell your property and get them out by a certain time for peak season.

Really a ton of factors play into why and how much you would want to offer or just go the regular eviction route.

Cash for keys. Why would any tenant want that?

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