I recently discovered an off market multifamily property forsale on the cheap. It was disclosed that one of the current tenants has not paid for almost a full year, hence the lower price point.
Once purchased, I was thinking best case I offer this tenant "cash for keys". Plain, simple, and effective. However, after a meet and greet with the tenant it was made clear they have NO place to go. The tenant themself brought up a pay out, to which they mentioned wouldnt be an option for them since they would most likely end up in a hotel. The tenant has baggage, lack of steady income, no means of transportation, no family that will take them in, and prior eviction history (which should say alot).
My question: are there any other creative methods, given the circumstances, that can be utilized to work with the tenant to make them get on their way? Im willing to work with them outside of court. However, the more I think about this in my head the more I believe court may be the only/best option....it hurts the deal given the uncertainty the eviction creates timeline wise.
Looking forward to the responses. Thank you in advance.
Real Estate Broker · Hyde Park Tampa, FL · Member since 2019 · 2k+ posts · 3k+ votes
7mo
No...don't do it - because the cost is going to be much higher than you think. And, you're not a social worker. If this had been a simple solution or even a legal one - like eviction -it wouldn't still exist. The seller needs to correct the issue prior to closing.
Bottom line:
Buy the property - NOT the problem. Again, the cost will be greater than you think.
Lender · Boston, MA · Member since 2021 · 125 posts · 64 votes
7mo
I think you're going to have to underwrite this deal given that it's going to cost you a significant amount in cash for keys or if going to court about 9-12 months in lost rent + legal fees. So your cash for keys $$ amount can probably be up to 9 months rent and still be cheaper than going the eviction route. Maybe you can find this person a room rental or shared apartment type place to live and offer to pay the deposit + a certain amount of rent/moving expenses but you'll probably have to do the leg work on that.
Real Estate Broker · Atlanta · Member since 2024 · 1k+ posts · 606 votes
7mo
If they haven’t paid rent in a year, this is a business decision and not a counseling situation. A couple options would be to offer cash for keys or payment for performance agreement. That said, go into this assuming you may need to evict. Underwrite the deal with 3–6 months of no income, legal costs, turnover and repairs. If the numbers don’t work after that stress test, it is not cheap.
Real Estate Broker · Hyde Park Tampa, FL · Member since 2019 · 2k+ posts · 3k+ votes
7mo
No...don't do it - because the cost is going to be much higher than you think. And, you're not a social worker. If this had been a simple solution or even a legal one - like eviction -it wouldn't still exist. The seller needs to correct the issue prior to closing.
Bottom line:
Buy the property - NOT the problem. Again, the cost will be greater than you think.
I recently discovered an off market multifamily property forsale on the cheap. It was disclosed that one of the current tenants has not paid for almost a full year, hence the lower price point.
Once purchased, I was thinking best case I offer this tenant "cash for keys". Plain, simple, and effective. However, after a meet and greet with the tenant it was made clear they have NO place to go. The tenant themself brought up a pay out, to which they mentioned wouldnt be an option for them since they would most likely end up in a hotel. The tenant has baggage, lack of steady income, no means of transportation, no family that will take them in, and prior eviction history (which should say alot).
My question: are there any other creative methods, given the circumstances, that can be utilized to work with the tenant to make them get on their way? Im willing to work with them outside of court. However, the more I think about this in my head the more I believe court may be the only/best option....it hurts the deal given the uncertainty the eviction creates timeline wise.
Looking forward to the responses. Thank you in advance.
You can make a LOT of money in this business solving problems others can't or won't put the time into.
You can also LOSE a lot of money buying problems you can't solve.
How well do you know the eviction laws of the state where the property is? How confident are you in your ability to get rid of this tenant? How quick do you think you can get rid of them? Worse-case how long do you think it will take?
Real Estate Agent · Memphis · Member since 2026 · 573 posts · 338 votes
7mo
You’re not buying a discounted property — you’re buying a legal process.
A tenant who hasn’t paid for almost a year, has prior eviction history, unstable income, and no relocation plan is not a “negotiation problem.” It’s a possession problem.
A few hard truths:
If they’ve gone a year without paying, incentives haven’t worked.
If they say cash for keys won’t help because they’d end up in a hotel, that signals they intend to stay as long as possible.
Once you close, you inherit the timeline risk.
Creative solutions are limited when the tenant has no viable exit path. You can attempt:
Structured cash-for-keys (paid only after surrender + keys + signed release)
Offering extended move-out timeline in exchange for signed agreement
Connecting them with local assistance programs (Section 8 transfer, housing nonprofits)
But none of those work if the tenant refuses to leave voluntarily.
The practical reality: If the tenant will not vacate voluntarily, court is the mechanism. The longer you delay filing, the longer you extend nonperformance.
Before you close, you need to:
Confirm current eviction backlog timelines in that jurisdiction
Underwrite the deal assuming zero rent for 6–12 months
Budget legal fees + potential damage + lost rent
If the numbers still work under worst-case timeline, proceed. If they only work under best-case assumptions, the “cheap” deal isn’t cheap.
Sometimes the right move isn’t creative — it’s decisive and procedural.
Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes
7mo
I would assume that with one Tenant that has been allowed to reach this point of delinquency, that others in the same property probably are not in the top 10% of the Tenant pool for that price range either.
You did not comment on the condition of the specific unit, or of the property overall. Usually, if someone is trying to unload a dog, you should expect a lot of issues...cosmetic, mechanical, structural, exterior surfaces, as well as Tenant issues, known or unknown. Did YOU inspect the property completely? Have you had conversations and/or met with the other Tenants? Do not rely on others for this critical information, unless you have deep pockets to address whatever comes up within your first year of ownership.
Lender · Marlboro, NJ · Member since 2025 · 243 posts · 150 votes
7mo
Honestly, even if the numbers penciled to the best deal ever, I’m not sure I’d want to buy into a situation that feels like a headache from day one. It's "on the cheap" for a reason. There will always be another deal, sometimes walking away is the best move you can make!
Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes
7mo
Well, if you are in the business of PMing other peoples properties, you will run across it fairly often depending on your locale. The key is to have rock solid systems in place to deal with it as you do every other client's property. Make whatever assessment you can prior to closing; notify all Tenants of termination of current Rental Agreements at the earliest per local law; initiate eviction if they holdover per local law; well secure each unit as it is vacated. Once empty, re-evaluate job scope, work through your normal Rental Prep and applying for permits and/or obtaining architectural drawings for as necessary to make best use of the total space.
Work towards getting one or more "model" units complete early to start marketing, and be sure you have a solid screening process for all adults that will be occupying. Stick to the process.
I had clients that bought a multi with two separate buildings. Approximately 14 Tenants, junk and parts all around the exterior, 2 of the "Tenants" were living under the building, which was on stilts, with dirt floor and an exposed sewer waste line they had broken open and placed a used toilet over. They used a handy garden house to "flush" the toilet! The individual units were all in poor condition and most were unsafely cluttered and filthy. Needles were laying about in several units, as were young children living in the filth. The out of state Owner's "Resident Manager" was a prostitute and not very good at depositing rents to the Owner's bank account. Of course, he was in the dark, and failed to take any action until he stopped getting any deposits. Then he tried to sell "as is", which was less than successful for at least another year until my existing Clients bought it without any consultation with me.
Ultimately, every one of the Tenants was removed, some willingly with small cash for keys, but 8 of them went the full eviction process route, which took more time. The most troublesome Tenant started slashing tires of management and contractors that parked on the property. At the bitter end, when the Sheriff was there to remove him and his squeeze, he actually faked a heart attack, falling to the ground. Sheriff had no choice but to call EMS, so they got a free ride to the hospital (returning back to their unit within 3 hours), and getting an additional 10 day reprieve before they were finally escorted out.
All the units were completely renovated by the Owner and his own Contractors, with the Conversion property being reconfigured to a useful 8 units, with secure Owner storage under the building on stilts. Gated access was installed, as were Security Cameras that could be remotely monitored live and archive all for a three week cycle.
I marketed, screened, and placed all of the new Tenants, and the property turned into a great investment, with solid, long term, quality residents. Rents were between $800 and $1400 when they first became available, for studio, one, and two bedroom units that were unique, but attractively finished. On-site coin laundry, a solidly mounted bike rack to secure bikes or mopeds, and only 5 total parking stalls, assigned to the largest units, and standard range and refer in each unit plus ceiling fans. I managed the property for about 10 years for that Client until I retired. Turnover was on par with my career average of over 4 years per Tenant, and those turnovers all required only minimum prep.
Rock solid systems are the key. If you cannot handle a little adversity, you are in the wrong business. Do not treat every circumstance as something new that you need to evaluate and analyze. With a good system, just DO.
