Does Cash For Keys include the Security deposit? 1 Other Question
1. If I offer a tenant $500 cash for keys, do I also give them the security deposit even though I don't have rent late into the month?
2. When exactly does one offer this? If grace period ends on 5th of month, sending a letter offering cash for keys right away sounds a bit rash, especially since if they end up paying, they know they can try to get paid in later months to leave. But if you offer it after they still haven't paid from the pay or quit notice, it's so late into the month even if you only give them a couple days more to move.
Just trying to establish my process for my tenant who lied about mailing rent, and process for future tenants as well! Thanks!
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- Real Estate Broker
- Cody, WY
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@Allan Smith I disagree with the basic premise of cash for keys but here's your answer:
The security deposit is regulated by state law. When you have questions like this, it's important to know what your state law says. A good resource for state law is www.nolo.com and I also highly recommend their book, Every Landlord's Legal Guide. It includes state-specific laws and a ton of practical advice on every aspect of Landlording, including sample forms.
I'm not going to study the state law for you but I'm pretty sure it will say something about using it only for specific purposes like unpaid rent, cleaning, or repairs.
If you choose to pay the tenant to leave, I recommend putting the agreement in writing with something along these lines:
Landlord and Tenant hereby agree to the following:
Bottom line: get it in writing and hold the tenant to it. How much will you pay? When will you pay them? Will you pay cash for keys and the deposit separately (recommended) or together?
I hope this was helpful.
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- Nathan Gesner
