What Is Cash for Keys?
Cash for keys is a voluntary agreement where a landlord pays a tenant to vacate the property peacefully, avoiding the formal eviction process. The tenant receives money; the landlord gets their property back quickly.
When Cash for Keys Makes Sense
- Should I offer cash for keys if the tenant owes months of rent?
Often yes. Calculate your true cost: 3 months unpaid rent + 3 months eviction process = 6 months lost income. Offering 1 month's rent to leave in 2 weeks may save you 5 months of losses.
How Much to Offer
The right amount balances getting the tenant to accept while not overpaying. Consider these factors:
The Cash for Keys Process
Cash for Keys Steps
Step 1: Make Contact
Approach the tenant calmly. Explain you want to discuss options.
Step 2: Make the Offer
Present your offer clearly. Explain the benefits for both sides.
Step 3: Negotiate
Be prepared to adjust. Listen to their concerns and timeline needs.
Step 4: Draft Agreement
Put everything in writing. Include amount, move-out date, and conditions.
Step 5: Inspection
Do a pre-move-out walk-through together. Document property condition.
Step 6: Payment & Keys
Exchange payment for keys only when property is fully vacated and inspected.
Essential Agreement Terms
Your written agreement should include:
• Exact move-out date and time
• Total payment amount and payment method
• Property condition requirements (broom clean, all belongings removed)
• Key return requirements (all keys, garage openers, etc.)
• Release of all claims (tenant waives right to sue)
• Forfeiture clause if tenant doesn't comply
- Do I need an attorney to draft the agreement?
Not required, but recommended for amounts over $2,000 or complex situations. Many attorneys charge $200-$500 for a simple cash-for-keys agreement.
Common Cash for Keys Mistakes
Local Requirements in Major California Cities
What If Cash for Keys Fails?
If the tenant refuses your offer or breaks the agreement, you have options:
• Increase your offer (if it makes financial sense)
• Proceed with formal eviction
• Sell the property to a cash buyer who handles problem tenants
Frequently Asked Questions
- Is cash for keys taxable income for the tenant?
Generally yes. Amounts over $600 may require issuing a 1099-MISC. Consult a tax professional.
- Can I offer cash for keys after starting eviction?
Yes. Many cases settle with cash-for-keys during the eviction process. It's never too late to negotiate.
- What if the tenant leaves belongings behind?
California law requires storing abandoned property for 15-18 days. Include abandoned property terms in your agreement.
Part of Our Complete Guide
Complete California Eviction Process Guide for Landlords [2026]Read the full guide for more in-depth information on this topic.
Frequently Asked Questions
How much should I offer for cash for keys in California?
Typical offers range from $500-$5,000 depending on your market, how quickly you need possession, and the tenant's circumstances. Consider what eviction would cost you in legal fees and lost rent.
Is cash for keys legally binding in California?
Yes, when properly documented. Your agreement should include: payment amount, move-out date, condition requirements, key return, and release of claims. Have both parties sign and get it notarized.
What if the tenant doesn't leave after accepting cash for keys?
If the tenant breaches the agreement, you'll need to proceed with formal eviction. Structure your agreement with partial payment upfront and remaining payment only after keys are returned.
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