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Why paying a tenant to leave can save you time, money, and stress
At Centurion Real Estate Management, we help property owners make informed, strategic decisions that protect their investments and minimize risk. One of the most challenging experiences for landlords is dealing with a tenant who stops paying rent or refuses to vacate.
While eviction is sometimes necessary, it can also be costly, time-consuming, and stressful. Fortunately, there’s a practical alternative that in specific cases, can make better financial sense — Cash-for-Keys.
It might sound counterintuitive at first — paying a tenant to move out — but in many cases, this approach can save thousands of dollars and weeks (or even months) of waiting.
What Is “Cash-for-Keys”?
Cash-for-Keys is a voluntary agreement between a property owner (or their property manager) and a tenant where the tenant agrees to vacate the property by a specific date in exchange for a cash payment.
This payment acts as an incentive for the tenant to leave the home in good condition, hand over the keys, and avoid a formal eviction.
The idea became popular during the 2008 housing crisis when lenders used it to avoid costly and lengthy foreclosure proceedings. Today, it remains an effective tool for landlords facing similar situations — especially when eviction timelines are long or unpredictable.
When to Consider a Cash-for-Keys Agreement
Cash-for-Keys isn’t the right choice in every situation, but it can be the smartest business move under the right conditions. At Centurion Real Estate Management, we typically consider this approach when:
Eviction timelines are long or costly. Some counties have extended court backlogs, meaning months of waiting before you can regain possession.
The tenant is unlikely to catch up on rent. If payment plans aren’t realistic, it’s often better to move toward a solution that minimizes ongoing losses.
You want to avoid potential property damage. A tenant facing eviction may feel resentful or act destructively. Offering an incentive to leave peacefully can help protect your property’s condition.
Legal fees are high. In some areas, attorney costs can add up quickly — often exceeding what you’d offer in a Cash-for-Keys agreement.
You want a faster resolution. A well-structured Cash-for-Keys deal can resolve an occupancy issue in a matter of days or weeks, not months.
Doing the Math: Why It Often Pays Off
Let’s compare the typical costs of a standard eviction versus a Cash-for-Keys agreement.
Example:
Monthly Rent: $1,500
Average time to complete eviction and regain possession: 4 months
Option 1: Eviction
Legal Fees & Court Costs: $1,200
Lost Rent (4 months): $6,000
Lockout & Repairs: $1,500
Total Cost: $8,700
Option 2: Cash-for-Keys
Cash Offer to Tenant: $1,500
Lost Rent (2 weeks): $750
Total Cost: $2,250
That’s a savings of over $6,000 — not to mention a faster turnaround time and fewer headaches. Even in faster-moving jurisdictions, Cash-for-Keys often still comes out ahead.
It’s a simple formula:
✅ Less time waiting for court dates
✅ Less risk of property damage
✅ Less money lost overall
In the next article, we’ll break down some of the best practices for structuring an effective cash-for-keys agreement.
