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What is Cash for Keys?

Are you keeping your foreclosed home in good repair? If yes, then you are in luck -- the bank will most likely want to ensure that it stays that way, and they'll pay you to do that. That's known as Cash for Keys, a program designed to expedite foreclosed homeowners in moving out while protecting the bank's assets; namely, the home.

How does it work? It's pretty simple, actually. The bank contacts the homeowner, makes an offer that includes a dollar value and a set move-out date. The homeowner can choose to accept it or negotiate (negotiating this will be covered in a future post). Once the paperwork is signed and the agreement is made, all parties are locked in and nothing else can be negotiated.

Also, it's important to look at the fine print of a Cash for Keys settlement. It'll include clauses about keeping the home in good repair, not taking fixtures or wiring, and basically maintaining it so that the bank won't have a headache of a property when they try to settle it. On the date of  “Cash for Keys exchange, It’s imperative you leave the home in broom clean condition and NOTHING left behind. I’ve seen the check sent back over a few items like wood and garbage left in the back yard. OUCH! Yes, it's essentially a bribe for good behavior, but try to think about it from the bank's perspective -- with all the news stories of homes being stripped to the bone, it makes sense for them to try and protect their asset.

For the homeowner, it can be a good deal. After all, you're going to move out anyway, so why not get a little extra cash to help with your transition? Sometimes, a Cash for Keys settlement is proposed once a Notice of Foreclosure is served. Remember, it is absolutely necessary that the homeowner is happy with the deal before he or she accepts it. Once the paperwork is signed, that's it -- no take-backs, no begging or pleading, no extra negotiating for more time or more money.

That means that you'll have to consider everything, from value to date, when you weigh the offer. And when you try to counter-offer, remember that banks appreciate a polite and professional exchange rather than demanding or rude. Kill them with kindness; you'll find that your bargaining power will increase quite a bit under that philosophy.

Israel Gonzalez

Real Estate Broker


Click here to contact me by email.

The views published here are the opinions of the writer and are not a substitute for legal counsel.



Max said:

There are many people who are getting homes on rent. By http://best-essay-writing-service.reviews/EssayPro-com-review/ people need to pay cash to get keys of home. There is an agreement between both parties. People can live in rental homes easily and can enjoy life also.

# February 27, 2018 8:02 AM
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