Cash for Keys: Legal, Voluntary and Often Unnecessary

Cash for keys is a written agreement in which a landlord pays a tenant to move out by an agreed date and hand back the keys. In California it is legal when it is genuinely voluntary, put in writing and consistent with state law and any city ordinance, and it cannot be used to make a tenant give up protections the law says cannot be waived. When the goal is to sell, it is often unnecessary: a rental can be sold with the tenant in place, and a written comparison shows whether paying for a vacancy actually nets more.

This article is part of our tenant-occupied rentals knowledge center. The full picture of selling with tenants is in the pillar, selling a rental with tenants in Southern California.

What is cash for keys?

The phrase covers any negotiated move-out where the tenant receives something of value in exchange for leaving. A typical agreement states:

• The date the tenant will deliver possession and return the keys
• The amount and how it is paid, often part at signing and the rest when the unit is empty
• What happens to the security deposit and any unpaid rent
• The condition the unit is left in, and what may stay behind
• That the tenant entered the agreement voluntarily and had the chance to get advice

Landlords usually reach for it in one of three places: before a sale, when they want the property vacant; in a dispute, instead of going to court; or when a no-fault reason to end the tenancy is unavailable or uncertain.

Is cash for keys legal in California?

Yes, with conditions. No California statute bans a landlord and tenant from agreeing that the tenant will leave in exchange for a payment. Several statutes shape what such an agreement can and cannot do:

• A written surrender agreement counts. Civil Code section 1946.2, subdivision (b)(1)(K), lists as an at-fault just cause a tenant who "makes a written offer to surrender that is accepted in writing by the owner, but fails to deliver possession" at the agreed time. In plain terms, the Tenant Protection Act recognizes a written, mutual move-out agreement.
• Rights cannot be signed away. Section 1946.2, subdivision (j), says any waiver of the rights in that section is void. Civil Code section 1953 separately voids lease provisions in which a tenant waives certain rights, including deposit and notice rights. An agreement that tries to trade money for those protections, rather than for a voluntary move, risks being unenforceable.
• Pressure is unlawful. Civil Code section 1940.2 makes it unlawful for a landlord, for the purpose of influencing a tenant to vacate, to use threats or menacing conduct that interferes with the tenant's quiet enjoyment, to commit a significant and intentional violation of the entry rules in section 1954, or to threaten to disclose immigration or citizenship status. Repeated unannounced visits to "discuss the offer" can cross that line.
• Cities can add rules. Where a city has its own rent or just-cause ordinance, as Pomona and Long Beach do, check whether it sets requirements for buyout or move-out agreements before you make an offer.

Mr. Cali Offers is not a law firm. Whether a particular agreement is enforceable depends on its wording, the tenancy and the city, so have an attorney draft or review it. A tenant who receives an offer can get help from a local legal aid office or their own attorney.

What "voluntary" means in practice

A voluntary agreement is one the tenant can decline with no consequence. That means the offer is made once, in writing, with time to consider it; the tenant can say no and keep living there on the same terms; and nobody suggests that refusing will lead to a notice, a rent increase outside the rules, or less attention to repairs. If the honest answer to "what happens if the tenant says no?" is "nothing changes," the offer is voluntary. If it is anything else, stop and talk to an attorney.

Cash for keys, a no-fault termination and a sale with the tenant in place

Sellers often treat cash for keys as the only alternative to an eviction. There are three different paths, and they cost different things.

Cash for keysNo-fault terminationSell subject to the lease

Who decides

Both parties agree

The owner, if a listed cause genuinely applies

The owner and the buyer

Payment to the tenant

Negotiated

Relocation assistance or a final-month rent waiver under state law, or a city's amount

None

Can the tenant refuse?

Yes

Not if the notice is lawful, but it can be contested

Nothing is asked of the tenant

Rent while you wait

Until move-out, then lost

Until move-out, then lost

Collected through closing

Main risk

No agreement, or an unenforceable one

A void notice and a restarted clock

A lower investor price

Cost to you

-

-

-

Under the Tenant Protection Act, the statutory amount for a no-fault termination is one month of the rent in effect when the notice is issued, paid within 15 calendar days of the notice, or a written waiver of the final month's rent. The statute also says that payment is credited against relocation assistance required by any other law. A city ordinance may require more. Neither amount is a ceiling or a guide for a voluntary agreement, which is whatever both sides accept.

Why it is often unnecessary when you sell

A vacancy is only worth buying if the property is worth more empty by more than the vacancy costs. The costs are easy to underestimate: the payment itself, the rent you stop collecting once the tenant leaves, the turnover work before the unit shows, the carrying costs during a listing, and the chance that the tenant takes the money and the date slips. Against that, an investor buying with the lease in place pays for the rent roll and skips every one of those lines.

That is why the two numbers on a tenant-occupied property price both paths. The cash column prices the building as it is, with the tenant, the current rent and the lease. The open-market column prices it occupied and vacant, and subtracts the cost of getting to vacant line by line. If the vacant price minus those lines is not clearly higher, the payment buys nothing. The same comparison on a Long Beach building is laid out in buying a Long Beach duplex subject to the existing lease instead of paying cash for keys.

When paying for the vacancy can net more

It does happen, and when it does the written recommendation says so. Delivering the property vacant and listing it tends to win when:

• The tenant already wants to move and asks for help doing it, so the agreement is simple and truly mutual.
• The property is a single-family home or a duplex that owner-occupants compete for, and the occupied-to-vacant price gap is wide.
• The current rent is well under the market and capped, which depresses what an investor will pay.
• You have the time to carry the property through the vacancy and a listing period.

In those cases you are introduced to a designated local expert, an independently licensed California agent who works that neighborhood. Mr. Cali Offers does not list houses. The open-market read is a preliminary estimate, not an appraisal. If an estate or a court needs a certified appraisal, that is done by a licensed appraiser; see estimate, CMA, appraisal or offer.

What this looks like in practice

These are the kinds of files that come in, described without names or figures.

• An owner who already offered a tenant a move-out payment, was turned down, and wants to know what the property brings with the tenant staying.
• A duplex in Ontario where one tenant plans to leave anyway and the other has lived there for years, so the question is whether one vacancy changes the price enough.
• A rental near the University of La Verne with student tenants on a lease that ends on its own, where waiting nets more than paying anyone to leave early.

Before you offer anyone money

Get the two numbers first. If the property nets as much or more sold with the tenant in place, there is nothing to negotiate. If vacant clearly wins, take the comparison to an attorney and let them write the agreement. The AB 1482 rules that shape both paths are in the Tenant Protection Act (AB 1482) and a sale.

Read how we handle tenant-occupied rentals, or send the address with the lease terms. You can also call (909) 498-3977. There is no cost and no obligation to get the two numbers and the written report.

Sources

• California Civil Code section 1946.2 (just cause, written offer to surrender, relocation assistance, waiver void): leginfo.legislature.ca.gov (accessed October 31, 2026)
• California Civil Code section 1940.2 (conduct to influence a tenant to vacate): leginfo.legislature.ca.gov (accessed October 31, 2026)
• California Civil Code section 1953 (waivers of tenant rights void): leginfo.legislature.ca.gov (accessed October 31, 2026)
• California Civil Code section 1954 (landlord entry and notice): leginfo.legislature.ca.gov (accessed October 31, 2026)
• City of Pomona, Rent Stabilization Program: pomonaca.gov (accessed October 31, 2026)
• City of Long Beach Municipal Code chapter 8.99, Just Cause for Termination of Tenancies: library.municode.com (accessed October 31, 2026)

Mr. Cali Offers is not a law firm and does not draft or advise on move-out agreements; have an attorney review any agreement before it is offered or signed. Cash offers come from independent buyers and investors who buy for their own account and may resell for profit; a cash offer is generally below what the open market would bring. Any value shown is a preliminary estimate, not an appraisal. Nothing here is legal, tax or financial advice.