Cash For Keys is Different Than Relocation Assistance

We are asked many times what the difference is between a cash for keys agreement and relocation assistance.  A cash for keys agreement is available to all landlords and is a method to have a tenant voluntarily move out before the end of the lease term.  Relocation assistance is financial assistance paid by the landlord to the tenant and is statutorily mandated if the landlord does not fall under an exemption to the California Tenant Protection Act, where the landlord seeks to terminate the lease without cause.

Specifically, a "cash for keys" agreement is an arrangement between a landlord and a tenant in which the landlord offers the tenant a sum of money to voluntarily vacate the rental property by a specific date. This agreement is typically used to avoid the lengthy and costly eviction process.

Key points of a cash for keys agreement include:

  1. Mutual Agreement: Both parties agree on the terms, including the amount of cash offered and the deadline for vacating the property.

  2. Incentive for Tenants: The financial incentive helps tenants cover moving expenses and encourages them to leave peacefully and without further disputes.

  3. Property Condition: Often, the agreement may include terms about returning the property in good condition, which helps landlords avoid potential damages or cleaning costs.

  4. No Formal Eviction: This arrangement allows landlords to bypass the eviction process, which can be time-consuming and public.

Overall, cash for keys agreements can provide a win-win solution, offering tenants financial assistance while enabling landlords to regain possession of their property efficiently.

Relocation assistance is financial assistance paid to the tenant by the landlord when the termination of the lease is without cause.  Payment is mandatory where the rental property is not exempt under Civil Code Section 1946, et seq.  Further, local laws can control the amount of relocation assistance the landlord must provide.  

Relocation assistance laws are designed to support tenants displaced from their residences due to certain actions, such as eviction or property redevelopment. Under these laws, landlords are required to provide financial assistance to eligible tenants, which typically includes a one-time payment to help cover moving expenses.

Key points include:

  1. Eligibility: Tenants may qualify for assistance if they are evicted without cause or if their unit is being demolished or significantly altered.

  2. Assistance Amount: The financial assistance varies based on factors like the tenant's length of residency and household income, with specific caps set by the city.

  3. Notification: Landlords must notify tenants about their rights and the availability of relocation assistance.

  4. Local Ordinances: San Diego may have additional local regulations that further define and enhance these provisions, including requirements for larger developments or specific circumstances.

Overall, these laws aim to ease the transition for displaced tenants and address the challenges posed by rising housing costs and redevelopment in the area.

Landlords need to ensure they are following the applicable tenant protection laws in order to avoid unnecessary delays and costs involved with lease terminations.  We offer a wide range of services for landlords, including drafting Surrender & Release Agreements, and offering legal advice as to the best practices for landlords under California law.


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