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Foreclosure - What does “Cash For Keys” Mean

Posted on May 6th, 2009 by Kevin McGrath

When a foreclosure takes place the home is often still occupied. It is in the banks best interest to have the home vacated as soon as possible, in the best condition possible.

What will generally happen is that the bank may make a “Cash For Keys” offer. What this means is that they may  be willing to financially compensate the occupant for vacating the property in a timely manner. The bank does not generally care if it is the owner or a tenant; just that it is the person or persons currently occupying the property.

The bank likes for the vacate date to be sooner rather than later; generally no more than 30 days.

All personal property, and I do mean all, must be removed from the property. This is very important. When the representative from the bank comes to the property, they will generally have a check for the occupant, but if the property is not ready and free of all personal belongings, the check is not released. Notice I said property, not house. Ther can’t be anything left anywhere on the property that is personal in nature.

Now, that being said, the house can’t be stripped either. I have seen situations where the occupant removed all of the appliances, the heat pump, the furnace, even the doro knobs, and they still thought they were getting a check. Not happening.

If it is done right, a Cash For Keys can soften a tough situation for an occupant. If it is done right, the bank shows up with a check, the occupant hands them the keys, they get a check, and walk away.

Not a bad deal - getting paid for doing something they were going to have to do anyway.

**Please keep in mind that this is a general description of the cash for keys process. It is generally a voluntary program, meaning neither side is obligated to participate. Also, each bank has a different program in regards to offering cash for keys. Some may not even offer it.

Kevin McGrath - Broker/Owner
RE/MAX BRAVO
www.fredva.com
Licensed in the State of Virginia

Tags: cash for keys, foreclosure

This entry was posted on Wednesday, May 6th, 2009 at 9:58 am and is filed under Buying a Home. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.