When a foreclosure sale is imminent, some mortgage lenders will offer the
homeowners an incentive called “Cash for Keys.” Under this
program, the lender will pay the homeowner cash to convince the homeowner
to vacate the house in a timely manner.
The Cash for Keys program has benefits for both the lender and the homeowner.
Homeowners dealing with a foreclosure are often short on money and often
need financial assistance to hire a moving company and/or pay the security
deposit and down payment for an apartment. Cash for Keys will usually
provide the homeowner with a few thousand dollars to get this process started.
In return, the mortgage lender does not have to finish the foreclosure
sale or evict the homeowners, which saves the company time and money.
Additionally, Cash for Keys may protect the value of the home. Some homeowners
who are forcibly evicted from their houses after a foreclosure seek revenge
on the bank by trashing the house, breaking appliances, and causing thousands
of dollars in damage to the property. The Cash for Keys agreement almost
always stipulates that the homeowner must clean the house and avoid causing
any further damage.
In general, the mortgage lender will offer the homeowner about 1% of the
home’s value. For example, a person living in a $250,000 home may
receive a Cash for Keys offer of $2,500. However, the amount of the offer
(just like the offer itself) is entirely up to the lender.
If you have been offered a Cash for Keys settlement, or would consider
accepting Cash for Keys to leave a foreclosed home, it is important to
speak with an attorney. Your attorney may be able to negotiate an agreement
that gives you more money exchange for vacating the home earlier, or could
give you more time before you need to leave the house.
If you are unsure of what to do with a Cash for Keys offer, contact Loan
Lawyers today. Our attorneys will review your agreement and will make
sure that your rights are protected. To schedule a free and confidential
consultation with our office about your foreclosure matter, contact us
today by calling (888) FIGHT-13 (344-4813).