Consumer Alert: “CASH FOR KEYS” – INFORMATION FOR CONSUMERS AND DRE LICENSEES

“CASH FOR KEYS” – INFORMATION FOR CONSUMERS AND DRE LICENSEES

The challenge to successfully market REO properties has given rise to a growing practice known as “cash for keys”. The Department of Real Estate (“DRE”) has been receiving questions and complaints from consumers about “cash for keys” solicitations. This article is intended to provide some guidance for consumers and licensees when involved in a “Cash for Keys” program to minimize any misunderstandings or violations of the law.

“Cash for Keys” Programs
When a lender takes a home back as a result of a foreclosure action, it becomes responsible for that property. The longer the lender has to wait to sell the property, and the more money it has to spend to repair damage to and/or to maintain the property, the greater will be its ultimate loss. The consequences of foreclosure and the looming legal eviction action affects the prior resident owner of the foreclosed property and/or the tenant(s) living in the property the same way – they must, unless there is an existing landlord-tenant rental or lease agreement which survives the foreclosure by law, or a written agreement with the new owner/lender to maintain or modify the tenancy, vacate the property in a relatively short period of time.

Read on: ConsumerAlert_Cash4Keys.pdf (application/pdf Object)