User deleted post
Cash for keys or sell at a discount.
There’s no easy way out of this that’s legal. He knows what he’s doing if he’s asked for $60k cash already. That means you doing anything illegal will go sideways.
Hire a lawyer and negotiate a reasonable buyout. Won’t be $60k but it will be expensive. But you’re a business person right? Make a deal and solve your problem. Anyone talking about a buyout must be either reasonably informed or well advised. Anything “semi-legal” is going to get you sued and cost way more.
Any real estate attorney is going to tell you to do cash for keys, especially in L.A. because there’s a 50/50 chance you will go to trial for illegal eviction and a 100% chance you’ll spend 300 hr+ on an attorney, easily going into more than the 10k territory if/when you go to trial. This is significantly more than you would to hire him to just draft a deal with these tenants.
You bought the property by over leveraging yourself and without adequate cash flow from existing tenants to support your debt, and now you want to make it the tenants problem. This was your choice, and you should deal with it without screwing over tenants who are paying you every month.
Whoo boy, what would possess you to rent property in LA?
First off, afaik, you can raise rent. 4% a year according to this 2 year old document I am reading. I don't know what the current limit is. Too lazy to try and find it.
Okay, how to get rid of a tenant in a rent controlled apartment.
You may be able to issue a notice that you intend to occupy the dwelling yourself. You will have to pay a Relocation Assistance fee to the tenant. Check the law to make sure you can do this in a rent controlled fourplex.
You will have to occupy it for a number of months (six I think) before you can put it back on the market. You'll have to decide if it is worth it to you or not.
but my new prop manager said they mentioned a cash for keys price of 60k.
Hahahahaha no. I don't know what that PM is thinking.
User deleted comment
8mo
What if the identical unit with newer tenants have a yr left on their lease and the longer tenants are MTM?
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How long is the lease? Why is not renewing not an option?
I don’t know the whole story, but what you’re sharing here makes you look like a horrible person. I know there was a lot that didn’t go your way, but these tenants are people and they are paying what they owe and are not breaking the lease. I sympathize with “what you could get” for the unit, but don’t punish others for your greed. That being said, my advise is to improve the units as they become vacant so you can increase the rent for the next tenants. And maintain and improve the property to increase its value.
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8mo
Then sell it
Then the $9000 extra you could expect from market rent* wouldn't put you in the black, so why are you trying? Sell the place for what you can get and walk away.
*If you can't make your nut on ten months of rent a year, you'll lose money long-term. Months 11 and 12 are happy bonuses for having good long term tenants.
If they are complying with their obligations then you can't evict them.