Cash-for-Keys in Ontario: What Landlords Need to Know
Not every dispute needs an LTB hearing. Sometimes the fastest and cheapest way to get your unit back is to pay the tenant to leave on a set date. Here is how cash-for-keys works, when it makes sense, and how to make the deal stick.
Key points
- Cash-for-keys is a private deal: the tenant agrees to move out by a set date in exchange for a payment.
- It can be faster and cheaper than a contested LTB case, especially for N12 or N13 matters.
- Put it in writing with an N11, so you can go to the LTB quickly if the tenant doesn’t leave.
- Paying part on signing and the rest on move-out protects you.
Not every landlord-tenant dispute needs to go to the Landlord and Tenant Board. In some situations, the fastest and most cost-effective way to get vacant possession is a negotiated agreement where the landlord pays the tenant to leave. This is called cash-for-keys, and it is more common in Ontario than most landlords realize.
What cash-for-keys is
Cash-for-keys is an agreement where the tenant agrees to move out by a specific date in exchange for a payment. Both sides agree, and the tenant leaves without a hearing, an order or the Sheriff. The move-out should be recorded on an N11 agreement to end the tenancy, so it can be enforced if the tenant changes their mind.
When it makes sense
- A hearing is likely months away.
- Your notice or application has a real risk of being challenged.
- You need the unit back quickly to sell, renovate or move in.
- The ongoing cost of the tenancy is higher than the cost of a settlement.
It is a business decision. Many landlords find a few months’ rent to end a difficult tenancy costs less than a full LTB process, especially in contested N12 or N13 cases.
Considering a negotiated exit? We draft cash-for-keys agreements that hold up.
Book a free 20-minute call →What the agreement must include
| Term | Why it matters |
|---|---|
| Full names of landlord and all tenants | Everyone on the lease must be bound |
| Rental unit address | Identifies the tenancy |
| Exact move-out date | Needed to enforce the agreement |
| Payment amount and timing | Avoids disputes about what was promised |
| Key return and unit condition | Sets out how possession is handed over |
| Signed N11 | Lets you apply to the LTB quickly if the tenant stays |
Structuring the payment
- Agree the total amount and the move-out date.
- Have every tenant sign the agreement and the N11.
- Pay a portion on signing, if needed to secure the deal.
- Pay the balance when the tenant hands over the keys and vacant possession.
- Inspect the unit and document its condition at move-out.
Never pressure a tenant to sign. An agreement signed under pressure can be challenged.
Frequently asked questions
What is cash-for-keys in Ontario?
An agreement where a landlord pays a tenant to move out by a set date. It is usually recorded with an N11 agreement to end the tenancy.
How much should I offer for cash-for-keys?
It depends on the rent, the tenant’s situation and how long an LTB case would take. Many offers are based on a few months’ rent.
Is a cash-for-keys agreement enforceable?
Yes, when it is in writing and paired with a signed N11. If the tenant doesn’t leave, you can apply to the LTB.
When should I pay the tenant?
A common approach is part on signing and the rest when the tenant hands over the keys and vacant possession.
Can I pressure a tenant to accept?
No. Pressure or harassment can make the agreement challengeable and expose you to a tenant application.
About Robert Di Lisi
Robert is a paralegal licensed by the Law Society of Ontario and co-founder of Stonegate Legal Services, a landlord-only firm. He leads client intake and speaks at landlord seminars across the GTA. Like the rest of the team, he is a landlord himself.
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