“Cash for Keys” Agreements in Ontario: What They Are & When They Might Be Used
What Is a “Cash for Keys” Agreement?
In Ontario, a “Cash for Keys” agreement is when a landlord offers a tenant money or another incentive to voluntarily move out of a rental unit. It’s a mutual agreement to end a tenancy — often used when the landlord wants vacant possession for renovation, sale, or personal use.
The term comes from the idea that the tenant hands over their keys in exchange for payment to help with relocation.
When Are “Cash for Keys” Offers Used?
Landlords may propose a “Cash for Keys” arrangement for various reasons, such as:
Renovations or repairs that don’t meet the criteria for an N13 notice
Selling the property where the buyer wants vacant possession
Owner or family move-in, as an alternative to serving an N12 notice
Resolving disputes or avoiding lengthy Landlord and Tenant Board (LTB) hearings
For tenants, these offers can help cover moving expenses — but only if the agreement is voluntary and informed.
Are “Cash for Keys” Agreements Legal in Ontario?
Yes, but only when both parties freely agree.
Under the Residential Tenancies Act, 2006 (RTA), a tenancy can end “by agreement between the landlord and the tenant” (section 47). However, coercion or pressure makes an agreement invalid, and the tenant can bring the issue to the Landlord and Tenant Board.
To be legally valid, the agreement must:
Be in writing
Clearly state that both parties agree to end the tenancy
Include the vacate date
Be signed and dated by both landlord and tenant
The LTB’s Form N11 – Agreement to End the Tenancy is the recommended template.
Guidelines for Landlords
If you’re a landlord considering this route:
Never pressure or threaten the tenant
Use Form N11 and clearly outline any payments
Only pay after the tenant vacates and returns the keys
Be transparent — explain the tenant’s right to refuse
Avoid retaliation — don’t offer “Cash for Keys” after a tenant files a complaint
These steps ensure the agreement remains enforceable and avoids potential LTB challenges.
Guidelines for Tenants
If you’re a tenant offered a “Cash for Keys” deal:
You can say no. You don’t have to accept.
Get everything in writing. Use the official LTB N11 form.
Understand your rights. Once you vacate, you lose the right to return.
Negotiate fairly. Consider moving costs and rental market changes.
Seek advice. If you feel pressured, contact a legal representative.
Typical “Cash for Keys” Amounts in Ontario
There’s no fixed rule for how much landlords should offer.
It depends on:
The difference between current rent and market rent
The urgency of the landlord’s need for possession
The tenant’s relocation costs
Amounts can range from a few hundred dollars to several months’ rent — it’s entirely negotiable.
When to Get Legal Advice
Before entering into a “Cash for Keys” arrangement, it’s smart to seek legal advice.
Tenants can contact a local legal clinic or the Landlord and Tenant Board for free information.
Landlords should speak with a licensed paralegal or lawyer experienced in Ontario housing law.
We help both landlords and tenants review, negotiate, and formalize “Cash for Keys” agreements that comply with the Residential Tenancies Act.
Final Thoughts
“Cash for Keys” agreements can be a lawful and practical solution when handled correctly.
For both landlords and tenants, the key is transparency, fairness, and informed consent.
Done right, this type of agreement can save time, reduce stress, and avoid unnecessary Landlord and Tenant Board proceedings.
Need help with a Cash for Keys agreement? CONTACT US!
*This blog is for informational purposes only and does not constitute legal advice.
