Selling a house with bad tenants is possible, but it takes planning and knowing your legal rights. You have several options including waiting for the lease to end, offering cash for keys, or selling the property as-is to a cash buyer who will handle the tenant problem for you.
Being a landlord can be tough. When you have bad tenants who don’t pay rent, damage your property, or refuse to let buyers view the home, it feels like you’re stuck. But you’re not. This guide will walk you through every step of selling your house with bad tenants in Colorado. We’ll keep things simple and show you the fastest ways to move on.
Understanding Your Rights as a Colorado Landlord
Before you can sell your house, you need to know what you can and can’t do legally.
What Does Colorado Law Say?
In Colorado, landlords must honor existing lease agreements when selling rental property, and tenants have the right to stay until their lease expires, even under new ownership. This means you can’t just kick tenants out because you want to sell.
The type of lease matters a lot:
- Fixed-term lease: If tenants are under a fixed-term lease, the new owner must honor the lease terms until the expiration date unless the tenant agrees to move
- Month-to-month lease: The landlord or buyer can terminate the lease with proper notice, typically 21 days under Colorado law
Your Legal Obligations
When selling a rental property, the seller must disclose the existence of tenants and provide copies of all lease agreements to the buyer. You can’t hide tenant problems from potential buyers.
You also need to:
- Give proper notice before showings
- Keep the property safe and livable
- Transfer the security deposit to the new owner or return it to the tenant after legal deductions
Special Rules for Colorado Cities
Some Colorado cities have extra rules:
- Denver: Landlords must give at least 21 days’ notice before showing the property
- Boulder: Landlords must provide 60 days’ notice before terminating a lease due to sale
Why Bad Tenants Make Selling Harder
Bad tenants create real problems when you’re trying to sell. Let’s talk about what makes them “bad” and how it affects your sale.
What Makes a Tenant “Bad”?
Bad tenants do one or more of these things:
- Don’t pay rent on time (or at all)
- Damage your property
- Refuse to let you show the home to buyers
- Break lease rules
- Scare off potential buyers with negative comments
- Make the property look messy or dirty
How Bad Tenants Hurt Your Sale
The problems stack up fast:
- Lower offers: Buyers see problems and offer less money
- Fewer interested buyers: Many buyers want a clean, empty home
- Longer selling time: The one buyer that may pay $10,000 or $20,000 more than anyone else may back away from your property if you keep bad tenants there
- Deal breakers: Some buyers walk away completely
More often than not, tired landlords don’t know the process or procedure for removing tenants, and even experienced investors get turned off by bad tenants.
The Real Cost of Waiting
Every month you wait costs you money:
- Lost rent if tenants aren’t paying
- Ongoing mortgage payments
- Property taxes and insurance
- More damage to the property
- Legal costs if you need to evict
Your Options for Selling With Bad Tenants
You have four main choices. Each one works better for different situations.
Option 1: Wait for the Lease to End
This is the simplest path if your tenant’s lease ends soon.
When it works:
- Lease ends in 1-3 months
- You can afford to wait
- Market conditions are good
The downsides:
- You keep paying the mortgage
- Tenants might damage the property more
- You lose time and money each month
Option 2: Offer Cash for Keys
Cash for keys is a way for a landlord to convince a tenant to vacate a property in exchange for an agreed-upon sum. Think of it as paying them to leave early.
How it works:
- Talk to your tenant about leaving
- Offer them money (usually $500 to $3,000)
- Put the agreement in writing
- They move out and give you the keys
- You pay them the agreed amount
Why it works:
- Cash for keys is often less expensive than going through a lengthy eviction process, and evictions can take months and cost between $4,000 and $7,000
- Much faster than eviction
- Avoids court and legal fees
- Tenants leave on better terms
What to offer:
- Half a month’s rent plus security deposit
- One full month’s rent
- Enough to cover their moving costs
Important tips:
- Never give cash for keys until the tenant has moved everything out and signed an agreement saying they are giving you back the unit voluntarily
- Get everything in writing
- Keep receipts of payment
- Take photos of the property after they leave
Option 3: Start the Eviction Process
Sometimes you need to evict. This is the legal way to remove tenants who break their lease.
Valid reasons to evict in Colorado:
- Not paying rent
- Breaking lease terms
- Illegal activity
- Property damage
The eviction timeline:
- Give written notice (3-10 days depending on reason)
- File eviction lawsuit if they don’t leave
- Attend court hearing
- Get court order
- Sheriff removes tenant
What it costs:
- Filing fees: $200-$300
- Attorney fees: $1,000-$3,000
- Lost rent during process
- Time: 2-6 months in Colorado
The reality: Evictions can take anywhere between nine and 18 months to complete from start to finish in some cases. That’s a long time to wait.
Option 4: Sell As-Is to a Cash Buyer
This is often the fastest and easiest option. You sell the house with the tenants still living there.
How it works:
- Cash buyers purchase properties in any condition
- They handle the tenant situation after closing
- You get paid and walk away
The benefits:
- No repairs needed
- Close in 7-14 days typically
- No showings or open houses
- No real estate agent commissions
- Cash buyers deal with the tenants
The trade-off:
- You might get less than market value
- But you save on repairs, commissions, and carrying costs
Companies like WeBuyColorado buy houses with tenant problems all the time. We handle the legal process and work with tenants after we buy.
Step-by-Step: How to Sell Your House With Bad Tenants
Let’s break down exactly what to do, step by step.
Step 1: Review Your Lease Agreement
Pull out your lease and read it carefully. Look for:
- When does the lease end?
- What are the notice requirements?
- Are there any clauses about selling?
- What can you legally do right now?
This tells you what options you have.
Step 2: Document Everything
Start keeping records of:
- Late or missing rent payments
- Property damage with photos
- Lease violations
- All communication with tenants
These records help if you need to evict or negotiate.
Step 3: Talk to Your Tenant
Have an honest conversation. Sometimes tenants will work with you if you:
- Explain your situation
- Listen to their concerns
- Offer solutions that help both of you
Be calm and professional. Getting angry makes things worse.
Step 4: Decide on Your Strategy
Based on your situation, pick your best option:
- Can you wait a few months? Wait for lease to end
- Need to sell now? Consider cash for keys or cash buyer
- Tenant is impossible? Start eviction process
Step 5: Take Action
Once you decide, move forward:
If offering cash for keys:
- Put your offer in writing
- Set a clear move-out date
- Explain what you expect (clean property, all items removed)
If evicting:
- Hire a landlord-tenant attorney
- Follow all legal steps exactly
- Keep detailed records
If selling as-is:
- Contact cash buyers for offers
- Compare offers and terms
- Choose the one that fits your timeline
Step 6: Prepare for the Sale
Even with bad tenants, you can help your sale:
- Clean up the outside if possible
- Fix obvious problems (if you’re selling traditionally)
- Gather all paperwork about the property and tenants
Cash for Keys: A Deeper Look
This strategy deserves more attention because it works so well.
Why Tenants Accept Cash for Keys
Most tenants agree because:
- They get money to help with moving costs
- They avoid an eviction on their record
- They get time to find a new place
- It’s a win-win situation
If they can’t afford rent, the idea of getting cash to vacate can be a win-win situation for both parties.
How Much Should You Offer?
Consider these factors:
- What would eviction cost? ($4,000-$7,000)
- How much rent are you losing each month?
- What’s the property worth after they leave?
- How fast do you need them gone?
A typical offer is $1,000 to $2,000. That’s way less than the cost of eviction.
The Cash for Keys Agreement
Always negotiate in good faith and involve a local real estate attorney or use a cash for keys agreement from reputable organizations. Your written agreement should include:
- The exact dollar amount
- The move-out date
- Condition you expect the property in
- When you’ll pay the money
- Both signatures
Common Mistakes to Avoid
Don’t make these errors:
- Paying before they move: Always wait until they’re completely out
- No written agreement: Get it in writing or it didn’t happen
- Offering too much: Don’t pay more than eviction would cost
- Skipping the security deposit: Still deduct for damages from their deposit
- Not taking photos: Document the property condition after they leave
What If They Don’t Leave?
Sometimes tenants take the money and don’t leave. If this happens:
- You still have the signed agreement
- Move forward with eviction
- The agreement shows their intent to leave voluntarily
- You may be able to deduct the payment from damages owed
Selling to Investors and Cash Buyers
Let’s talk about why this option makes sense for many landlords.
Who Are Cash Buyers?
Cash buyers are:
- Real estate investors
- Companies that buy houses quickly
- People who understand tenant problems
- Buyers who purchase properties as-is
Investors often buy properties “as-is,” making them an ideal option when selling a house with bad tenants.
How It’s Different From Traditional Sales
Traditional sale vs. cash sale:
| Traditional Sale | Cash Sale |
| Need to make repairs | Sell as-is |
| Pay agent commission (5-6%) | No commission |
| Takes 30-90 days to close | Close in 7-14 days |
| Multiple showings needed | One quick visit |
| Buyers may back out | Guaranteed closing |
| Deal with tenant problems yourself | Buyer handles tenants |
What to Expect
The process is simple:
- Contact the buyer: Fill out a form or make a call
- Quick property review: They look at your house (often with tenants there)
- Get an offer: Usually within 24-48 hours
- Accept or negotiate: No pressure to accept
- Close fast: Pick your closing date
Will You Get Less Money?
Yes, cash offers are typically 70-85% of market value. But consider what you save:
- No repairs (can save $5,000-$20,000)
- No agent commission (saves 5-6%)
- No carrying costs while waiting for sale
- No risk of deals falling through
- Time and stress saved
The real question: what’s the house worth if you can’t sell it because of bad tenants?
How to Find Reliable Cash Buyers
Look for buyers who:
- Have good online reviews
- Are transparent about their process
- Don’t charge any fees
- Give you time to think about offers
- Have experience with tenant situations
WeBuyColorado has helped many tired landlords sell properties with tenant problems. We buy houses as-is and handle all the paperwork.
Legal Considerations You Can’t Ignore
Selling with bad tenants involves legal issues. Don’t skip this section.
Fair Housing Laws
You must follow fair housing rules. You can’t:
- Discriminate based on race, religion, or other protected classes
- Treat tenants differently because of who they are
- Retaliate against tenants for reporting problems
Even with bad tenants, follow the law.
Notice Requirements
While Colorado law doesn’t specifically require notifying tenants of your intent to sell, providing written notice is a professional courtesy and helps maintain good relations.
Give proper notice for:
- Property showings (usually 24 hours)
- Lease termination (21 days for month-to-month)
- Any changes that affect them
Warranty of Habitability
The buyer inherits the obligation to maintain habitable premises for existing tenants. Even if you’re selling, you must:
- Keep the property safe
- Make necessary repairs
- Provide heat, water, and electricity
Retaliation Protection
Colorado law prohibits landlords from terminating a tenancy or increasing rent as retaliation against tenants who have complained about housing conditions. Don’t evict a tenant just to make the sale easier if they’ve recently complained about legitimate problems.
Get Legal Help When Needed
Consider hiring a landlord-tenant attorney if:
- The situation is complicated
- You’re not sure about your legal rights
- The tenant is threatening legal action
- You need to evict
Legal fees now can prevent bigger problems later.
Tips for Managing the Sale Process
These practical tips will help things go smoother.
Keep Communication Open
Talk to your tenants regularly:
- Tell them about your plans to sell
- Listen to their concerns
- Update them on the process
- Be respectful and professional
Playing open cards with the tenant by keeping communication lines open might be the easiest way to sell the property.
Be Honest With Buyers
Don’t hide tenant problems:
- Disclose all issues upfront
- Share the lease agreement
- Explain what you’ve tried to fix the situation
- Let buyers make informed decisions
Hiding problems can kill a deal or cause legal trouble later.
Offer Incentives to Tenants
Consider offering:
- Rent discounts during the sale
- Help with moving costs
- A positive rental reference
- Flexibility with move-out timing
Small incentives can make tenants more cooperative.
Set Realistic Expectations
Understand that:
- Your house may sell for less with bad tenants
- The process might take longer
- You may not get your ideal outcome
- Sometimes the best solution is just moving on
What About Eviction Statistics?
Let’s look at the bigger picture of evictions in America.
How Common Are Evictions?
Research shows that 2.7 million households, on average, are threatened with eviction each year in the United States. That’s a lot of families facing housing instability.
Landlords filed just over one million eviction cases in 2024 in the jurisdictions tracked by researchers.
The Cost of Eviction
Evictions hurt everyone:
- Landlords lose money on legal fees and lost rent
- Tenants get eviction records that make renting harder
- Communities lose stable residents
- Court systems get overloaded
That’s why cash for keys and other alternatives make sense.
Rising Eviction Rates
The overall eviction filing rate across tracked cities was 7.8% in 2024, meaning there were almost eight eviction filings for every hundred renter households. Some cities saw much higher rates.
This shows why finding alternatives to eviction helps both landlords and tenants.
Special Situations
Some situations need extra attention.
Inherited Property With Bad Tenants
If you inherited property with problem tenants:
- Review the existing lease carefully
- Understand what you inherited legally
- Consider selling as-is to avoid the hassle
- You’re not stuck with someone else’s problem forever
Properties Facing Foreclosure
If your property is in foreclosure and has bad tenants:
- Act fast—time is limited
- Cash buyers can close quickly
- Selling stops foreclosure
- You might save your credit
Properties Needing Major Repairs
If your property needs repairs and has bad tenants:
- Don’t make repairs with bad tenants there
- Sell as-is to a cash buyer
- Let someone else deal with both problems
- Focus on moving forward
Divorce Situations
If you’re going through a divorce and need to sell:
- Agree with your ex on the strategy
- Quick sales reduce conflict
- Cash buyers can help you both move on
- One less thing to argue about
Frequently Asked Questions
Can I sell my house if tenants refuse to leave?
Yes. You can sell to a cash buyer who will buy the property with the tenants in place. They handle getting the tenants out after closing.
Do I have to tell buyers about bad tenants?
Yes. You must disclose that tenants are living there and any major problems. Hiding issues can lead to legal trouble.
How long does eviction take in Colorado?
Typically 2-6 months, but some cases take nine to 18 months from start to finish. That’s a long time to wait.
Is cash for keys legal in Colorado?
Yes. Cash for keys agreements are legal in every state in the U.S., as long as the correct protocol is followed and all relevant state and local laws are taken into consideration.
What if my tenant is destroying the property?
Document everything with photos and videos. Consider cash for keys to get them out fast, or start eviction immediately. Waiting makes it worse.
Should I wait for the lease to end or offer cash for keys?
It depends on:
- How long until lease ends
- How much the delay costs you
- What you can afford
- How bad the situation is
If the lease ends in 1-2 months, waiting might work. If it’s 6-12 months, cash for keys or selling as-is makes more sense.
Can the new owner kick out my tenants?
In Colorado, tenants have the right to remain in the rental property after a sale until the lease or rental agreement expires. The new owner must honor the lease.
What happens to the security deposit when I sell?
If a landlord sells the property, the tenant’s security deposit must be transferred to the new landlord or returned to the tenant after any legal deductions.
Final Thoughts
Selling a house with bad tenants feels overwhelming. You’re dealing with problem people, legal rules, and money stress all at once. But you have options, and you can move forward.
The key is picking the right strategy for your situation:
- If you have time: Wait for the lease to end or start eviction
- If you need speed: Offer cash for keys or sell to a cash buyer
- If tenants are impossible: Sell as-is and let someone else handle them
You are better off ending their tenancy and having one unit vacant for a month or two, as you will make up for the lost rent often times by 10X in a higher offer.
Remember that every month you wait costs money. Mortgage payments, taxes, insurance, and stress all add up. Sometimes the best move is to accept a fair cash offer and move on with your life.
At WeBuyColorado, we’ve helped countless landlords escape difficult tenant situations. We buy houses as-is, close fast, and handle all the tenant issues after we buy. If you’re a tired landlord ready to move on, we can help.
Don’t let bad tenants keep you stuck. You have the power to solve this problem and move forward. Take the first step today.
Ready to sell your house with bad tenants? Contact us for a no-obligation cash offer. We can close in as little as 7 days and take the tenant problem off your hands. No repairs, no commissions, no stress. Just a simple solution that works.