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Verella’s Round-Up: Leasing Tips for the New Year

 

verella osborne


Statutory and technology changes have created some new opportunities and some new risks for property owners. Here are a few ideas about how to improve your lease documents in the ever-changing world of property management.

  1. Interest rate disclosures: Many landlords correctly update the Chicago Security Deposit Interest Rate in the body of the lease, but neglect to attach the current bilingual disclosure. This is a breach of the CRLTO. For 2019, the interest rate remains 0.01%.
  2. Legalization of Marijuana: If you have a “no smoking” policy in your lease, that provision should stipulate that “no smoking” encompasses the use of marijuana, vaping or electronic cigarettes, cigars, pipes, etc. Medical marijuana users should be required to show their prescription. Even the smoking of marijuana for medically approved purposes may be banned from building interiors in buildings with a clearly-defined “no smoking” lease provision. Medical marijuana may not be prohibited for those with valid prescriptions, but may be restricted to exterior areas so other residents are not exposed to the smoke.
  3. Service and Assistance/Emotional Support Animals: Too many leases have a “no animals/pets” policy without noting that service or legal assistance/emotional support animals are exempted from this prohibition. This can lead to fair housing discrimination problems. Too many leases also prohibit certain types or breeds of animals. No type of animal may be prohibited as a legal service or assistance animal, except in very limited circumstances. Finally, too many applications ask questions about disabilities or service animals. Such questions are prohibited under FHA laws.
  4. Electronic Payments: If you accept electronic payments, the lease should state that no payments will be accepted once a 5-Day Notice has expired. If each tenant has a separate account, close that account after the notice expires (remember to exclude weekends and holidays from the 5-day count). If it’s a general account, you must monitor the account for any payments and notify your eviction attorney immediately. Remember that the acceptance of a partial payment will void your notice and your lawsuit in the city of Chicago. If a payment is made after the 5-day period passes, your attorney may direct you to refund the deposit to the tenant, contact the tenant and offer a court-enforced installment payment plan, or bring your refund to court and request permission to accept the partial payment as “use and occupancy.”
  5. Utility Payments Charged Back to Tenants: If you pay a utility and invoice tenants for their proportionate share, the proportionate share formula must be stipulated in the lease. In addition, you must attach a copy of the utility bill to the invoice. Such payments must be designated as “additional rent” so they may be included in a 5-Day Notice, if necessary. In my own experience, I believe it is simpler and more cost-effective to increase monthly rent and advertise that it includes those utilities.

FINAL NOTE regarding landlord’s e-mail or text messages to tenants – technology has made communicating with tenants and providing non-legal notices, such as 48-hour access and repair notices, much easier than in the past. However, last year we had two very unpleasant surprises when tenants produced text messages in eviction court that were extremely damaging to the landlords’ lawsuits. Regardless of your frustration, anger – or personal relationship – with a tenant, NEVER hit “send” until you review your message as though you were standing in front of a judge. Once sent, these messages cannot be pulled back – and never disappear!

 

 

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