Chicago, Cook County renting contract thoughts

[Michael Downs]

Pretty much described it all in the description above. New to REI. First rental after a very nice rehab in Cook County outside of Chicago. I'm comfortable with screening renters but wondering if anyone out there in Bigger Pockets land has advice on how to prevent problems, horror stories, things I should add in detail in the lease.

Appreciate any recommendations.

Thanks,

Mike

[Joseph Konney]

Hi @Michael Downs - 

We could talk about this subject all night. However, knowledge of the local law/ordinances, a solid lease, and associated documents can save a bunch of headaches and give an extra layer of lessor protection. This is especially true with the tenant friendly laws in Chicago and Cook County which the following pertains to:

In your apartment advertisement, don't include any criminal background qualifications/exclusions. 

In your apartment application:
- Include a tenant selection criteria rubric.
- Have applicant initial off on a copy and submit with the application.
- Don't include any questions about criminal background

After processing the application, send out a credit approval/rejection letter.

If approved, you may then obtain written consent to perform a background check. 
- If background check passes, send an approval letter.
- If background check doesn't pass, send a 'right to dispute letter'.
        - If disputed and applicant sends supporting evidence, perform an "Individualized Assessment" and send a 'final determination letter'. 
                 - Also, send 'Notice of Denial after PreQualification' or 'Approval' letter based on the outcome. 

The lease and lease packet I have include:
- I'm using a slightly modified version of the Chicago Investment Corporation (CIC) lease for Chicago.
- A lease addendum which set expectations and include predefined fines/fees such as lockout or lost key fees. (tenant initials)
- Condition of property checklist (Lessor/Lessee signs off on the condition at move in, initial each page too).
- A guide on how to pay rent electronically.
- Chicago: "Rate of Interest on Security Deposits" summary document (tenant initials even if there is no security deposit).
- Chicago: "Preventing Bed Bug Infestations In Apartments" guide (tenant initials received in lease docs).
- Chicago: Copy of the Chicago Residential Landlord Tenant Ordinance Summary (tenant initials received in lease docs).
- Chicago: Heat/Energy Disclosure Statement (only if tenants pay their own heat, tenant to sign)
- Chicago: Chicago Recycling Ordinance Flyer/Disclosure (tenant to sign)
- Illinois: "Protect Your Family From Lead In Your Home" guide. (tenant initials received in lease docs)
- Illinois: "Disclosure of Radon Hazzards" (only if they are known to exist or there has been a warning they exist by lessee)
- Illinois: Pre-1978 Rental Housing: Lead Based Paint or Paint Hazzard Disclosure Statement (tenant to sign)
- City Info sheet with phone numbers for utilities, municipalities, etc.
- Move Out Bonus Contract (If tenant meets all criteria at move out, I give them a bonus / rent refund for a good move out)

Security Deposits: In Chicago, the landlord must disclose the name and address of the bank where the tenant’s security deposit is held using an interest bearing account. He must also pay out interest annually to the lessee.

New as of this year is the Just Housing Law:
See: https://www.cookcountyil.gov/content/just-housing-amendment-information-housing-providers

"Why did the Cook County Board of Commissioners pass the Just Housing Amendment (JHA) to the Human Rights Ordinance?
In most cities, individuals with any kind of criminal record, even just an arrest record, are unfairly denied housing. The JHA was passed to help such individuals gain access to safe, stable and affordable housing.

The JHA:

Prohibits housing providers and landlords from denying a housing application based on juvenile and arrest records; and
Requires that landlords perform an individualized assessment prior to denying any housing."

"The Cook County Human Rights Ordinance:
This ordinance prohibits people in Cook County (including employers, landlords, property managers, real estate agents, store and restaurant owners, bankers, lenders and Cook County government officials and employees) from unlawfully discriminating against or harassing other people on the basis of that person's race, color, sex, age, religion, disability, national origin, ancestry, sexual orientation, marital status, parental status, military discharge status, source of income (including use of a housing choice voucher), housing status, or gender identity. The ordinance also provides protection against retaliation for making a discrimination or harassment complaint and provides additional protections against some forms of employment discrimination based on a person's credit history or criminal background."

Conclusion:
I'm probably missing some good information here so I hope some other folks can chime in. I will say there are a lot of i's to dot and t's to cross. When you have to hold accountable or evict a lessee, make sure there is nothing for them or their attorney to grab on to.

Feel free to reach out and I can send you some of the documents I am using for reference. Please do not take the preceding as legal advice. I recommend reviewing your leasing documents with an attorney to make sure you are in good shape.