Excerpt taken from The Ins and Outs of Tenant Screening: From Application to Eviction: By George N. Skidis, Jr.

Tenant Disputes Rent Claimed Due

A tenant who is served a five-day notice can and will dispute the amount of rent the landlord claims as due. If the amount claimed exceeds the amount the tenant believes is due the court may want to know the reason or reasons why. Should the tenant actually pay the actual amount of rent due as stated on the notice they can defeat the landlord’s claim to possession.

Rent Demand Should Not Include Non-Rent Amounts – 75ILCS 5/9-209

A five day rent demand should include rent only. The demand cannon include other claims such as damages, security deposits, attorney’s fees, etc. The courts prohibit a Property Manager from including in five-day rent demands claims for items other than rent such as attorney’s fees and other costs. You demand for rent should advise the tenant to pay the rent actually due. Do not include late fees.

Method of Payment

Some courts can narrowly interpret method of payment also called tender. A tenant should tender rent due in the manner demanded on the five-day notice. If the notice does not specify, the tenant should tender the rent in accord with the past practice or how they have always done it. If paying in person, the tenant can bring a witness to watch them make the payment to the Property Manager. The witness can then describe how payment was made and appear in court on tenant’s behalf.

Refusal of Payment

If the Property Manager refuses payment of the entire amount due, the tenant can bring a motion to dismiss any eviction action. The reason for this is that the original five-day demand for rent demanded payment of rent. If you want them out for some other reason use a different type of notice or demand.

Payment (Tender) Excused

Tender may be excused where it would be futile. If the Property Manager tells the tenant not to try to make a payment, or if the rent amount claimed dues is grossly excessive, payment may be futile. This argument may be even stronger if the Property Manager includes the “only full payment” language included in ILCS 5/ 9-209. That language is: Only full payment of the amount of rent demanded in this notice will waive the landlord’s right to terminate the lease under this notice, unless the landlord agrees in writing to continue the lease in exchange for receiving partial payment.

A: Maybe. But your old neighbor has an uphill climb.

You didn’t know it, but you created a bailment. Legally speaking, that’s a delivery of personal property for temporary safekeeping. Physical possession of the goods is transferred, but not legal ownership.

Bailments commonly occur when you drop something off at the cleaners, or at a repair shop, or when you park in a private lot.

The legal owner of the personal property is the “bailor.” The person who temporarily keeps the bailor’s property is the “bailee.”

You’re probably what the law calls a voluntary bailee. You voluntarily and intentionally took control of someone’s personal property. Your neighbor is the bailor.

Even though you and your neighbor didn’t formally agree to create a bailment, or to become bailor and bailee, a contract for a bailment is implied by law.

Actually, the law INFERS from what the facts IMPLY that there’s a bailment. But contract law always refers to “implied contracts.” As one Illinois court said, when you take possession of someone’s property, “the law implies a contract for the keeping of the property until it shall be restored to the owner or his agent.”

In general, “bailees will be liable for losses that result from their negligence.” Ordinary negligence would be the breach of a duty of reasonable care for the property. The general idea is: What would reasonable people do in your situation?

For you, reasonable care probably means keeping your neighbor’s property safe for a reasonable length of time—but NOT forever. Your neighbor would probably also be expected to act reasonably, by retrieving her stuff within a reasonable amount of time. If she sued, you could certainly defend by claiming that her delay in doing anything was unreasonable. You might even be able to prove that she had abandoned the property, and forfeited any claim to it.

Some courts say we should go easy on good Samaritans like you, and say voluntary bailees aren’t liable unless they’re “grossly negligent.” Although what’s “grossly negligent” isn’t clear, it’s much harder for bailors to prove than ordinary negligence.

If your old neighbor could prove the required level of negligence, the most you’d be liable for is the value of the lost property. Your neighbor’s lax attitude implies it wasn’t worth much.

If she sued you, you’d probably not be able to sue her for storage fees. Unless you’re a business, voluntary bailees are presumed to be acting for free.

You had no duty to safeguard your neighbor’s property in this situation. You’d not have been liable for doing nothing. It’s only when you took control of the property that the law imposed a duty, and opened the door to liability.

A: You can do this several ways. Each way is different, and involves different details. While this column can cover some general points, you should talk to a lawyer about what’s best for your specific situation.

For real estate that’s titled in just your name, a will could designate who gets it—and your other property—when you die. During your lifetime, you’d be the sole owner. Your heirs would have no rights until you die.

Putting title to real estate in joint tenancy is another way to allow designated people to get property when you die. When one joint tenant dies, the property in joint tenancy passes automatically to the surviving joint tenants. It does NOT become part of your estate, so any attempt to transfer property in joint tenancy via a will won’t work.

If it’s just you and your daughter as joint tenants, the house passes automatically to her upon your death. During your lifetime, she’d be a co-owner, which has consequences you might want to avoid. For example, as co-owners you’d both have to agree on selling or mortgaging the property. And, your daughter’s creditors could go after property she holds in joint tenancy, even if she’s the only one liable on the debt.

The hassles and risks of co-ownership are often good reasons to avoid a joint tenancy.

(The second basic way to co-own real estate is a tenancy in common. Property held as tenants in common does NOT pass to the surviving tenants in common when you die. Upon your death, that property DOES become part of your estate, so it CAN be willed to somebody else. But it’s the will, not the tenancy in common, that transfers the property to a designated heir.)

A new law creates a new way to pass real estate to somebody else when you die. It’s the “Real Property Transfer on Death Instrument Act.” As the name suggests, it’s a way to transfer property when you die. Until then, though, the property’s all yours. Whoever may get the property when you die has no rights during your lifetime.

In the mean time, you can do whatever you want with the property. You don’t have to worry about working together with a co-owner. You can sell or mortgage the property by yourself.

And if you change your mind, and want to transfer the property to somebody else when you die, you can. If you decide you don’t want to transfer it at all, you can simply cancel the transfer.

The new law sets out what a transfer-on-death “instrument” is supposed to say, and how it goes into effect when you die. You can prepare a valid instrument now, but it will only transfer property starting January 1, 2012. If you die before then, it won’t work.

It’s been possible for years to designate bank accounts, CDs, IRAs, stocks, and bonds as “payable on death” to somebody else. This new law new makes it possible to do something similar with residential real estate.

This is a great article on the purpose of landlord regulation. Many Illinois cities use these same tactics to deny housing to low income people. They do this by going after the people who provide housing. Cities like Joliet and Westmont use the code enforcement methods described. They impose current code standards on older property so they always have a reason to force people out. Down state the crime free housing model is common. Crime free housing means that if a landlord fails to evict when ordered to by government they take away the property owner’s right to rent any property. Licensing and registration usually have crime free housing and the code enforcement method as part of the regulation. It is great to see these tactics challenged. If you are a housing provider share this with anyone who would be concerned with the expansion of these policies in Illinois.

 Article from the American Apartment Owners Association

A:    It’s probably riskier to require proof.  The risk of being prosecuted for “harboring aliens” is small, compared to the risk of violating the Fair Housing Act.

The federal Immigration and Nationality Act has various penalty provisions.    One of those applies to “Bringing in and Harboring Certain Aliens.”  It applies when someone “conceals, harbors, or shields from detection” an “alien” who is “in the United States in violation of law.”  Penalties are fines, up to 5 years in prison, or both.

But, to violate the law, the harboring must be done in “knowing or reckless disregard of the fact” that the alien is illegal.  In the few prosecutions of property owners, on top of knowing that their tenants were illegal, the owners seem to have been involved in transporting or employing them, too.

Just renting to someone who turns out to be illegal, then, is not likely to get a landlord prosecuted.  As the venerable Justice Learned Hand said in one case, “the statute is very plainly directed against those who abet evaders of the law against unlawful entry, as the collocation of “conceal” and “harbor” shows. Indeed, the word, “harbor” alone often connotes surreptitious concealment.”

Employers are required by another federal law to document that their employees are here legally.  But employers usually face only civil fines for violating the law.  To be prosecuted criminally, they have to be “engaged in a pattern or practice” of hiring illegal non-citizens.  Being harsher on landlords, who aren’t required to document anything, is probably not the law’s goal.

Courts have also struck down local ordinances that a few towns passed that required landlords to document that tenants are legal.  Those decisions say that immigration is controlled by federal law, so it’s up to the federal government, and not state or local governments, to enforce immigration laws.

This all suggests that landlords who don’t know much about their tenant’s immigration status probably don’t face much risk.

It wouldn’t necessarily be illegal for a landlord to require that tenants be legal.  But, it might be difficult for a landlord to do that in a completely neutral and uniform way.  If they can’t, they could be violating the Fair Housing Act.

That’s another federal law, which makes it unlawful to refuse to sell or rent a dwelling “because of race, color, religion, sex, familial status, or national origin.”  The Illinois Human Rights Act does the same thing, but adds to that list “ancestry, age, order of protection status, marital status, physical or mental disability, military status, sexual orientation, or unfavorable discharge from military service.”

Requiring all tenants to prove their legal status would require some immigration law expertise.  Although documentation might usually be easy, in some cases it can get quite complicated.

Finally, it’s not a crime to be here illegally.  It’s only “illegal” in the sense that it violates federal immigration law.  But the remedy for that is “removal”–formerly “deportation”.  The Supreme Court has said that “deportation, however severe its consequences, has been consistently classified as a civil rather than a criminal procedure.”

Read the HUD ruling directly here

Q: Can a creditor refuse to accept payments on a debt? If I sent them a payment, and they sent it back, is the debt cancelled? Can they still sue me?

A: Creditors can accept or reject payments, and still sue. It’s a myth that rejecting your payment cancels your debt.

Creditors want money, so it’s a mystery when they reject it. Some claim that small payments cost too much to process, or take too long to repay the debt. Some may want to cultivate a tough reputation. Others, though, take anything they can get.

So, for good, bad, or no reason, creditors can reject payments. You can’t make them take your money.

Rejecting your payments does NOT cancel the debt. It’s not some kind of jubilee. A creditor who refuses your money can still sue you.

Once they sue and get a judgment against you in court, a creditor could still refuse to accept payments. But, having used up the threat to sue, they don’t have a lot of threats left that can squeeze more out of you. In most cases, a wage garnishment will be the most a judgment creditor can get, and they don’t need your permission to try that.

But threatening to garnish wages, post-judgment, may extract voluntary payments from employed debtors who want to avoid a garnishment hassle. Voluntary payments save the creditor from the extra hassle of a garnishment, too.

Because wages can only be garnished when a debtor’s employed, and taking home more than $371.25 per week, threats of garnishment can be hollow. A debtor earning less than that threshold amount can refuse to pay, and neither a judge nor a garnishment can make them pay.

Above that threshold, a garnishment will get the weekly net pay in excess of $371.25, or 15% of gross pay—whichever is LESS.

In Small Claims cases (for less than $10,000), the court rules say that “installment payments . . . shall not extend over a period in excess of three years duration.” But that runs up against the fact that some debtors simply can’t pay off a judgment that fast, or at all. In practice, then, that rule doesn’t get much use.

Creditors often prefer lump sum payoffs over installment payments that drag on forever. In exchange for one “big” payment, they’ll cancel the debt—even if that payment is a faction of what’s owed. When possible (e.g., tax refund time), lump sum payoffs are worth considering.

A lump sum for about half of what’s owed will almost always be taken seriously. If the debt’s been sold off to someone who paid pennies on the dollar for it, a lump sum for pennies on the dollar may be accepted. Same when a creditor realizes they can’t otherwise squeeze much blood out of you.

When a creditor agrees to take a lump sum pay-off, get it in writing. Before paying, insist they confirm that the payment satisfies the debt. Afterwards, insist they confirm the debt has been satisfied.

When renting out your property, one of the first decisions you must make is whether you will be asking your future tenants to sign a lease or a rental agreement. Both fixed-term and periodic agreements have advantages and disadvantages for landlords and renters.

A lease establishes tenancy for a consecutive number of months normally twelve, but terms of eighteen, twenty-four and thirty-six months are not unusual. A rental agreement is set up on a month-to-month basis. The parties to a rental agreement assume that the agreement will continue each month unless the landlord or the tenant gives 30 days notice to the other party that agreement will not continue.

Which agreement is right for your property?

Periodic Lease Agreement (Month to Month)

Many landlords prefer the flexibility of month-to-month arrangements. There are a couple of reasons for this. First in rental markets with abundant renters and rising rents the landlord can pick and choose at will.

The second instance is when the property being rented is listed for sale. In either case the landlord has the flexibility to raise rent on a month-to-month basis rather than yearly and the landlord will be utilizing the income generating the power of the property during the period of time during which the building is for sale.

The downside of month-to-month agreements is the increase in tenant turnover because of the elasticity the arrangement creates.

The rental agreement or periodic lease agreement has the advantage of flexibility in that the term of a periodic lease agreement is indefinite. The lease grants the tenant the legal right to occupy the dwelling for an unspecified period of time. The tenant retains the right of occupancy until the lease agreement has been lawfully terminated.

The difference between a rental agreement and lease agreement is a rental agreement is automatically renewed (usually on a month-to-month basis) and the landlord can change the terms by giving the tenant proper written notice.

Unless contrary to local law the periodic lease agreement can be terminated at any time by either the tenant or the landlord. The only requirement is that a notice to be given by the terminating party before the contract has ended.

The period of notice in a periodic lease agreement varies by locality but either landlord or tenant will need to provide written notice to the other party anywhere from fifteen to thirty days before actually terminating the agreement.

A: You’re on the hook for rent until a lease expires. An eviction notice doesn’t stop your duty to pay rent.

A lease is a contract. Contracts are sometimes called an exchange of promises. Among other things, the landlord promises to provide a place for the tenant, in exchange for the tenant’s promise to pay rent. In the common one-year lease, each side is supposed to hold to their promises for a year.

Moving out—voluntarily or involuntarily—doesn’t change that. Without an explicit (i.e., written) agreement to let you out of the lease, you’re on the hook for rent for a year.

A termination notice from the landlord terminates your right to live there, but not your promise to pay rent. It’s step 1 in the formal eviction process. If you don’t move out voluntarily, the landlord must take step 2, and take you to court.

An eviction order from a judge can then officially ends your right to live there. The sheriff can enforce the eviction order by removing you or your stuff from the premises.

Losing the apartment doesn’t stop your promise to pay for it. You promised to pay rent for a year, and the landlord can hold you to it. The obligation to pay rent continues until the lease expires, or the place is re-rented. At those points, the landlord’s no longer damaged by your non-payment.

It’s like a car loan. If you default, the seller can (usually) take back the car, and try to collect full payment of the purchase price. You promised to pay, and the fact that you lost the car doesn’t change things.

The only way out of a lease, and off the hook to pay rent, is by agreement. You can’t make a landlord let you out of a lease, but you might be able to work something out.

When a landlord starts the eviction process with an eviction notice, the tenant usually doesn’t have a lot of leverage to extract concessions, like a release from the lease. But saving the landlord time, and money, or actually paying money to the landlord, are possibilities. For example, a landlord might agree to release you from the lease if you move out without delay, and save the landlord the time and expense of a court case.

If you do work out an agreement, get it in writing. Make sure it releases you from the lease, and the obligation to pay rent, as of a certain date. If the landlord agrees, but won’t sign anything, there’s really no agreement.

Fair Housing Discrimination Claims- It’s surprising how the diligent efforts of Property Managers, Owners and Boards to address seemingly minor complaints or requests often become much more serious when residents claim that they are being discriminated against. Thorough documentation of the actions taken to resolve these issues are often the key to successfully defending claims of this nature.

Failure to Place or Failure to Maintain Insurance- An uncovered insurance loss will generally generate litigation at some level. Errors range from missing a bill to leaving locations off of schedules. Clear contracts specifying a Property Manager’s role and responsibilities are essential for successfully defending claims of this nature. Clear and documented communications with owners and boards are also essential. This is of particular concern when Property Mangers take on a new client and are integrating the new locations and properties into their system.

Personal Injury- Evictions are seldom pleasant. Claims for Wrongful Eviction certainly occur in Property Management. These can take the form of constructive evictions as well. Once again the devil is in the details. Documented correspondence is always critical when facts are challenged. A common surprise for Insurance Agents and their Property Manager Clients is the realization that Wrongful Eviction is not included as part of the Personal Injury definition under their policy. This is easily remedied prior to a claim.

Professional Services- Clients make many demands on their Property Managers. Property Managers must be sure that they are aware of the any Professional Services that they perform that may not be covered by their policies. Policies may limit coverage to “residential properties” or specific services that Property Managers provide. Since most Property Managers are licensed Real Estate Agents or Brokers this generally needs to be a covered service.

General Liability- Everyone knows that Property Managers are defined as insureds on most General Liability policies. As result many Property Managers and their agents opt against a General Liability policy for the Property Managers operations. While this may appear to be a wise budget decision Property Managers can find themselves as defendants in many situations in which they will not be covered by a client’s policy. A designated premises office policy generates the same concerns. Cost effective options are available in many cases.

Cyber Liability: Property Managers can be responsible for security breaches of the personal information in their care. This can be an electronic or “Cyber” breach or a simple theft of documents containing information. Third parties and employees with access can be potential threats. Notification requirements and credit repair can be substantial. Secure networks and thorough background checks can reduce this exposure. Large fines can also be assessed for the improper disposable of personal information even when there has been no actual breach.

These areas can all be covered.
Please talk to your agent today or call Snyder Insurance!
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A: Landlords who already have eviction judgments against their tenant are in the driver’s seat. They pretty much call the shots. They can take money from tenants if they want to, but they don’t have to. In particular, they don’t have to let tenants catch up the rent and stay.

The basic parts of an eviction are: notice, and a court case. In an eviction for non-payment of rent, there’s just point in the process where the landlord MUST let the tenant pay and stay.

That’s when the tenant offers to pay what’s owed within 5 days of getting an eviction notice. That’s the whole point of a 5 day notice—to give the tenant a chance to avoid eviction by catching up.

The law is clear, though, that only FULL PAYMENT within 5 days stops the eviction. The landlord can’t refuse. If tenants offer less, and the landlord’s properly warned them, the landlord can take their money and still evict. The proper warning is set out in the law, and says (in part): “Only FULL PAYMENT of the rent demanded in this notice will waive the landlord’s right to terminate the lease.”

After those 5 days are up, but before a court case is filed, the landlord can probably take full payment and still evict. But that’s not perfectly clear, and the source of some disagreement.

Once the eviction case is filed, state law clearly says that accepting past due rent from the tenant “shall not invalidate the suit.” That should be just as true after you get an eviction judgment.

The judgment officially establishes your right to evict the tenant. You’re in control. You can take past due rent, and still evict. If you want to, you can let the tenant pay to stay, but you don’t have to, and they can’t make you. It’s your call.

Good landlords won’t mislead tenants into thinking that payments will stop the eviction, but still evict.

Smart tenants won’t let themselves be misled. If there’s already an eviction judgment, tenants shouldn’t pay a dime unless there’s a written agreement from the landlord that says payment stops the eviction. Unless, of course, they know they’ll be evicted anyway.

Eviction judgments are now good for 120 days. After that, they expire, and should not be enforced by the sheriff. Within 120 days, landlords can seek extensions, which require a specific notice to the tenant.

So, if you have an unexpired eviction judgment a tenant, you’re in control. The tenant is vulnerable, and has no leverage to make you do anything.

A: Trespassing can be both a criminal or civil matter. Your situation was a landlord-tenant matter, which is civil. You have to evict. The police can’t just arrest unwanted tenants.

Under the Illinois Criminal Code, “criminal trespass to real property” is a Class B misdemeanor, which can get you 30 days to 6 months in jail, and a maximum $500 fine.

Criminal trespass to real property happens two basic ways: when someone enters after being warned not to, or won’t leave after being asked to. Officially, the second type happens when someone “remains upon the land of another, after receiving notice from the owner or occupant to depart.”

That may sound like it covers your landlord-tenant situation, but it does NOT. That’s because the criminal law specifically does NOT apply “to anyone living on such land at the request of, or by occupancy, leasing or other agreement or arrangement with the owner or his agent.” (It also doesn’t apply to anyone invited there by a tenant.)

That’s why criminal trespass mostly occurs when someone refuses to leave a business or public area. It’s occasionally used by feuding neighbors—one appellate court case involved someone who trespassed by retrieving an envelope that blew into his neighbor’s yard—but rarely to get rid of someone who claims a right to live somewhere.

So, it’s not criminal trespass for the tenant to refuse to leave upon a landlord’s request. The police should stay out. If they get involved, and arrest the tenant, they could be liable for illegally evicting the tenant.

The legal way to get rid of someone who moves in with your permission, and won’t leave, is an eviction. That’s done by following the Forcible Entry and Detainer Act, which is buried in the Illinois Code of Civil Procedure. It’s designed to settle landlord-tenant disputes peacefully.

As one case said, “the forcible entry and detainer statute reflects the long-established public policy that violence and even bloodshed could result from individuals using force and violence to regain possession of real property, even if the possession is rightfully theirs.”

Landlords can’t call the police, then, and can’t just do it themselves. They must follow the procedures set out in the law.

Those procedures boil down to two steps: notice, and a court case. The written notice is a pre-requisite for the court case, so you can’t take step two without properly completing step one. If the notice doesn’t say the right things, or isn’t delivered correctly, or the proper time (5, 10, or 30 days) doesn’t pass between delivery and filing the court case, that case can be dismissed.

Doing things right isn’t that hard, and doesn’t take that long. In Champaign County, it’s possible to go from notice to court order for eviction in less than a month.

A: To shovel, or not to shovel—if that is the question, you’re pretty safe either way. You can only be liable for creating an “unnatural accumulation” of snow or ice, which protects you if you never shovel. And lest you think that shoveling therefore opens you up to liability, few cases actually hold shovelers liable for creating unnatural accumulations.

The unnatural accumulation rule in Illinois dates back to 1931. The state Supreme Court said then that a city could be liable for injuries caused by ice on a sidewalk, when that ice came from overfilling a nearby ice rink. The court reasoned that while people shouldn’t be liable for risks created by nature, they could be liable for man-made, unnatural risks.

The rule that makes you liable for an unnatural accumulation of snow or ice specifically applies to your own, private property. A slightly different rule applies to public sidewalks adjacent to your property.

The Snow and Ice Removal Act of 1979 seeks to encourage citizens “to clean the sidewalks abutting their residences of snow and ice.” The Act does that by shielding anyone from liability for injuries “caused by the snowy or icy condition of the sidewalk resulting from his or her acts or omissions unless the alleged misconduct was willful or wanton.”

It’s not clear what’s willful and wanton misconduct, since no Appellate Court case has held anyone liable under the Act. It’s clear, though, that it must be extreme, and much worse than simply creating an unnatural accumulation of snow or ice. Something like hosing down a sidewalk for the kids to slide on might qualify.

Just as it’s hard to tell what’s “willful and wanton,” it’s hard to tell the difference between a natural and an unnatural accumulation of snow or ice. As one judge said, “no one understands the difference.”

About the only way doing nothing can create an unnatural accumulation is if runoff from something like a downspout freezes where people walk.

Ice from melting piles of snow may be an unnatural accumulation, as may be piles or mounds people have to step over or around. Judges, though, seem reluctant to make someone liable for improperly removing snow, especially when their efforts are consistent or methodical.

One type of accumulation that courts have said is unnatural is a plowed or shoveled mound of snow that blocks a driver’s view of traffic. Be careful, then at driveway exits and corners.

Finally, landlords have no duty to shovel for their tenants. They can agree, in a lease, to clear sidewalks, but otherwise don’t have to do anything.

The IRPOA Political Action Committee has been investigating changes in the law regarding requirements for a mortgage originator license.  Previously the law provided for a number of exempt transactions when private financing is involved before a mortgage originator license was required.  This exemption was removed with the enactment of PA 096-1216.  Here is a link to that legislation.  http://www.ilga.gov/legislation/publicacts/fulltext.asp?Name=096-1216 This law was passed to bring Illinois law into compliance with federal requirements.

IRPOA submitted a list of questions to the Department of Professional Regulation in order to determine what types of transactions would be affected.  The questions are in the attached document.  Initially we were told that none of the questions could be answered until the Federal Government provided guidance on their requirements.   After some conversations by IRPOA members with legislators we did received a verbal statement that contracts for deed and lease options would not be effected.  We requested a written statement to document this position to provide to our members but have not received it yet.  We have been told that something is being worked on.  . 

IRPOA VP Jane Garvey provided the information copied below from the National Association of Realtors expressing Congress’ intent that some seller financing should be permitted under the SAFE act.  The SAFE act is the federal legislation driving these changes. The Department of Professional Regulation has stated that they expect when HUD issues guidance on the SAFE act a number of exempt transactions will be permitted in the federal law.  As of January 1, 2011 there are no exempt transactions allowed under Illinois law and that will remain the case until Illinois law is amended.

If you engage in any type of transactions where unconventional financing is involved the IRPOA PAC recommends you contact your state legislators immediately to inform them that your ability to conduct business will be on hold until this issue is resolved.

To find your State Senator and State Representative go to http://www.elections.il.gov/DistrictLocator/DistrictOfficialSearchByAddress.aspx

Paul Arena
IRPOA PAC Chairman

Additional support from National Association of Realtors Washington Report  – August 23, 2010

Conventional Residential Lending Report
Frank-Bachus Letter prods HUD to Issue S.A.F.E. Act Final Rule and Clarify Other Issues

In Late July 2010, House Financial Services Committee (HFSC) Chairman, Barney Frank, and Ranking Member, Spencer Bachus, sent a joint letter to HUD Secretary Shaun Donovan addressing their concerns related to the implementation of the Secure and Fair Enforcement for Mortgage Licensing (S.A.F.E.) Act, as well as to clarify other issues. Their primary concern was that as of July 31st, 2010, states were required to have a system in place to license and register loan originators, yet HUD had not published its final rule addressing the implementation of the S.A.F.E. Act. Therefore, they strongly recommended that “HUD provide prompt and clear guidance for states where there is some debate or uncertainty as to the need for the registration and licensing of certain individuals.”

In the letter, the Chairman and Ranking Member mention that “several states allow for a de minimis standard that exempts seller financed and/or personal investment loan originations where there are five or fewer loans annually.” Reps. Frank and Bachus indicate that, “[they] believe that these types of standards are consistent with S.A.F.E. Act language that requires consideration of the commercial context in which the mortgage loan origination activities are undertaken.” They go further to indicate that such an exemption is in line with the federal banking agencies’ draft final rule implementing the S.A.F.E. Act, (74 FR 27385).

Now, this does not mean that any existing State’s S.A.F.E. Act is immediately amended. The letter submitted by Chairman Frank and Ranking Member Bachus are just an indication to HUD of Congress’ intention. It remains up to HUD what the final S.A.F.E. Rule will be. Once the final rule is published, individual states will need to review their legislation and determine if any changes are necessary. Also, as a point of clarification, the Dodd-Frank Wall Street Reform and Consumer Protection Act does not amend the S.A.F.E. Act. However, the seller financing exemption established in Title XIV of that legislation is partially responsible for the Frank-Bachus letter to HUD.

NAR will continue to communicate to HUD the importance of publishing their final rules for the implementation of the S.A.F.E. Act, as well as to remind them of Congress’ intentions with regard to seller-financing as outlined in the Frank-Bachus letter. Stay tuned, there is more to come.

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Illinois requires carbon monoxide alarms effective January 1, 2007.

Carbon monoxide (CO) is odorless, colorless, and tasteless. It’s produced when any fossil fuel, including natural gas, is burned. When fossil fuels do not burn properly, CO can build up and cause sickness – even death. Carbon monoxide kills about 200 people in the U.S. every year.

Homeowners, landlords and building owners of any occupancy that have rooms used for people to sleep in are required to install carbon monoxide (CO) detectors by January 1, 2007, under legislation passed this spring. The new Illinois law requires the owner of the building to install carbon monoxide detectors within 15 feet of all rooms used for sleeping. This law applies only to those occupancies that use fossil fuel to cook, heat or produce hot water, or is connected to an enclosed garage.

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Garbage, Recycling, Composting, and Hazardous Waste Disposal Information

(Article re-printed from the Champaign City Website)

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Appliance Disposal

The City does not provide any waste collection services. Appliances should be disposed of by calling or taking the appliance to a business listed in the phone book yellow pages. Businesses that accept appliances and recycle them can be found under “Recycling Centers.” Another option is to call a garbage hauler who specializes in one-time-only hauling. Garbage haulers can be found in the yellow pages under “Garbage & Rubbish Removal.” Fees associated with appliance disposal are the responsibility of the requestor.

Composting

At-home-composting for yard waste material is legal in the City of Champaign.

Information and a “How To” brochure are available by contacting:

University of Illinois Extension – Champaign County
801 N. Country Fair Drive, Suite D
Champaign, Illinois 61821

217-333-7672

Garbage Service

Refuse haulers or private solid waste haulers provide garbage collection. Burning and the accumulation of garbage are prohibited in Champaign. Garbage haulers can be found in the yellow pages in the phone book under “Garbage & Rubbish Removal.” Materials can also be taken to the Solid Waste Transfer Station located at 915 W. Saline Dr. in Urbana. The transfer station’s phone number is 384-2274. There is a drop-off fee for all materials.

Hazardous Waste

The City recommends purchasing only the amount of hazardous materials needed to reduce the disposal of hazardous wastes. The City has held tire drop-off programs in the past. These drop-offs are in conjunction with the IEPA and are not held on a regular basis.

Recycling — Curbside and Drop-off

The City strongly supports recycling and encourages all citizens to take part in waste reduction. Citizens may take part by participating in the City’s curbside recycling service or by bringing materials to the public drop-off site operated by the City of Champaign.

Recycling Household Products

This information is provided as an alternative to landfill disposal and limited to household quantities only. Businesses should contact the Illinois Environmental Protection Agency for information on how to dispose of their materials.

Yard Waste and Christmas Tree Pickups

The City provides yard waste collection services for all residential properties within City limits at three times each year: Spring, Fall, and after Christmas.

By George N. Skidis, Jr.

Whether the tenant leaves voluntarily or by legal force, you need to deal with the security deposit. Whether or not you are entitled to keep the deposit, you must comply with the state law.

In most states you must return the security deposit within a required number of days or send a certified letter to the tenant stating why you are keeping it. Even if you are entitled to keep the deposit, your failure to comply with proper procedure will result in a lawsuit against you for improper withholding. You can always sue the tenant in small claims court for rent owed and damages to the property, but you cannot withhold the security deposit without the following rules.

The only way to win an eviction is never to need one. Once the eviction procedure is started your goals should be minimizing your lost rents, stopping your damages, limiting your expenses, obtaining a monetary judgment and recovering your property.

As an investor working with tenants, you should be very familiar with the eviction laws where you do business. These basics of these laws apply to your property whether you are renting it out, sandwich leasing, lease optioning or selling bond for deed. Corporations, which are legal entitles, but not physical persons, must hire an attorney to represent them. Private individuals, sole proprietorships and individuals doing business under an assumed name or DBA can represent themselves in court.

I recommend that you learn the landlord tenant laws and the timetable for evictions in your county, even if you are a corporation. If your business is not a corporation, and you have any doubts as to how to proceed, hire an attorney. You should probably hire an attorney to handle your case the first few times just to see how it is done. Landlord tenant law is not difficult to understand, but it is very technical.

A minor flaw in your paperwork or filing, or conduct could mean having your case thrown out. Being thrown out means you get the luxury and expense of starting all over and the tenant gets more free rent. Thus you should consider paying an experienced landlord-tenant attorney to do the job. Make sure it is an attorney that specializes in landlord tenant law.

An eviction proceeding is known by various names depending on what part of the country has jurisdiction. In Saint Clair County, Illinois is referred to as “Forcible Entry and detainer” but I have also heard it called a “Summary Proceeding” or “Unlawful Detainer” proceeding. In any case the plaintiff (property owner) is filing a lawsuit against the defendant (tenant).

The purpose of the lawsuit is to obtain a court order to permanently remove the tenant from the premises. A “Forcible Entry and detainer” called an F.E. & D. lawsuit is the only way to legally remove any and all tenants from the premises.

There are many ways to illegally remove a tenant from the premises.

Such an action is called “Constructive Eviction”, those days are over. No matter how much they owe you or how emotionally charged the situation is, don’t even consider trying it. It is illegal to physically or constructively remove the tenant from the premises. You cannot change the locks, shut off the power, and remove an exterior door to repair it, board up the house, place fake condemnation placards on the dwelling or other similar action.

Before you can commence the proceeding, you need to terminate the tenancy; you do this by serving notice on the tenant as required by your state law. For nonpayment of rent, the notice can be a three or five day notice depending upon jurisdiction. It frequently has a heading such as “Pay Rent or Quit”.

When serving a “Pay Rent or Quit Notice” never include the day of service in your calculations of the time period. If notice is properly served on the 10th of the month, the time period starts on the 11^th In this case five days would expire at midnight on the 15th

On the sixth day after serving a five day “Pay Rent or Quit Notice”, if the tenant has not paid the rent in full or moved out after that time, you can commence legal proceedings to recover possession of your property. This means your case can be filed anytime after the 15th I normally wait an extra day or so before filing, some judges like patient gracious property managers.

Typical Duties of the Landlord

• A landlord is obligated to supply possession of the premises as agreed in the lease. The premises must meet minimum standards of habitability including compliance with the applicable local and national building codes.
• All weatherizing, locks, running water, working plumbing, heating and cooling, pest control, and other basics must be in place. A landlord is obligated to keep the premises in repair, to the same standard as existed when the tenant initially leased the premises. Damages caused by the tenant, however, will be repaired only at tenant’s expense.

Typical Duties of the Tenants

Many leases now incorporate any statutory duties of tenants. Aside from complying with the lease agreement the tenant is obliged to keep the premises in as clean and safe condition as possible.

• The tenant must comply with any applicable health and safety codes, including proper disposal of garbage.
• The tenant must use the facilities and appliances in the premises in a reasonable manner.
• The tenant must not damage the premises, nor cause a nuisance to neighboring tenants.
• The tenant must not permit or participate in criminal activity on the premises.
• The tenant is required to inform the landlord of any dangerous conditions that develop.
• The tenant should also advise the landlord of any damage caused to the premises by whatever source, and of any serious injury to the tenant, tenant’s family, guests, or tenant’s property while on the premises

Q: Do my minor children have to file tax returns if they had earned income, or can I just include their income on my return?

A: You can’t include a dependent’s earned income on your tax return. If it was unearned income, from interest, dividends, or other investments, you might be able to depending  on the amounts involved.

That means a minor child with employment income can file their own tax return. (This assumes that somebody somewhere is claiming that child as a dependent.) The minor may not be required to file a tax return, but they always can if they want to.

Minor dependents must file a return if their earned income in 2009 was more than $5,700. That’s the amount of the standard deduction. Income above that amount could be taxed, so they must file.

But even if minor dependents earned less than $5,700 in 2009, and don’t have to file a tax return, they should if any tax was withheld from their wages. With income under $5,700, their tax should be zero, so any withheld tax is a tax overpayment that can be refunded. But if they don’t file, they won’t get a refund.

The IRS collects tax on our adjusted gross income. Before the adjustments from standard and itemized deductions, gross income is, according to the IRS, “all income from whatever source derived.”

The two broadest categories of income are earned and unearned. In addition to requiring minor dependents to file a tax return if their earned income exceeds $5,700, the IRS also requires those minors to file if their unearned income exceeds $950. It would take a sizable savings account to generate $950 in interest, but there are certainly ways for CDs, dividends from stocks, and other investment income to exceed that threshold.

One other category of mandatory filers is minor dependents with net earnings from self-employment of at least $400.

Although parents can’t include a minor child’s earned income on the parent’s tax return, they can include some interest, dividend, or investment income. A child’s unearned income, then, is the only kind of income parents can include on their own tax return. And then, there are limits.

If interest and dividends are the minor dependent’s only income, and the total is less than $9,500, a parent can elect to include it on their own tax return. They use Form 8814.

The first $1,900 of a minor’s (under 18) unearned income is taxed at the child’s rate. Above $1,900, no matter whose return the income is reported on, a minor’s interest and dividend income is taxed at the parent’s rate. That prevents parents from creating tax shelters by putting accounts in their kids’ names, so that the income is taxed at the presumably lower kids’ rate.

Minors who file their own tax returns—because they’re required to file, or because they choose to file to get a refund—can sign their own names to the return. Parents aren’t usually entitled to information from the IRS about their minor children, although a child can authorize the IRS to disclose information, or even designate a parent as their representative to deal with the IRS.