Tuesday, January 14, 2014

Chicago Security Deposits..Did you know?

A landlord must hold all security deposits received in a federally insured interest- bearing account in a bank, savings and loan association or other financial institution located in the State of Illinois.  The security deposit and interest due shall continue to be the property of the tenant and must not be commingled with the assets of the landlord.

A landlord may accept the payment of the first month's rent and security deposit in one check or one electronic funds transfer, and deposit the money into one account, if within 5 business days of the acceptance of the check or electronic transfer, the landlord transfers the amount of the security deposit into a separate account.

The name and address of the financial institution where the security deposit will be deposited shall be clearly and conspicuously disclosed in the written rental agreement signed by the tenant.  If no written rental agreement is provided, the landlord shall, within 14 days of receipt of the security deposit, notify the tenant in writing of the name and address of the financial institution where the security deposit was deposited.

If, during the rental agreement, a security deposit is transferred from one financial institution to another, the landlord must within 14 days of the transfer, notify the tenant in writing of the name and address of the new financial institution.

Any landlord who receives a security deposit from a tenant or prospective tenant must at the time provide a receipt indicating the amount of the security deposit, the name of the person receiving it and, in the case of an agent, the name of the landlord for whom the security deposit is received, the date on which it is received, and a description of the dwelling unit. The receipt must be signed by the person who received the deposit. If the security deposit is received by means of an electronic funds transfer, the landlord must also provide an electronic receipt of the security deposit which provides an electronic or digital signature of the person receiving the deposit.

A landlord who holds a security deposit for more than six months shall pay interest to the tenant accruing from the beginning date of the rental term specified in the rental agreement at the rate determined in accordance with the interest rates set by the City of Chicago Comptroller for the year in which the rental agreement was entered into.  The landlord shall, within 30 days after the end of each 12-month rental period, pay to the tenant any interest, by cash or credit to be applied to the rent due.
 

Posted by Bradford Miller Law, P.C.
134 N. LaSalle Street, Suite 1040
Chicago, IL 60602
312-238-9298


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