2013 Chicago CRLTO Security Deposit Interest Rate Set

chirate2013The New Year is a crazy time for Chicago landlords.  The first thing they need to do is to figure out the new security deposit interest rate to pay their tenants on CRLTO covered leases initiated in the new year.  The Chicago Residential Landlord Tenant Ordinance requires landlords in covered tenancies to pay interest on residential security deposits based upon the interest rate provided by the Comptroller of the City of Chicago in accordance with 5-12-081 of the CRLTO.  The Comptroller has released the rate in a press release today.  For leases entered into from January 1, 2013 to December 31, 2013, the interest rate to be used for the CRLTO is .023%

Landlords can also find the security deposit interest rate for past years on our website.

State sets 2013 security deposit interest rate

2013 Illinois Security Deposit Interest RateEvery new year brings the requirement that landlords learn the new interest rate to be paid on certain residential security deposits.  2013 is no exception.  The Illinois Security Deposit Interest Act requires covered landlords to pay interest on certain residential security deposits based upon “the interest paid by the largest commercial bank, as measured by total assets, having its main banking premises in this State on Continue reading

Chicago ups price of Certificate of Zoning Compliance on 1-1-13

The City of Chicago has announced an increase in the cost of a “Certificate of Zoning Compliance” needed for the sale of all non-condominium/co-op residential properties consisting of five or fewer units.  The certification indicates the number of “legal” units in a residential property.  Real estate sellers in the City can expect to pay an additional $30 for the certification that is required to sell most residential property within the City.

Here comes the drop! Mortgage Forgiveness Debt Relief Act to expire

mdfraexpUPDATE:  As part of the “fiscal cliff legislation”, congress has extended the MFDRA until December 31, 2013.

In 2007, congress passed the federal Mortgage Forgiveness Debt Relief Act, a law that allowed taxpayers to exclude “forgiven” debt after a shortsale, foreclosure, or loan modification to be excluded from a person’s “income”.  That law is set to expire on December 31, 2012.  Prior to the enactment of the law, any forgiven debt was considered “income” to a borrower and the borrower had to pay income tax despite not actually receiving actual “cash-in-hand” income.  If Congress does not extend the law, a number of real property owners will face increased income taxes in the wake of transactions related to distressed properties.  Many short sales currently in progress will be effected.  Attorneys General from a majority of states have urged the congress to extend the law when they go back to work in December.

Corporate minute scammers target Illinois corporations

If you are a registered agent for an Illinois corporation, you may have received a notice in the mail from a company called “Corporate Records Service” offering to prepare annual minutes for a fee of $125.  Because I am a registered agent for many of my clients’ companies, I have seen it.  The paperwork they send looks “official”.  Continue reading

The problem with pre-approvals

preapproval doesn't mean much in a Chicago real estate transactionPre-approval letters in Chicago real estate deals really don’t mean anything.  There, I said it.

I’ll say it again.  Pre-approvals don’t mean a thing.  I know it is hard to believe, but it’s true.  I probably average one telephone call a month from a confused seller-client who wants to know why the buyer needs a mortgage contingency extension when “they were already pre-approved”. Continue reading

Estate planning for digital assets?

One estate planning topic sure to become more and more important as we advance in the digital age is the issue of what to do with a person’s digital assets.  Our own Richard Magnone was interviewed about the topic for an article in the August 26, 2012 Chicago Tribune.  Right now, it seems, the most important task for estate planners is making their clients aware of the issues related to digital assets.  Few people feel the need to plan for digital assets but that does not mean that they should not do so.  There are a variety of types of digital property – more than people might guess.  A few years back, Rich did a series of blog articles on the topic that deserve a fresh look.

How real property taxes are calculated in Cook County

Cook County, Illinois residents will get a big surprise in their mailboxes around July 1.  Just in time to celebrate the nation’s birthday, the Cook County Treasurer will come looking for the 2nd installment of 2011 real estate taxes (remember, property taxes are paid in arrears).  This year will mark the first time in decades that the bills are not tardy.  Most property owners will wonder why their bills are going up when the values of their homes are going down.  Its easy to see why once you know the process used by the to calculate a tax bill. Continue reading

Illinois re-writes Medicaid eligibility rules

Without much advance fanfare, the State of Illinois has passed a law intended to close Illinois’ $2.7 billion dollar Medicaid funding gap.  On June 14, 2012, Governor Quinn signed Public Act 97-689 into law.  Among other things, the law amends the Illinois Public Aid Code to change Medicaid eligibility rules.  The Chicago Sun Times printed a story criticizing the law for “cutting people off of medicaid”.  The law changes medicaid eligibility rules for people who own real estate and suspended the use of “OBRA” pooled trusts (one form of special needs trust) for anyone over age 65 who is not a ward of the public guardian (OPG) or the state guardian (OSG).

HAFA approved or half approved?

Real estate MLS listings often proclaim “HAFA Approved Short-Sale” as a key selling point for a listed short sale property.  HAFA is the “Home Affordable Foreclosure Alternative” program.  Part of the program is a process for pre-approving a short sale (a short sale is when a bank with a mortgage releases the mortgage in return for less money than is owed on the loan secured by the real estate).  In theory, HAFA approved short sales should be quicker and less complicated than a standard short sale because the home seller applies to the program in advance and is provided with an approval based upon the seller obtaining a contract to sell at a certain price.  HAFA short sales benefit a seller because, among other things, the Seller can get some relocation funds from the sale and can avoid being pursued for any repayment deficiency.  The trouble is that even if a property is HAFA approved, there may be other parties that have a hand in blocking the sale. Continue reading