Wednesday, January 29, 2014
Security Deposit or No Security Deposit?
The Chicago Association of Realtors has come out against security deposits.
http://www.chicagotribune.com/classified/realestate/ct-mre-0126-podmolik-homefront-20140124,0,4166623.column
I am really torn about this. Reading the article did not help me make up my mind either. There are real risks with holding deposits and complying with the rules that the Landlord Tenant Ordinance has. Interest is the hardest one, have you ever tried to get your tenant to cash a check for $.42? I have, it is not easy. In my opinion, the other rules are reasonable, but you do have to know what they are in order to comply with them. You have to send written notice to your tenants in 30 days if you are going to keep any portion of their deposit and you need to itemize all deductions in writing at that time. You also have 45 days in which to return the actual money, but I would stick to 30 days for everything. Less chance of you missing a date. If you don't know where they are then you need to send the check certified mail to the old address so you can show that you tried. If you don't think you can handle tracking everything it might be better to just charge a move-in fee, but keep is reasonable, just a few hundred dollars a the most.
http://www.chicagotribune.com/classified/realestate/ct-mre-0126-podmolik-homefront-20140124,0,4166623.column
I am really torn about this. Reading the article did not help me make up my mind either. There are real risks with holding deposits and complying with the rules that the Landlord Tenant Ordinance has. Interest is the hardest one, have you ever tried to get your tenant to cash a check for $.42? I have, it is not easy. In my opinion, the other rules are reasonable, but you do have to know what they are in order to comply with them. You have to send written notice to your tenants in 30 days if you are going to keep any portion of their deposit and you need to itemize all deductions in writing at that time. You also have 45 days in which to return the actual money, but I would stick to 30 days for everything. Less chance of you missing a date. If you don't know where they are then you need to send the check certified mail to the old address so you can show that you tried. If you don't think you can handle tracking everything it might be better to just charge a move-in fee, but keep is reasonable, just a few hundred dollars a the most.
