The world was a simpler time before Covid and that includes giving written notice to end a lease agreement in Chicago. During Covid, Lori Lightfoot passed a new law for proper notice needed to end a lease agreement and have your tenant move out. The fair notice ordinance in Chicago creates different tiers of non-renewal notices that need to be followed in order to properly non-renew a tenant.
What was the reasoning behind this new ordinance?
Under the old rules, landlords only had to give a 30 day notice to end a lease, but the city council thought that forcing tenants to find a new home in only a month was unfair treatment. See, more and more buildings started to sell to new property owners at very high prices with very high interest rates. Many of these landlords wanted to renovate and rent them out at higher rental rates, but they needed to do that quickly. These new property owners were then providing 30-day notices to end their month-to-month leases. Tenants who had lived in the home for upwards of 20 years found themselves suddenly at the end of the lease term, with no money to move to a new address. Under the new ordinance, there are now three different notices that can be given, and how much notice depends on how long the tenant has lived in the home.
30-day notice
For any tenant who has lived in the home for less than 6 months, you may give a 30-day notice that you are ending their lease. This notice period is by far the least used as most landlords and property management companies in Chicago will sign their tenants to a one year lease. This is generally going to be used for mid-term leases or leases that are on a month-to-month agreement from the start.
60-day notice
A 60-day notice can be given to a tenant as a non-renewal letter if the tenant has been there for more than 6 months but less than 3 years. These tenants are more common and generally this is used when tenants are on their first or second lease and the landlord no longer sees them as a good fit for the apartment.
120-day notice
This notice is used when your tenant has lived in your rental unit for more than 3 years. This is often seen when a long term tenant has been in the home and is paying under market rent or the rental unit needs a major rehab to bring the condition up to par.
Some important notes on these notices:
You cannot send a notice of non-renewal that would expire before your tenant's lease expires. This is just for notices of non-renewal without cause - as in the renter isn’t doing anything wrong.
If you have a tenant not paying their rent, you would want to send an eviction notice, which is a 5-day notice where the tenant must either pay their past due balance or you will take them to court to have them removed. There is also a ten-day notice for non-compliance with a lease. This is used when a tenant has an unauthorized pet, or another person living with them not on the lease, and you want to start the eviction process.
How can you deliver a lease non-renewal letter, and what should be in the letter?
The information in the letter should include the date of the notice, the expiration date of the current lease, the name of the tenants, and the address of the rental property. A sample of this may read something like this:
Dear (Tenants Name)
Your lease at 123 Example Street expires on August 30th, 2025. This notice serves to notify you that we will be non-renewing your lease, and your move-out date must be on or before August 30th, 2025, at 12am midnight.
This notice can be served either by email, text, or hand delivered to the tenant/posted on their door. All of these ways of notifying the tenant are considered official notice.
When to serve the notice
This is the part of Chicago's Fair Notice Ordinance that many get incorrect legal advice on. Day one of the x days' notice begins on the first of the following month, meaning whether you serve the notice on March 1st or March 31st, day one is April 1st and day 60 is the last day of June. Day 120 would be the last day of August. This is important information to note because if you serve a notice that ends the lease in the middle of a month and have to take your tenant to court to evict, the judge will dismiss the notice to vacate because it was served incorrectly.
What to do when your period of time has expired?
So you gave your move-out notice and waited x amount of days. The 30th of x month comes and goes and your tenant still has not moved out. Here are a few things that you need to keep in mind to make sure you keep your legal rights to have the tenant move out at the end of the time period for your notice to vacate.
1. If you accept the next month’s rent on the first, that creates an automatic month-to-month agreement and you will have to start the notice process over again. Once the lease end date comes, you can no longer charge the tenant rent or the courts will assume that because you accepted the rent payment then you are accepting the terms of the lease to continue.
2. Proof of service: make sure you document that the tenant received the notice. This is why we advise sending an email and text, so that you have documentation of the notice being sent.
3. As stated above, make sure that your days' notice includes the correct number of days. It's not actually x days' notice; a 60-day notice may have to be given 65 days before the end of the lease date.
4. File for eviction before it's too late. If you let the tenant stay 3 or 4 weeks past the end of the notice date, you may have issues in court proving that you are not allowing them to stay on a month-to-month tenancy.
What if we want to do a notice of renewal with a rent increase?
Your legal obligation is still the same for renewing a lease or for a rent increase, even on a month-to-month lease. If the tenant’s lease expires within 6 months from the tenant moving in, you can give a 30-days notice of your rent increase. If the tenant has lived in the property for more than six months but less than 3 years, a 60-days notice is required. Lastly, a 120-days notice is required if the tenant has been in the home for more than 3 years.
Now here is where the tricky part comes in. A landlord cannot force a tenant to renew their lease or agree to a rent increase more than 90 days out. This means if a tenant has an existing lease and has lived in the home for more than 3 years, you must give 120 days' notice to the tenant but cannot require them to decide if they will stay or move out before the 90 day period is up.
This brings up the problem of giving sufficient notice to the tenant that their lease will not be renewed if they do not agree to renew their lease. The notice should state that “this notice is to inform you of an offer to renew your lease at x rate. If you decide not to sign your renewal, your lease will not be renewed at the end of your current lease.” This is the best option for giving both enough notice of a lease renewal and enough notice to end their lease if they do not decide to accept the rent increase.
Unilaterally raising rent on a month-to-month lease
In Illinois, if a tenant is on a month-to-month lease, the landlord can give proper notice (same rules apply as above in terms of notice time period). This means if your tenant doesn't want to sign a new lease or move out, you have one more alternative that doesn't involve evicting them. You can send notice that at the end of your notice period rent will increase to x amount. As long as these notices are adequately served and the tenant does not have a current lease at the end of the expiration date, you are allowed to raise rent without them agreeing to it. Unfortunately, if they don't pay it, you will have to go through the eviction process in Chicago, which is a very long process.
The laws in Chicago for landlords/property management companies and their tenants are constantly changing, which is why we highly recommend not dealing with the legal pitfalls on your own. We at Chicago Style Management specialize in navigating the complex rules of Chicago and southern Cook County, including the Fair Notice Ordinance and security deposit laws. We've developed an exceptional rental agreement that allows us to maintain control over our tenants. Suppose you haven't considered a property manager for your investment property. In that case, I highly recommend giving us a call to see how we can help take the stress out of property investing. Often we can increase your profit enough to pay for our services. Of course this now takes a little longer in Chicago with the 60 and 120 days notices needed to raise rent, but getting a free assessment on how much more rent we can get you for your property can be life changing. And, knowing you have a property management company that knows all the new state and local laws keeps you safe from lawsuits that can cost you up to 2x all of the rent you've collected from a tenant. Our phone number is 224-601-5415. Give us a call today for a free consultation.
