Universities and colleges around Chicago will soon resume classes, and perhaps students are hoping to rent your property. Domu reminds you that discrimination on the basis of age or legal source of income would violate Chicago's Fair Housing Ordinance. Still, you might make the following edits to your standard lease (for all tenants) to make sure your lease agreements make the grade for the upcoming academic year.
Insist on a (Credit-Worthy) Guarantor
Worried your student renter might fall short on rent because he or she doesn't generate enough income to cover the rent? Then employ the financial backstop of a guarantor (see the guarantor provision in Domu’s model lease). A guarantor agrees to the financial obligations of the lease – in other words, to pay the rent. Make sure the guarantor meets your standards for creditworthiness – perhaps you like to check credit scores or employment history. Typically, students ask parents or legal guardians to serve as guarantors, but anyone who is willing to assume the financial obligations of the lease may serve in the role. Don’t confuse a lease guarantor and a lease co-signer. Co-signers occupy the unit as tenants, whereas guarantors are responsible for the rent but are not tenants.
Consider Requiring a Security Deposit, Despite the Regulatory Hurdle
Security deposits have their advantages over move-in fees: because they are refunded at the end of the term except in certain circumstances like property damage, they serve as an incentive for students to maintain the unit during the term of the lease. Move-in fees, on the other hand, are non-refundable, so they don’t incentivize a tenant to maintain the property. If you are concerned that your tenant might damage the unit beyond ordinary wear and tear, you might consider collecting a security deposit. Just beware of the CRLTO’s stiff penalties for mishandled security deposits. Check out Domu’s Guide to Security Deposits for tips.
Address Subletting in the Lease
Students don’t always occupy a rental 12 months out of the year. If students return home or otherwise travel during the term of their lease agreement, they might want to find a short term subtenant to pay the rent. Note that Chicago’s Residential Landlord Tenant Ordinance requires landlords to accept a reasonable subtenant without an additional fee (Section 5-12-120). But that doesn’t mean that you must accept just any subtenant -- you may consider the same types of qualifications as you would for a renter, such as rental or credit history. Consider adding a provision to your lease that requires the tenant to seek the landlord’s consent prior to subletting the unit (see Section 15 of the Domu model lease).
Keep the Neighbors Happy by Addressing Noise Complaints in the Lease
A standard lease, such as the one available for download on Domu, should contain language about the acceptable use of the premises. Explain in the lease that the tenant may not engage in dangerous or illegal activities while occupying the unit (including illegal Airbnb rentals). Also, consider adding a standard paragraph to all of your leases -- not just those for students, as age discrimination is illegal -- that tenants be mindful not to disturb neighbors with excessive noise. Noise complaints are handled by law enforcement and can even result in fines for the first offense, so it’s not a bad idea to put some guidelines into a lease agreement. For example, a landlord might want to specify that excessive noise (what the City of Chicago calls “louder than average conversational level”) after 10 p.m. could lead to a chat with the police.