The lower rate is great news for landlords holding security deposit money. The City of Chicago Residential Landlord and Tenant Ordinance (RLTO) requires the City Comptroller to set the rate of interest to be paid on security deposits held by landlords. The rate is calculated annually based on a formula tied to actual market rates. The new rate for 2010 of 0.073% applies to all residential rental agreements in which the lease term begins from January 1, 2010 to December 31, 2010. The amount of interest paid on security deposits is determined by the rate in effect on the date the lease term commences. Owner-occupied buildings of six or fewer units are not required to pay interest on security deposits.
City code requires that a general summary of the RLTO and a separate summary on security deposits, including the required rate of interest, be attached to each lease. For more information about what this means or help with a rental property please don’t hesitate to contact me.
Happy New Year!