Notes Flashcards
In Illinois, who is NOT required to hold a real estate license in order to rent out their property to a tenant?
If they own the property
In IL, the statute of frauds requires that lease agreements be ___ to be enforceable if they are for more than one year.
in writing
In IL, the statute of frauds requires that lease agreements be in writing to be enforceable if they are for more than ___.
one year
Written leases should be signed by…
Both lessor and lessee
Leaseholds are generally considered ___ property
personal
An estate for years always has specific ___ and ___.
Beginning and ending dates
___ is NOT required to terminate an estate for years.
Notice
Notes is NOT required to terminate an estate for years because….
lease agreement states a specific expiration date
In an estate for years, any extension of tenancy requires a(n) ___.
New contract
An estate for years may be terminated before the expiration date if ___ or ___.
both parties agree
contract is breached
If a lease is a periodic tenancy, it does not contain a(n) ___.
Specific expiration date
A periodic tenancy continues indefinitely until…
notice of termination is given
A ___ tenancy is created when a tenant takes possession with no definite termination date and pays monthly rent.
Periodic tenancy
If the landlord accepts rent after the expiration of an estate for years, and no new lease agreement is made, a(n) ___ is created.
Holdover tenancy
___ is usually considered conclusive proof of acceptance of holdover tenancy.
Acceptance of rent
In IL, to terminate a tenancy from year to year, at least ___ days written notice is required at anytime within the ___ period before the last ___ days of the lease period
60 days
4 month period
60 days
In IL, to terminate tenancy from month to month, ___ days written notice is required
30 days
In IL, to terminate any periodic estate having a term of less than year to year but greater than week to week, ___ days written notice is required.
30
In IL, to terminate tenancy from week to week, ___ days written notice is required
7
In IL, to terminate farm tenancies from year to year, parties must give at least ___ written notice to terminate and may do so only at the ___.
4 months
end of the period
To vacate March 1, farm tenancy notice must be given by ___.
November 1
Under IL law, when Tenancy at sufferance arises, the landlord has a choice to either ___ the tenant or treat the tenant as a(n) ____
evict
holdover tenant
What are the 4 requirements that make a lease valid?
1) Capacity to contract
2) Legal Objectives
3) Offer and Acceptance
4) Consideration
___ is the normal consideration given for the right to occupy leased premises
Rent
___ leases are generally more complex, and may include complicated calculations of rent and maintenance costs
Commercial
___ are often prepared in advance of a commercial lease by the licensees representing the respective parties
Letters of intent
In a commercial lease, the ___ generally sets forth the basic agreements between the parties that both parties’ attorneys can then use to prepare the lease from.
letters of intent
Commercial leases and complex residential leases should only be drafted by a(n) ___.
attorney
The lessor is usually bound by the implied covenant of ___, and guarantees that he will not interfere in the tenant’s possession or use of the property
Quiet enjoyment
___ are common in leases for stores or commercial space, and are when a lessor restrict’s the lessee’s use of the premises through provisions in the lease.
Use restrictions
A lease provides that the premises are to be used “only as a real estate office and for no other purpose.” This is an example of ___.
Use restrictions
The period for which the lease will run
Term of lease
If a tenant defaults on payment of rent or damages the premises, the lessor may keep all or part of the ___ to compensate for the loss
security deposit
What are 4 safeguards against nonpayment of rent?
1) Security deposit
2) Advance rental payment
3) Contracting for a lien on the tenant’s property
4) Requiring the tenant to have a 3rd person guarantee payment
In IL, landlords who receive security deposits on residential leases of units in properties containing 5 or more units may not withhold any part of a security deposit as compensation for property damage unless they give the tenant a(n) ___.
Itemized statement listing the damage
In IL, if a landlord withholds any part of a security deposit as compensation for property damage, an itemized statement must be delivered within…
30 days of the date when the premises was vacated
In IL, if a landlord withholds any part of a security deposit as compensation for property damage, an itemized statement must be delivered within 30 days of the date when the premises was vacated. If the statement is not delivered, the landlord must return the entire security deposit within…
45 days of the date when the premises was vacated
In IL, if a landlord withholds any part of a security deposit as compensation for property damage, an itemized statement must be delivered within 30 days of the date when the premises was vacated. If the statement is not delivered, the landlord must return the entire security deposit within 45 days of the date when the premises was vacated. If a landlord is found guilty by a court for failing to comply with this requirement, they must pay the tenant…
Double the security deposit
IL lessees are entitled to receive ___ on their security deposits.
Annual interest
In IL, landlords who receive security deposits on residential leases of units in properties of 25 or more units, on deposits held for more than 6 months, are required to pay ___ from the date of the deposit.
interest
In IL, any landlord who is found by a court to have willfully withheld interest on a tenant’s security deposit must pay the tenant…
an amount equal to the security deposit
A lease should specify whether a payment is a(n) ___ or ___.
Security deposit or advance rental
If a lease specifies that a payment is a security deposit, the tenant is usually NOT entitled to apply it to…
the final month’s rent
If a lease specifies that a payment is an advance rental, the landlord must treat it as…
income for tax purposes
The Fair Housing Act requires that tenants with disabilities must be permitted to make ___ to a property.
Reasonable modifications
The Fair Housing Act requires that tenants with disabilities must be permitted to make reasonable modifications to a property at WHO’s expense?
The tenant
The Fair Housing Act requires that tenants with disabilities must be permitted to make reasonable modifications to a property, however if the modifications would interfere with a future tenant’s use, the landlord may require that the premises be…
restored to their original condition at the end of the lease term at the tenant’s expense
The Americans with Disabilities Act (ADA) applies to ___ property in which ___ are provided.
Commercial
Public goods or services
The ADA requires that commercial properties be free of ___ or provide ___ for persons with disabilities
Architectural barriers
Reasonable accomodations
Failing to provide access to drinkable and hot water, heat during winter, working electricity, a smoke detector, and a working bathroom would violate the ___.
Implied Warranty of Habitability
Failing to remediate rodent or insect infestations violates the ___
Implied Warranty of Habitability
Failing to correct building code violations violates the ___
Implied Warranty of Habitability
When a tenant chooses to move out and terminates the lease if repairs are not made within a reasonable time
Constructive eviction
Often times in agricultural or industrial land, ___ are obligated for the payment of rent if improvements are damaged or destroyed
tenants
If a tenant repairs a problem themselves, they may ___ and the costs cannot exceed ___.
deduct the repair costs from next month’s rent
cannot exceed one month’s rent
If a residential property is damaged or destroyed, the tenant is usually permitted to ___ their rent in ___.
Reduce
Proportion to the amount of space they are able to use
In a commercial property, tenants who lease only part of the building, generally are not required to ___ after the leased premises are destroyed.
Pay rent
In some states, if property was destroyed as a result of the landlord’s negligence, the tenant can…
recover damages
If an agricultural or industrial property is destroyed, tenants must ___ to deal with their loss of the improvement
turn to their insurance company
In a lease assignment, who is legally obligated for all the promises originally made in the lease?
The new tenant
In the case of a sublease, the original tenant is responsible for ___ and ___.
payment of rent
damages during the lease
In the case of a sublease, the new tenant is responsible for ___.
Payment to the original tenant
Most leases prohibit a lessee from ___ or ___ without the lessor’s consent
Sublease or assignment
It is always necessary to record a lease. True or false?
False, it is usually UNNECESSARY, but it is allowed in most states
Some states require that long-term leases be ___
Recorded
What are the 3 basic types of leases?
1) Gross Lease
2) Net Lease
3) Percentage Lease
The type of lease that exists depends on the manner in which ___ is determined
rent
Most residential leases are ___ leases.
Gross
In a(n) ___ lease, the tenant pays a fixed rent and the landlord pays all taxes, assessments, insurance, and maintenance & utilities connected with the property.
Gross
The typical rent structure involved in apartment rentals is a(n) ___ lease.
Gross
In a(n) ___ lease, the tenant pays all or some of the operating expenses in addition to the rent.
Net
In a(n) ___ lease, the monthly rental constitutes income for the landlord after operating costs have been paid
Net
Leases for commercial or industrial buildings and the land on which they are located are usually ___ leases.
net
In a gross lease, who pays all property charges such as repairs, taxes, insurance, and operating expenses?
Landlord
In a net lease, who pays all property charges such as repairs, taxes, insurance, and operating expenses?
Tenant
A(n) ___ lease or ___ lease may be a percentage lease.
Gross or net
In a(n) ___ lease, the rent is based on a minimum fixed rental fee plus a percentage of the gross income generated by the tenant doing business on the leased property.
Percentage
Percentage leases are usually used for ___ and ___.
Retail businesses and restaurants
Percentage leases call for a minimum ___ payment plus payment of a(n) ___ exceeding a stated amount.
monthly rent payment
percentage of tenant’s gross sales income
A percentage lease requires minimum payment of $1,300 per month, plus 5% of the business’s sales exceeding $160,000. On an annual sales volume of $250,000, the annual rent would be…
$20,100
Explanation:
$1300 x 12 months = 15600
250,000-160,000 = 90,000
90,000 x 0.05 (5%) = 4500
15600+4500=20100
A percentage lease requires minimum payment of $1,300 per month, plus 5% of the business’s sales exceeding $160,000. $160,000 is known as the…
Breakpoint
___ leases and ___ leases allow for increases in rental charges during the lease period
Graduated leases and index leases
When a landowner leases unimproved land to a tenant who agrees to erect a building on the land, the lease is usually called a(n) ___ lease
Ground
Ground leases are usually ___ leases
long-term net leases
Ground leases usually involve separate ownership of the ___ and ___.
Land and buildings
___ leases often run for terms of 50-99 years
Ground
Ground leases are generally ___ leases
net
In a ground lease, the ___ must pay real estate taxes, insurance, maintenance, and utilities
lessee
A(n) ___ is used when a tenant wants to purchase the property but is unable to do so
Lease purchase
In a lease purchase, the ___ is the primary consideration, while the __ is secondary.
Purchase agreement is primary
Lease is secondary
In a lease purchase, part of periodic rent is applied toward ___ until that price is reduced to an amount for which the tenant can obtain financing or purchase the property outright.
Purchase price
A(n) ___ arrangement is often used when extra capital is needed on a construction project
sale–and-leaseback
In a(n) ___, the original owners pull out their equity to use on other projects and reduce their taxable income when they pay rent to the new owner.
sale-and-leaseback arrangement
Two types of agricultural leases
Cash rent
Sharecropping
An agricultural landowner can be paid by their tenant with an agreed-on rental amount in cash in advance, this is called…
cash rent
An agricultural landowner can be paid by their tenant with a percentage of profits or losses from the sale of crop when it is sold. This is called…
sharecropping
A lease generally does NOT terminate if ___ or ___.
The parties die
Property is sold
A lease generally does not terminate if the parties die or property is sold. However there are two exceptions to this general rule. What are those 2 exceptions?
1) Lease from the owner of a life estate ends when the tenant’s life ends
2) Death of either party terminates a tenancy at will
A lease agreement may contain language that permits a new landlord to terminate existing leases. True or false?
True
If a tenant defaults on payment of rent, what 2 options does the landlord have?
1) 5 day written eviction notice
2) 10 day’s written notice
If a landlord serves their tenant a 5 day written eviction notice, demanding payment of the delinquent rent, what happens if the tenant pays the past-due rent within those 5 days?
Lease continues
If a landlord serves their tenant a 5 day written eviction notice, demanding payment of the delinquent rent, and the tenant fails to pay the rent, the landlord may…
Terminate the lease and sue for possession
If a landlord serves a 10 day written notice, even if the default is cured, the landlord still has the right to…
sue for possession
In IL, a landlord seeking actual eviction of a tenant must file an action called a(n) ___.
Forcible entry and detainer
Forcible entry and detainer suits must be filed in the…
circuit court of the county in which the property is located
In IL, a landlord seeking actual eviction of a tenant must file an action called a forcible entry and detainer. If the court rules in favor of the landlord, a(n) ___ will be entered, and a(n) ___ will be issued by the clerk of court.
judgement of possession
order of possession
After the court issues an order of possession, the tenant must…
leave peaceably & remove all their property from the premises
In IL, if a residential tenant personally appears in court and the landlord prevails, the court will…
delay issuing the order for a reasonable time to allow the tenant to find alternative housing
when a tenant refuses to vacate peaceably after a judgment for possession has been entered, the landlord must deliver the order to the ___ to forcibly evict the tenant.
the sheriff
After a sheriff forcibly evicts a tenant, the landlord has the right to ___ and ___.
re-enter
regain possession of the property
IL landlords may not forcibly remove a tenant without…
following the proper legal procedures
In IL, where is source of income is a protected class under fair housing laws?
Chicago
all of cook county
In Chicago and all of Cook County, refusing to rent to a section 8 voucher is ___.
Discrimination
The residential-lead-based paint hazard reduction act is also called ___.
Title X
Real estate licensees leasing properties built before 1978 must ensure that landlords disclose any possible ___ or related hazards
lead-based paint
If an offer for a lease on a property built before 1978 is received, the licensee representing the landlord must ensure that they provide which 3 things to the tenant?
1) EPA-approved pamphlet titled “protect your family from lead in your home”
2) any known information concerning presence of lead-based paint or related hazards
3) A “Lead warning statement” in or attached to the contract
If an offer for a lease on a MULTI-UNIT property built before 1978 is received, the licensee representing the landlord must ensure that they provide which 3 things to the tenant?
1) EPA-approved pamphlet titled “protect your family from lead in your home”
2) any known information concerning presence of lead-based paint or related hazards in both the unit AND common areas, as well as information on other units when the information was obtained via a building-wide evaluation
3) A “Lead warning statement” in or attached to the contract
In IL, the ___ requires that the owner of any residential building cited by the state as a lead-paint hazard give prospective tenants written notice of the danger unless the owners have a certificate of compliance.
Lead Poisoning Prevention Act
In IL, the Lead Poisoning Prevention Act requires that the owner of any residential building cited by the state as a lead-paint hazard give prospective tenants written notice of the danger unless the owners have ___
a certificate of compliance.
In IL, when a mitigation order is issued to an owner of a building containing lead hazards, the owner has ___ days to eliminate the hazard in a manner prescribed by the law, or ___ days if occupied by a child under age 6 or pregnant woman.
90 days
30 days
In IL, the ___ requires landlords to disclose any knowledge of radon gas on the premises.
Radon Awareness Act
___ is a naturally occurring odorless and colorless gas, and is the second leading cause of lung cancer in the USA.
Radon
In IL, radon disclosure is only required for…
Dwelling units below the 3rd story above ground level
A rental-finding service may not list or advertise any rental without…
Express or written authority of the unit’s owner or agent
In IL, any person or business entity that operates a rental-finding service in IL must obtain a(n) ___ and comply with all provisions of the ___.
Real Estate License
Act
In IL, any person or business entity that operates a rental-finding service in IL must obtain a real estate license and comply with all provisions of the Act. However, ___ are exempt from this requirement.
General-circulation newspapers
In IL, the act allows landlords to ___ to tenants if the tenant refers a prospective tenant for a unit in the same building or complex.
pay a referral fee
In IL, the act allows landlords to pay a referral fee to tenants if the tenant refers a prospective tenant for a unit in the same building or complex if he refers nor more than ___ prospective lessees in any ___ period
3
12 month
In IL, the act allows landlords to pay a referral fee to tenants if the tenant refers a prospective tenant for a unit in the same building or complex if he receives compensation of no more than $___ or the equivalent of ___ - whichever is less - in any ___ period.
5,000
one-month rent
12 month
In IL, the act allows landlords to pay a referral fee to tenants if the tenant refers a prospective tenant for a unit in the same building or complex if he limits his activities to ___.
Referring prospective lessees to the owner
In IL, the act allows landlords to pay a referral fee to tenants if the tenant refers a prospective tenant for a unit in the same building or complex if he does NOT ___, ___, or ___.
Show units
Discuss lease terms
Participate in negotiation of a lease
A leasehold estate that runs for a specific length of time creates a(n) ___.
Estate for years
An estate at will runs as long as…
the landlord permits
A(n) ___ is possession without consent of the landlord
Estate at sufferance
A leasehold estate is classified as a(n) ___ interest
personal property
State statutes of frauds generally require that any lease that will not be completed within 1 year of the date of its making must be ___ to be enforceable in court
in writing
The right to abandon the premises and refuse to pay rent until the premises are repaired
Constructive eviction
___ and ___ laws protect rights of tenants.
Fair housing and civil rights
The IL ___ defines fair housing as including freedom from discrimination against an individual for being part of a protected class.
Human Rights Act
The IL ___ requires availability of public accommodations
Human Rights Act
In IL, the ___ act requires that leases for more than 1 year, or those that cannot be performed within 1 year must be in writing to be enforceable
Frauds Act
In IL, even a short oral lease requires that a(n) ___ disclosure be supplied
lead-paint
