Home values seem to be dipping every month, and face it, you’re not getting any younger. Have you considered that upon your death, the value of your home might be enough to push your estate from non-taxable to taxable? If you were to die in 2008 and your estate was valued at less than $2,000,000, there would be no federal estate tax. But if the value of your house (or anything else, for that matter) causes you to exceed that magic number, then presto — your estate is paying taxes. A QPRT (Qualfied Personal Residence Trust) is essentially a way to move your home out of your estate, thereby lowering the value of your estate upon your death. At the same time, you still get to live in your home while you’re alive. How does this work? Let’s say your house was worth $750,000 in early 2007 but is only… read more →
Condominium owners often wonder if the information they were given about the size of their unit is correct. They find themselves asking questions such as: Is it really 1,000 square feet? Or: That second bedroom looks kind of small — Did I get cheated? Is the ceiling really 10′ high? Isn’t that what my contract said it should be? Well, there are two ways that developers and architects can measure footage of a condominium unit, and both are widely accepted: 1) From inside wall to inside wall — meaning, from the surface of the drywall on one wall, to the surface of the drywall on the wall across from it; this is commonly called the “paint to paint” measurement. 2) From the outside wall of the unit to the middle of the opposing wall. In a recent case, Kirkpatrick v. Strosberg, 2008 Ill.App.LEXIS 358 (1st Dist. 2008), the condominium owners… read more →
Many times property owners forget that they have escrowed money with their lender for property taxes. As a result, Illinois counties often receive duplicate tax payments on an individual parcel of property — one from the bank and one from the property owner. If your bank is escrowing your taxes and you erroneously make a duplicate tax payment, you should submit a property tax refund request to the county. To do so, you can go online to your county treasurer’s website and follow their instructions. Most of the time, you will receive a refund within a few months. But what happens if you forget to request the refund? How do you get your money back? Well, in Illinois you can get duplicate tax payments back as long as you submit your request within five years. The court recently confirmed this in Alvarez v. Pappas, 208 Ill.LEXIS 315 (2008). In that… read more →
People are always asking me about other areas of the law, and car troubles and their legal ramifications have come up more than once! Sergei Lemberg, an attorney specializing in lemon laws, is guest blogging today. I hope you find his article about lemon laws in Illinois informative! If you’ve ever bought a new car, you know what a rush it is. There’s the new car smell, the feeling of power as you hit the accelerator, and the peace of mind knowing that you’ll have a reliable ride for a long, long time. But what happens when that new car isn’t so reliable? When you wake up one morning and have to come to terms with the fact that you’ve bought a lemon? Well, Illinois lemon law can help. Every state has a lemon law, but that each of them is different. Under Illinois’ lemon law, some vehicles qualify as… read more →
On October 9, 2008, the Cook County Sheriff’s Department announced it was suspending evictions of all foreclosed homes within county limits. The sheriff’s primary concern was for tenants in foreclosed properties, not property owners. Tenants in properties facing foreclosure were not receiving notice of the potential or actual foreclosure from the banks as required by law. With neither the banks nor landlords notifying them, many tenants knew nothing about having to vacate their homes until the sheriff’s office came knocking on their doors. Last week the court promised to enforce the rules requiring banks to provide a four month grace period before forcing tenants to move out. Additionally, banks will have to notify the court of all tenants residing at the property, and prove that they gave each tenant notice of the foreclosure. While adhering to these rules will prolong the foreclosure process for properties inhabited by tenants, tenants will… read more →
More good news for distressed Cook County homeowners: The Cook County Sheriff’s Department announced this week that they are suspending service of evictions notices on people who are being foreclosed, as well as renters in buildings that are being foreclosed because the landlord has been unable to make mortgage payments. Particularly with respect to renters, the Cook County Sheriff is requesting that banks give tenants notice of the foreclosure and time to leave voluntarily if the landlord has not paid the mortgage; while landlords routinely get such notices from their banks, they usually do not share them with tenants. As a result, tenants often know nothing about having to vacate the property until the sheriff shows up at their door. The Cook County Sheriff’s Department has chosen to take this course of action despite the fact that it violates numerous foreclosure decrees issues by Cook County courts. It is yet… read more →
Finally, some good news for the thousands of people who are being foreclosed and losing their homes: Countrywide (now part of Bank of America) recently entered into an $8.4 billion settlement with 11 states, including Illinois. Illinois’ share of this settlement amounts to $190 million, and these funds will be used to assist approximately 21,000 distressed Illinois homeowners who obtained loans from Countrywide Mortgage prior to December 31, 2007. Specifically, these homeowners can expect to have their interest rates reduced; in some cases, even the principal of the loan may be reduced. The goal is to make their monthly payments more affordable, ideally 32% or less of a family’s income. Additionally late fees, loan modification fees, and prepayment penalties will be waived. Certain families that already lost their homes as a result of foreclosure proceedings shall receive cash payments. Countrywide/Bank of America will also suspend ongoing foreclosure proceedings for those… read more →
I have quite a few clients who own residential investment property, such as condominiums or townhomes or even single family homes that they rent out. On occasion, I get a phone call from a client who has a “bad” tenant — in other words, a tenant who is not paying rent or is breaking the lease in some other way. What should you do if you are a landlord and this happens to you? Well, you should start simple and hope that you can resolve the problem without having to file an eviction. So how do you start simple? I always recommend that you call or visit your tenant and try to talk the issue through — give them a day or two to fix the problem. Sometimes that’s the easiest way to resolve the matter. If that doesn’t work, you need to hone in on your specific problem so… read more →
Landlords know how important security deposits are in residential leases. The threat of losing their security deposit can keep tenants honest. Good landlords don’t want to hold back the security deposit after the tenant leaves; they would much rather have their home or apartment back in good shape. Tenants, too, look forward to the return of their security deposit when they move out. Illinois has two laws governing security deposits, and it is easy to run afoul of them: 1. The Security Deposit Interest Act: This law requires all landlords who have 25 or more units in one building or complex to pay interest on security deposits to their tenants, so long as the landlord hold the security deposit for more than 6 months. The interest rate is calculated based on the savings account interest rate payable by the state’s largest bank at the end of the year preceding the… read more →
As if the real estate market hasn’t had it bad enough this year, Cook County’s real estate tax bills will be coming out soon and will be due on November 3, 2008, and unfortunately, the taxes are going up. While home prices are plummeting, real estate taxes are not. In fact, Cook County’s north and northwest suburban homes were reassessed last year. The second installment tax bill that homeowners will soon receive will include these increased assessments. Unfortunately, the increased assessments are valued as of January 1, 2007, before the housing market crashed. Therefore homeowners will be paying taxes based on home values inflated beyond where they are today. The City of Chicago will not be reassessed until 2009. In the meantime, their property taxes are still based on home values as on January 1, 2006, when the housing market was peaking. Some Chicago homeowners will thus see large increases… read more →