A Chicago ordinance takes effect Tuesday that will offer additional protections, including funds to offset relocation costs, to tenants in foreclosed rental buildings in the city.
The Keep Chicago Renting ordinance, passed by the Chicago City Council in June, requires most entities that take possession of foreclosed rental buildings to offer legitimate tenants rent-controlled leases for as long as they own the building or give them $10,600 per unit in relocation assistance. Any unpaid rent could be deducted from the relocation fee.
The rules apply to any rental unit, including single-family homes, and will most directly affect lenders to who repossess properties at the end of the foreclosure process. Lenders who allow tenants to remain in the buildings must offer them leases with annual rent increases of no more than 2 percent. The requirements would continue until the building is sold to a third party.