About Betsy Urbance, Director of Legal Services

Betsy Urbance is the Director of Legal Services for Illinois REALTORS®. She is an Associate in the Springfield law firm of Sorling Northrup. She answers the many questions that members have regarding their real estate activities and writes legal articles for association publications.

Alert: About 1,400 corporate real estate licenses fall into non-renewed status.

Source: Bigstock

Is your corporate real estate license current?

If you aren’t sure, now is a good time to check.

That’s because Illinois REALTORS® has learned that as many as 1,400 corporate real estate licenses have fallen into non-renewed status with the Illinois Department of Financial and Professional Regulation.

The expiration date on the entity licenses was October 31, 2016. Illinois REALTORS® suspects that notification by electronic means as opposed to mailing paper notices may be the reason for the missed deadline.

Here’s why this is important: Any brokerage operating under a non-renewed entity license can be subjecting itself to certain serious consequences.

It is imperative that managing brokers check the current status of their entity license to be sure it is renewed.  If the entity license was not renewed, download the reinstatement form here and send it to IDFPR as quickly as possible, return receipt requested.  This can’t be done online.

Here is the department’s contact information if you have a question: Illinois Department of Financial and Professional Regulation, Division of Real Estate, 320 West Washington St.. Springfield, IL 62786. Reach Real Estate Licensing at 800/560-6420.

Amendment to the Illinois Lead Poisoning Prevention Act

Source: Bigstock

You may have heard or read something recently about changes to the Illinois Lead Poisoning Prevention Act, and wondered what this is all about.

But first, let’s discuss what it is not about. This amendment to existing Illinois statute, does not change anything in the FEDERAL law with regard to the disclosures and the pamphlet (Protect Your Family from Lead in Your Home) familiar to real estate brokers when they are selling or renting residential property that was built before 1978. Those federally required lead based paint disclosures (the form and pamphlet) have been provided for sales and rentals of pre-1978 properties for many years and these requirements remain.

What has changed a bit, is the Illinois Lead Poisoning Prevention Act (410 ILCS 45).  Specifically, Section 9.1 of that Act was amended as follows:  If a residential property owner has received a mitigation notice from the Illinois Department of Public Health stating that a lead hazard has been found and must be mitigated, the owner must provide this notice to a new buyer if the owner sells the property.  Likewise, the owner must provide this mitigation notice to a current tenant where the owner and tenant are renewing an existing lease.  However, the owner (existing or a new owner who purchases with notice of the lead hazard), will not be allowed to enter into a new lease for a residential unit unless and until the lead hazard has been mitigated.  These amendments to Section 9.1 of the Illinois Lead Poisoning Prevention Act became effective on Jan. 1, 2017.

It is important for Illinois REALTORS® to be aware of this amendment to Illinois law, but it is also important to understand that it is not a change to the existing federal requirements to make lead based paint disclosures for pre-1978 residential properties.


U.S. Supreme Court Rules on Texas ‘Disparate Impact’ Case

On June 25, 2015, the U.S. Supreme Court issued its opinion in the case entitled, Texas Department of Housing and Community Affairs et al. v. Inclusive Community Project, Inc., et al., examining the question of whether “disparate impact claims are cognizable under the Fair Housing Act….”(576 U.S.____(2015)). In other words, is it appropriate for the Court to consider claims alleging discrimination where a particular statute or regulation appears neutral on its face; but application appears to create an “after-the-fact” discriminatory effect or disparate impact on members of a protected class?

The Supreme Court held, in a 5-4 decision, with Justice Anthony Kennedy writing for the majority, that disparate impact claims are appropriate for consideration by the courts, but that care should be taken when considering these types of cases so as not to impose “racial targets or quotas.” Click here to read the opinion.

Explaining the Cook County(unincorporated) Zoning Use Certificate Ordinance

Bigstock Photo

For those members practicing in areas which include unincorporated Cook County, take note that effective March 21, 2015 a new application procedure became effective for sellers of real property.

The ordinance requires sellers of property to apply for a Zoning Use Certificate when the property goes under contract for sale. Sellers are required to complete an application form [http://www.cookcountyil.gov/building-and-zoning/] and pay a $100 fee seeking a Zoning Use Certificate.

The Cook County Zoning Administrator will either issue or deny the certificate. If denied, the Administrator will state the reasons for denial. The stated goal of this requirement is to prevent surprises to buyers that might limit their ability to use the property for the buyer’s intended purpose. Individual units in condominium and co-op buildings are exempt from this requirement.

Definitions in the ordinance speak to the seller or the “seller’s agent,” which, depending upon the facts, could be our members. However, the Illinois Association of REALTORS®’ Legal Team recommends that licensees not complete the form, but make sure that the seller or his “legal” agent, i.e. his attorney-at-law or attorney-in-fact (power of attorney) complete the form since the seller is asked to make certain representations about the property that the real estate broker may or may not know.

It is important for our members to be aware of this new requirement so that they can be an information source for their clients. Brokers can direct their clients to the form and to their attorneys if the seller has any concerns about providing the information and answering the questions on the application form.

5 practical lessons learned through IAR’s Legal Webinar

Advice regarding surveillance videos, commercial drones, state real estate licenses, medical marijuana and tenant foreclosure rights were among the topics addressed during the Feb. 19 Illinois Association of REALTORS® Legal Webinar.

Although IAR Members were able to get answers to a number of other questions from the IAR Legal Services team, anyone interested in real estate could benefit from these questions, answers and news updates.

1. Q.  The federal ‘Protecting Tenants at Foreclosure Act’ expired on Dec. 31, 2014. Is there a similar Illinois law that protects tenants when their leased property is foreclosed?

A. Yes. In 2013, an Illinois law was enacted, giving tenants similar rights to the federal law. Generally, bona fide leases for residential property must be allowed to go to the end of term, or if the lease is month-to-month, it must give a 90-day notice before eviction. The Illinois law contains specific definitions and some exceptions.

2. Q. A company website/portal has Illinois real estate for sale and is soliciting bids for property it does not own. The company is licensed for real estate and auctioneering in California but not Illinois. Must this company be licensed in Illinois to auction the sale of real estate?

A. Based on these facts, the California company doing business with regard to Illinois real estate would need an Illinois real estate broker license to auction property owned by others for compensation. Complaints would need to be filed with the Enforcement Section of the Illinois Department of Financial and Professional Regulation (IDFPR) at http://wwwidfpr.com/Banks/CONSUMER/FORMS/RealEstateComplaints.pdf.

3. Q. How do we advise tenant clients that qualify for medical marijuana when their landlord prohibits smoking indoors?

A. Landlords may still prohibit smoking indoors. Properly certified patients wishing to use medical marijuana indoors may need to use a smokeless form of the drug. See www.iar.org/publications for articles and webinars on this subject.

4. News on eavesdropping. The only type of eavesdropping allowed in Illinois without consent is video in public areas (it is prohibited in private areas like a bathroom). Effective Dec. 30, 2014, when conversations are expected to be private, audio recording requires the consent of all parties. However, it is unclear whether a conversation in a listed home should be considered private, even if a sign about surveillance recording is posted. Practically speaking, IAR recommends REALTORS® representing sellers get consent or post a sign. REALTORS® representing buyers should not discuss anything with regard to the listed property until off the premises.

5. News on commercial drones. Although the commercial use of drones is presently prohibited by the Federal Aviation Administration (FAA) without an FAA-issued permit, it has proposed new rules that should provide for permitted commercial use of small drones if certain requirements are met. Those proposed rules are in the comment period, so they are not in effect, and it will still be quite some time before the rules become final.