Can Landlords Use Lease Modifications as an Alternative to Evictions?

The ongoing COVID-19 crisis has affected many individuals, families, and businesses, and it has caused financial struggles for both landlords and tenants. Some residential tenants have experienced job losses, and many businesses have been required to close or scale back their operations. When residential or commercial tenants are unable to pay rent, this can put landlords in a difficult position, since they may be unable to meet their own financial obligations. 

Typically, landlords are able to pursue evictions when tenants do not meet their rent requirements or otherwise violate the terms of a lease. However, the state of Illinois has placed a moratorium on evictions, and this prohibition has been repeatedly extended as the pandemic continues to affect people throughout the state. Most recently, Governor J.B. Pritzker issued an executive order extending this moratorium through January 9, 2021, and additional extensions may be made if they are determined to be necessary. For landlords who are currently unable to evict tenants who have not paid rent, other options may be available, including making lease modifications that can provide protections and benefits for both landlords and tenants.

Options for Lease Modifications

Even though tenants cannot currently be evicted, they are still required to meet the terms of their lease agreements, and this means that they will need to pay all rent that is due. If they cannot do so, a landlord may pursue eviction proceedings once the moratorium is lifted. However, landlords and tenants may be able to agree on concessions, such as a decrease in the amount of rent to be paid or a deferral of rent payments for a certain period of time. In return for making concessions, landlords may consider other lease modifications that will provide them with certain financial protections. These modifications may include:

  • A temporary reduction in the amount of rent, followed by an increase in rent at a later date or upon circumstances in which a tenant will once again be able to make larger payments.

  • Requirements that a tenant pay an additional security deposit if they anticipate an inability to make rent payments in the future.

  • Requirements that a tenant apply for public aid assistance available for businesses that have been affected by the COVID-19 pandemic and set aside a certain amount of the benefits received to put toward past-due rent.

  • Changes to a tenant’s rights regarding the use of the property or their ability to extend the lease or purchase the property.

  • Terms allowing a tenant to sublet the property to other tenants who can contribute toward rent payments.

  • Terms placing a lien on property owned by the tenant that will allow a landlord to receive compensation if the tenant continues to be unable to make rent payments after a certain amount of time.

Contact a Beverly Commercial Real Estate Lawyer

If you are a landlord who is struggling to receive rent payments during the COVID-19 pandemic,  The Marques Eason Law Group can help you determine your legal options. We will work with you to negotiate lease modifications that will protect your rights and financial interests, and we will advise you of other forms of financial relief that may be available. Call our skilled South Side of Chicago real estate attorney today at 773-973-3755 to schedule a private consultation.


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