Chicago's RLTO has strict rules about security deposits that protect tenants—including requirements for interest payments that many landlords violate. Understanding these rules can help you get your full deposit back and potentially recover penalties if your landlord doesn't comply.
(RLTO limit)
after move-out
violations
Maximum Security Deposit
Under the Chicago RLTO, landlords cannot charge more than 1.5 months' rent as a security deposit. This applies regardless of your credit score or rental history.
Deposit Calculation Examples
Interest Requirements
This is where many Chicago landlords violate the law. Under the RLTO:
- Deposit must be held in a federally insured, interest-bearing account at an Illinois bank
- Interest must be paid to you annually — within 30 days after the end of each 12-month rental period
- Receipt required within 14 days — with bank name, address, and amount deposited
Interest Rate
The city sets the minimum interest rate annually based on bank rates. Even if rates are low, you're entitled to interest on your deposit.
What Can Be Deducted?
Landlords can only deduct for actual damages beyond normal wear and tear:
Normal Wear & Tear (NOT deductible)
- • Faded paint from sunlight
- • Minor scuffs on walls
- • Worn carpet in high-traffic areas
- • Small nail holes from hanging pictures
- • Loose door handles from normal use
- • Minor marks on wood floors
Actual Damage (CAN be deducted)
- • Holes in walls (beyond nail holes)
- • Broken windows or doors
- • Stained or burned carpet
- • Damaged appliances
- • Pet damage
- • Unpaid rent
Getting Your Deposit Back
When you move out, your landlord must return your security deposit according to these timelines:
Return Timeline
If landlord makes no deductions, full deposit + interest must be returned within 30 days
If landlord deducts for damages, must return remainder + itemized statement within 45 days
Penalties for Violations
If your landlord violates any security deposit requirement under the RLTO, you may be entitled to:
RLTO Penalty for Security Deposit Violations
- 2×Two times the security deposit amount
- +Interest on the deposit
- +Attorney's fees if you sue and win
Common violations that trigger penalties include:
- Not holding deposit in interest-bearing account
- Not paying interest annually
- Not providing receipt within 14 days
- Not returning deposit within required timeframe
- Improper deductions
How to Protect Your Deposit
At Move-In
- • Take photos and videos of every room
- • Note any existing damage (stains, holes, scratches)
- • Test all appliances and fixtures
- • Email photos to yourself (creates timestamp)
- • Request a move-in checklist from landlord
During Your Tenancy
- Track when you receive (or don't receive) your annual interest payment
- Keep your deposit receipt in a safe place
- Report maintenance issues in writing
- Keep copies of all communication with landlord
At Move-Out
- • Clean the apartment thoroughly
- • Fill small nail holes (if required by lease)
- • Take photos/video of final condition
- • Return all keys
- • Provide forwarding address in writing
- • Request walk-through with landlord
What If Your Landlord Won't Return It?
If your landlord doesn't return your deposit within the required timeframe:
- Send a demand letter — Certified mail, requesting return within 7-10 days. Mention the RLTO penalties.
- Contact a tenant organization — Metropolitan Tenants Organization: (773) 292-4988
- File in small claims court — You can sue for 2x deposit + interest. Filing fee is small, no lawyer needed.
Small Claims Court Tips
- • File in the district where the apartment is located
- • Bring all documentation (lease, photos, deposit receipt, demand letter)
- • You can sue for 2x deposit + interest + court costs
- • Many judges are familiar with RLTO violations
Common Landlord Violations
Illegal Practices
- ✗Charging more than 1.5 months — Illegal under RLTO
- ✗Not paying annual interest — Very common violation
- ✗No receipt within 14 days — Must provide bank info
- ✗Deducting for normal wear — Can only deduct for actual damage
- ✗No itemized statement — Must explain all deductions