Understanding Oral Leases

What is an oral agreement?

A rental agreement can be oral or written. It is the same thing as a lease. An oral rental agreement is where a tenant and a landlord agree that a tenant can rent a unit but the agreement is not in writing. An oral rental agreement is still enforceable. 

If the landlord lets a tenant move in and accepts rent payments, then a tenant has an oral rental agreement. 

The rental period begins on the day rent is due. A tenant is not bound for a certain amount of time after this period.

How does a landlord or tenant terminate an oral lease?

• An oral lease on a month-to-month unit allows a tenant to move out with just a one month's notice.
• On the other hand, the landlord has to give a tenant 30, 60, or 120 days of notice to terminate the lease without a reason under the Chicago Fair Notice Ordinance.
• Landlords can also terminate an oral lease early by giving a 5-day notice when the tenant does not pay rent or a 10-day notice when the tenant violates the lease.

Can a landlord change the lease terms?

Because there is no written lease, the landlord may add or change rules. Many tenants feel that they have a lot less power if they do not have a written lease. You are probably more stable in your housing if you have a written lease.

However, a landlord can only increase the rent with a written letter based off a 30, 60, or 120 day notice under the Chicago Fair Notice Ordinance.

Oral agreements can be valid, but it is difficult to prove their terms. Without written proof of what was agreed, it ends up being an argument between the tenant and landlord.