Basement apartment in Chicago (apartments, lease, insurance)

[the urban politician]

If I don't get my way with the city in regards to a property I bought, I might have to build an illegal apartment in my basement. I did my due diligence and bought a property that has the zoning to allow my basement to be rented, but sometimes people downtown still get in the way of one's plans. Just for details, I'm being told that there is a chance that despite having a Certificate of Zoning Compliance, the Zoning Dept still (which is just plain WRONG and criminal, if you ask me) occasionally will not approve a basement unit.

So my question is, what have all of your experiences been with this issue? Do owners of illegal apartments usually get caught, or is it something they usually get away with?

Thanks

[Vlajos]

I'm pretty sure people get away with it all the time.

[dewthedru]

if the amount of illegal basement apartments i encountered while looking for a house to buy is any indication, you'll have zero issues.

[knitgirl]

It probably depends on if the neighbors have a beef with you or not.

[soulful]

OP. One of the main reasons to avoid an illegal apartment is your insurance. Think about it. Your entire policy may be invalidated if a fire, for example, started in that unit. Or if one of those tenants is injured anywhere on the premises.

I wouldn't take the risk of my insurance not paying when you need it most. There is always a clause in the policy to protect the insurance company. I've owned my share of rental/3 flat units and once "thought about it" and decided not to proceed for the reasons I outlined above.

[Drover]

Perhaps the most overlooked potential issue is having a tenant finding out the unit is illegal (or knowing from the get-go) and using it as a tool of extortion ("I'd suggest lowering my rent/letting me out of my lease/letting my late rent slide/letting me have my 7 cats/etc. if you don't want the city to find out about it").

[MassVt]

I hope that you can pay the mortgage without the illegal tenant; you'd be opening up a huge can of worms if you rented out your basement..

[the urban politician]

The trick is this: I have a certificate of zoning compliance saying I'm allowed to have 3 apartments.

The problem is, the building department doesn't approve of the basement unit

[soulful]

Originally Posted by the urban politician

The trick is this: I have a certificate of zoning compliance saying I'm allowed to have 3 apartments.

The problem is, the building department doesn't approve of the basement unit

What reason does the building dept give for not approving?

[the urban politician]

^ I think it was probably built without permits. Of course, isn't that the case in general for a lot of these basement apts, whether legal or illegal?