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Author: Mark Ainely | Partner GC Realty & Development & Co-Host Straight Up Chicago Investor Podcast

A demand letter or legal notice from an attorney might be the first sign of legal trouble, or it could be just a bluff designed to scare you into overreacting. In this episode, attorney Bibek Das joins Mark Ainley and Tom Shallcross to demystify what a demand letter really is, what landlords should (and shouldn’t) do when receiving one, and why staying calm is your most powerful first move. If you own rental property in Chicago or anywhere else, understanding this legal step can save you thousands in the long run. Also, it will allow you to sleep better as I would, and have been, stressed out for days.

From personal injury claims to RLTO violations, demand letters show up in real estate more than most investors realize. Bibek walks through the anatomy of a demand letter, explains when to involve your attorney, and shares examples of both legitimate threats and complete nonsense meant to extract a quick settlement.

Often, landlords are blindsided by these letters. You may have done everything you thought was right—maintained the property, followed the lease, even returned the security deposit—and still find yourself accused of wrongdoing. That’s because demand letters aren’t always based on truth. Sometimes they’re part of a strategy to extract money from property owners who panic. That’s why the theme of this episode is so important: don’t let your emotions write your response. Instead, bring clarity and legal strategy to the table.

Bibek also explains that demand letters can appear in many forms. Some are handwritten by tenants. Others are professionally formatted by law firms with intimidating language. Some are even mass-produced template letters designed to look official but are little more than scare tactics. Regardless of how it arrives, the first step is always the same—review it calmly and get your legal team involved early

Questions We Answer in This Episode

Q: What is a demand letter?
A: A written request from one party demanding something—usually money or action—from another party, often under the threat of a lawsuit. It may come from a person or their attorney, and it usually lays out alleged claims or damages.

Q: What are some common demand letters landlords receive?
A: Security deposit disputes under the RLTO, breach of contract claims from buyers post-closing, habitability issues like no heat or broken appliances, and even personal injury claims from tenants or guests.

Q: How should you respond to a demand letter?
A: First, do not panic. Don’t respond emotionally or immediately. Review the letter carefully, and always consult with your attorney before saying anything that could be used against you later. In these instances, it is always best to consult with your attorney who can help you understand the situation in its entirety.

Q: Can landlords respond to demand letters without an attorney?
A: Technically yes, but it’s not advised. Even a simple statement could create liability or weaken your defense. A lawyer helps you evaluate the claim, prepare a strategic response, and avoid unintentional admissions. It is highly encouraged that you have this type of representation on your side during a time like this.

Q: What’s the risk of overreacting?
A: Many landlords respond impulsively—firing off emails, admitting to things they didn’t need to, or offering settlements too early. These responses can become costly mistakes if the issue escalates.

Q: Is a demand letter always legitimate?
A: No. Some are baseless threats sent to scare you into a payout. Others are legitimate, but inflated. That’s why it’s important to review the facts with your lawyer before making a move.

Q: Why not just file a lawsuit instead of sending a demand letter?
A: Lawsuits are time-consuming and expensive for both sides. Demand letters are often used to push a resolution faster, cheaper, and without court involvement. It’s the first negotiation step before things get formal.

Q: What’s the best mindset when receiving a demand letter?
A: Take a breath. It’s not the end of the world. Treat it like a business issue, not a personal attack. Stay calm, consult legal help, and build your defense carefully.

Show Notes 00:00 – Intro: Beck Dass returns to discuss demand letters
00:42 – What a demand letter actually is
01:53 – Examples of demand letters in real estate
03:09 – Injury claims, habitability, and RLTO cases
04:24 – Legal differences between Chicago and suburban rules
05:29 – Why demand letters are designed to make you panic
06:26 – Don’t respond too quickly—talk to your attorney
07:42 – There’s usually no rush, despite urgent language
08:40 – Why you need legal review before responding
09:08 – Every landlord gets one eventually—it’s part of the game
09:44 – Responding to frivolous vs. legitimate demand letters
11:03 – Avoiding costly missteps when responding directly
12:03 – Purpose of a demand letter: resolve before suing
13:12 – Litigation time, cost, and energy considerations
14:09 – Don’t let fear force a bad early decision
15:15 – Chicago trivia question and wrap-up

Takeaways for Chicago Property Managers and Chicago Landlords

A demand letter is not a lawsuit—it’s a negotiation tool
Don’t respond immediately or emotionally. Pause and consult an attorney
Most claims involve RLTO, personal injury, or post-sale property issues
Your insurance may cover the matter—but only if you don’t admit fault
Responding incorrectly can lead to unnecessary lawsuits or damages
Even if the claim is frivolous, a bad response can worsen your position.
Always document everything—photos, emails, timelines—in advance.
Demand letters are part of being a landlord. Stay professional
Grey areas in landlord-tenant law mean even good landlords can be targeted
Don’t feed a fishing expedition—control your communication
Strategic silence is sometimes the best response
Understand the tone and intent behind the letter—it may be more about leverage than truth
Having a responsive attorney is key to managing landlord risk
Know when to loop in your insurance carrier
Build proactive systems that protect you before legal issues arise

Guest Info Name: Bibek Dass
Firm: Das Law

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Dear Investor,

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