Property Buying & Selling in Illinois

Buying or selling real estate in Illinois involves contracts, careful review of public records, and a closing process typically overseen by both title companies and attorneys. Success in the market depends on understanding local market conditions, completing thorough due diligence, and ensuring that the property’s title is clear of liens or defects before ownership is transferred.

Understanding the Real Illinois Market in Illinois

The market conditions in real estate markets typically influence pricing, negotiation strategy, and timing of purchase or sale actions. Local real estate markets may be categorized as a seller’s market or a buyer’s market.

A seller’s market occurs when inventory is low and demand is high. Homes sell quickly in this type of market, attracting multiple offers and limiting negotiation leverage for buyers.

On the other hand, in a buyer’s market, there are more homes available than buyers. Here, buyers typically have more negotiating power, longer due diligence periods, and time to request repairs or concessions.

Buying a Property in Illinois

Purchasing real estate in Illinois involves several key steps, including the following:

• Mortgage Pre-Approval: Before shopping for homes, most buyers secure pre-approval from a lender, which strengthens any offer made on a property. Pre-approval letters typically indicate the buyer’s borrowing capacity and show sellers that financing is likely to close.

• Find a Property: Once pre-approved, buyers can work with a licensed real estate agent to find a home. Factors often considered include school districts, local tax rates, commute times, and crime data.

• Make an Offer and Sign a Contract: After selecting a property, the buyer submits a written offer using a standard Illinois Residential Real Estate Contract. Once both parties sign, the agreement immediately becomes subject to a 5-business-day attorney review period.

• Attorney Review and Inspection Period: This period begins after the contract is signed. During this period:

• Both attorneys may approve, modify, or reject the contract.

• A licensed home inspection is performed, and any issues are addressed.

• The buyer may request repairs or credits, or cancel the deal based on inspection results.

• Title Search and Insurance: Illinois uses title companies, not closing attorneys, to manage most residential closings. The title company will:

• Verify legal ownership

• Check for liens, unpaid taxes, encroachments, or easements

• Issue title insurance to protect the buyer against undiscovered defects in the title

• Appraisal and Final Loan Approval: If financing the purchase, the buyer’s lender will order a property appraisal to ensure the home’s market value supports the loan amount. If the appraisal is low, negotiations may reopen.

• Closing: Closings are typically coordinated by the title company. On the closing date:

• Final documents are signed by both parties.

• Funds are transferred from the buyer or lender.

• The deed is recorded with the County Recorder’s Office, finalizing the legal transfer of ownership.

Selling a Property in Illinois

Selling a property in Illinois typically follows these steps:

• Pre-Listing Preparation: Sellers review their public property records to identify any old mortgages or judgments that were never formally released. This allows the seller’s attorney to start resolving title issues early.

• Attorney Engagement: In Illinois, the seller’s attorney prepares the necessary closing documents, including the deed and the affidavit of title, and coordinates with the title company to ensure all financial obligations are met.

• Title Clearance: The title search initiated by the buyer will reveal all recorded liens attached to the property. The seller’s attorney ensures that the proceeds from the sale are sufficient to pay off all outstanding debt, including the current mortgage lien, property tax liens, or judgments.

• Closing: The seller signs the deed, which, upon recording, transfers the title to the buyer, and the seller receives the net proceeds.

Buying and Selling at the Same Time in Illinois

When a homeowner is selling their current home and buying a new one at the same time, engaging a contingent sale process can ensure that both deals can be closed successfully.

The primary challenge of buying and selling a property at the same time is the timing of funds. Typically, the seller needs the proceeds from their sale to close on their purchase. If the sale closing is delayed, the purchase closing must also be delayed, which can put the buyer’s funds at risk.

A contingency placed in the purchase contract for the new home allows for the conditional purchase upon the successful closing of their current home sale.

In Illinois, attorneys typically manage the delicate timing, often scheduling the closings back-to-back on the same day. This ensures the sale funds are available in time for the purchase, minimizing the time the client is without a home.

Records to Review Before Buying or Selling

Before completing any transaction in Illinois, the following records should be reviewed:

• Property Deed: To find out the legal owner, method of vesting, and legal description of the property

• Mortgage/Lien: To find all active recorded debt against the property and determine the payoff amount needed to clear the title

• Building Permits: To find a history of structural changes, additions, or major electrical or plumbing work

• Covenants and Restrictions: To determine compliance with all recorded covenants and restrictions

• Title Commitment Report: To ensure that the buyer is informed of title conditions and confirm title insurance coverage and exceptions

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