This Article is the first in a series about new real estate related laws in Illinois, effective in 2025. I have a fair number of clients who buy distressed properties at foreclosure auctions. Occasionally my client buys a home to live in at a judicial sale, but more often than not, it’s investment property. If you are in the business of purchasing foreclosed property from judicial sales and/or auctions, or if this is something you are looking to get into, then you should be aware of Public Act 103-930 S.B., 2919, which was recently signed into law and is effective as of January 1, 2025. Through the end of last year, foreclosure auctions were entirely in person. If you found a foreclosed property you were interested in, you had to physically attend the auction. In this day and age of Zoom, Teams, and Google Meets, this might seem unusual, but… read more →
If you’ve been looking for a home for a while, chances are a listing marketed as a short sale has come across your radar. The price of the home probably caught your eye since it seemed to be way below market value. However, when signing a contract to purchase a short sale, there are many things you need to know. A short sale is not like a regular purchase. First, what is a short sale? A short sale may very well be the last straw before a home goes into foreclosure. Indeed, often a short sale is processed while the home is already in foreclosure. Essentially the owner of the property is behind on their mortgage payments. Instead of the bank foreclosing and taking possession of the house, the bank cuts a deal with the current owner to sell the property and use the proceeds to pay off as much… read more →
If student debt is holding you back from buying a home, the Illinois Housing Development Authority (IHDA) may have a solution. Provided you meet certain criteria, IHDA’s SmartBuy program will not only give you $5,000 towards your down payment or closing costs, but it will also PAY OFF YOUR STUDENT DEBT, UP TO $40,000. It does not matter where you live now. As long as you are buying a home in Illinois and plan to move in within 60 days after you purchase your home, and you meet the other eligibility criteria listed below, you may qualify for SmartBuy. SmartBuy eligibility is based on the following: The property you purchase must be your primary residence. If you currently own a home and intend to purchase your next home with SmartBuy, your lender will decide if you are able to own both homes or if you need to sell the first… read more →
For some reason, a lot of people want to add their adult children onto the deeds of their homes. I must talk to a client about this at least once a week. People generally have different, specific reasons they want to do this. But if you take away all the fluff, it generally boils down to one thing—they want their kids to end up with the house when they die. But is adding your children onto the title of your home the best way to do this? Well, I can’t say it’s never a good idea. There are a few situations where it may be the best way to go. But more often than not, there is a better solution. So why is it not a good idea to add your adult children onto the deed to your home? Your child may want to get a mortgage to purchase real… read more →
A few years back, during the pandemic, I had a particularly memorable closing. Unfortunately, it was not memorable for any good reason. Every single thing was going wrong. My paralegal had an emergency and was not in the office. My clients, the buyers, had gone to do their walk-through that morning. They found rats in the house. Additionally, built-in shelving that was included in the purchase had been removed from two different rooms in the house, including an entire wall of mudroom built-ins. The seller was nowhere to be found. The seller‘s attorney was nowhere to be found. When I finally tracked down his assistant and told her about the rats, she said a few rats should not bother anyone and they certainly wouldn’t bother her. Gross. Honestly, I have had so many closings where sellers have pulled these types of stunts that despite all the problems, in a normal… read more →
While you are negotiating your contract for purchase of real estate, or during your attorney and inspection review periods, you (the Buyer) may reach a point where you need to make a decision about a closing cost credit or a purchase price reduction. For some reason or other, you and the seller have agreed on a financial concession in your favor. At this point, you need to decide how you should receive that concession. If you are purchasing in cash, the simplest thing to do is to reduce the purchase price. Since you are a cash purchaser, you will be paying your purchase price and all of your closing cost at closing anyway. There is no lender involved to make things messy, so you might as well take a straight reduction on the purchase price. At some point when the county goes back and looks at the sale of the… read more →
If you are thinking about setting up a land trust, you should educate yourself. Does a land trust even make sense for you? What are the benefits of putting your real estate in a land trust? What’s the downside? And of course, what types of land trust options do you have in the state of Illinois? In its essence, a land trust is simply a trust created to hold real estate. In most cases, one land trust holds one parcel of real estate. The elements of a land trust are fairly straightforward: (a) You need to create a trust agreement; (b) to the extent you are using a title company or a bank to manage the land trust, you need to make sure that the trust is open and paid for; and (c) you need to actually fund the trust by transferring in the real estate in question. One of… read more →
If you are buying or selling real estate, you may have heard the term “appraisal contingency“ thrown about by your real estate agent. But do you really understand what it means? Do you know how it affects you? Whether you are buying or selling real estate, if the transaction is being financed, the appraisal contingency is very important. Let’s back up a second. What is an appraisal? Well, when you engage a lender to finance your transaction, they will typically order an appraisal to determine the value of the property you are purchasing. The actual appraisal is handled by a third-party company. Neither your loan officer nor your bank is personally handling the appraisal. What does the appraisal entail? Well, once the appraisal is ordered, an appraiser will be sent out to look at your property. Usually the appraiser will not only go inside and look around, but also… read more →
If you are selling your home, you want everything to be smooth. You could be selling for any number of reasons — upsizing, downsizing, moving out of state, moving to senior living, or even because you are just ready for a change. After all, you went to all the trouble of putting your house on the market, procuring a buyer, dealing with the buyer’s inspection items, waiting for the buyer‘s mortgage to be finalized, and meeting with your attorney to sign a stack of papers. And now finally, finally, finally, you have a closing date on your calendar. Just a few more days, and you will be on to the next chapter of your life. Or so you thought. . .Everything was fine. . . And then your survey came in. In a typical residential real estate transaction, the survey is usually one of the last things the parties actually… read more →
Much has been made in the news recently about the proposed “Mansion Tax” referendum that will be on the primary ballot for Chicago voters in March of 2024. But for the average person to understand what this proposed tax actually is, it is important to understand how Chicago properties are currently taxed. First of all, the proposed “Mansion Tax” does not refer to real estate taxes or income taxes. The “Mansion Tax” is all about transfer taxes. Unlike income tax, which is due every year, or real estate taxes, which are due twice a year, we don’t hear a lot about transfer taxes in the news. Why is that? It’s because transfer taxes are only due when real estate is bought or sold. If you bought your house 10 years ago, you paid the tax then. You won’t be paying anything again until you sell. Unless the property is exempt… read more →