New! 2022 updates to the Illinois Residential Real Property Act
Brokers,
On May 13, 2022, Governor Pritzker signed the Illinois House Bill 4322. This bill updates the Ilinois Residential Real Property Disclosure Act by: adding a 24th disclosure, changing the timing of disclosures, allowing email or e-delivery, and changing which sellers need to make disclosures.
These changes went into effect immediately—as soon as Pritzker lifted his pen off the paper.
As you know, Illinois sellers must disclose specified “known material defects” to prospective buyers via the Residential Real Property Disclosure Report form. (This has been law for nearly 30 years now.)
The new bill will update the form, but until then, here’s what we think you should know now.
The 2022 disclosure updates real estate brokers should know:
A new (24th) disclosure asks if the property is insured against flooding.
What about defects that are discovered after the disclosure is signed? The law is unclear. So, proceed with caution. Must your seller disclose if the roof springs a leak after a disclosure was made but before closing? There is no express directive in the statute. Our firm intends to continue our practice of asking sellers to disclose newly discovered defects as part of our attorney review process.
Questions? Feel free to contact us. We are always happy to answer your questions and to help you solve client problems.
On May 13, 2022, Governor Pritzker signed the Illinois House Bill 4322. This bill updates the Ilinois Residential Real Property Disclosure Act by: adding a 24th disclosure, changing the timing of disclosures, allowing email or e-delivery, and changing which sellers need to make disclosures.
These changes went into effect immediately—as soon as Pritzker lifted his pen off the paper.
As you know, Illinois sellers must disclose specified “known material defects” to prospective buyers via the Residential Real Property Disclosure Report form. (This has been law for nearly 30 years now.)
The new bill will update the form, but until then, here’s what we think you should know now.
The 2022 disclosure updates real estate brokers should know:
A new (24th) disclosure asks if the property is insured against flooding.
- Disclosures are to be made before the contract is signed.
- If the disclosures are made after the contract is signed, the buyer is allowed 5 days to cancel the contract.
- The form can now be sent via email or other e-delivery.
- Sellers must supplement their disclosure if they discover errors, omissions, or inaccuracies in the report.
- Buyers can cancel contracts based on a supplemental disclosure under three scenarios:
- The seller knew about the problem – but did not disclose it in the original report
- If the defect cannot be repaired before closing
- Or if the defect can be repaired but the seller declines to do so.
- Not all sellers need to make these disclosures. Disclosures are not required if:
- The seller is a relocation company
- The property is newly constructed (Rehabbers and flippers must make disclosures)
- Transfer is made between spouses or others of direct lineageTransfer is made pursuant to wills/probate/TODI (Transfer on Death Instrument)
- Transfer is made between co-owners
- Transfer is made pursuant to court orders
- Transfer is made pursuant to foreclosures
- Disclosures made by a seller who is exempt from disclosure requirement do not count. Exempt sellers are still exempt.
What about defects that are discovered after the disclosure is signed? The law is unclear. So, proceed with caution. Must your seller disclose if the roof springs a leak after a disclosure was made but before closing? There is no express directive in the statute. Our firm intends to continue our practice of asking sellers to disclose newly discovered defects as part of our attorney review process.
Questions? Feel free to contact us. We are always happy to answer your questions and to help you solve client problems.
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