When buying or selling a home in Illinois, your transaction must comply with the provisions of the Real Property Disclosure Act. The Act requires sellers of qualifying residential properties to disclose known material defects in the property, giving buyers a legal claim if sellers knowingly misrepresent the property’s condition.
Understanding the Real Property Disclosure Act
Until the 1990s, Illinois law did not require sellers of residential property to volunteer any information about the property; instead, buyers had to ask for any information they wanted when considering whether to purchase a property. The Illinois legislature passed the Real Property Disclosure Act (RDPA) to remedy this situation. The law prohibits sellers from falsely representing the property’s condition and requires them to disclose material information about the property to buyers.
The RDPA applies to all residential properties containing up to four units, including condominiums and co-ops. The law also applies to lease options and land contractors. However, the RPDA does not cover new residential construction, commercial condominiums, foreclosure sales, deeds in lieu of transfer, transfers between co-owners, or transfers in divorce, probate, or bankruptcy.
Key Provisions of the RPDA
The RPDA has several key provisions. First, the law requires sellers of covered residential properties to fill out and sign a 22-question disclosure form. The disclosure form asks about property conditions such as:
- Flood damage or flood risks on the property
- Defects in the foundation, roof/ceiling, walls, floors, chimneys, electrical system, plumbing, septic/sewer, HVAC system, and well system
- Safety of the drinking water
- Radon level
- Presence of asbestos or lead
- Continuing ground settlement or earth instability
- Presence of termites or other wood-boring insects or existing insect damage
- Presence of underground fuel storage tanks
- Outstanding property boundary disputes
- Prior zoning, building code, or municipal ordinance violations
- Prior use of the property as a methamphetamine lab
The law requires sellers to disclose all material defects in the property but does not require them to inspect the property before completing the disclosure statement. However, when a seller discovers a material defect after submitting the disclosure statement but before closing, they must submit a supplemental disclosure report to the prospective buyer.
The Act also permits sellers to omit prior material defects from the disclosure statement if they believe they have reasonably fixed the issue since the statement must reflect the property’s current condition. However, sellers can disclose prior defects and describe the steps taken to remedy the issue.
Buyers can cancel their purchase contracts if sellers fail to provide their disclosure statements before closing. A seller who fails to disclose known material defects in their property becomes liable to the buyer for the costs of repairing the property, alternative living expenses, and potential legal fees and court costs.
Contact a Real Estate Attorney Today
When buying or selling a property, an experienced real estate attorney can help you understand and navigate your rights or obligations under the Real Property Disclosure Act. Contact the Law Office of Van-Lear P. Eckert, P.C., today for a free, no-obligation consultation to discuss how our firm can protect your interests in your real estate transaction.