What Are My Disclosure Obligations for FSBO in Illinois
Are You Planning to Sell Your House in Illinois Without the Help of a Real Estate Agent?
FSBO transactions are gaining immense traction lately. Thanks to the convenience and cost-saving benefits. But, as tempting as “for sale by owner” sounds, it can get you into legal trouble if you fail to follow the legal obligations.
For instance, a seller must make certain disclosures about the physical condition of the property to their prospective homebuyers. In the early 1990s, sellers were not required to disclose any information about the property until asked. Buyers had to ask necessary questions to learn everything about the property. Even then, buyers used to sue the seller if they found any flaw after the purchase.
The Illinois legislature came up with new estate laws that cleared the confusion of what was to be disclosed and what was not. Let’s see what a seller has to disclose to the buyer according to the current Illinois residential disclosure act.
Residential Disclosure Act
A homeowner’s responsibility is limited to disclosing the defects in their home they are aware of. You are not supposed to conduct a house inspection, even though most sellers consider performing an inspection for marketing purposes.
A house inspection gives you insights into the minor flaws or the ones that can be fixed. You can increase the value of your property by making small upgrades. If you are conducting a house inspection before putting the property for sale, you need to disclose the defects you’ve discovered during the inspection to the buyers.
The Residential Disclosure Act of 1994 is to protect home buyers from sellers who make false claims and hide important facts about the property intentionally. The Illinois residential property disclosure form consists of a set of 23 questions, which are as follows:
- Has the seller used the property for residential purposes in the past 12 months?
- Was there any leakage in the basement?
- Is the house covered by flood insurance?
Are there defects in the basement?
- Are the chimney, roof, and ceilings in good condition?
- What is the condition of the floor and wall?
- Are there any defects in the electrical system?
- Are plumbing units in working order?
- Is drinking water safe for consumption?
- Is the HVAC system working well?
- Problems with the fireplace and wood-burning stove
- Potential defects in sanitary swerve and disposal system
- Are radon levels safe?
- Is there any risk of unsafe asbestos conditions?
- Are the lead paint, lead soil, and lead pipes in good condition?
- Does the property have earth instability?
- Is the property infested with termites and other pests?
- Is there any structural flaw in your property caused by termites or wood-boring pests?
- Is there an underground fuel storage tank?
- Is the property associated with any crime or legal violations?
- Was the house ever used as a methamphetamine lab?
- Is the property associated with boundary line disputes?
Anyone who is a partial or full owner of the property has to fill out the disclosure form when executing a real estate transaction. It could be a homeowner, a lessor, and any entity with full or partial interest in real estate.
Can the Seller be Sued if They Fail to Disclose this Information?
The buyer can sue the seller for failure to disclose property defects in Illinois. Failure to disclose any known defects may lead to serious consequences for the Seller. The case can be dragged to court if the buyer sues the seller for failure to disclose material facts about the property.
Note that if a seller presents incorrect information about the property intentionally or hides any major defect in the plumbing, electrical, HVAC, and other areas of the property, they will be liable for damages incurred to the homebuyer. They also have to pay court costs and attorney’s fees. The buyer could be aware of the defects in your property, but that doesn’t save you from the penalty incurred for stating misleading facts in the disclosure.
Why Should You Work with an Attorney in Illinois?
Although Illinois doesn’t require you to have an attorney during the closing, you should consider working with one to prevent any legal issues.
Hire the top FSBO lawyers in Illinois, of FSBO Legal Services, and streamline the real estate deal. The attorney will help you with documentation, disclosure, and closing. The real estate attorney will also print and help you complete the residential disclosure document.
As a seller in Illinois, you are supposed to only disclose the questions asked in the disclosure form. The buyer can submit additional inquiries, but you will not be held liable for not disclosing anything other than what’s in the disclosure form. You get to answer these questions in “Yes,” “No,” or Not Applicable.
There’s extra space for each question. You need to give a detailed explanation of your answer if you choose yes or not applicable.
When in doubt, it is better to disclose any material defect than not. Even if it isn’t included in the 23 questions, you should make a separate document for the issues the buyers might want to know.
Not only will it increase your buyers’ trust in you, but it will protect you from lawsuits that might arise later. Enter the date and sign the form. If you are a partial owner of the property, then another part-owner(a) also needs to sign the document.
To ensure a safe and smooth closing, contact FSBO Legal Services.