The 60-Second Answer

Illinois residential sellers must give the buyer a written Residential Real Property Disclosure Report before the buyer is contractually obligated to close. The form, defined by 765 ILCS 77/35 (the Illinois Residential Real Property Disclosure Act, or IRELA), asks 23 yes/no/no-knowledge questions about specific defects. If the answer is yes, the seller must describe the defect.

Three things get sellers in trouble:

1. Skipping the form entirely. Gives the buyer an automatic right to terminate before closing.
2. Knowingly marking “no” when the answer was “yes.” Exposes the seller to actual damages plus the buyer’s court costs and attorney fees under 765 ILCS 77/55.
3. Missing Section 22.1 on a condominium sale. A separate Illinois Condominium Property Act disclosure that requires the condo board to provide specific documents to the buyer before closing.

FSBO sellers aren’t exempt. Most of the hard-fought Illinois disclosure cases involve owner-sellers who thought they could skip the form because there was no agent in the middle.

The 23 Specific Conditions on the Illinois Disclosure Form

765 ILCS 77/35 lists 23 statutory questions. The seller must answer each with Yes, No, or No Knowledge. If Yes, the seller must describe the condition on the form or an attached page.

1. Flooding or recurring leakage problems in the crawl space or basement.
2. Material defects in the basement or foundation (cracks, bulges, settling).
3. Leaks or material defects in the roof, ceilings, or chimney.
4. Material defects in the walls, windows, doors, or floors.
5. Material defects in the electrical system.
6. Material defects in the plumbing system (including fixtures, water heater, sump pump).
7. Material defects in the well or well equipment.
8. Unsafe conditions in the drinking water.
9. Material defects in the heating, air conditioning, or ventilating systems.
10. Material defects in the fireplace or woodburning stove.
11. Material defects in the septic, sanitary sewer, or other disposal system.
12. Unsafe concentrations of radon on the premises.
13. Unsafe concentrations of or unsafe conditions relating to asbestos on the premises.
14. Unsafe concentrations of or unsafe conditions relating to lead paint, lead water pipes, lead plumbing pipes, or lead in the soil.
15. Mine subsidence, underground pits, settlement, sliding, upheaval, or other earth stability defects.
16. Current infestations of termites or other wood-boring insects.
17. A structural defect caused by previous infestations of termites or other wood-boring insects.
18. Underground fuel storage tanks on the property.
19. Boundary or lot-line disputes.
20. Encroachments or easements other than utility easements.
21. Notice of federal, state, or local government threatened or pending litigation affecting the property.
22. Notice of a violation of federal, state, or local government regulations affecting the property that has not been corrected.
23. An affinity for meth production on the property or knowledge that methamphetamine was manufactured on the premises.

“Material defect” is defined in the statute: a condition that would have a substantial adverse effect on the value of the residence or that would significantly impair the health or safety of future occupants. Cosmetic problems don’t have to be disclosed. Something that leaks when it rains or that will cost $5,000 to fix absolutely does.

Section 22.1: The Condo and HOA Disclosure Most Sellers Miss

Section 22.1 of the Illinois Condominium Property Act (765 ILCS 605/22.1) is a separate disclosure that applies to every resale of a condominium unit. The seller must request and deliver to the buyer, before closing, nine specific items from the condo board or managing agent:

1. A copy of the declaration, bylaws, and rules and regulations.
2. A statement of any liens, including a statement of the account of the unit setting forth the amounts of unpaid assessments and other charges.
3. A statement of any capital expenditures anticipated within the next two years.
4. A statement of the status and amount of any reserve fund.
5. A copy of the audited financial statements for the last fiscal year, or if an audit is not available, the statement of receipts and disbursements.
6. A statement of the status of any pending suits or judgments in which the association is a party.
7. A statement setting forth any insurance coverage of the association.
8. A statement of the existence of any right of first refusal or other restraint on the sale of the unit.
9. Any other information that the board or its managing agent has regarding the unit that the buyer may reasonably request.

The condo board has 30 days to deliver these items once requested. The statute gives the buyer the right to terminate the contract without penalty if any of the disclosed items materially and adversely affects the buyer, as long as the termination notice is delivered within five business days of receiving the disclosure.

A common trap: the board charges a “22.1 fee” (often $150 to $400) to generate the package. Many seller agents don’t tell their clients about this cost until the last week before closing. Budget for it early.

If the seller can’t produce the Section 22.1 package by closing, the buyer can extend the closing or walk. Neither outcome is good for a seller who’s already moved out.

What Happens If You Get the Disclosure Wrong

The remedies under 765 ILCS 77/55 are stronger than most sellers realize:

• Actual damages. The cost to fix what should have been disclosed, plus any diminution in value. On a roof leak that was marked “No Knowledge” when the seller had a bucket under the drip for six months, that’s the cost of a new roof plus damaged contents.
• Court costs and reasonable attorney fees. The statute specifically authorizes fee-shifting to a prevailing buyer. A $15,000 damages claim becomes a $45,000 exposure when you add the buyer’s lawyer.
• Rescission. In some cases, the buyer can undo the deal entirely and get their money back plus closing costs.

The scariest case law involves sellers who answered “No Knowledge” on things they plainly knew about, like a basement that flooded every spring. Illinois courts read “No Knowledge” strictly. If you had any reason to know, “No Knowledge” is a false statement and you lose.

FSBO Sellers Still Have to Disclose

A for-sale-by-owner transaction is not exempt from IRELA. The form is still required. The only Illinois residential transfers that skip the statutory disclosure are:

• Transfers from one co-owner to another.
• Transfers by a trustee in bankruptcy or receiver.
• Transfers pursuant to a court order (divorce, probate, tax sale).
• Transfers from a mortgagee who acquired at foreclosure and is re-selling.
• Transfers to a spouse or direct lineal relative.
• New construction that has never been occupied.

Everything else needs the form, including FSBO. FSBO sellers who skip the disclosure thinking they’re “not in the system” are the buyers’ lawyers’ favorite defendants.

How Disclosure Fits Into Your Closing

Disclosure is not a line-item service. For anyone selling a home in Illinois with me as counsel, disclosure review, Section 22.1 coordination, and any back-and-forth with the buyer over inspection items are already part of the flat closing fee. There is no separate charge for getting the form right.

If you are working with another closing attorney and just want a read on a specific answer, or if you’re in an unusual position (FSBO without counsel, Illinois property owned out of state, inherited property), start with a phone call. Those conversations are free. See the home-selling attorney page for a walkthrough of how a full seller representation runs from contract through recording.

The Cost of Getting It Wrong

When a disclosure answer is wrong and the buyer discovers it after closing, the remedies under 765 ILCS 77/55 are what make sellers call me two months after the fact:

The remedy these numbers point to is engaging a closing attorney before you sign the disclosure, not after the buyer sues.

Why Hire Me for This

• Licensed Illinois attorney since 2014, ARDC #6308444. Verify on ARDC.
• Closed hundreds of Illinois residential transactions. I know the form, the traps, and the title companies.
• Flat-fee residential closings. Disclosure review and Section 22.1 coordination are included, not billed extra.
• I handle the condo board or managing agent for the 22.1 package directly so you don’t chase paperwork.
• Chicago, Cook, DuPage, Kane, Will, and Lake counties.

Frequently Asked Questions