House & Apartment

Buying a home is a big financial decision. The first step is finding out what's affordable. Before seriously looking at available homes, figure out the price range. If you plan on taking out a home loan (mortgage) to make the purchase, getting preapproved is a great place to start.

The Department of Housing and Urban Development (HUD) supports housing counseling agencies nationwide. Counselors offer free or low-cost help with every step of the homebuying process. Find a HUD-certified housing counselor online or call (800) 569-4287. The MyPathToHome website can also connect you with a HUD-approved housing counselor. 

Once the price range and housing priorities are clear, the steps usually include:

• Creating a wishlist of what you're looking for in a home (this HUD checklist is a good place to start),
• Hiring a real estate agent,
• Researching and visiting potential homes,
• Making a purchase offer that's accepted,
• Getting a home inspection to check for major issues,
• Hiring an appraiser to confirm the home’s value,
• Finalizing financing, including homeowner’s insurance,
• Hiring a lawyer to help with the paperwork, and
• Signing documents and officially taking ownership at closing.

When you are in the process of renting or buying a home, it is illegal for someone to discriminate against you because of your race, religion, national origin, color, familial status, sex (including sexual orientation), or disability. Read HUD’s fair housing information to learn about the Fair Housing Act and your rights as a potential homeowner.

Under the Equal Credit Opportunity Act, it is also illegal for any lender to decide not to give you a loan because of your race, color, religion, national origin, sex, marital status, age, or because you receive public assistance. The Illinois Department of Human Rights has information about discrimination under the Illinois Human Rights Act. If you believe your rights may have been violated, you can report housing discrimination to HUD. 

A home-buying budget should include:

• Total purchase price (including inspections, down payment, and closing costs),
• Moving expenses,
• Initial home expenses,
• Monthly mortgage payments,
• Any payments to a condominium or homeowner's association,
• Homeowner's insurance,
• Property taxes,
• Utilities, and
• Upkeep costs.

You are not legally required to hire a real estate agent to buy a home in Illinois. However, buying a home is a complicated process. Having your own real estate agent, sometimes called a buyer's agent, can make a big difference in getting a good deal.

Real estate agents work for a buyer or seller and generally charge no upfront fee. They are usually paid a commission built into the home's sale price. The benefits of having your own agent include:

• Access to the Multiple Listings Service (MLS), which can show properties that aren't publicly available yet,
• Knowledge of the local real estate market, and
• Help negotiating a good deal.

Buyer's agents also often have enough experience with different types of home purchases that they can spot if something seems unusual in the process. Because many people only purchase homes a few times at most, having someone help who has gone through the process many times can be beneficial.

You are not legally required to hire a lawyer to buy a home in Illinois. Hiring an attorney is recommended because Illinois property law can be complex. Lawyers are especially important if you are using a rent-to-own contract.

Lawyers can:

• Review your contract to make sure it follows current laws,
• Negotiate on your behalf,
• Explain complicated terms and documents so you can make an informed decision,
• Perform a title search to ensure there are no liens or ongoing lawsuits related to the property and that the seller actually owns the property, and
• Help you during the closing to make sure all documents are correct and that you understand the many documents you are signing.

If you know that you want to buy property soon, the first step is usually getting pre-approved for a mortgage. A mortgage is a loan to buy a home. Most people who buy a home take out a mortgage loan. 

Pre-approval letters show a real estate agent or seller that you can purchase a home in a specific price range. Being pre-approved for a mortgage only involves communications between you and the possible lender. The lender will evaluate your financial situation based on the information you provide. 

A mortgage loan requires knowing which property you're purchasing, who the seller will be, and the price. The lender (bank, mortgage company, or broker) gives the buyer money to pay the seller. The buyer repays the lender over an agreed period (usually 30 years), with the home as collateral. This loan is the mortgage, and the written promise to repay is the promissory note. If the buyer fails to follow the loan terms, the lender can file a foreclosure lawsuit to recover its money.

Many people choose to compare options from multiple lenders. Look for important details like:

• Fixed or adjustable rates (adjustable rates are riskier because the interest rate can go up and increase your monthly payment),
• How long the time period is to pay off the loan,
• Whether the mortgage is insured or guaranteed by the federal government (conventional private mortgages, which are the most common type, aren't),
• Whether there's a special federal mortgage program involved, like Federal Housing Administration (FHA), USDA, or VA mortgages, and
• Whether a state mortgage program is available (check with the Illinois Housing Development Authority for more information).

To shop for a mortgage, you will need to gather all of your financial information and then reach out to multiple lenders. This information usually includes:

• Your Federal and State tax returns,
• Pay stubs and W-2 forms,
• Any records of other income (such as rental income),
• Evidence of funds to make your down payment,
• Identification documents, and
• Bank statements.

Lenders include banks, mortgage companies, and brokers. When you apply for a loan, a lender will get a copy of your credit report. Your credit score can go down slightly as a result of this inquiry (less than five points). As long as you apply with multiple lenders within 45 days, any other lenders requesting your credit report should not impact your credit.

There are several federal programs that can help first-time or low-income buyers, including: 

• VA Loans: Low or no down payment or private mortgage insurance for eligible military members, veterans, and surviving spouses.
• USDA Loans: Low interest rates and no down payment for rural and some suburban buyers who meet income limits.

Illinois also offers several statewide first-time homebuyer programs, including:

• IHDAccess Forgivable Mortgage: Down payment assistance that may be forgiven for those that meet certain requirements.
• IHDAccess Deferred Mortgage: Down payment help with repayment deferred until sale or refinance for those that meet certain requirements.
• IHDAccess Repayable Mortgage: Down payment assistance that must be repaid over time for those that meet certain requirements.
• Chicago Housing Authority Down Payment Assistance Program: Helps Chicago residents with down payment costs if they meet certain requirements.

Several municipalities in Illinois offer their own programs, including the City of Alton, Joliet, Kane County, and others. If you are uncertain about purchasing a home, IHDA’s First Housing Counseling Resource Program (HCRP) can answer your questions and help you determine if it is the right time for you.

A home inspection gives you a better idea of the condition of the home you are looking to buy. It can reduce your risk of purchasing a home that has problems. For example, some homes may have termites or mold that could cause structural or health problems.

It is usually the buyer’s responsibility to schedule and pay for the home inspection.  In Illinois, home inspectors must be licensed by the State.

These organizations can help you find a home inspector:

• International Association of Certified Home Inspectors, and
• American Society of Home Inspectors

To find out if a home inspector has an active license, use the Illinois Department of Financial and Professional Regulation’s License Lookup.

HUD provides a list of 10 important questions to ask your home inspector.

When you have found a home you would like to purchase, the next step is to make an offer to the seller. If the seller responds, you can then negotiate the price and other terms and hopefully come to an agreement. Once you and the seller both sign, this means that the home is “under contract.” You will have a certain amount of time to inspect the property, finalize the approval of your loan, and shop for title insurance.

Once you are under contract, you should be ready to provide your lender or lawyer with updated and extra information. This will include:

• Financial information,
• Information about your new homeowner’s insurance and title insurance,
• Any condo or homeowner’s association bylaws and condo disclosures, and
• Any changes to your situation that might impact your ability to close on the loan.

Most real estate contracts include an "attorney review period," which gives lawyers time to review and negotiate terms. Buying a home is a major purchase. You should seriously consider hiring a lawyer to review the closing disclosure with you.

A real estate contract is a binding agreement, so it’s important to understand what’s in it before you sign. There are several important parts of your contract that you should review and consider before entering into a final agreement.

• Earnest money: This is a deposit that shows you’re serious about buying the home. If you cancel for a reason not covered by a contingency, you often will not get it back.
• Financing: The contract should say how you plan to pay for the home and may include a financing contingency in case your mortgage falls through.
• Contingencies: Common contingencies allow you to cancel the contract if the inspection finds serious defects, the title is not clear, or the land survey shows issues with the property boundaries.
• Closing costs and timeline: Check who is paying for what and make sure the schedule gives you enough time to get financing and prepare for closing.
• Tax proration: In Illinois, property taxes are paid a year behind. The seller usually gives you a credit at closing to cover their share of the unpaid taxes.

A lawyer can help you understand these parts of the contract. 

Before you sign a contract to buy a home, the seller must give you a Residential Real Property disclosure. This tells you about any major defects in the property the seller knows about. If the seller says in the report that there is a major problem with the house then you have the right to cancel the contract. Necessary disclosures include: 

• Major defects that impact the value of the property. This could include a leaking roof, plumbing problems, or a history of pests;
• Any code violations from within that last 10 years;
• Major defects that would impact the health and safety of anyone living there;
• The presence of lead-based paint, radon, or other environmental hazards like asbestos;
• Any homeowner association rules and bylaws.

If the seller fails to disclose a known problem, and you discover it later, you may have the right to take legal action. There is a strict timeline for filing legal action about issues that weren't disclosed. Talk to a lawyer immediately if you think a problem wasn't disclosed at closing to determine if legal action is an option in your situation.

However, there may be significant problems in the house that the seller doesn't know about or that are not covered by the report. That’s why it’s also a good idea to get a professional home inspection to find any issues the seller might not have disclosed or even known about. Sellers and buyers may also have different opinions about what kinds of problems are serious.

The Illinois Residential Real Estate Property Disclosure Act lists what sellers need to disclose.

Checking property records at the County Recorder’s Office shows who legally owns the property and if anyone else has a claim or interest. This helps you understand exactly what you’re buying and avoid problems when multiple people claim rights to the same property.

In Cook County, the County Recorder's Office is part of the Cook County Clerk's Office. You, your lawyer, or your real estate agent can check the property records. A legal claim to the property could be based on a deed, mortgage, lease, or another right to the property. 

Types of documents commonly filed with the county recorder's office include:

• Mortgages,
• Leases,
• Liens,
• Easements,
• Condominium Declarations, and
• Notices of pending lawsuits regarding the property (called Lis Pendens).

Checking property records is one step in a larger process called a title search. A title search is a more complete investigation of the property's legal history, usually performed by a title company or attorney during the closing process.

A title search is an in-depth review of public records that confirms who legally owns a property and identifies any legal issues that could affect your ownership. This step is essential before closing on a home because it protects you from hidden problems.

A title search helps you:

• Verify that the seller actually owns the property and has the legal right to sell it
• Uncover any liens (such as unpaid property taxes, contractor debts, or mortgages) that could affect your ownership
• Check for other claims, like easements or pending lawsuits, that may limit your use of the property

Title searches are typically done by title companies or real estate attorneys. While you can search public records yourself at the county recorder’s office, it can be time-consuming and difficult to catch everything. That’s why it’s strongly recommended that you hire a lawyer or title professional to do the search for you.

Yes. If you’re buying property in a planned development, find out if it’s part of a property association before you commit. Property associations can charge monthly or annual fees and set rules about everything from exterior paint colors to parking. Once you buy into a property association, you typically can’t just opt out. You’re agreeing to follow its rules and pay its fees for as long as you own the property. Learn more about residential community associations. 

When you buy a home, you receive a document called a deed. This is a document that shows that the seller transferred their legal ownership, or "title," to the home or property to you. Sometimes, problems arise with the title after the purchase, such as unpaid taxes, liens, mortgages, or restrictions on the property. 

Title insurance protects buyers and lenders against defects or issues with a title when there is a transfer of property ownership. Lenders typically require the buyer to purchase the lender’s policy. You can also shop around for an owner’s policy that would protect your interest in the home. You may also contact survey companies for quotes if a survey is required. Check your loan estimate to see which services you can shop for.

Title insurers are required to be licensed in Illinois. Visit the Illinois Department of Professional and Financial Regulation to check on an insurer's license.

If your home or belongings are damaged, homeowner’s insurance protects you. Certain types of damage are covered by insurance, and others are not. Usually covered are damage from fire, theft vandalism, and damage caused by weather like lightning, wind, or hail. Many policies also include personal liability coverage, which can help protect you if someone is injured on your property or if you cause damage to someone else’s property. 

Most lenders will require you to have homeowner’s insurance in place before closing. This is because when a lender gives you a mortgage, they also have an investment in the property. Homeowner’s insurance helps cover the cost of repairs or rebuilding, which protects both you and the lender.

When you shop for homeowners insurance, it’s a good idea to compare rates from different insurance companies. You should ask for the same coverage and limits to compare the options. 

When you’re asking for quotes, you may want to ask the insurance agent:

• Are you licensed by the Illinois Department of Insurance?
• What deductible will I have to pay if I make a claim?
• How will having a higher or lower deductible affect my premium?
• If I submit a claim, how will that affect my premium?
• How will my credit history affect my premium?
• What damage or losses does the policy cover, and what doesn’t it cover?
• Does the policy include enough coverage to rebuild my destroyed home?
• Would the policy cover the value of important personal belongings?
• How much liability coverage does the policy include? Who does it cover?
• What options are available for flood insurance and earthquake coverage? How much does the additional coverage cost?
• What types of water damage are covered, and which are not?
• Is mold damage covered?
• Are there any discounts I may qualify for?

Be sure to work with a licensed insurance agent or company. Insurers are required to be licensed. An unlicensed agent or company may not: 

• Pay your claims, or
• Refund your premiums if you cancel your policy. 

Consider getting a quote from your current insurer, such as your auto insurer. Many insurers will offer discounts if you “bundle” your coverage. It means that you buy both car and homeowners insurance from the same company. 

Learn more about shopping for homeowners insurance and licensing on the Illinois Department of Insurance’s website. 

Homeowners insurance policies offer different packages to protect your home and belongings. These policies may cover:

• The structure of your house and other buildings on your property, like a garage or shed,
• Personal belongings, even those kept off-site, such as in storage or with a child at college (subject to limits),
• Sudden damage caused by events like fire, wind, or theft,
• Extra living expenses if you can’t live in your home after a covered loss (for example, hotel and food costs), and
• Liability protection if someone is injured on your property.

Some common issues and types of damage are not covered and may require separate policies or added coverage. These typically include:

• Normal wear and tear or damage from lack of maintenance,
• Flood damage, which usually needs a separate flood insurance policy,
• Sewer or drain backups, unless you purchase extra coverage for this,
• Damage to vehicles, which are covered by separate auto insurance policies, and
• Some types of tree damage.

Read your insurance policy closely to understand what your policy covers.

If you have tried but cannot get homeowners insurance, ask your insurance agent about the Illinois Fair Plan. To qualify for the FAIR plan, you must have unsuccessfully tried to buy homeowners insurance 3 times. 

As a buyer, the closing process is the final step in purchasing your home. Before closing, you should do a final walkthrough to make sure the property is in the condition agreed upon and that any requested repairs have been completed.

At closing, you’ll sign documents transferring ownership and finalizing your mortgage loan. The seller must prepare all necessary documents ahead of time. This includes the final closing statement (also known as the HUD-1 or ALTA Settlement Statement), which outlines the financial details of the transaction.

You should be aware of costs, which can include lender and attorney’s fees, property taxes (prorated up to the date of sale), title insurance, and homeowner association fees or assessments (if applicable). Illinois also has a state transfer tax, and some municipalities may impose additional transfer taxes or require stamps before a deed can be recorded.

Yes. After buying a property, you must file the deed with the County Recorder’s Office (or equivalent office) to officially show you are the legal owner. Recording the deed makes your ownership public and helps prevent future disputes. In Cook County, the Recorder’s Office is part of the Cook County Clerk's Office.

The recorder’s office keeps records of property transactions like deeds, mortgages, liens, leases, easements, condominium declarations, and notices of lawsuits (Lis Pendens). Anyone can check these records to verify ownership or claims. 

Filing fees vary by county and document but generally start around $21. You can file in person, by mail, or sometimes electronically. Check with your local recorder’s office for specific instructions. 

While some forms are designed for public use, filing property documents can be complex. It’s a good idea to consult a lawyer to ensure everything is done correctly.

If you find serious repair problems after closing, your options depend on what the seller knew, what your contract says, and how much time has passed. There is a strict deadline for legal action against the seller. If you are interested in legal action against the seller, talk to a lawyer right away.

Document the problem before making any repairs. The seller may be responsible if they failed to disclose defects or transferred the property in a condition worse than promised in the purchase contract. The Illinois Residential Real Estate Property Disclosure Act lists what sellers need to disclose.

It is also against the law for you and the seller to lie about anything concerning the contract. If the seller lied about the home's condition to convince you to buy it, you may be able to sue them or force them to repair certain problems. The written contract must include the seller's statements about the house.

If the seller won’t cooperate with your request for repairs, you should consult with a lawyer and file a complaint with the Illinois Attorney General. 

In some cases, you may be able to become the legal owner of property you’ve used for a long time through a legal process called adverse possession. But it is rare and requires very specific conditions to be met under Illinois law.

• Continuous for a period of 20 years,
• Hostile or adverse (without the owner’s permission),
• Actual (you physically used the land),
• Open, notorious, and exclusive possession of the premises, and
• Under claim of title inconsistent with that of the true owner.

Even if you meet all the conditions, you won’t automatically become the owner. You still have to go to court and get a judge to recognize your claim. The court will draw all presumptions in favor of the original title owner. If you have “color of title” (a document like a deed or contract) and pay property taxes for 7 years, you may qualify sooner—but only if you also possessed the land.

Land held by Illinois state and municipal government entities is generally immune from adverse possession actions.