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Changes to the Illinois Residential Real Property Disclosure


When most home sellers list their property with a real estate agent or listing broker, those sellers routinely fill out what is known as a “Residential Real Property Disclosure Report”. The “report”, required of many home sellers by law, is made up of a series of questions intended to elicit the disclosure of certain conditions of the property. The report requires disclosure of issues such as leakage, defects, and unsafe conditions to potential buyers.

With House Bill 358, sponsored by representative Novak, the Illinois General Assembly has amended the law making new changes that home seller’s should be aware of as their duties under the law are now expanded.


The bill requires a disclosure by a “Sellers”. The law now defines sellers as “Every person or entity who is an owner, beneficiary of a trust, contract purchaser or lessee of a ground lease, who has an interest (legal or equitable) in residential real property.” The law adds an exemption with the following: “However, ‘Seller’ shall not include any person who has both (1) never occupied the residential real property and (2) never had the management responsibility for the residential real property nor delegated such responsibility for the residential real property to another person or entity.” 765 ILCS 77/5  As such, persons who own property but delegate the property’s management to others are still required to make a disclosure.


Under the old law, home sellers, in conjunction with their real estate agent, usually filled out the residential real property disclosure report at the time they listed the property. That report or a photocopy of that report would usually be appended to all contract offers. Under the old law, Sellers were not responsible under the Act for any inaccurate information resulting from acts, occurrences, incidents or agreements arising after the date the report was completed.  The amendment places the burden of an ongoing duty of the seller at all times prior to closing to supplement the form in writing of any error, inaccuracy or omission. 765 ILCS 77/30.


The new duty to supplement the disclosure report brings with it some additional risk to the Seller. For any supplemental disclosure, including that of a material defect, the prospective buyer will still be bound to the contract. However, in the event that the Seller had actual knowledge of the material defect at the time the prior disclosure was signed by the Seller, the prospective buyer will have, during a short period after disclosure, the right to terminate the contract. 765 ILCS 77/40. Sellers should be mindful that the supplemental disclosure is not a vehicle for disclosing material defects after a contract is signed.


The penalties for failure to provide a disclosure are severe. Under the old law, prospective purchasers did not have any right to invalidate a contract solely because of non compliance with the Act. Now, a prospective buyer shall have the right to terminate the contract if not provided with a disclosure. Further, a Seller who fails to comply with any duties of the act or discloses any false information on the report could be found liable for actual damages, court costs, and attorney fees. 765 ILCS 77/55


The residential real property disclosure report is not a contract. It is, however, a creature of statute and failure to comply with the statute can result in severe penalties for a Seller. Make sure to take this disclosure seriously.

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