Lawmakers pass bill to limit exposure of foreclosed condo buyers

25-May-14 – The Illinois House and Senate have approved a bill aimed at reducing the number of surprises for buyers of condominium units that have been foreclosed upon.

If signed into law, a buyer of a condo unit at a foreclosure sale would have to pay any unpaid monthly assessments up to nine months but other costs are limited.

Illinois is the only state that allows condo associations to collect unpaid assessments from buyers. Currently, a buyer is responsible for as many as six months of unpaid costs that can include regular and special assessments, unlimited attorney fees, fines, and other charges. The new amount could include attorney fees and court costs but the total amount owed must appear on any official notice of the sale and a condo association must provide the information within 14 days of a request.

The Illinois Association of Realtors supports the bill, saying it would “make the process fairer for those trying to buy foreclosed condos.”

“Not only is it an unpleasant surprise for buyers expecting to pay one amount and getting stuck with another amount,” wrote the association on its blog, “it also can jeopardize deals when the buyer doesn’t have immediate arrangements to come up with the additional money.”

The amendment to the Illinois Condominium Property Act was passed 64-47 in the Illinois House on Thursday. It was passed in the Illinois Senate on April 8 with all but one senator voting for the bill.