Buying a condo in Illinois offers a unique opportunity to balance ownership with shared responsibility. Condos provide amenities, convenience, and a community-focused lifestyle, but they also have considerations that differ from buying a single-family home. Evaluating these elements carefully will determine whether you reach the closing table without avoidable surprises.
The Unique Elements of Buying a Condo
When purchasing a condo, you’re not just acquiring a private living space—you’re also buying into a collective. This includes shared areas like lobbies, gyms, or pools and a financial stake in the broader building or development. Most buildings rely on homeowners’ association (HOA) fees to keep things running. These monthly payments cover maintenance, utilities, and reserves for future repairs. Before buying, assess how much these fees will cost and what they cover.
Illinois law mandates that sellers provide a 22.1 resale disclosure, a document explaining the condo association. This disclosure reveals ongoing litigation, insurance policy details, and whether the association has sufficient reserves for extensive repairs. It also specifies whether upcoming special assessments or one-time fees are often used for major building projects like a new roof or tuck-pointing upkeep. Failing to review this disclosure carefully could result in unexpected costs after purchase.
Illinois also requires condo associations to hold at least four meetings per year. Reviewing meeting minutes or attending a meeting can give you insight into how decisions are made and whether conflicts or financial challenges are on the horizon. Some associations hold orientation meetings for new owners, which can help you understand the building’s rules and expectations.
Considerations for Protecting You & Your Investment
Before finalizing your purchase, verify whether the current owner is up-to-date on their fees. This is done through a Paid Assessment Letter (PAL), which confirms that all dues have been paid. Title companies often require this document before closing to avoid disputes. If there are unpaid fees, these must be settled before continuing the property sale.
Condos often have additional costs beyond the purchase price. Many associations use management companies that charge transfer fees during sales. Depending on the building, these fees might be split between buyer and seller or handled differently. Familiarizing yourself with the specifics beforehand can save you frustration later.
Insurance is another critical aspect to investigate. The association’s policy typically covers the building and shared spaces, but usually does not cover the inside of the condo or your belongings. Check if supplemental coverage is needed to protect your investment fully.
Finally, consider the association’s financial health. A well-funded reserve means the building can address unexpected repairs without relying heavily on special assessments. If the reserve is underfunded, owners may face sudden, significant expenses. Asking direct questions about reserves, financial stability, and upcoming projects is not only prudent—it’s essential.
Let Us Be Part of Your Real Estate Team
Buying a condo involves a blend of private ownership and shared responsibility. With so many moving parts—monthly fees, disclosures, assessments, and management—it pays to dig into the details and be well-prepared. Take the time to understand the financial and operational aspects of the building before committing. For assistance navigating this process and ensuring details are addressed, consider contacting Auricchio Law Offices for a free consultation. With experience across Chicagoland and Northwest Indiana, we’re here to help make your real estate transactions as seamless as possible.
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- What to Know About Buying a Condo in Illinois - January 13, 2025
