(765 ILCS 86/10-20)
(Section scheduled to be repealed on January 1, 2020)
Sec. 10-20. Sale of encumbered lots prohibited; exceptions. It is unlawful for the owner or subdivider to sell lots or parcels within a subdivision subject to a blanket encumbrance unless one of the following conditions is met:
(1) All sums paid or advanced by a purchaser are
placed in an escrow or other depository account acceptable to the Department until (i) the fee title contracted for is delivered to the purchaser by deed together with complete release from all financial encumbrances; (ii) the owner, subdivider, or purchaser defaults and fails to perform under the contract of sale and there is final determination as to the disposition of such moneys; or (iii) the funds in the escrow or other account are voluntarily returned to the contract purchaser.
(2) The fee title to the subdivision is placed in
trust under an agreement or trust acceptable to the Department until a proper release from each blanket encumbrance, including all taxes, is obtained and title is delivered to the purchaser.
(3) A bond to the State of Illinois is furnished to
the Department for the benefit and protection of purchasers of such lots or parcels, in the amount and subject to terms approved by the Department. The bond shall be executed by a surety company that is authorized to do business in the State of Illinois and has given consent to be sued in this State. The bond shall provide for the return of moneys paid or advanced by a purchaser if (i) the title contracted for is not delivered and (ii) a full release from each blanket encumbrance is not obtained. If it is determined that the purchaser, by reason of default or otherwise, is not entitled to the return of those moneys, or any portion of those moneys, then the bond is released by the amount of moneys to which the purchaser of parcel is not entitled.
(4) The blanket encumbrance contains provisions
evidencing the subordination of the lien of the holder of the blanket encumbrance to the rights of those persons purchasing from the subdivider, and further evidencing that the subdivider is able to secure releases from such blanket encumbrances with respect to the property.
(Source: P.A. 96-855, eff. 12-31-09.)
Sections: Previous 10-5 10-10 10-15 10-20 10-25 10-30 Next
Last modified: February 18, 2015