HB3146 104TH GENERAL ASSEMBLY

LRB104 11225 HLH 21307 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB3146

Introduced 2/18/2025, by Rep. Will Guzzardi

SYNOPSIS AS INTRODUCED:

35 ILCS 200/21-90
35 ILCS 200/21-302 new
35 ILCS 200/22-10
35 ILCS 200/22-40
35 ILCS 200/22-65
765 ILCS 940/5
765 ILCS 940/30

Amends the Property Tax Code. Provides that, when the county, as trustee, files one petition for more than one delinquent tax lien or certificate, the county may request that the court issue a tax deed to the county, as trustee, without holding a judicial tax deed auction. Provides that the county shall offer the parcel for sale at a public auction within 120 days of recording the tax deed. Sets forth requirements for the county auction. Provides that any owner of property sold under any provision of the Code who sustains loss or damage by reason of the issuance of a tax deed shall have the right to recover surplus equity that was lost in the property through an award of indemnity. Amends the Mortgage Rescue Fraud Act. Provides that a distressed property conveyance contract must contain a statement that the property owner may have the right to obtain money for any equity lost if a tax deed is issued. Effective immediately.

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Property Tax Code is amended by changing Sections 21-90, 22-10, 22-40, and 22-65 and by adding Section 21-302 as follows:

(35 ILCS 200/21-90)

Sec. 21-90. Purchase and sale by county; distribution of proceeds.

(a) When any property is offered for sale under any of the provisions of this Code, the county board of the county in which the property is located, in its discretion, may bid, or, in the case of forfeited property, may apply to purchase it or otherwise acquire the tax lien or certificate in the name of the county as trustee for all taxing districts having an interest in the property's taxes or special assessments for the nonpayment of which the property is sold. The presiding officer of the county board, with the advice and consent of the board, may appoint on its behalf some officer, person, or entity to attend such sales, bid on tax liens or certificates, and act on behalf of the county when exercising its authority under this Section, with reasonable costs and fees for such services paid from redemption interest and sales proceeds arising from county certificates. The county shall apply on the bid or purchase the unpaid taxes and special assessments due upon the property. No cash need be paid. Under Sections 21-110, 21-115, 21-120, and 21-190, a county may bid or purchase tax certificates only in the absence of other bidders.

(b) The county, as trustee for all taxing districts having an interest in the property's taxes or special assessments, shall be the designated holder of all tax liens or certificates that are forfeited to the State or county. No cash need be paid for the forfeited tax lien or certificate.

(c) For any tax lien or certificate acquired under subsection (a) or (b) of this Section, the county may take steps necessary to acquire title to the property, including a final right of first refusal or final bid at the close of any public auction or judicial sale conveying title to the property, and may manage and operate the property, including, but not limited to, mowing of grass, removal of nuisance greenery, removal of garbage, waste, debris or other materials, or the demolition, repair, or remediation of unsafe structures. When a county, or other taxing district within the county, is a petitioner for a tax deed, no filing fee shall be required. When a county or other taxing district within the county is the petitioner for a tax deed, one petition may be filed including all parcels that are tax delinquent within the county or taxing district, and any publication made under Section 22-20 of this Code may combine all such parcels within a single notice. The notice may include the property street address as listed on the most recent available tax bills, if available, and shall list the Property Index Number of the parcels for informational purposes. The county, as tax creditor and as trustee for other tax creditors, or other taxing district within the county, shall not be required to allege and prove that all taxes and special assessments which become due and payable after the sale or forfeiture to the county have been paid nor shall the county be required to pay the subsequently accruing taxes or special assessments at any time. The county board or its designee may prohibit the county collector from including the property in the tax sale of one or more subsequent years. The lien of taxes and special assessments which become due and payable after a sale to a county shall merge in the fee title of the county, or other taxing district within the county, on the issuance of a deed.

The county may sell any property acquired with authority provided in this Section, or assign any tax certificate to any person or entity party, including, but not limited to, taxing districts, municipalities, land banks created pursuant to Illinois law, or non-profit developers focused on constructing affordable housing.

The assigned tax certificate shall be void with no further rights given to the assignee, including no right to refund or reimbursement, if a tax deed has not been recorded within 4 years after the date of the assignment unless a court extends the assignment period as provided in this Section. Upon a motion by the assignee, a court may toll the 4-year deadline for a specified period of time if the court finds the assignee is prevented from obtaining or recording a deed by injunction or order of any court, by the refusal or inability of any court to act upon the application for a tax deed, by a municipality's refusal to issue necessary transfer stamps or approvals for recording, or by the refusal of the clerk to execute the deed. If an assigned tax certificate is void under this Section, it shall be forfeited to the county and held as a valid certificate of sale in the county's name pursuant to this Section 21-90. The proceeds of any sale or assignment under this Section, less all costs of the county incurred in the acquisition, operation, maintenance, and sale of the property or assignment of the tax certificate, including all costs associated with county staff and overhead used to perform the duties of the trustee set forth in this Section, and less any surplus payments to owners, shall be distributed to the taxing districts in proportion to their respective interests therein.

(d) When the county, as trustee, files one petition for more than one delinquent tax lien or certificate, the county may request, pursuant to Section 22-40, that the court issue a tax deed to the county, as trustee, without holding a judicial tax deed auction. If the county requests a tax deed without a judicial tax deed auction, the Order for Issuance of Tax Deed shall identify the total amount of delinquent taxes and penalties, municipal advancements identified in Section 22-35, pro rata county costs incurred pursuant to subsections (a) through (c) of Section 21-90, and other posted costs for each parcel conveyed, and order the county to offer each parcel for sale at a public auction, as set forth in subsection (e), within 120 days of recording the tax deed.

(e) Auctions held by a county pursuant to this Section shall conform with the following requirements.

(1) The county or its agent shall give notice of the auction with the following information:

(A) the Property Identification Number and Address listed on the latest tax bill;

(B) the time and place of the auction;

(C) the terms of the auction; and

(D) the total amount of delinquent taxes and penalties, municipal advancements identified in Section 22-35, pro rata county costs incurred pursuant to subsections (a) through (c) of Section 21-90, and other posted costs.

The notice of auction shall be mailed via first class mail to all parties at the address at which service of process was made. If service of process was made in any manner other than by personal service, substitute service, corporate service, or government service, notice shall be mailed via first class mail to all addresses included in the notice served pursuant to Section 22-25. The notice shall include a sworn certificate of service signed by the party sending the notice attesting to the fact that the notice of auction was placed in the mail at least 10 calendar days prior to the date of the auction. The notice of auction shall be published at least 3 consecutive calendar weeks (Sunday through Saturday), once in each week, the first such notice to be published not more than 45 days prior to the auction, the last such notice to be published not less than 7 days prior to the auction. If the property is located in a municipality in a county with less than 3,000,000 inhabitants, the county or its agent shall also publish a notice in some newspaper published in the municipality. If the petitioner cannot identify a newspaper published in the municipality, or if the property is located in a county with 3,000,000 or more inhabitants, the notice shall be published in a newspaper published within the county. If no newspaper is published in the county, then the notice shall be published in the newspaper that is published nearest the county seat of the county in which the property is located. The publication shall include all information included in the notice sent pursuant to this Section.

(2) The county may establish minimum bids at any auction held pursuant to this Section, not to exceed the total amount of delinquent taxes and penalties, municipal advancements identified in Section 22-35, pro rata county costs incurred pursuant to subsections (a) through (c) of Section 21-90, and other posted costs, for the auctioned parcel, as identified in the Order for Issuance of Tax Deed. For purposes of this section, "pro rata county costs incurred pursuant to subsections (a) through (c) of Section 21-90" may include costs incurred by the county in filing one petition for more than one delinquent tax lien or certificate and all costs related to the filing of the one petition and obtaining tax deeds for the liens and certificates identified in the one petition, reasonably apportioned and included in the total costs for each individual tax deed issued pursuant to the petition.

(3) If an auction is postponed, adjourned, or rescheduled to occur less than 60 days after the last scheduled auction, the county shall announce the date, time, and place upon which the adjourned auction shall be held at the time, date, and location in the notice. The County is not required to send additional notice of any postponed auction as provided in item (1) of subsection (e) of Section 21-90. Notwithstanding any provision of law to the contrary, for auctions that are conducted more than 60 days after the date in the required notice, the county shall send notice of the adjourned auction in accordance with Section item (1) of subsection (e) of Section 21-90.

(4) In auctions held pursuant to this Section, the county, as trustee, shall have a right of first refusal or final bid at the close of any public auction. The county is required to pay the full amount of any county bid that exceeds the credit bid prior to the disbursement of surplus funds in subsection (6) of this Section.

(5) Failure to hold a public auction of the parcels received within the 180-day period shall not affect the validity of the recorded deed, the Order for Issuance of Tax Deed, or otherwise affect the marketability of title.

(6) To the extent that the winning bid at the auction exceeds the amount of the tax deed judgment as defined in subsection (d) of Section 21-90, the county trustee shall deposit the surplus funds with the treasurer of the county in which the subject property lies within 30 days. Within 60 days of the auction sale, the county, as trustee, shall send a notice to interested parties in the underlying case, stating that the owner is entitled to a distribution of surplus proceeds and may file a claim pursuant to subsection (i) of Section 22-40.

Under Sections 21-110, 21-115, 21-120, and 21-190, a county may bid or purchase only in the absence of other bidders.

(Source: P.A. 102-363, eff. 1-1-22; 103-555, eff. 1-1-24.)

(35 ILCS 200/21-302 new)

Sec. 21-302. Payments of surplus equity.

(a) Any owner of property sold under any provision of this Code who sustains loss or damage by reason of the issuance of a tax deed shall have the right to recover surplus equity that was lost in the property through an award of indemnity as follows:

(1) The claim for indemnity shall be filed not later than 2 years from the date the order directing the issuance of tax deed was entered, or 2 years from the effective date of this amendatory Act of the 104th General Assembly, whichever is earlier.

(2) The indemnity award shall be limited to the fair cash value of the property as of the date the tax deed was issued, less any mortgages or liens on the property. The Court shall liberally construe this equitable entitlement standard to provide compensation wherever, in the discretion of the Court, the equities warrant the action.

(3) In determining the fair cash value of property less any mortgages or liens on the property, the fair cash value shall be reduced by the principal amount of all taxes paid by the tax purchaser or his or her assignee before the issuance of the tax deed. The court, in its discretion, may order the joinder of the mortgagee or lienholder as an additional party to the indemnity action.

(b) The provisions of the Code of Civil Procedure shall apply to proceedings under the petition, except that neither the petitioner nor County Treasurer shall be entitled to trial by jury on the issues presented in the petition.

(c) Any contract involving the proceeds of a judgment for indemnity under this Section, between the tax deed grantee or its successors in title and the indemnity petitioner or his or her successors, shall be in writing. In any action brought under Section 21-305, the Collector shall be entitled to discovery regarding, but not limited to, the following:

(1) the identity of all persons beneficially interested in the contract, directly or indirectly, including at least the following information: the names and addresses of any natural persons; the place of incorporation of any corporation and the names and addresses of its shareholders unless it is publicly held; the names and addresses of all general and limited partners of any partnership; the names and addresses of all persons having an ownership interest in any entity doing business under an assumed name and the county in which the assumed business name is registered; and the nature and extent of the interest in the contract of each person identified;

(2) the time period during which the contract was negotiated and agreed upon, from the date of the first direct or indirect contact between any of the contracting parties to the date of its execution;

(3) the name and address of each natural person who took part in negotiating the contract, and the identity and relationship of the party that the person represented in the negotiations; and

(4) the existence of an agreement for payment of attorney's fees by or on behalf of each party. Any information disclosed during discovery may be subject to protective order as deemed appropriate by the court. The terms of the contract shall not be used as evidence of value.

(35 ILCS 200/22-10)

Sec. 22-10. Notice of expiration of period of redemption. A purchaser or assignee shall not be entitled to a tax deed to the property sold unless, not less than 3 months nor more than 6 months prior to the expiration of the period of redemption, he or she gives notice of the sale and the date of expiration of the period of redemption to the owners, occupants, the municipality in which the subject property lies, or the county if the property lies outside of municipal corporate boundaries, and parties interested in the property, including any mortgagee of record, as provided below. For counties or taxing districts holding certificates pursuant to Section 21-90, the date of expiration of the period of redemption shall be designated by the county or taxing district in its petition for tax deed and identified in the notice below, which shall be filed with the county clerk.

The Notice to be given to the parties shall be in at least 10-point type in the following form completely filled in: TAX DEED NO. .................... FILED ....................

TAKE NOTICE

County of ...........................................

Date Premises Sold or Forfeited .....................

Certificate No. .....................................

Sold or Forfeited for General Taxes of (year) .......

Sold for Special Assessment of (Municipality)

and special assessment number .......................

Warrant No. ................ Inst. No. .................

THIS PROPERTY HAS BEEN SOLD FOR

DELINQUENT TAXES Property Address (as identified on the most recent tax bill, if available) .... Legal Description or Property Index No. .......... .......... ..............................

This notice is to advise you that the above property has been sold for delinquent taxes and that the period of redemption from the sale will expire on .......... ..........

Check with the county clerk as to the exact amount you owe before redeeming.

This notice is also to advise you that a petition has been filed for a tax deed which will transfer title and the right to possession of this property if redemption is not made on or before ..................................................

This matter is set for hearing in the Circuit Court of this county in ...., Illinois on .....

You may be present at this hearing but your right to redeem will already have expired at that time.

YOU ARE URGED TO REDEEM IMMEDIATELY

TO PREVENT LOSS OF PROPERTY

Redemption can be made at any time on or before .... by applying to the County Clerk of ...., County, Illinois at the Office of the County Clerk in ...., Illinois.

For further information contact the County Clerk ADDRESS:.................... TELEPHONE AND/OR EMAIL ADDRESS:..................

..........................

Purchaser or Assignee.

Dated (insert date).

In counties with 3,000,000 or more inhabitants, the notice shall also state the address, room number, and time at which the matter is set for hearing.

The changes to this Section made by Public Act 97-557 apply only to matters in which a petition for tax deed is filed on or after July 1, 2012 (the effective date of Public Act 97-557).

The changes to this Section made by Public Act 102-1003 apply to matters in which a petition for tax deed is filed on or after May 27, 2022 (the effective date of Public Act 102-1003). Failure of any party or any public official to comply with the changes made to this Section by Public Act 102-528 does not invalidate any tax deed issued prior to May 27, 2022 (the effective date of Public Act 102-1003).

The changes made to this Section by this amendatory Act of the 103rd General Assembly apply to matters concerning tax certificates issued on or after the effective date of this amendatory Act of the 103rd General Assembly.

(Source: P.A. 102-528, eff. 1-1-22; 102-813, eff. 5-13-22; 102-1003, eff. 5-27-22; 103-154, eff. 6-30-23; 103-555, eff. 1-1-24.)

(35 ILCS 200/22-40)

Sec. 22-40. Issuance of order authorizing judicial tax deed auction, confirmation and order for tax deed; possession.

(a) To obtain an order authorizing a judicial tax deed auction and for issuance of tax deed, the petitioner must provide sufficient evidence that:

(1) the redemption period has expired and the property has not been redeemed;

(2) all taxes and special assessments which became due and payable subsequent to the sale have been paid, unless the county or its agent, as trustee pursuant to Section 21-90, is the petitioner;

(3) all forfeitures and sales which occur subsequent to the sale are paid or redeemed, unless the county or its agent, as trustee pursuant to Section 21-90, is the petitioner;

(4) the notices required by law have been given, and all advancements of public funds under the police power made by a county, city, village, or town under Section 22-35 have been paid; and

(5) the petitioner has complied with all the provisions of law entitling him or her to a deed.

Upon receipt of sufficient evidence of the requirements under this subsection (a), the court shall find that the petitioner complied with those requirements and shall enter an order authorizing a judicial tax deed auction subject to the requirements of this Section, or subject to the requirements in Section 21-90 directing the county clerk, on the production of the tax certificate and a certified copy of the order, to issue to the purchaser or its assignee a tax deed. The court shall insist on strict compliance with Sections Section 22-10 through 22-25. Prior to the entry of an order under this Section directing the issuance of a tax deed, the petitioner shall furnish the court with a report of proceedings of the evidence received on the application for tax deed. Petitioner shall also furnish to the court an estimate of redemption from the county clerk showing the of the total taxes, penalties, and costs that were required to be paid to redeem the tax sale as specified in the notice required under Section 22-10. The petitioner for tax deed may file a statement of (i) all taxes it has paid or redeemed for the property after the expiration of the redemption period, (ii) the costs paid for a court reporter and transcript services, (iii) the fees paid to the clerk for the estimate of redemption, (iv) all payments made for municipal advancements required by Section 22-35, and (v) costs incurred pursuant to subsection (c) of Section 21-90. The total of the amount shown on the estimate of redemption as of the last day to redeem plus (i) through (v) above, or portion thereof, plus a fee of equal to the then-allowable foreclosure attorney fees for Illinois as published by Fannie Mae, plus the cost of publication of the judicial tax deed auction, shall be identified as the tax deed judgment amount. The tax deed judgment amount shall accrue interest at 0.75% per month, or portion thereof, from the date of the judgment until the date of judicial tax deed auction. The order for judicial tax deed auction shall include such terms and conditions of the auction as specified by the court and the report of proceedings shall be filed and made a part of the court record.

(b) Except as provided in subsection (e) of this Section, if taxes for years prior to the year or years sold are or become delinquent subsequent to the date of sale, the court shall find that the lien of those delinquent taxes has been or will be merged into the tax deed grantee's title if the court determines that the tax deed grantee or any prior holder of the certificate of purchase, or any person or entity under common ownership or control with any such grantee or prior holder of the certificate of purchase, was at no time the holder of any certificate of purchase for the years sought to be merged. If delinquent taxes are merged into the tax deed pursuant to this subsection, the court shall enter an order declaring which specific taxes have been or will be merged into the tax deed title and directing the county treasurer and county clerk to reflect that declaration in the warrant and judgment records; provided, that no such order shall be effective until a tax deed has been issued and timely recorded. Nothing contained in this Section shall relieve any owner liable for delinquent property taxes under this Code from the payment of the taxes that have been merged into the title upon issuance of the tax deed.

(c) The county clerk is entitled to a fee of $10 in counties of 3,000,000 or more inhabitants and $5 in counties with less than 3,000,000 inhabitants for the issuance of the tax deed, with the exception of deeds issued to the county pursuant to its authority under Section 21-90. The fee paid to the county clerk for the issuance of the tax deed shall be accompanied by a $300 indemnity fund fee in counties of 3,000,000 or more inhabitants and a $100 indemnity fund fee in counties with less than 3,000,000 inhabitants, with the exception of deeds issued to the county pursuant to its authority under Section 21-90. All fees received under this subsection shall be paid by the county clerk to the county treasurer of the county in which the land is situated for the purpose of funding the county's indemnity fund established under Section 21-295. The clerk may not include in a tax deed more than one property as listed, assessed and sold in one description, except in cases where several properties are owned by one person.

Upon application, the court shall, enter an order to place the tax deed grantee or the grantee's successor in interest in possession of the property and may enter orders and grant relief as may be necessary or desirable to maintain the grantee or the grantee's successor in interest in possession.

(d) The court shall retain jurisdiction to enter orders pursuant to subsections (b) and (c) of this Section. This amendatory Act of the 92nd General Assembly and this amendatory Act of the 95th General Assembly shall be construed as being declarative of existing law and not as a new enactment.

(e) Prior to the issuance of any order for judicial tax deed auction under this Section, the petitioner must redeem all taxes and special assessments on the property that are subsequent to the date of its tax sale subject to a pending tax petition filed by a county or its assignee pursuant to Section 21-90.

(e-5) Following the expiration of the period of redemption, the petitioner's payment of (i) any subsequent tax and special assessment and (ii) any redemption of any sale of subsequent taxes or forfeiture shall be accompanied by an indemnity fund fee of 10% of the principal taxes and interest paid by the petitioner under this Section. All fees received under this subsection shall be paid by the collector and county clerk to the county treasurer of the county in which the land is situated for the purpose of funding the county's indemnity fund established by Section 21-295. No fees incurred under this subsection shall be posted to the subject tax sale pursuant to Section 21-355.

(f) If, for any reason, a purchaser fails to obtain an order for tax deed within the required time period and no sale in error was granted or redemption paid, then the certificate shall be forfeited to the county, as trustee, pursuant to Section 21-90.

(g) Except as provided in Section 21-90, upon entry of an order requiring a judicial tax deed auction under subsection (a) of this Section, the property shall be offered for sale by public auction and sold to the highest bidder at such an auction in accordance with the following minimum standards and subject to additional requirements set by the court's order:

(1) The tax deed petitioner, its assignee, or a duly appointed private selling officer, shall give notice of the auction with the following information:

(A) the Property Identification Number and Address listed on the most recent tax bill;

(B) the time and place of the auction;

(C) the terms of the auction; and

(D) the amount of the tax deed judgment amount provided in Section 22-40.

The Notice of Tax Deed Auction shall be mailed via first class mail to all interested parties at the address at which service of the Section 22-10 Take Notice was attempted and to any parties who have appeared in the proceeding. The notice shall include a sworn certificate of service signed by the party sending the notice attesting to the fact that the notice of auction was placed in the mail at least 10 calendar days prior to the date of the auction.

The notice of auction shall be published at least 3 consecutive calendar weeks (Sunday through Saturday), once in each week, the first such notice to be published not more than 45 days prior to the auction, the last such notice to be published not less than 7 days prior to the auction. If the property is located in a municipality in a county with less than 3,000,000 inhabitants, the purchaser or his or her assignee shall also publish a notice as to the owner or party interested, in some newspaper published in the municipality. If the petitioner cannot identify a newspaper published in the municipality, or if the property is located in a county with 3,000,000 or more inhabitants, the notice shall be published in a newspaper published within the county. If no newspaper is published in the county, then the notice shall be published in the newspaper that is published nearest the county seat of the county in which the property is located. The publication shall include all information included in the notice sent pursuant to this Section.

(2) The selling officer shall start all bidding with a minimum bid equal to (1) the tax deed judgment amount plus interest at the rate of 0.75% per month, or portion thereof, for each month since the date of judgment, (2) the cost for the publication of the judicial sale required in this Section; and (3) the costs of the selling officer. The selling officer shall proceed to a public auction, offer the real estate for sale, and sell the real estate to the highest bidder. If no bidder is willing to pay the minimum bid, the tax certificate holder shall be the winning bidder and entitled to a tax deed, and it shall be conclusively presumed that there is no equity in the property.

(3) At the auction under this Section, the person conducting the auction shall enter a bid in favor of the tax certificate holder in the amount of the minimum bid set forth above. Any tax deed Petitioner shall have a final right of first refusal or final bid at the close of the judicial tax deed judicial sale auction.

(4) Upon and at the conclusion of the judicial tax deed auction, the person conducting the auction shall give to the purchaser a receipt of sale. The receipt shall describe the real estate purchased and shall show the amount bid, the total amount paid to date, and the amount still to be paid therefor. An additional receipt shall be given at the time of each subsequent payment. Any purchaser who fails to complete the sale for failure to make full payment shall forfeit to the county indemnity fund any deposit already made, and the court shall order a new auction of the property.

(5) Upon payment in full of the amount bid, the person conducting the sale shall issue, in duplicate, and give to the purchaser a certificate of judicial tax deed sale. The certificate of judicial tax deed sale shall be in a recordable form, describe the real estate purchased, indicate the date and place of sale and show the amount paid therefor. The certificate of tax deed sale shall further indicate that it is subject to confirmation by the court. The certificate of sale shall be freely assignable by endorsement thereon.

(6) To the extent that the winning bid exceeds the tax deed judgment amount, the selling officer shall deposit the surplus funds with the treasurer of the county in which the subject property lies upon the expiration of 30 days following confirmation of the sale. The petitioner shall send a notice to all parties entitled to the section 22-10 Take Notice, stating that the owner is entitled to a distribution of surplus proceeds and may file a claim to recover the surplus.

(h) Confirmation of sale; Order for Issuance of Tax Deed.

(1) The person conducting the sale shall promptly make a report to the court that issued the order authorizing the judicial tax deed auction, which report shall include a copy of all receipts and, if any, certificate of judicial tax deed sale.

(2) Upon motion and notice in accordance with court rules applicable to motions generally, which motion shall not be made prior to sale, the court shall conduct a hearing to confirm the sale. Unless the court finds that a notice required in this Section was not issued or the sale was not conducted in accordance with the order for judicial tax deed auction, the court shall enter an order (a) confirming the judicial tax deed sale, (b) directing the county clerk to issue a tax deed in the name of the holder of the certificate of judicial tax deed sale once presented with a certified copy of the confirmation order and original certificate of judicial tax deed sale, and (c) directing the selling officer to pay to the holder of the tax certificate the amount of the credit bid upon surrender of the tax certificate, and to pay the selling officer its fees. The order for issuance of tax deed shall contain the name, address, and telephone number of the holder of the certificate of judicial tax sale for the clerk to confirm the identity of the tax deed grantee.

(3) If any sale fails to comply with the requirements in this Section, any party may, by motion supported by affidavit made prior to confirmation of such sale, request that the court which entered the judgment set aside the judicial tax deed sale. Any such party shall guarantee or secure by bond a bid equal to the successful bid at the judicial tax deed auction. No guarantee or bond shall be required if the property is residential and the party seeking to set aside the sale is the owner-occupant of the property at the time the motion is filed. If the court denies confirmation of the judicial tax deed sale, it shall order a new judicial tax deed auction. Any subsequent auction is subject to the same notice requirement as the original auction.

(4) No sale under this Section shall be held invalid or be set aside because of any defect in the notice thereof or in the publication of the same, or in the proceedings of the officer conducting the sale.

(i) Order to Disburse Surplus Proceeds. Upon a filing of motion by any interested party, the court hearing the underlying tax case shall set a hearing to determine whether an interested party is the owner of record entitled to a disbursement of surplus proceeds. All interested parties in the underlying case shall be notified of the motion for disbursement of proceeds. Any party claiming to have an ownership interest in the parcel at the time of the issuance of tax deed may present evidence of ownership and request a disbursement of any or all surplus proceeds. The court shall issue an order directing the treasurer to disburse a specific amount of surplus proceeds to specific parties, with sufficient personally identifiable information to accurately identify the parties entitled to disbursement.

(Source: P.A. 103-555, eff. 1-1-24; revised 8-5-24.)

(35 ILCS 200/22-65)

Sec. 22-65. Form of deed. A tax deed executed by the county clerk under the official seal of the county shall be recorded in the same manner as other conveyances of property, and vests in the grantee, his or her heirs and assigns, the title of the property therein described without further acknowledgment or evidence of the conveyance. Tax deeds issued under this Section shall not require a municipal transfer stamp or be subject to any municipal real estate transfer taxes, requirements or certifications prior to recording. The conveyance shall be substantially in the following form: State of Illinois) ) ss. County of .......)

At a public sale of property for the nonpayment of taxes, held in the county above stated, on (insert date), the following described property was sold: (here place description of property conveyed). The property not having been redeemed from the sale, and it appearing that the holder of the certificate of purchase of the property has complied with the laws of the State of Illinois necessary to entitle (insert him, her or them) to a deed of the property: I ...., county clerk of the county of ...., in consideration of the property and by virtue of the statutes of the State of Illinois in such cases provided, grant and convey to ...., his or her heirs and assigns forever, the property described above.

Dated (insert date).

Signature of .................. County Clerk

Seal of County of ...., Illinois

(Source: P.A. 91-357, eff. 7-29-99.)

Section 10. The Mortgage Rescue Fraud Act is amended by changing Sections 5 and 30 as follows:

(765 ILCS 940/5)

Sec. 5. Definitions. As used in this Act:

"Distressed property" means residential real property consisting of one to 6 family dwelling units that is in foreclosure or at risk of loss due to nonpayment of taxes, or whose owner is more than 30 days delinquent on any loan that is secured by the property.

"Distressed property consultant" means any person who, directly or indirectly, for compensation from the owner, makes any solicitation, representation, or offer to perform or who, for compensation from the owner, performs any service that the person represents will in any manner do any of the following:

(1) stop or postpone the foreclosure sale or stop or postpone the loss of the home due to nonpayment of taxes;

(2) obtain any forbearance from any beneficiary or mortgagee, or relief with respect to a tax sale of the property;

(3) assist the owner to exercise any right of reinstatement or right of redemption;

(4) obtain any extension of the period within which the owner may reinstate the owner's rights with respect to the property;

(5) obtain any waiver of an acceleration clause contained in any promissory note or contract secured by a mortgage on a distressed property or contained in the mortgage;

(6) assist the owner in foreclosure, loan default, or post-tax sale redemption period to obtain a loan or advance of funds;

(7) avoid or ameliorate the impairment of the owner's credit resulting from the recording of a notice of default or the conduct of a foreclosure sale or tax sale; or

(8) save the owner's residence from foreclosure or save the owner from loss of home due to nonpayment of taxes.

A "distressed property consultant" does not include any of the following:

(1) a person or the person's authorized agent acting under the express authority or written approval of the Department of Housing and Urban Development;

(2) a person who holds or is owed an obligation secured by a lien on any distressed property, or a person acting under the express authorization or written approval of such person, when the person performs services in connection with the obligation or lien, if the obligation or lien did not arise as the result of or as part of a proposed distressed property conveyance;

(3) banks, savings banks, savings and loan associations, credit unions, and insurance companies organized, chartered, or holding a certificate of authority to do business under the laws of this State or any other state or under the laws of the United States;

(4) attorneys licensed in Illinois engaged in the practice of law;

(5) a Department of Housing and Urban Development approved mortgagee and any subsidiary or affiliate of these persons or entities, and any agent or employee of these persons or entities, while engaged in the business of these persons or entities;

(6) a 501(c)(3) nonprofit agency or organization, doing business for no less than 5 years, that offers counseling or advice to an owner of a distressed property, if they do not contract for services with for-profit lenders or distressed property purchasers, or any person who structures or plans such a transaction;

(7) (blank);

(8) licensees of the Consumer Installment Loan Act who are authorized to make loans secured by real property; or

(9) licensees of the Real Estate License Act of 2000 when providing licensed activities.

"Distressed property purchaser" means any person who solicits an owner of distressed property and acquires any interest in fee in a distressed property or a beneficial interest in a trust holding title to a distressed property while allowing the owner to possess, occupy, or retain any present or future interest in fee in the property, or any person who participates in a joint venture or joint enterprise involving a distressed property conveyance. "Distressed property purchaser" does not mean any person who acquires distressed property at a short sale or any person acting in participation with any person who acquires distressed property at a short sale, if that person does not promise to convey an interest in fee back to the owner or does not give the owner an option to purchase the property at a later date.

"Distressed property conveyance" means a transaction in which an owner of a distressed property transfers an interest in fee in the distressed property or in which the holder of all or some part of the beneficial interest in a trust holding title to a distressed property transfers that interest; the acquirer of the property allows the owner of the distressed property to occupy the property; and the acquirer of the property or a person acting in participation with the acquirer of the property conveys or promises to convey an interest in fee back to the owner or gives the owner an option to purchase the property at a later date.

"Person" means any individual, partnership, corporation, limited liability company, association, or other group or entity, however organized.

"Service" means, without limitation, any of the following:

(1) debt, budget, or financial counseling of any type;

(2) receiving money for the purpose of distributing it to creditors in payment or partial payment of any obligation secured by a lien on a distressed property;

(3) contacting creditors on behalf of an owner of a residence that is distressed property;

(4) arranging or attempting to arrange for an extension of the period within which the owner of a distressed property may cure the owner's default and reinstate his or her obligation;

(5) arranging or attempting to arrange for any delay or postponement of the time of sale of the distressed property;

(6) advising the filing of any document or assisting in any manner in the preparation of any document for filing with any court; or

(7) giving any advice, explanation, or instruction to an owner of a distressed property that in any manner relates to the cure of a default or forfeiture or to the postponement or avoidance of sale of the distressed property.

(Source: P.A. 94-822, eff. 1-1-07; 95-691, eff. 6-1-08; 95-1047, eff. 4-6-09.)

(765 ILCS 940/30)

Sec. 30. Distressed property conveyance contract terms. Every contract required by Section 25 must contain the entire agreement of the parties, be fully assignable, and survive delivery of any instrument of conveyance of the distressed property. Every lease entered into pursuant to a contract required by Section 25 is terminable at will by the distressed property owner, without liability. Every contract required by Section 25 must include the following terms:

(1) the name, business address, and the telephone number of the distressed property purchaser;

(2) the address of the distressed property;

(3) the total consideration to be given by the distressed property purchaser or tax lien payor in connection with or incident to the sale;

(4) a complete description of the terms of payment or other consideration including, but not limited to, any services of any nature that the distressed property purchaser represents he or she will perform for the owner of the distressed property before or after the sale;

(5) a complete description of the terms of any related agreement designed to allow the owner of the distressed property to remain in the home such as a rental agreement, repurchase agreement, contract for deed, or lease with option to buy;

(6) a notice of cancellation as provided in this Section;

(7) the following notice in at least 12-point boldface type, if the contract is printed, or in capital letters, if the contract is typed, and completed with the name of the distressed property purchaser, immediately above the statement required by this Section:

"NOTICE REQUIRED BY ILLINOIS LAW

Until your right to cancel this contract has ended, ..................(Name) or anyone working for ...................(Name) CANNOT ask you to sign or have you sign any deed or any other document. You are urged to have this contract reviewed by an attorney of your choice within 5 business days of signing it."; and

(8) if title to the distressed property will be transferred in the conveyance transaction, the following notice in at least 14-point boldface type if the contract is printed, or in capital letters if the contract is typed, and completed with the name of the distressed property purchaser, immediately above the statement required by this Section:

"NOTICE REQUIRED BY ILLINOIS LAW

As part of this transaction, you are giving up title to your home.".

(9) In the case a distressed property is at risk of loss for the non-payment of real estate taxes, a statement that the property owner may have the right to obtain money for any equity lost if a tax deed is issued, either through the right to indemnity or public auction, and will lose the right to claim the surplus equity if they sell the property, and should consult an attorney to discuss their options before selling their property.

(Source: P.A. 94-822, eff. 1-1-07.)

Section 99. Effective date. This Act takes effect upon becoming law.