Handling new condition information after an offer is accepted
A guide for Illinois sellers on navigating the disclosure of material defects identified or discovered after a formal sales contract has been signed.
The short answer
When you become aware of a material defect after signing a contract, you are required by Illinois law to provide a written supplemental disclosure before closing. A material defect is a condition that significantly impairs health or safety or substantially affects property value. Timely disclosure helps satisfy your legal obligations and provides buyers with necessary information.
Defining Materiality and Disclosure Obligations
Not every minor repair is a material defect. You only need to disclose conditions you have actual knowledge of that qualify as significant impairments to health, safety, or value. You are not required to perform new inspections to complete the supplemental form.
Decision Question: Based on a matrix of 'Condition Observed,' 'Does it impair safety/value?,' and 'Do I have actual knowledge?,' does the condition meet the criteria for a supplemental disclosure?
Exercising the Supplemental Disclosure Process
Once a material defect is confirmed, draft the supplement immediately. The supplement must be delivered to the buyer as soon as possible, ideally through the same method used for the original disclosure.
Keep the original disclosure available for comparison. The supplemental report should clearly identify what has changed since the buyer’s initial acceptance of the property condition.
Understanding Buyer Termination Rights
If you disclose a material defect after the contract is signed, the buyer has a right to terminate the contract within five business days. This right is restricted to defects known at the time of the original disclosure or those that cannot be repaired.
Always consult with your legal counsel regarding specific termination timelines, as these rights cease once the property conveyance is officially recorded.
Evaluating Known Versus Unknown Defects
You are not liable for inaccuracies if you truly had no knowledge of the defect. However, if the buyer discovers an issue that you knew about but failed to disclose, you may face claims for actual damages.
If you relied on a professional's advice regarding a repair that later failed, document that professional's report. You may not be liable for inaccuracies based on information provided by licensed professionals.
Checklist
- Assess if the new condition qualifies as a material defect.
- Draft a written supplemental disclosure report.
- Deliver the supplement to the buyer via an accepted method.
- Document the date and time of the supplement delivery.
- Consult legal counsel if the buyer threatens to terminate.
Common questions
Does disclosing a defect allow the buyer to demand repairs?
The disclosure act itself does not mandate specific repairs. However, the buyer may choose to negotiate repairs or exercise their right to terminate the contract within the five-day window following the disclosure.
What if I reasonably believed a defect was fixed?
If you had a reasonable belief that a defect was corrected, you may not be liable for the initial omission. Be prepared to provide evidence of the repair work to your legal advisor to justify your prior disclosure status.
Sources
- Illinois Residential Real Property Disclosure ActChecked October 12, 2026
- Illinois Condominium Property Act — 2025 editionChecked October 12, 2026
- IEMA-OHS — Real estate radon guidanceChecked October 12, 2026
- EPA — Real estate lead-hazard disclosuresChecked October 12, 2026
This guide is general educational content from SQFT IO, prepared with AI assistance. It is not legal, tax or loan advice. Talk with a licensed attorney, tax professional or lender about your situation. SQFT IO Illinois license 478.027617.