Most home purchases, unless they are cash deals, involve a mortgage loan. Since the real estate market crashed in 2008, a lesser-used path towards home ownership has been on the rise - owner financing. Also known as an installment contract, owner financing allows a buyer to live in a home while paying the seller the purchase price over time.
However, the practice is ripe for abuse because the purchaser doesn't actually own the home until the balance is paid in full. That means the Illinois Mortgage Foreclosure Law - and its protections for homeowners - doesn't apply in the event of a default. A simple eviction action is all it takes to divest the would-be purchaser of what may be a significant financial investment. On August 25, 2017, Governor Rauner approved Public Act 100-0416, also known as the Installment Sales Contract Act, which is designed to provide protection for purchasers.
According to a March 2017 report by The Chicago Reader (http://bit.ly/2ulgc2X), installment sales contracts are seeing a resurgence in Cook County, particularly in poorer communities that were hit hard by the foreclosure crisis. According to the Reader, Illinois law doesn't require that these contracts be recorded or otherwise registered with the state, which makes it difficult to know just how many exist.
