Legal Question in Real Estate Law in Illinois

I suggest you work with a local real estate closing attorney who also is experienced in probate matters. It will be worth your while to pay someone who can make sense out of the series of transactions and advise you properly. My impression from the way you phrase your question is that the estate representative is at least inclined to try to work something out. That is a positive, because I can see where this could have left you at a complete loss or in a position of having to spend a lot of money to try to protect your interests. Whether you will be able to receive full credit for everything you put into the property is hard to say, but the declined economy may prove helpful to you.

I agree with Mr. Repay. It sounds as though you were purchasing the house under something of an "installment contract" or "seller financing" from an owner/seller that still had a loan on the house, when the owner/seller fell behind in loan payments and passed away. How do you know the owner/seller "lost" the house: if the installment contract or seller financing documents had been recorded, you should have received some kind of notice (perhaps a summons?) that the owner/seller was being foreclosed? It is also possible that the only reason the owner/seller's loan is in default is because of the estate situation. So there are many questions that should be answered with the help of a real estate/probate attorney.