Legal Question in Real Estate Law in Illinois
Cash back at closing
I have recently seen several offers involving selling of condos in which developers or owners are offering hugh cash back amounts. One specific deal that I have seen pitched was promising $35,000 one week after closing.
My question is, I have thought such deals were illegal. Is there anyway in which getting $35,000 back from the seller one week after closing is legal.
3 Answers from Attorneys
Re: Cash back at closing
If there is a lender involved, it must be disclosed on your HUD-1 Settlement Statement. If it is a cash transaction, it is not illegal. If there is a lender, and the seller kickback is not disclosed on the settlement statement, it is without question illegal.
Re: Cash back at closing
If it's disclosed on the RESPA or HUD-1 form, it's legal unless there is some other reason why not. My question is, why do you have to wait until a week after the closing, why isn't it available at the closing?
Re: Cash back at closing
Generally, if disclosed to all, including your lender, it is legal.