Legal Question in Real Estate Law in Illinois

I recommend you work with an experienced real estate closing attorney in your area to make sure everything is in order and you receive clear title. You have a right to enforce the contract, but that may simply create a predicament. If the seller is not in a position to pay the mortgage, something needs to be done short of an expensive lawsuit over $1600.00. Before anything is done, the attorney will want to review the figures. Depending on how each of you is calculating your respective payoff amounts, how property taxes were handled, what closing costs are likely, ..., maybe the circumstances are not what they seem. Next, if the seller does require funds, a short sale request to his lender is an option, but that will require time and effort. Next, while it is not a perfect solution without some form of security (maybe a vehicle title or mortgage on another property of seller), perhaps you can pay whatever the seller is short with a promissory note for him to pay you monthly. Alternatively, you can review the calculations as to whether the seller will get to a break even point soon, although I wonder if you are gaining equity more quickly than he/she is. Bottom line, you may be best served biting the bullet with the extra cost (with the risk in taking back a note), but getting this done with clear title to the property.

I agree w/ Mr. Repay. An attorney must review your contract. Assuming it allows for prepayment at any time on stated notice, your seller may have breached its obligations to keep the place free of junior liens, or not. Some contracts allow sellers to continue to lien the property pending payoff, which is a very dangerous thing but happens. Hopefully the contract protects you. Ultimately you should be entitled to the bargain you struck in the contract, but without reviewing it, it is impossible to be certain the best course of action. Mr. Repay has outlined some scenarios I'm sure to attempt to be helpful.