Legal Question in Real Estate Law in Illinois

That is a correct interpretation of what you quoted. It is important to determine at what stage of the proceedings you are seeing this and follow the case through to the end. I would recommend taking the documents to an attorney to advise you to make sure there is not anything that creates any doubt.

This "sounds" like you are not in a foreclosure but instead doing a short sale or deed in lieu arrangement where the lender is willing to waive deficiency if it does not have to foreclose. If so this is only one aspect of those kinds of arrangements. For example, in a short sale situation if there are unpaid property taxes that the lender will not pay, then you may have to deal with this situation directly with the buyer, because if unpaid taxes show up on the title commitment and the lender will not satisfy them for you, you may still wind up having to come to closing with cash to cover them if the contract does not protect you or the deal could still fall apart. So you are still best advised to have an attorney involved to help make sure that you are protected.