Detailed Answer
When co-owners sell real estate in Illinois, the default rule is that sale proceeds are divided according to each owner’s ownership share (for example, tenants in common by their percentage interests). But before the final division of proceeds, co-owners often disagree about who paid what for mortgages, taxes, insurance, repairs, or improvements. Under Illinois practice, you generally may insist on an accounting and supporting documentation (mortgage statements, repair receipts, cancelled checks, invoices) before accepted proceeds are finally distributed — especially if you place the funds in the court registry or otherwise start a partition/accounting process.
Key points you should know:
- Partition actions: If co-owners cannot agree, a party may file a partition action in Illinois court. The court can order sale of the property and an accounting among the co-owners to determine credits and charges before distribution of net proceeds. See the Illinois Code of Civil Procedure for statutes governing partition procedures: https://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2058&ChapterID=57
- Accounting and credits: In a partition or related equitable proceeding, the court can credit a co-owner for lawful payments they made that benefited the property (e.g., mortgage payments, property taxes, necessary repairs). The court evaluates whether a payment was necessary or provided a lasting increase in value and may require documentation to support credits.
- Equitable reimbursement: If one co-owner paid a mortgage, taxes, or repairs that benefited all owners, Illinois courts can award reimbursement or an adjusting credit when proceeds are divided. That relief typically requires proof (receipts, cancelled checks, loan statements) showing the payments and their connection to the property.
- Withholding proceeds: If sale proceeds are being held by a closing agent, title company, or the court, a concerned co-owner can ask the holder not to disburse funds until an accounting is completed or until the dispute is resolved. If proceeds already were distributed, a co-owner may need to file a claim in court seeking an accounting and reimbursement.
- Proof matters: Oral assertions are rarely enough. Save and produce contemporaneous mortgage statements, paid invoices, cancelled checks, bank statements, work contracts, contractor licenses, and photos. Detailed records increase the likelihood a court will treat a payment as reimbursable.
How this typically works in practice (hypothetical)
Suppose two co-owners in Illinois sell a house. Owner A claims they paid the mortgage and $8,000 in roof repairs. Owner B claims Owner A should not get credit because Owner B paid other bills and contributed labor. If the parties disagree, either can:
- Ask the closing agent or title company to hold proceeds in escrow pending resolution;
- Serve a written demand for accounting and copies of mortgage statements and repair receipts; or
- File a partition and accounting action in Illinois court and ask the court to (a) order the sale or confirm the sale, (b) require an accounting, (c) allocate credits for mortgage payments and repairs, and (d) distribute net proceeds accordingly.
In the partition action, Owner A would present mortgage statements and paid repair invoices. Owner B could contest the amounts, object to the necessity or reasonableness of repairs, or offer counterproof (for example, receipts for other payments). The judge will weigh the evidence and decide credits or liens to adjust each owner’s share.
Practical limits and counterpoints
- If you are asking for documentation solely as a negotiating tactic, note that a court-ordered accounting requires more formal proof and legal filings.
- There is usually no automatic penalty if a co-owner cannot immediately produce older informal records — but absence of documents weakens that co-owner’s claim for reimbursement.
- If a co-owner recorded a lien (for example, a mortgage on their interest) or has claimable advances, those recorded liens will be treated according to priority of record and law.
What you can do now
- Put your request in writing. Ask for mortgage statements, cancelled checks, bank statements, paid invoices, and contractor agreements. Keep copies of everything you send and receive.
- Ask the closing agent to hold funds in escrow or in the court registry pending resolution. If needed, file a motion in court to impound proceeds.
- Preserve evidence. Gather your own records of payments you made and any communications about who would pay what.
- If the co-owner refuses to cooperate, consider filing a partition action or a claim for an accounting and equitable contribution under Illinois law. A partition court can order the accounting and adjust distributions.
For statutory guidance on partition procedures in Illinois, see the Illinois Code of Civil Procedure provisions related to partition actions: https://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2058&ChapterID=57
Helpful Hints
- Document everything early. Electronic copies of statements and receipts are acceptable; keep originals if possible.
- Send a certified letter or email with read receipt when requesting records — it creates a paper trail.
- Ask the closing/title company to hold proceeds in escrow if you expect a dispute.
- If you paid a mortgage or major repairs, try to show they were necessary and benefited the property (photos before/after, contractor warranties, permits).
- If you and the co-owner plan to split proceeds outside court, put any agreement in writing and have both parties sign; consider using a neutral escrow agent.
- Be aware of deadlines. If you wait too long after distribution, reclaiming funds can become harder and may require a lawsuit.
- Consult a local Illinois attorney experienced in real estate and partition law if the amounts are substantial or the co-owner refuses reasonable documentation.
Disclaimer: This article explains general Illinois legal principles and is for informational purposes only. It is not legal advice and does not create an attorney-client relationship. For advice about your specific situation, consult a licensed Illinois attorney.