Panel Discussion. Agreements Engagement LeDers Disclosure Forms. Joseph R. Fortunato Momkus McCluskey, LLC, Lisle

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1 4/27/15 Residential Real Estate Closings From Listing Through Closing Panel Discussion Agreements Engagement LeDers Disclosure Forms Joseph R. Fortunato Momkus McCluskey, LLC, Lisle Bruno W. Tabis, Jr. Haskin, Corrigan, Tabis & Parravano P.C., Wheaton Lindner Conference Center Lombard, Illinois May 7, 2015 Listing Agreements Contract with broker sesng forth terms of sale and services Types Exclusive Right to Sell/ Exclusive Agreement- Typical Exclusive Agreement Special Open Not Available 1

2 4/27/15 Typical Provisions of Exclusive Listing Agreements real estate and personal property to be sold Time to surrender possession Commission of agreement services, signs Holding earnest money Provisions in Listing Agreement to be Negotiated Dual Agency and broker Seller s broker role Buyer s broker role Loyal@es Broker incen@ve Price nego@a@on 2

3 4/27/15 Commission Payable Legal standard- ready, willing and able purchaser Only upon closing of the sale and only out of the proceeds of the sale Examine earnest money provision Does broker get commission upon purchaser default? Does broker get to recover costs? Particular Provisions - Continued Indemnifica@on of broker Try to eliminate, but good luck How broad is the provision? All ac@ons? All misrepresenta@ons? Misrepresenta@ons by seller? Limit to seller misrepresenta@on/misinforma@on Or carve out willful and wanton, gross negligence and criminal acts of broker 3

4 4/27/15 Terminating Listing Agreements Early Is it permided? Can broker recover costs? Commissions a`er Persons who view property during contract but enter into contract a`er Limit days a`er Replacement Broker Listing Agreement First broker and replacement could both be to a commission Review first lis@ng agreement Carve out commissions due prior broker 4

5 4/27/15 Administrative Fees Try to eliminate Fees due as a result of termina@on Engagement Letters General ARDC Highest Number of Enforcement Ac@ons Real Estate Lawyers Rules of Professional Conduct, Rule 1.2 Scope of representa@on Alloca@on of authority between lawyer and client Rules of Professional Conduct, Rule Fees Reasonable Manner of calcula@on 5

6 4/27/15 Engagement Letter Scope of services Seller Consider Review and agreement Review and contract(s) Consult re contract provisions Consider disclosure of agency at this point Order survey and survey Order pay- offs, water Local transfer taxes (prepare documents) Who will obtain? Prepare closing documents ADend closing Limit to customary, maders Engagement Letter Scope of services Buyer- Consider Review and contract(s) Consult re: provisions Review survey commitment, advise generally re: Review loan documents Review closing documents ADend closing 6

7 4/27/15 Engagement Letter Not Within Scope Disputes over return of earnest money Non- Fees Hourly, good luck Flat for services within scope Extra or adjustments Out of scope maders Terminated contracts Terminated Hourly rate or to be agreed upon Advanced Amounts Will reimburse When? Disclosure Forms Real Property Disclosure Act (759 ILCS 77/1, et seq). Applies to transfers of Real Property (765 ILCS 77/5) 1 to 4 residen@al dwelling units Residen@al condo units Manufactured homes Obliga@on of Seller (765 ILCS 77/5) Owner Trust beneficiary Contract purchaser Ground lease lessee Unless never occupied and never managed 7

8 4/27/15 Exempt Transfers (765 ILCS 77/15) By court order Probate To spouse in of marriage Bankruptcy trustee Eminent domain Specific performance Mortgage related Deed in lieu Foreclosure Acquiring mortgagee Fiduciary Administrator, executor, guardian trustee Exempt Transfers Continued Between co- owners Testate or intestate succession Spouse or descendent company (but most supply report from the seller ) To or from government en@@es New construc@on, never occupied 8

9 4/27/15 Residential Real Property Disclosure Form (765 ILCS 77/35) Seller must complete all applicable items (765 ILCS 77/20) Seller or agent must deliver to buyer prior to signing sale contract (765 ILCS 77/20) All items must be checked yes, no or N/A All yes items must be explained Material Defect adverse effect on value Significantly impairs health or safety Unless reasonably believes has been corrected Not deemed to be but buyer may chose to rely I am aware Actual no@ce or actual knowledge No specific inves@ga@on or inquiry required Disclosure Form Continued Must supplement for later discovered defects not on original disclosure form (765 ILCS 77/30) Subsequent events Buyer s inspec@on Must assure that supplemental reports are sent to the buyer Manner of delivery set forth at 765 ILCS 77/50 Because of liability, adorney should send Buyer may terminate contract prior to closing: Disclosure made a`er signing contract 3 days following receipt of supplemental disclosure report 9

10 4/27/15 Disclosure Form Continued Liability for: (765 ILCS 77/55) Failure to provide Knowingly false Damages plus adorney fees Must commence within 1 year a`er earliest of : (77 ILCS 77/60) Possession Occupy Recording Disclosure Items Most are customary or common sense, e.g. Flooding or basement cracks Roof leaks Electrical, plumbing, HVAC, etc. Disclosure Form Continued Specific disclosure items 14. unsafe concentra@ons of radon Standard? 15. unsafe concentra@ons of or unsafe condi@ons rela@ng to asbestos Standard? 16. unsafe condi@ons or concentra@ons re: lead paint, lead water pipes, lead in soil 23. property has been used for manufacture of methamphetamines 10

11 4/27/15 Other Property Related Disclosures Radon Addressed by IRPTA Illinois Radon Awareness Act (420 ILCS 46/10 et seq) Seller must provide to buyer Radon Guidelines for Real Estate - pamphlet Illinois Disclosure of on Radon Hazards - form No remedies for non- compliance set forth in statute Lead- Based Paint Addressed by IRPTA Federal requirements (42 U.S.C. 4852d(a)), must deliver: Disclosure of Informa@on on Lead- Based Paint and/or Lead- Based Paint Hazards form Known hazards with explana@on Reports and records Protect Your Family from Lead in Your Home - pamphlet Mold No requirement to disclose It s everywhere No iden@fiable standard What is buyer s concern? Attorney Disclosure Title Agency Illinois Rules of Professional Conduct: Rule 1.4 Communica@on Rule 1.8 Conflict of Interest Business Transac@ons Illinois Title Insurance Act RESPA Must disclose agency rela@onship to client Best prac@ce Earlier the beder No later than distribu@on of commitment Title Company disclosure form. 11

12 RULE 1.2: SCOPE OF REPRESENTATION AND ALLOCATION OF AUTHORITY BETWEEN CLIENT AND LAWYER (a) Subject to paragraphs (c) and (d), a lawyer shall abide by a client's decisions concerning the objectives of representation and, as required by Rule 1.4, shall consult with the client as to the means by which they are to be pursued. A lawyer may take such action on behalf of the client as is impliedly authorized to carry out the representation. A lawyer shall abide by a client's decision whether to settle a matter. In a criminal case, the lawyer shall abide by the client's decision, after consultation with the lawyer, as to a plea to be entered, whether to waive jury trial and whether the client will testify. (b) A lawyer's representation of a client, including representation by appointment, does not constitute an endorsement of the client's political, economic, social or moral views or activities. (c) A lawyer may limit the scope of the representation if the limitation is reasonable under the circumstances and the client gives informed consent. (d) A lawyer shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is criminal or fraudulent, but a lawyer may discuss the legal consequences of any proposed course of conduct with a client and may counsel or assist a client to make a good-faith effort to determine the validity, scope, meaning or application of the law. (e) After accepting employment on behalf of a client, a lawyer shall not thereafter delegate to another lawyer not in the lawyer's finn the responsibility for performing or completing that employment, without the client's informed consent RULE 1.5: FEES (a) A lawyer shall not make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses. The factors to be considered in determining the reasonableness of a fee include the following: (1) the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly; (2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer; (3) the fee customarily charged in the locality for similar legal services; ( 4) the amount involved and the results obtained; (5) the time limitations imposed by the client or by the circumstances; (6) the nature and length of the professional relationship with the client; (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and (8) whether the fee is fixed or contingent. (b) The scope of the representation and the basis or rate of the fee and expenses for which the client will be responsible shall be communicated to the client, preferably in writing, before or within a reasonable time after commencing the representation, except when the lawyer will charge a regularly represented client on the same basis or rate. Any changes in the basis or rate of the fee or expenses shall also be communicated to the client.

13 (c) A fee may be contingent on the outcome of the matter for which the service is rendered, except in a matter in which a contingent fee is prohibited by paragraph (d) or other law. A contingent fee agreement shall be in a writing signed by the client and shall state the method by which the fee is to be determined, including the percentage or percentages that shall accrue to the lawyer in the event of settlement, trial or appeal; litigation and other expenses to be deducted from the recovery; and whether such expenses are to be deducted before or after the contingent fee is calculated. The agreement must clearly notify the client of any expenses for which the client will be liable whether or not the client is the prevailing party. Upon conclusion of a contingent fee matter, the lawyer shall provide the client with a written statement stating the outcome of the matter and, if there is a recovery, showing the remittance to the client and the method of its determination. (d) A lawyer shall not enter into an arrangement for, charge, or collect: (1) any fee in a domestic relations matter, the payment or amount of which is contingent upon the securing of a divorce or upon the amount of alimony or support, or property settlement in lieu thereof; or (2) a contingent fee for representing a defendant in a criminal case. (e) A division of a fee between lawyers who are not in the same firm maybe made only if: (1) the division is in proportion to the services performed by each lawyer, or if the primary service performed by one lawyer is the referral of the client to another lawyer and each lawyer assumes joint financial responsibility for the representation; (2) the client agrees to the arrangement, including the share each lawyer will receive, and the agreement is confirmed in writing; and (3) the total fee is reasonable.

14 (765 ILCS 77/35) Sec. 35. Disclosure report form. The disclosures required of a seller by this Act shall be made in the following form: RESIDENTIAL REAL PROPERTY DISCLOSURE REPORT NOTICE: THE PURPOSE OF THIS REPORT IS TO PROVIDE PROSPECTIVE BUYERS WITH INFORMATION ABOUT MATERIAL DEFECTS IN THE RESIDENTIAL REAL PROPERTY. THIS REPORT DOES NOT LIMIT THE PARTIES' RIGHT TO CONTRACT FOR THE SALE OF RESIDENTIAL REAL PROPERTY IN "AS IS" CONDITION. UNDER COMMON LAW, SELLERS WHO DISCLOSE MATERIAL DEFECTS MAY BE UNDER A CONTINUING OBLIGATION TO ADVISE THE PROSPECTIVE BUYERS ABOUT THE CONDITION OF THE RESIDENTIAL REAL PROPERTY EVEN AFTER THE REPORT IS DELIVERED TO THE PROSPECTIVE BUYER. COMPLETION OF THIS REPORT BY THE SELLER CREATES LEGAL OBLIGATIONS ON THE SELLER; THEREFORE THE SELLER MAY WISH TO CONSULT AN ATTORNEY PRIOR TO COMPLETION OF THIS REPORT. Property Address:.... City, State & Zip Code:.... Seller's Name:.... This Report is a disclosure of certain conditions of the residential real property listed above in compliance with the Residential Real Property Disclosure Act. This information is provided as of... (month).. (day)... (year), and does not reflect any changes made or occurring after that date or information that becomes known to the seller after that date. The disclosures herein shall not be deemed warranties of any kind by the seller or any person representing any party in this transaction. In this form, "am aware" means to have actual notice or actual knowledge without any specific investigation or inquiry. In this form, "material defect" means a condition that would have a substantial adverse effect on the value of the residential real property or that would significantly impair the health or safety of future occupants of the residential real property unless the seller reasonably believes that the condition has been corrected. The seller discloses the following information with the knowledge that even though the statements herein are not deemed to be warranties, prospective buyers may choose to rely on this information in deciding whether or not and on what terms to purchase the residential real property. The seller represents that to the best of his or her actual knowledge, the following statements have been accurately noted as "yes" (correct), "no" (incorrect), or "not applicable" to the property being sold. If the seller indicates that the response to any statement, except number 1, is yes or not applicable, the seller shall provide an explanation, in the additional information area of this form. YES NO N/A l Seller has occupied the property within the last 12 months. (No explanation is needed.) 2... I am aware of flooding or recurring leakage problems in the crawl space or basement I am aware that the property is located in a flood plain or that I

15 currently have flood hazard insurance on the property. 4 I am aware of material defects in the basement or foundation (including cracks and bulges) I am aware of leaks or material defects in the roof, ceilings, or chimney I am aware of material defects in the walls, windows, doors, or floors I am aware of material defects in the electrical system I am aware of material defects in the plumbing system (includes such things as water heater, sump pump, water treatment system, sprinkler system, and swimming pool) I am aware of material defects in the well or well equipment I am aware of unsafe conditions in the drinking water I am aware of material defects in the heating, air conditioning, or ventilating systems I am aware of material defects in the fireplace or woodburning stove I am aware of material defects in the septic, sanitary sewer, or other disposal system.... I am aware of unsafe concentrations of radon on the premises.... I am aware of unsafe concentrations of or unsafe conditions relating to asbestos on the premises I am aware of unsafe concentrations of or unsafe conditions relating to lead paint, lead water pipes, lead plumbing pipes or lead in the soil on the premises I am aware of mine subsidence, underground pits, settlement, sliding, upheaval, or other earth stability defects on the premises I am aware of current infestations of termites or other wood boring insects I am aware of a structural defect caused by previous infestations of termites or other wood boring insects I am aware of storage tanks I am aware of disputes. underground fuel on the property. boundary or lot line

16 22... I have received notice of violation of local, state or federal laws or regulations relating to this property, which violation has not been corrected I am aware that this property has been used for the manufacture of methamphetamine as defined in Section 10 of the Methamphetamine Control and Community Protection Act. Note: These disclosures are not intended to cover the common elements of a condominium, but only the actual residential real property including limited common elements allocated to the exclusive use thereof that form an integral part of the condominium unit. Note: These disclosures are intended to reflect the current condition of the premises and do not include previous problems, if any, that the seller reasonably believes have been corrected. If any of the above are marked "not applicable" or "yes", please explain here or use additional pages, if necessary: Check here if additional pages used:... Seller certifies that seller has prepared this statement and certifies that the information provided is based on the actual notic e or actual knowledge of the seller without any specific investigation or inquiry on the part of the seller. The seller hereby authorizes any person representing any principal in this transaction to provide a copy of this report, and to disclose any information in the report, to any person in connection with any actual or anticipated sale of the property. Seller: Date:.... Seller: Date:.... THE PROSPECTIVE BUYER IS AWARE THAT THE PARTIES MAY CHOOSE TO NEGOTIATE AN AGREEMENT FOR :HE SALE OF THE PROPERTY SUBJECT TO ANY OR ALL MATERIAL DEFECTS DISCLOSED IN THIS REPORT ("AS IS"). THIS DISCLOSURE IS NOT A SUBSTITUTE FOR ANY INSPECTIONS OR WARRANTIES THAT THE PROSPECTIVE BUYER OR SELLER MAY WISH TO OBTAIN OR NEGOTIATE. THE FACT THAT THE SELLER IS NOT AWARE OF A PARTICULAR CONDITION OR PROBLEM IS NO GUARANTEE THAT IT DOES NOT EXIST. THE PROSPECTIVE BUYER IS AWARE THAT HE MAY REQUEST AN INSPECTION OF THE PREMISES PERFORMED BY A QUALIFIED PROFESSIONAL. Prospective Buyer: Date: Time: Prospective Buyer:... Date: Time: (Source: P.A , eff )

17 RULE 1.4: COMMUNICATION (a) A lawyer shall: (1) promptly inform the client of any decision or circumstance with respect to which the client's informed consent, as defined in Rule 1.0( e), is required by these Rules; (2) reasonably consult with the client about the means by which the client's objectives are to be accomplished; (3) keep the client reasonably informed about the status of the matter; ( 4) promptly comply with reasonable requests for information; and (5) consult with the client about any relevant limitation on the lawyer's conduct when the lawyer knows that the client expects assistance not permitted by the Rules of Professional Conduct or other law. (b) A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation RULE 1.8: CONFLICT OF INTEREST: CURRENT CLIENTS: SPECIFIC RULES (a) A lawyer shall not enter into a business transaction with a client or knowingly acquire an ownership, possessory, security or other pecuniary interest adverse to a client unless: (1) the transaction and terms on which the lawyer acquires the interest are fair and reasonable to the client and are fully disclosed and transmitted in writing in a manner that can be reasonably understood by the client; (2) the client is informed in writing that the client may seek the advice of independent legal counsel on the transaction, and is given a reasonable opportunity to do so; and (3) the client gives informed consent, in a writing signed by the client, to the essential terms of the transaction and the lawyer's role in the transaction, including whether the lawyer is representing the client in the transaction. (b) A lawyer shall not use information relating to representation of a client to the disadvantage of the client unless the client gives informed consent, except as permitted or required by these Rules. (c) A lawyer shall not solicit any substantial gift from a client, including a testamentary gift, or prepare on behalf of a client an instrument giving the lawyer or a person related to the lawyer any substantial gift unless the lawyer or other recipient of the gift is related to the client. For purposes of this paragraph, related persons include a spouse, child, grandchild, parent, grandparent or other relative or individual with whom the lawyer or the client maintains a close, familial relationship. (d) Prior to the conclusion of representation of a client, a lawyer shall not make or negotiate an agreement giving the lawyer literary or media rights to a portrayal or account based in substantial part on information relating to the representation. (e) A lawyer shall not provide financial assistance to a client in connection with pending or contemplated litigation, except that:

18 (1) a lawyer may advance court costs and expenses of litigation, the repayment of which may be contingent on the outcome of the matter; and (2) a lawyer representing an indigent client may pay court costs and expenses of litigation on behalf of the client. (f) A lawyer shall not accept compensation for representing a client from one other than the client unless: (1) the client gives informed consent; (2) there is no interference with the lawyer's independence of professional judgment or with the client-lawyer relationship; and (3) information relating to representation of a client is protected as required by Rule 1.6. (g) A lawyer who represents two or more clients shall not participate in making an aggregate settlement of the claims of or against the clients, or in a criminal case an aggregated agreement as to guilty or nolo contendere pleas, unless each client gives informed consent, in a writing signed by the client. The lawyer's disclosure shall include the existence and nature of all the claims or pleas involved and of the participation of each person in the settlement. (h) A lawyer shall not: (I) make an agreement prospectively limiting the lawyer's liability to a client for malpractice unless the client is independently represented in making the agreement; or (2) settle a claim or potential claim for such liability with an unrepresented client or former client unless that person is advised in writing of the desirability of seeking and is given a reasonable opportunity to seek the advice of independent legal counsel in connection therewith. (i) A lawyer shall not acquire a proprietary interest in the cause of action or subject matter of litigation the lawyer is conducting for a client, except that the lawyer may: (1) acquire a lien authorized by law to secure the lawyer's fee or expenses; and (2) contract with a client for a reasonable contingent fee in a civil case. G) A lawyer shall not have sexual relations with a client unless a consensual sexual relationship existed between them when the client-lawyer relationship commenced. (k) While lawyers are associated in a firm, a prohibition in the foregoing paragraphs (a) through (i) that applies to any one of them shall apply to all of them.

19 DISCLOSURE OF INFORMATION ON RADON HAZARDS (For Residential Real Property Sales or Purchases) Radon Warning Statement Every buyer of any interest in residential real property is notified tbat tbe property may present exposure to dangerous levels of indoor radon gas tbat may place tbe occupants at risk of developing radoninduced lung cancer. Radon, a Class-A human carcinogen, is tbe leading cause of lung cancer in nonsmokers and tbe second leading cause overall. The seller of any interest in residential real property is required to provide tbe buyer witb any information on radon test results of tbe dwelling showing elevated levels of radon in tbe seller's possession. The illinois Emergency Management Agency (lema) strongly recommends ALL homebuyers have an indoor radon test performed prior to purchase or taking occupancy, and mitigated if elevated levels are found. Elevated radon concentrations can easily be reduced by a qualified, licensed radon mitigator. Property Address: Seller's Disclosure (initial each of the following which applies) (a) (b) (c) (d) Elevated radon concentrations (above EPA or lema recommended Radon Action Level) are known to be present witbin tbe dwelling. (Explain) Seller has provided tbe purchaser witb tbe most current records and reports pertaining to elevated radon concentrations within tbe dwelling. Seller eitber has no know ledge of elevated radon concentrations in tbe dwelling or prior elevated radon concentrations have been mitigated or remediated. Seller has no records or reports pertaining to elevated radon concentrations within the dwelling. Purchaser's Acknowledgment (initial each of the following which applies) (e) (f) Purchaser has received copies of all information listed above. Porchaser has received tbe lema approved Radon Disclosure Pamphlet. Agent's Acknowledgment (initial) (if applicable) (g) Agent has informed tbe seller of the seller's obligations under illinois law. Certification of Accuracy The following parties have reviewed tbe information above and each party certifies, to tbe best of his or her knowledge, tbat tbe information he or she provided is true and accurate. Seller Printed Name Seller Printed Name Seller Date Seller Date Signature Signature Purchaser Printed Name Purchaser Printed Name Purchaser Date Purchaser Date Signature Signature Agent Printed Name Agent Printed Name Agent Signature Date Agent Signature Date

20 Where the test should be conducted Place the detector or detectors in each lowest area suitable for occupancy; such as: a family room, living room, den, playroom, bedroom, workshop, or exercise room; in the lowest level suitable for occupancy, even if it isn't currently used but could be, without renovating. For instance, if the house has one or more of the following foundation types, e.g., basement, crawl space, slab-on-grade, a test should be performed in the basement and in at least one room over the crawlspace and slab-on-grade area. If an elevated radon concentration is found and confinned in one of these areas, fix the house. DO NOT MEASURE: in the kitchen, laundry room and bathroom (because fan systems and humidity may affect some detectors); or in crawl spaces, on floor or wall cracks, or right next to a sump pump, as this may cause a false high reading. The detector should be placed: in an area where it will not be disturbed; at least three feet from doors and windows to the outside; at least one foot from exterior walls; 20 inches to 6 feet from the floor; at least four inches away from other objects horizontally and directly above the detector; away from drafts; and four feet from heat, fireplaces, furnaces, and away from direct sunlight and areas of high humidity. If the test results show radon levels above 4 pci/l Contact the lema-division of Nuclear Safety Radon Program. Staff can provide names and addresses of professional radon mitigators who are trained to reduce radon concentrations. We also recommend that you see our web site or contact the Radon Program for a copy of our brochnre, lema-division of Nuclear Safety Guide to Radon Mitigation. After a radon reduction system is installed Perform an independent short-term test to ensure that the reduction system is effective. Make sure the system is operating during the entire test. The lema-division of Nuclear Safety Radon Program can provide: Information about radon and radon testing; Names of licensed radon measurement professionals; Names of licensed radon mitigation professionals trained to reduce radon. Call the lema-division of Nuclear Safety Radon Program at: 1(800) ; ;. ijia4'p""';.. ~-..: ~"}... it'~ffi~~'l-"~"' ~ lema-division of Nuclear Safety 1035 Outer Park Drive Springfield, IL (217) TDD: (217) Prittt<.. >d by the Authority of the State of llllnois (3o,ooo.. S/09. l'm 625) <l@gj:> Radon Testing Guidelines for Real Estate Transactions Because of the unique nature of real estate transactions, involving 1nultiple parties and financial interests, the U.S. Envirorunental Protection Agency (U.S. EPA) designed special protocols for radon testing in real estate transactions. The Illinois Emergency Management Agency(IEMA)-Division of Nuclear Safety has adapted these protocols to conform with its radon regulations. These op~ions are listed in simplified form in the table below. Recommendations for Real Estate Transactions lema strongly recommends ALL homebuyers have an indoor radon test performed prior to purchase or taking occupancy, and mitigated if elevated levels are found. It is not in tl1e best interest of the buyer or seller to rely on a radon measurement performed by anyone other than a licensed measure1nent professional or technician. Elevated radon concentrations can easily be reduced by a qualified, licensed radon mitigator. Test Options for Real Estate Transactions Conduct a short-term radon test in each of the lowest stmctural areas of the home. For example, if the house has one or more of the following foundation types, e.g., basement, crawl space, slab-on-grade, a test in each area is required for licensed professional measurements.

21 What to Look for in Short-Term Real Estate Testing Options Option Detector Location What to do Next Simultaneous Two detectors, four inches apart, Fix U1e home if U1e average of U1e Two short-term tests, 48 hours or in each of the lowest structural two tests is 4 picocuries per liter longer, performed at the same time. areas suitable for occupancy. (pci/l) or more. Continuous Monitor Test Continuous monitor placed in Fix the home if the average radon One test, 48 hours or longer, each of the lowest structural level is 4 pci/l or more. performed with an active continu- areas suitable for occupancy. ous monitor that integrates and records radon levels hourly Short-term tests may last between two and 90 days. Most last between two and seven days. Tests between seven and 90 days are usually impractical for real estate transactions. Examples of short-term detectors used in real estate testing include: activated charcoal canisters, charcoal liquid scintillation vials, electret chambers and continuous radon tnonitors. If your tests don't agree, contact the lema-division of Nuclear Safety If your simultaneous tests are not in agreement (or if you're not sure whether or not they agree), contact the lema-division of Nuclear Safety Radon Program or your licensed radon measurement professional. When do you average radon test results? The only time radon test results can be averaged is when two test results are placed simultaneously. Test results from different areas, such as above the crawl space and in the basement, are considered two different tests. Results are each independent of fue other and are reported independently, such as basement result of 4.2 pci/l and family room over crawl space result of 6.1 pci/l. With an elevated radon level in any one of the lowest structural areas, the recommendation is to fix fue house. -- Interfereuce with successful completion of a radon measurement is illegal in Illinois. Rev /2007 (lema ) lema-division of Nuclear Safety Recommendations for Real Estate Radon Measurements Hire a licensed radon measurement professional. Be sure that lema-division of Nuclear Safety Radon Program radon testing protocols are followed. Contact fue lema-division of Nuclear Safety Radon Program if you are uncertain about anything regarding radon testing. Disclosure of Radon Information The Illinois Radon Awareness Act and the Illinois Real Property Disclosure Act require that a seller of a home disclose information if aware of unsafe concentrations of radon in the home. The acts do not require that testing or remediation work be conducted. However, many relocation cmnpanies and lending institutions, as well as home buyers, request a radon test when purchasing a house. Sellers and brokers are cautioned to err on the side of full disclosure of material facts prior to entering into a purchase agreement. When Testing Be aware fuat any test lasting less than a week requires closed-house conditions. Closed-house conditions mean keeping all windows closed, keeping doors closed except for normal entry and exit, and not operating fans or other machines which bring air in from outside (except for fans that are part of a radon reduction system, or small exhaust fans that operate for only short periods of time). Before Testing: Begin closed-house conditions at least 12 hours before the start of the short-term test. During Testing: Maintain closed-house conditions during the entire duration of ilie short term test, especially for tests less than one week in duration. Operate home heating or cooling systems normally during the test. For tests lasting less than one week, only operate air conditioning units that recirculate interior air. Note that professional measurement licensees are required to post Radon Measuretnent in Progress Notifications at every building entry.

22 Lead Warning Statement Disclosure of Information on Lead-Based Paint and/or Lead-Based Paint Hazards Every purchaser of any interest in residential real property on which a residential dwelling was built prior to 1978 is notified that such property may present exposure to lead from lead-based paint that may place young children at risk of developing lead poisoning_ Lead poisoning in young children may produce permanent neurological damage, including learning disabilities, reduced intelligence quotien~ behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. 7he seller of any interest in residential real property is required to provide the buyer with any information on lead-based paint hazards from risk assessmenis or inspections in the seller's possession and notify the buyer of any known lead-based point hazards. A risk assessment or inspection for possible lead-based paint hazards is recommended prior to purchase Seller's Disclosure (a) Presence of lead-based paint and/or lead-based paint hazards (check (i) or (ii) below): (i) Known lead-based paint and/or lead-based paint hazards are present in the housing (explain). (ii) Seller has no knowledge of lead-based paint and/or lead-based paint hazards in the housing. (b) Records and reports available to the seller (check (i) or (ii) below): (i) Seller has provided the purchaser with all available records and reports pertaining to leadbased paint and/or lead-based paint hazards in the housing Oist documents below). (ii) Seller has no reports or records pertaining to lead-based paint and/or lead-based paint hazards in the housing. Purchaser's Acknowledgment (initial) (c) (d) Purchaser has received copies of all infonnation listed above. Purchaser has received the pamphlet Protect Your Family from Lead in Your Home. (e) Purchaser has (check (i) or (ii) below): (i) received a 10-day opportunity (or mutually agreed upon period) to conduct a risk assessment or inspection for the presence of lead-based paint and/or lead-based paint hazards; or (ii) waived the opportunity to conduct a risk assessment or inspection for the presence of lead-based paint and/or lead-based paint hazards. Agent's Acknowledgment (initial) (t) Agent has infonned the seller of the seller's obligations under 42 U.S.C. 4852(d) and is aware of his/her responsibility to ensure compliance. Certification of Accuracy The following parties have reviewed the information above and certify, to the best of their knowledge, that the information they have provided is true and accurate. Seller Date Seller Date Purchaser Date Purchaser Date Agent Date Agent Date

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24 thil11k....u n~omte has high lead: Get your young children tested for lead, even if they seem healthy. Wash children's hands, bottles, pacifiers, and toys often. Make sure children eat healthy, low-fat foods. Get your home checked for lead hazards. Regularly clean floors, window sills, and other surfaces. Wipe soil off shoes before entering house. Talk to your landlord about fixing surfaces with peeling or chipping paint. Take precautions to avoid exposure to lead dust when remodeling or renovating (call LEAD for guidelines). Don't use a belt-sander, propane torch, high temperature heat gun, scraper, or sandpaper on painted surfaces that may contain lead. Don't try to remove lead-based paint yourself.

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26 Buy, Rent, Before t Renovate any houses and apartments built before 1978 have paint that contains high levels of lead (called leadbased paint). Lead from paint, chips, and dust can pose serious health hazards if not taken care of properly. OWNERS, RENTERS are encouraged to check for lead (see page 6) before renting, buying or renovating pre housing. Federal law requires that individuals receive certain information before renting, buying, or renovating pre-1978 housing: LANDLORDS have to disclose known information on lead-based paint and lead-based paint hazards before leases take effect. Leases must include a disclosure about lead-based paint. Sf.Uf.RS have to disclose known information on lead-based paint and lead-based paint hazards before selling a house. Sales contracts must include a disclosure about lead-based paint. Buyers have up to 10 days to check for lead. RENOVATORS disturbing more than 2 square feet of painted surfaces have to give you this pamphlet before starting work.

27 IMPORTANT! Lead from Paint, Dust, and Dangerous If na1nasleo Properly fact: Lead exposure can harm young children and babies even before they are born. fact: Even children who seem healthy can have high levels of lead in their bodies. fact: People can get lead in their bodies by breathing or swallowing lead dust, or by eating soil or paint chips containing lead. fact: People have many options for reducing lead hazards. In most cases, lead-based paint that is in good condition is not a hazard. fact: Removing lead-based paint improperly can increase the danger to your family. If you think your home might have lead hazards, read this pamphlet to learn some simple steps to protect your family. l

28 Ways poisoning environmen- Even children heau:hy can have dangerous levels ~ea.a in their bodies. People can get lead in their body if they: Breathe in lead dust (especially during renovations that disturb painted surfaces). Put their hands or other objects covered with lead dust in their mouths. Eat paint chips or soil that contains lead. Lead is even more dangerous to children under the age of 6: At this age children's brains and nervous systems are more sensitive to the damaging effects of lead. Children's growing bodies absorb more lead. Babies and young children often put their hands and other objects in their mouths. These objects can have lead dust on them. Lead is also dangerous to women of childbearing age: Women with a high lead level in their system prior to pregnancy would expose a fetus to lead through the placenta during fetal development. 2

29 lead's Effects It is important to know that even exposure to low levels of lead can severely harm children. In children, lead can cause: Nervous system and kidney damage. Learning disabilities, attention deficit disorder, and decreased intelligence. Speech, language, and behavior problems. Poor muscle coordination. Decreased muscle and bone growth. Hearing damage. While low-lead exposure is most common, exposure to high levels of lead can have devastating effects on children, including seizures, unconsciousness, and, in some cases, death. Although children are especially susceptible to lead exposure, lead can be dangerous for adults too. In adults, lead can cause: Increased chance of illness during pregnancy. Harm to a fetus, including brain damage or death. + Fertility problems (in men and women). High blood pressure. Digestive problems. Nerve disorders. Memory and concentration problems. Muscle and joint pain. Reproductive Problems (Adults) Brain or Nerve Damage Lead affects the body many ways. 3

30 In general, Many homes built before 1978 have leadbased paint. The federal government banned lead-based paint from housing in Some states stopped its use even earlier. Lead can be found: In homes in the city, country, or suburbs. In apartments, single-family homes, and both private and public housing. Inside and outside of the house. In soil around a home. (Soil can pick up lead from exterior paint or other sources such as past use of leaded gas in cars.) To reduce your child's exposure to lead, get your child checked, have your home tested (especially if your home has paint in poor condition and was built before 1978), and fix any hazards you may have. Children's blood lead levels tend to increase rapidly from 6 to 12 months of age, and tend to peak at 18 to 24 months of age. Consult your doctor for advice on testing your children. A simple blood test can detect high levels of lead. Blood tests are usually recommended for: Children at ages 1 and 2. Children or other family members who have been exposed to high levels of lead. Children who should be tested under your state or local health screening plan. Your doctor can explain what the test results mean and if more testing will be needed. 4

31 lead-based paint is usually not a hazard if it is in good condition, and it is not on an impact or friction surface, like a window. It is defined by the federal government as paint with lead levels greater than or equal to 1.0 milligram per square centimeter, or more than 0.5% by weight. Deteriorating lead-based paint (peeling, chipping, chalking, cracking or damaged) is a hazard and needs immediate attention. It may also be a hazard when found on surfaces that children can chew or that get a lot of wear-and-tear, such as: Windows and window sills. Doors and door frames. Stairs, railings, banisters, and porches. Lead from paint chips, you can see, and lead dust, which you can't always see, can both be serious hazards. lead dust can form when lead-based paint is scraped, sanded, or heated. Dust also forms when painted surfaces bump or rub together. Lead chips and dust can get on surfaces and objects that people touch. Settled lead dust can re-enter the air when people vacuum, sweep, or walk through it. The following two federal standards have been set for lead hazards in dust: 40 micrograms per square foot (Jlg/ft2) and higher for floors, including carpeted floors. 250 J.lg/ft2 and higher for interior window sills. Lead in soil can be a hazard when children play in bare soil or when people bring soil into the house on their shoes. The following two federal standards have been set for lead hazards in residential soil: 400 parts per million (ppm) and higher in play areas of bare soil. 1,200 ppm (average) and higher in bare soil in the remainder of the yard. The only way to find out if paint, dust and soil lead hazards exist is to test for them. The next page describes the most common methods used. 5

32 Checking You can get your home tested for lead in several different ways: A paint inspection tells you whether your home has lead-based paint and where it is located. It won't tell you whether or not your home currently has lead hazards. A risk assessment tells you if your home currently has any lead hazards from lead in paint, dust, or soil. It also tells you what actions to take to address any hazards. A combination risk assessment and inspection tells you if your home has any lead hazards and if your home has any lead-based paint, and where the lead-based paint is located. Hire a trained and certified testing professional who will use a range of reliable methods when testing your home. Visual inspection of paint condition and location. A portable x-ray fluorescence (XRF) machine. Lab tests of paint, dust, and soil samples. There are state and federal programs in place to ensure that testing is done safely, reliably, and effectively. Contact your state or local agency (see bottom of page 11) for more information, or call l lead (5313} for a list of contacts in your area. Horne test kits for lead are available, but may not always be accurate. Consumers should not rely on these kits before doing renovations or to assure safety. 6

33 If you suspect that your house has lead hazards, you can take some immediate steps to reduce your family's risk: If you rent, notify your landlord of peeling or chipping paint. Clean up paint chips immediately. Clean floors, window frames, window sills, and other surfaces weekly. Use a mop or sponge with warm water and a general all-purpose cleaner or a cleaner made specifically for lead. REMEMBER: NEVER MIX AMMONIA AND BLEACH PRODUCTS TOGETHER SINCE THEY CAN FORM A DANGEROUS GAS. Thoroughly rinse sponges and mop heads after cleaning dirty or dusty areas. Wash children's hands often, especially before they eat and before nap time and bed time. Keep play areas clean. Wash bottles, pacifiers, toys, and stuffed animals regularly. Keep children from chewing window sills or other painted surfaces. Clean or remove shoes before entering your home to avoid tracking in lead from soil. Make sure children eat nutritious, low-fat meals high in iron and calcium, such as spinach and dairy products. Children with good diets absorb less lead. YOGUR.T 1

34 The Home Removing house. trained to remove lead hazards safely. 8 In addition to day-to-day cleaning and good nutrition: You can temporarily reduce lead hazards by taking actions such as repairing damaged painted surfaces and planting grass to cover soil with high lead levels. These actions (called "interim controls") are not permanent solutions and will need ongo~ ing attention. To permanently remove lead hazards, you should hire a certified lead "abatement" contractor. Abatement (or permanent hazard elimination) methods include removing, sealing, or enclosing lead-based paint with special materials. Just painting over the hazard with regular paint is not permanent removal. Always hire a person with special training for correcting lead problems-someone who knows how to do this work safely and has the proper equipment to clean up thoroughly. Certified contractors will employ qualified workers and follow strict safety rules as set by their state or by the federal government. Once the work is completed, dust cleanup activities must be repeated until testing indicates that lead dust levels are below the following: 40 micrograms per square foot (Jlgtftl) for floors, including carpeted floors; 250 J.lgfftl for interior windows sills; and 400 J.lgfftl for window troughs. Call your state or local agency (see bottom of page 11) for help in locating certified professionals in your area and to see if financial assistance is available.

35 Home With Take precautions before your contractor or you begin remodeling or renovating anything that disturbs painted surfaces (such as scraping off paint or tearing out walls): Have the area tested for lead-based paint. Do not use a belt-sander, propane torch, high temperature heat gun, dry scraper, or dry sandpaper to remove lead-based paint. These actions create large amounts of lead dust and fumes. Lead dust can remain in your home long after the work is done. Temporarily move your family (especially children and pregnant women) out of the apartment or house until the work is done and the area is properly cleaned. If you can't move your family, at least completely seal off the work area. Follow other safety measures to reduce lead hazards. You can find out about other safety measures by calling LEAD. Ask for the brochure "Reducing Lead Hazards When Remodeling Your Home." This brochure explains what to do before, during, and after renovations. If you have already completed renovations or remodeling that could have released lead-based paint or dust, get your young children tested and follow the steps outlined on page 7 of this brochure. conducted properly, certain types renovations can :release lead ~'~"~"~l1'1111 paint a.n u dust into 9

36 ' ' /) \. '((!.IJI exist. Drinking water. Your home might have plumbing with lead or lead solder. Call your local health department or water supplier to find out about testing your water. You cannot see, smell, or taste lead, and boiling your water will not get rid of lead. If you think your plumbing might have lead in it: Use only cold water for drinking and cooking. Run water for 15 to 30 seconds before drinking it, especially if you have not used your water for a few hours. The job. If you work with lead, you could bring it home on your hands or clothes. Shower and change clothes before coming home. Launder your work clothes separately from the rest of your family's clothes. Old painted toys and furniture. Food and liquids stored in lead crystal or lead-glazed pottery or porcelain. Lead smelters or other industries that release lead into the air. Hobbies that use lead, such as making pottery or stained glass, or refinishing furniture. Folk remedies that contain lead, such as "greta" and "azarcon" used to treat an upset stomach.

37 The National Lead Information Center Call LEAD ( ) to learn how to protect children from lead poisoning and for other information on lead hazards. To access lead information via the web, visit and EPA's Safe Drinking Water Hotline Call for information about lead in drinking water. Consumer Product Safety Commission (CPSC) Hotline To request information on lead in consumer products, or to report an unsafe consumer product or a product-related injury call , or visit CPSC's Web site at: Health and Environmental Agencies Some cities, states, and tribes have their own rules for lead-based paint activities. Check with your local agency to see which laws apply to you. Most agencies can also provide information on finding a lead abatement firm in your area, and on possible sources of financial aid for reducing lead hazards. Receive up-to-date address and phone information for your local contacts on the Internet at or contact the National Lead Information Center at LEAD. F.. :::::::--;:=:=:==-, For the hearing impaired, call the Federal Information Relay Service at t to access any of the phone numbers in this brochure. l I