Senator Gillespie speaks into a microphone while seating during a committee hearing.SPRINGFIELD — For people purchasing a home, an upfront cash payment from a real estate agency in exchange for signing a contract seems harmless. What these homebuyers may not realize is this signed agreement can lead to added costs and barriers when they try to sell their home in the future. This type of predatory contract is what State Senator Ann Gillespie is working to prevent in Illinois.

“People deserve transparency and control when it comes to making decisions about large purchases,” said Gillespie (D-Arlington Heights). “Buying a house is an investment, and homeowners should not be deceived or steered toward contracts without understanding the full terms.”

Non-Titled Recorded Agreements for Personal Services, known as NTRAPS, are contracts between a service provider — such as a real estate firm — and a homeowner in which the homeowner is offered a small amount of money in exchange for signing an agreement for future services. These long-term agreements are recorded within property records, giving the service provider the right to list the property for future sale. Homeowners who later try to sell their property outside of this agreement or transfer the title can face costly penalties.

Senate Bill 3420 would prohibit businesses from entering into these unfair real estate contracts. Gillespie’s measure would also protect property owners from financial loss in the event a contract is included within their property record. Illinois would join 17 other states in passing this type of protective legislation.

“Real estate brokers are targeting older homeowners who may not realize the extent of these agreements, which can span 40 years,” said Gillespie. “The financial impact of these predatory contracts can then fall onto family members who inherit the property and are put through obstacles during an already challenging time.”

Senate Bill 3420 passed the Senate on Friday and heads to the House for consideration.