Illinois guide
Illinois condo reserve study requirements
Illinois requires condo budgets after July 1, 1990, to provide for 'reasonable reserves' for capital expenditures and deferred maintenance under 765 ILCS 605. The statute does not define reasonable, does not require a formal reserve study, and explicitly permits owners to waive reserves by 2/3 vote (with conspicuous disclosure on resale financials).
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For older Chicago stock entering capital cycles, the gap between statutory compliance and practical adequacy is one of the leading sources of unexpected special assessments.
What 765 ILCS 605 requires for condos
Budgets after July 1, 1990, must provide for reasonable reserves. The board must consider future restoration, replacement, repair costs, and useful life of common elements. Independent professional reserve studies are permitted but not required. The Act does not impose a funding percentage. Older condos (pre-July 1990) may operate without reserves if their governing documents allow.
2/3 owner waiver right
Owners can waive the reserve requirement entirely by a 2/3 vote. A waiver must be conspicuously disclosed on resale financials. This is legal but a meaningful diligence flag — the building either has confidence in voluntary special-assessment funding or is deferring capital obligations.
CICAA HOA reserves
CICAA requires the proposed annual HOA budget to indicate amounts for reserves, repairs, taxes. There is no specific funding requirement and no waiver framework. Reserves are largely discretionary for Illinois HOAs.
Chicago-specific reserve considerations
For Chicago condos subject to FISP, the inspection's identified work materially affects realistic capital trajectory. Reserve adequacy must be measured against FISP-driven obligations, not just generic capital-program estimates.
Illinois legal references
Informational only. Not legal advice. Always confirm against current statute and counsel.
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Find a Illinois specialist →Reviewer's checklist
- Request any voluntary reserve study and current reserve balance
- Confirm post-1990 condos have a reasonable-reserves budget line
- Check for any conspicuous 2/3 reserve-waiver disclosure
- For Chicago: compare reserves to FISP-identified capital needs
- Read 24 months of minutes for capital-planning discussions
- Identify recent special-assessment activity
- For HOAs: confirm budget shows reserve allocation per CICAA
- Verify D&O coverage triggers if reserves exceed $250,000
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We can introduce your board to vetted reserve fund engineers, HOA lawyers, property managers, building envelope consultants, and restoration contractors — free intros, no obligation.
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A condo document review is the structured analysis of every disclosure document your seller or association has provided — declaration, bylaws, rules, reserve study, budgets, financials, meeting minutes, insurance summary, estoppel or resale certificate, and any pending special assessment notices.
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The association's master insurance policy determines what your personal HO-6 policy needs to cover — and what it does not.
FAQ
Frequently asked questions
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Find an engineer for your reserve study
We can introduce your board to vetted reserve fund engineers, HOA lawyers, property managers, building envelope consultants, and restoration contractors — free intros, no obligation.
- Reserve fund engineer
- Property manager
- Building envelope consultant
- Restoration contractor
Risk Intelligence
Get a Free Structured Read on Your Association's Documents
Reserve studies, audit findings, attorney memos, milestone inspections — CondoSignal produces a free, structured review with page citations your board can act on. No cost to the association.