Tax Foreclosure in Illinois: What Chicago-Area Homeowners Need to Know
A guide from AuctionBlock.org
If you own a home in Illinois — particularly in the Chicago metropolitan area — and you have fallen behind on your property taxes, it is important to understand how the tax foreclosure process works in your state. Illinois uses a tax lien sale system, which means the county does not immediately take your home when you miss a tax payment. Instead, your unpaid taxes are sold to a third-party buyer at an annual tax sale. That buyer does not own your home, but they do hold a claim against it — and if you do not pay off that claim within the redemption period, you can lose your property.
This guide explains how the process works in Illinois, with specific attention to Cook County (which includes Chicago and surrounding suburbs). Cook County has the largest property tax system in the state and uses procedures that differ in some respects from other Illinois counties.
How Property Tax Collection Works in Illinois
Property taxes in Illinois are collected by the county treasurer. Tax bills are typically issued in two installments per year. If you do not pay your property taxes, the unpaid amount becomes delinquent. After a period of delinquency, the county treasurer offers the unpaid taxes for sale at an annual tax sale.
Illinois law governing this process is found primarily in the Property Tax Code, 35 ILCS 200/21-1 through 200/22-95.
The Annual Tax Sale
Each year, the county treasurer holds a tax sale where delinquent property taxes are sold to buyers. Here is how it works:
1. Notice to the Homeowner Before the tax sale, the county must send written notice to the property owner. In Cook County, the Cook County Treasurer's Office publishes a list of properties with delinquent taxes and sends notices by mail.
2. The Sale Itself At the annual tax sale, buyers bid on the right to pay your delinquent taxes. They are not buying your home — they are buying a tax lien certificate. The winning bidder is the one who accepts the lowest interest rate (called the "penalty bid") that will be charged to the homeowner upon redemption. The maximum penalty rate is 18% every six months (which amounts to 36% annualized), as set by 35 ILCS 200/21-215.
3. What the Buyer Gets The buyer receives a Certificate of Purchase. This certificate gives them the right to collect the delinquent taxes plus the penalty interest from the homeowner. It does not give them ownership of the property.
The Scavenger Sale
In Cook County, there is a special type of tax sale called the scavenger sale, which occurs for properties with taxes that have been delinquent for two or more years. Unlike the annual tax sale (where buyers bid interest rates), the scavenger sale allows buyers to bid a flat dollar amount for the tax lien — sometimes for as little as a few hundred dollars on properties with large delinquencies.
The scavenger sale is governed by 35 ILCS 200/21-260. Properties that appear at the scavenger sale are typically those that went unsold at the annual tax sale. Many of these are in lower-income neighborhoods on the South and West sides of Chicago.
The same redemption rights apply after a scavenger sale — the homeowner can still pay off the taxes owed plus penalties to keep the property.
The Redemption Period
After your taxes are sold at a tax sale, you have a period of time to "redeem" the property — meaning you pay back the delinquent taxes plus any penalties and costs to the county clerk. If you redeem, the lien is released and you keep your home.
Standard redemption periods in Illinois:
- Residential property (6 or fewer units): You generally have 2 years and 6 months from the date of the tax sale to redeem. (35 ILCS 200/21-350)
- Vacant or commercial property: The redemption period may be shorter — as little as 6 months in some cases.
- Scavenger sale properties: The redemption period is generally 2 years from the date of sale. (35 ILCS 200/21-260)
During the redemption period, the tax buyer may also pay subsequent years' taxes on your property, adding those amounts to what you owe for redemption.
How to redeem: Contact the Cook County Clerk's Office (or your county clerk if you live outside Cook County) to get the exact redemption amount, which includes the original delinquent taxes, penalty interest, and any subsequent taxes paid by the buyer. Payment is made to the county clerk, not to the tax buyer directly.
Cook County Clerk's Office: (312) 603-5656
What Happens If You Do Not Redeem
If you do not redeem within the redemption period, the tax buyer can petition the circuit court for a tax deed. This is a court proceeding under 35 ILCS 200/22-30 through 22-55.
Before the court will grant a tax deed, the buyer must:
- Give you written notice (by certified mail and personal service or posting)
- Publish notice in a local newspaper
- File proof of notice with the court
If the court grants the tax deed, ownership of the property transfers to the tax buyer. At that point, you lose your home.
Important: Under the U.S. Supreme Court's 2023 decision in Tyler v. Hennepin County, if your property is worth more than the taxes owed, you may have a right to the surplus equity. If you are in this situation, consult with a legal aid attorney immediately.
The Senior Citizen Tax Deferral Program
Illinois offers a Senior Citizens Real Estate Tax Deferral Program that allows qualifying seniors to defer all or part of their property taxes. The state pays the taxes on your behalf, and a lien is placed on the property. The deferred taxes plus interest (currently 6% per year under 320 ILCS 30/3) are repaid when the property is sold or transferred.
Eligibility requirements (320 ILCS 30/1 — Senior Citizens Real Estate Tax Deferral Act):
- You must be 65 years of age or older as of June 1 of the year you apply
- Your total household income must be $65,000 or less (this threshold is set by statute — verify the current limit with your county treasurer as it may be adjusted)
- The property must be your primary residence
- You must have owned the property for at least 3 years (or at least 2 years if the property was acquired through inheritance)
- There must be no delinquent taxes on the property at the time of application (you must be current)
- Total liens on the property cannot exceed 80% of the property's equalized assessed value
How to apply: Applications are filed with the county treasurer's office. The deadline is typically March 1 of the tax year for which you are requesting deferral. Contact the Cook County Treasurer's Office at (312) 443-5100 or visit cookcountytreasurer.com.
Other Programs That May Help
Cook County Property Tax Exemptions
Cook County offers several property tax exemptions that reduce your tax bill:
- Homeowner Exemption: Available to owner-occupants. Reduces your property's equalized assessed value, lowering your tax bill. Apply through the Cook County Assessor's Office.
- Senior Citizen Exemption: Available to homeowners age 65 and older. Provides an additional assessed value reduction. Apply through the Cook County Assessor's Office.
- Senior Freeze (Assessment Freeze Homestead Exemption): Freezes the equalized assessed value of your property so your taxes do not increase even if property values rise. Requires annual household income at or below the program limit. Apply annually through the Cook County Assessor's Office.
- Disabled Persons Homestead Exemption: Available to homeowners with disabilities. Apply through the Cook County Assessor's Office.
- Disabled Veterans Exemption: Available to veterans with service-connected disabilities. Apply through the Cook County Assessor's Office.
Cook County Assessor's Office: (312) 443-7550 or cookcountyassessor.com
Cook County Treasurer's Payment Plans
If you owe back taxes, the Cook County Treasurer's Office may offer payment plans for delinquent property taxes. Contact them directly to discuss your options.
Cook County Treasurer: (312) 443-5100 or cookcountytreasurer.com
Illinois Housing Development Authority (IHDA)
IHDA administers various homeowner assistance programs, including the Illinois Homeowner Assistance Fund (ILHAF), which has provided assistance for delinquent property taxes, mortgage payments, and other housing costs for homeowners who experienced financial hardship. Program availability depends on federal and state allocations — check current availability at ihda.org or call (312) 836-5200.
Legal Aid Resources in Illinois
If you are facing a tax sale or have already had your taxes sold, you should speak with an attorney. Several organizations provide free or low-cost legal assistance to homeowners in Illinois:
- Legal Aid Chicago: Serves Cook County residents. (312) 341-1070 or legalaidchicago.org
- LAF (Legal Assistance Foundation): Free legal services for low-income residents of Cook County. (312) 341-1070 or lafchicago.org
- Cabrini Green Legal Aid: Serves Cook County. (312) 738-2452 or cgla.net
- Prairie State Legal Services: Serves northern and central Illinois outside Cook County. (815) 965-2134 or pslegal.org
- Land of Lincoln Legal Aid: Serves central and southern Illinois. (217) 529-8400 or lollaf.org
- Illinois Legal Aid Online: Statewide legal information and referral. illinoislegalaid.org
Emergency Steps If You Are Facing a Tax Sale
If you have received a notice that your property taxes will be sold, or if your taxes have already been sold and the redemption period is running:
- Do not ignore notices. Every notice you receive is a deadline. Missing deadlines can cost you your home.
- Contact your county clerk immediately to find out the exact redemption amount and deadline.
- Call a legal aid organization listed above. Many offer free consultations for homeowners facing tax sales.
- Apply for every exemption you qualify for — if you have not already claimed the homeowner, senior, or disability exemptions, you may be paying more property tax than necessary.
- Ask the county treasurer about payment plans for delinquent taxes.
- If you are 65 or older, ask about the Senior Citizens Real Estate Tax Deferral Program before your taxes become delinquent.
- Contact a HUD-approved housing counseling agency: Find one at hud.gov/findacounselor or call (800) 569-4287.
- Document everything — keep copies of all notices, payment receipts, and correspondence.
Need Help?
If you are an Illinois homeowner facing property tax difficulties and you are not sure where to start, we can help you understand your options and connect you with resources in your area.
Visit auctionblock.org/get-help to connect with us.
You are not alone. There are programs designed to help you keep your home — but you have to take the first step.
Important Disclaimer
This guide is educational information only. It is not legal advice, tax advice, or financial advice. Laws and program rules change. Always verify current program requirements, deadlines, and eligibility thresholds directly with the relevant government agency before making any decisions. AuctionBlock.org is a mission-driven company providing educational resources about foreclosure prevention. We are not a law firm, not a tax preparation service, and not a government agency. Consult with a qualified attorney or HUD-approved housing counseling agency for advice about your specific situation.
Published by AuctionBlock.org, a mission-driven company dedicated to foreclosure prevention for vulnerable families.
Last updated: March 21, 2026