Chicago Homebuyers Stuck Waiting as Tax Bill Delays Drag on

Thousands of recent Cook County homebuyers are facing an unexpected hangup — and it’s not with their mortgage.

Roughly 17,000 people who’ve closed on homes since July 1 are waiting on property tax reimbursements held in limbo by the county’s latest tax bill delay, which could now stretch into next year, Crain’s reported.

The bills, slated to go out July 1 with an Aug. 1 due date, still haven’t been mailed, leaving buyers uncertain when they’ll see refunds that typically arrive within weeks of closing.

“Nobody’s being harmed, but they are being inconvenienced,” Kelli Fogarty of Advocus National Title Insurance told the outlet. “They don’t have this money that belongs to them, and we can’t tell them when they’ll get it.”

In Cook County’s complex tax system, sellers prepay their share of taxes owed for the previous year, often by crediting buyers at closing. Title companies hold those credits in escrow until the final tax bills arrive, refunding the difference once payments are made. But with the county months behind, that money — often thousands per transaction — is frozen.

The delay, officials have said, stems from a still-unfinished transition to new computer systems managed by Texas-based Tyler Technologies. The switch was supposed to be completed in April, but as of late October, dozens of tasks were outstanding, according to a county technology tracker.

It’s not the first time county bureaucracy has tripped up the billing cycle. In 2022, bills went out five months late — in December — with a Dec. 31 due date. This time, there’s still no mailing date in sight.

The lag has turned routine closings into logistical headaches.

Title firms are collecting 1.5 to 2 times last year’s second installment amounts to ensure enough funds are available when new, higher reassessments hit.

That means buyers are fronting more cash, even for homes well into the seven figures. One North Center buyer who closed on a $2.6 million house in August may have as much as $17,000 tied up until the bill drops.

While buyers and title firms wait, the bigger financial strain falls on local governments that rely on property taxes to operate.

In September, the Cook County Board approved a $300 million bridge loan to keep municipalities and school districts afloat until revenue starts flowing again. Chicago advanced $28 million to the Firemen’s Annuity & Benefit Fund in September and will continue to lend to all four pension funds as needed until the property tax issue is resolved.

This is not the first time Chicago has provided stopgap loans to its pensions, having advanced over $900 million in similar loans in late 2022 and 2023.

— Eric Weilbacher