Illinois laws and regulations topic guide
Illinois Commercial Real Estate Broker Lien Act
A commission can be owed without a valid broker lien. Start with the property and the signed compensation agreement, then identify the transaction path. A sale, an owner-side lease and a buyer or tenant brokerage agreement do not all use the same recording deadline.
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The short answer
The Illinois Commercial Real Estate Broker Lien Act, 770 ILCS 15, secures compensation due to the broker named in a qualifying signed writing. The property must meet the Act's commercial-real-estate definition, and the broker must satisfy the applicable recording, notice and enforcement rules. Ordinary owner-side sale liens require recording before transfer; ordinary owner-side lease claims generally use 90 days after tenant possession, with an important earlier-signing exception. A fee claim alone does not create the lien.
Reviewed October 25, 2026. Illinois III.J in the June 24, 2026 PSI broker outline names the Commercial Broker Lien Act. The whole Additional Illinois Laws and Regulations domain has 10 of 40 scored state questions, not a separate ten-question lien allocation. The relevant codified Act was checked in the source scopes below. This page teaches the statutory distinctions; it is not a filing form, a deadline calculator or a full foreclosure procedure manual.
Check the property, claimant and transaction path first
- Start with Section 5, not the marketing label. The property must be in Illinois. The definition excludes real estate containing one through six residential units, land with no building or structure, and property classified as farmland for assessment purposes. It also excludes individual residential units conveyed unit by unit, even within a larger development.
- Find the signed writing and the money actually due. Section 10(a) identifies the owner-side and prospective buyer or tenant instruments. The lien belongs to the broker named in the instrument, not that broker's employee or independent contractor. The broker must otherwise be entitled to the fee; recording does not prove entitlement.
- Select the recording rule. The general owner-side sale rule requires recording before actual conveyance or transfer. Section 10(c) has a limited post-transfer installment rule, except as provided for leases in(d). Owner-side lease and buyer or tenant agreement rules have different starting events. Do not apply a single 90-day rule to every transaction.
- Separate recording from owner notice. Record in the property county's recorder or registrar-of-titles office with the required contents, signature and verification. Then satisfy 10(f)'s owner-copy requirement unless its within-ten-days-before-closing exception applies. Timely statutory mailing is not the same as proof of receipt within ten days.
- Check priority and any closing escrow. The broker's lien does not relate back to the agreement date. Section 15 protects prior recorded interests and specified relation-back and construction-credit interests. If 20's escrow conditions apply, the transaction can close while money remains held to resolve entitlement.
- Track enforcement and release separately. Ordinary enforcement is within two years after recording; option-purchase claims and properly served demands can use shorter clocks. Section 10(i)'s ten-day release after owner demand is different from 10(k)'s five-day payment-or-expiration wording. A stale lien cannot be revived by simply recording the same claim again.
| Situation | Rule in the Act | Do not confuse it with |
|---|---|---|
| Ordinary owner-side sale | Record before actual conveyance or transfer:10(b) | A post-closing 90-day grace period |
| Post-transfer installment claim | Limited 10(c) rule: after transfer, before installment due; unpaid transferee-to-transferor money limits effectiveness | One blanket pre-transfer notice securing all future installments |
| Ordinary owner-side lease | Record within 90 days after tenant possession:10(d) | The lease-signing date in every case |
| Timely personal signing notice to broker | If 10(d) conditions are met, record before the signing date specified | An emailed reminder automatically triggering acceleration |
| Broker retained by buyer or tenant | Record within 90 days after that party's purchase, lease or other acquisition:10(e) | Always waiting for tenant possession |
| Owner copy after recording | Within 10 days under 10(f), unless recorded within 10 days before closing | Owner must actually receive a properly mailed copy by day 10 |
| Ordinary enforcement suit | Within 2 years after recording:10(g) | Two years after the brokerage agreement |
| Option-purchase claim | Within 6 months after transfer through exercise of the option:10(g) | Six months after the option is granted |
| Proper demand to sue or answer | Within 30 days after the properly served demand:10(j) | An unqualified right to wait the full 2 years |
| Condition precluding compensation | Written release or satisfaction within 10 days after owner demand:10(i) | A general permission to retain a lien for unearned compensation |
| Paid claim or failure to enforce in time | 10(k): written owner demand; five-day wording tied to payment or expiration | A new five days automatically beginning whenever a later demand arrives |
The distinctions that matter
| Distinction | How it works | What to notice |
|---|---|---|
| Business use vs. the statutory property definition | Commercial zoning or an investor buyer does not cure an express Section 5 exclusion. A six-unit apartment property and an empty industrial lot are excluded for different reasons. | Check the actual property, not just its intended use. |
| Seven-unit property as a whole vs. an individual condo | A whole property with more than six residential units may pass the unit-count exclusion, subject to the other requirements. An individual residential condo conveyed unit by unit remains excluded. | More than six in the surrounding development is not enough. |
| Contract right vs. statutory lien | A valid payment claim and a valid property lien require separate analysis. Losing the lien does not automatically erase a contract claim, but it does not establish that claim either. | Prove each remedy's conditions. |
| Ordinary owner lease vs. retained tenant broker | Section 10(d) uses tenant possession, subject to the signing-notice exception. Section 10(e) uses the purchase, lease or acquisition by the broker's buyer or tenant client. | Identify whose written agreement supports the claim. |
| Recording date vs. relation back | The broker lien attaches on recording, without relating back to its agreement. A valid mechanic's lien can have a legally earlier relation-back date even if recorded later. | The last document recorded does not always have last priority. |
| Escrowed funds vs. earned commission | Escrow can remove the title obstruction without deciding who owns the money. Funds remain held until an agreement, court decision or another agreed process resolves the rights. | Release of the property lien is not necessarily payment to the broker. |
| Ten-day release vs. five-day satisfaction wording | Section 10(i) measures ten days following an owner demand after a compensation-precluding condition. Section 10(k) concerns a paid claim or missed enforcement period and uses payment-or-expiration wording. | Do not substitute one starting event for another. |
| Unenforceable vs. extinguished | Section 10(f) calls a lien unenforceable when required owner-copy notice is missed. Sections 10(g) and (j) use extinguishment for their missed enforcement periods. These are distinct statutory consequences. | Do not assume every defect can be cured by recording the same claim again. |
Work through the facts
Exactly six apartments
A broker has a signed owner agreement, a fee due and timely recording on an Illinois property containing exactly six residential units.
- Section 5 excludes one through six residential units.
- A signed agreement and timely notice do not change the property definition.
Answer: This statutory lien is unavailable. Any separate contract claim must be established independently.
An empty industrial parcel
An industrially zoned Illinois parcel has no building or structure. The buyer plans a factory.
- The vacant-property exclusion applies to land without a building or structure.
- A future plant and commercial zoning do not supply a structure in the stated facts.
Answer: The parcel is excluded under this Act despite the planned business use.
The owner-side sale was already transferred
A fee is due for a covered warehouse sale. The deed transfers June 10 and the broker first records a general owner-side sale lien June 11. No installment or buyer-side exception is stated.
- Section 10(b) requires this recording before actual conveyance or transfer.
- The agreement does not make the June 11 notice relate back to an earlier date.
Answer: The general sale lien was recorded too late.
An earlier lease-signing deadline
The broker is personally served September 15 with written notice that the covered lease will be signed September 30. The broker is entitled to claim a lien.
- The notice is written and personally served at least ten days before the stated signing date.
- Section 10(d) therefore requires recording before that specified date rather than relying on the ordinary possession-based deadline.
Answer: Record before September 30 under these stated facts, not ninety days after a later possession date.
Mailed on time, received later
The lien was recorded 25 days before closing. A proper copy is sent to the record owner on day 9 by certified mail, return receipt requested, with prepaid postage, to the subject property. It arrives on day 12.
- The close-to-closing exception is not available, so the owner-copy requirement applies.
- Section 10(f) makes the prescribed mailing effective on deposit in the United States mail.
- A day 12 receipt does not by itself make a proper day 9 mailing late.
Answer: These facts satisfy the described mailing timing; they do not independently prove every other lien condition.
A later installment and an unpaid purchase balance
Assume all applicable 10(c) conditions are met for a nonlease sale: a $20,000 commission installment is due after transfer, and $10,000 remains owed by transferee to transferor.
- The special notice is recorded after transfer and before that installment is due.
- Its effectiveness as a property lien extends only to money still owed by transferee to transferor.
- A single pre-transfer notice claiming all future installments is not a substitute under 10(c).
Answer: On the stated assumptions, the unpaid $10,000 balance limits this lien's effectiveness; it does not by itself extinguish the remaining contractual fee claim.
Escrow lets the closing proceed
A disputed $40,000 recorded broker lien would prevent a covered closing. Proceeds are sufficient, and there is no acceptable alternative procedure under Section 20.
- Establish the required escrow from transaction proceeds.
- Once the claimed amount is escrowed, the claiming broker provides the lien release.
- Hold the money until the parties' rights are resolved by a specified written or legal process.
Answer: The lien claim can move from the property to held funds without awarding the $40,000 to the broker at closing.
A condition prevents the commission becoming payable
After a lien is recorded, a condition occurs that precludes compensation under the written agreement. The record owner demands release.
- Section 10(i) addresses this compensation-precluding condition.
- Its written release or satisfaction is due within ten days following the record owner's demand.
- That is distinct from the paid-or-expired provision in 10(k).
Answer: Apply 10(i)'s ten-day demand clock rather than treating every release as the same five-day rule.
Mistakes to avoid
- Six apartments count as commercial for every purpose This Act expressly excludes one through six residential units.
- A broker lien secures every oral commission promise Section 10 requires the qualifying signed written instrument and entitlement.
- Every affiliated broker can file the firm's lien separately The remedy is for the named broker, not that broker's employee or independent contractor.
- Every lease lien has the same 90-day starting event Read 10(d) versus 10(e), including the properly served signing-notice exception.
- The copy must be received by the owner within ten days in every case Proper statutory mailing is effective on deposit, and 10(f) has a narrow closing exception.
- All later-recorded mechanic's liens must lose priority Section 15 expressly recognizes a valid later-recorded mechanic's lien that relates back before the broker recording.
- Escrow proves that the broker won the fee dispute It preserves funds and clears the property claim; entitlement remains unresolved.
- Every five-day release clock starts with demand Read 10(k)'s payment-or-expiration language separately from 10(i)'s ten-day demand rule.
Check your understanding
These are original teaching questions, not recalled or predicted PSI questions. Answer first, then explain why the other choices fail.
1. Which property is expressly excluded by Section 5?
- A six-unit residential property
- A warehouse with a structure
- An occupied office tower
- A covered retail center
Show answer and explanation
Answer: A. A six-unit residential property
One through six residential units are excluded. A commercial label or investment purpose does not change that definition.
2. A residential condo is sold individually in a 100-unit development. What follows?
- The buyer's investor status decides
- It qualifies solely because 100 exceeds six
- Recording before closing cures the exclusion
- The unit-by-unit residential exclusion applies
Show answer and explanation
Answer: D. The unit-by-unit residential exclusion applies
Section 5 separately excludes single-family residential units such as condos conveyed unit by unit, even in a larger property with more than six units.
3. Who may claim under the qualifying signed instrument?
- The county recorder personally
- Any unlicensed assistant who helped
- Every employee of that broker
- The broker named in the instrument
Show answer and explanation
Answer: D. The broker named in the instrument
Section 10(a) makes the lien available to the named broker and expressly excludes that broker's employee or independent contractor.
4. A general owner-side sale has no special installment or buyer-side facts. When must recording occur?
- Within 2 years after the listing
- Before actual conveyance or transfer
- Within 90 days after closing
- Only after a court awards damages
Show answer and explanation
Answer: B. Before actual conveyance or transfer
Section 10(b) supplies the general pre-transfer rule. The notice does not relate back to the agreement date.
5. Under the ordinary owner-side lease rule, what starts the 90-day period, absent the signing-notice exception?
- The brokerage agreement
- The notice of foreclosure
- The first renewal invoice
- Tenant possession
Show answer and explanation
Answer: D. Tenant possession
Section 10(d) uses tenant possession. A timely personally served written signing notice can require an earlier recording.
6. A proper intended-signing notice is personally served at least ten days before the specified lease-signing date. What happens under 10(d)?
- Recording must occur before the specified signing date
- Recording can always wait ninety days after possession
- The lien automatically takes priority from the agreement date
- Emailing the owner later replaces recording
Show answer and explanation
Answer: A. Recording must occur before the specified signing date
The stated service activates the earlier pre-signing requirement. Do not confuse it with ordinary lease possession timing.
7. A proper certified-mail copy is deposited with prepaid postage on day 9 after recording and received on day 12. No closing exception applies. What is correct?
- Any ordinary text message would have the same effect
- Receipt must always occur by day 10
- Recording alone makes the copy unnecessary
- Receipt on day 12 alone does not make the timely prescribed mailing late
Show answer and explanation
Answer: D. Receipt on day 12 alone does not make the timely prescribed mailing late
Section 10(f) makes the prescribed mailing effective when deposited in United States mail. It requires the correct method, recipient and return-receipt request, not merely an internal mailing note.
8. A proper 10(j) demand requires suit or an answer in a pending suit. How long does the lien claimant have?
- Six months from the agreement
- Two years regardless of demand
- Ten days from closing
- Thirty days after the properly served demand
Show answer and explanation
Answer: D. Thirty days after the properly served demand
Section 10(j) imposes the thirty-day response, with lien extinguishment if it is missed. The ordinary two-year period does not override the demand.
9. A valid mechanic's lien is recorded after the broker lien but legally relates back to an earlier date. Which statement matches Section 15?
- The specified relation-back lien is treated as prior
- The broker always wins because recorded first
- The brokerage agreement date controls all priority
- All mechanic's liens automatically lose
Show answer and explanation
Answer: A. The specified relation-back lien is treated as prior
Section 15 includes that valid relation-back mechanic's lien among prior liens. This is not a statement that every later mechanic's claim has priority.
10. The facts meet Section 20 and sufficient claimed funds are escrowed. What follows?
- The broker releases the property lien while entitlement to the funds is resolved
- The buyer must pay a second commission regardless of the agreement
- The broker automatically receives the money as a final award
- The seller must cancel every closing
Show answer and explanation
Answer: A. The broker releases the property lien while entitlement to the funds is resolved
The escrow clears the property obstruction while the dispute continues under a written agreement, court decision or other agreed process.
11. A broker retained by a prospective tenant proceeds under 10(e). What event starts its stated 90-day recording period?
- Tenant possession in every possible tenant-broker case
- The broker's first conversation with the owner
- The option being offered for the first time
- The client's lease or other covered acquisition of its interest
Show answer and explanation
Answer: D. The client's lease or other covered acquisition of its interest
Section 10(e) refers to the purchase, lease or other conveyance or transfer to the buyer or tenant. It attaches to the acquired interest; do not automatically substitute 10(d)'s possession event.
12. Which statement avoids confusing the two release provisions?
- Both 10(i) and 10(k) always start ten days after a phone call
- A late demand always restarts a fresh five days
- 10(i) uses ten days following owner demand;10(k) has different payment-or-expiration wording and a written demand condition
- Every release can wait until two years after closing
Show answer and explanation
Answer: C. 10(i) uses ten days following owner demand;10(k) has different payment-or-expiration wording and a written demand condition
Read the separate conditions. Section 10(i) concerns a compensation-precluding event;10(k) concerns a paid claim or failure to institute enforcement in time. Do not rewrite 10(k) as an automatic five days from demand.
Common questions
What does the Illinois Commercial Broker Lien Act do?
The Commercial Real Estate Broker Lien Act,770 ILCS 15, supplies a property-lien remedy for compensation due to the broker named in a qualifying signed writing. Entitlement, covered property, proper recording, notice and enforcement remain separate requirements. A recorder accepting a document does not decide those merits.
Which properties are excluded?
Section 5 excludes Illinois real estate containing one through six residential units, property without buildings or structures, and property classified as farmland for tax-assessment purposes. It separately excludes residential condos, townhouses and subdivision homes conveyed unit by unit, even within a larger development. Commercial zoning or an investor buyer is not enough.
Can a seven-unit apartment property qualify?
It can pass the one-through-six-unit exclusion when the property is conveyed as a whole, but every other condition still matters. Do not extend that answer to one individually conveyed residential condo inside a much larger development.
Does the lien apply to land-trust interests?
Section 5 includes an interest in a land trust within interests in commercial real estate, by reference to the Code of Civil Procedure. That does not remove the property exclusions, writing requirements or transaction-specific recording rules.
Is an oral promise or unpaid invoice enough?
No. Section 10 requires compensation due under the qualifying signed written instrument. It identifies owner-side and prospective buyer or tenant agreements and makes the lien available to the named broker, not that broker's employee or independent contractor. An invoice does not replace the required agreement.
When does the ordinary seller-side sale lien attach?
With the required entitlement and recording before actual conveyance or transfer, under 10(b). The recording is in the county where the property is located. The lien attaches on recording and does not relate back to the agreement date. Special installment, lease and buyer or tenant facts require their own analysis.
What is different about post-transfer installments?
Under 10(c), except as provided for leases in(d), a claim for compensation due after transfer may be recorded after transfer but before that payment is due. It is effective as a lien only to the extent money remains owed by transferee to transferor. A single pre-transfer notice claiming all future installments is not valid for those post-transfer payments.
What is the owner-side commercial lease deadline?
Section 10(d) ordinarily requires recording within ninety days after tenant possession. If the entitled broker is personally served with written intended-signing notice at least ten days before the stated signing date, recording must instead occur before that date. Do not equate an informal email with the specified personal service.
What if the broker represents the buyer or tenant?
Section 10(e) requires the prospective-client writing and the client's acquisition, plus recording within ninety days after the purchase, lease or other conveyance or transfer to that client. The lien attaches to the interest that client acquired, on recording. The tenant-possession event in(d) is not a universal substitute.
What must the recorded notice contain?
Section 10(h) lists claimant and owner names, property description, amount claimed and the broker's real estate license number. It requires an accuracy recital, the broker's or an authorized signer's signature, and verification. This is a statutory content summary, not an approved recording form.
Must the owner receive a copy within ten days?
Section 10(f) requires the prescribed copy mailing or personal service within ten days after recording, unless the lien was recorded within ten days before closing. Registered or certified mail must request a return receipt. Proper mailing to the property address is effective on deposit in United States mail with prepaid postage; receipt after day ten is not by itself late mailing. If the required notice is not sent at the time and in the manner required, the statute calls the lien unenforceable.
What is the deadline to start enforcement?
The ordinary outside period to commence suit is two years after recording. A claim based on an option to purchase uses six months after transfer under exercise of the option. Missing the applicable period extinguishes the lien, and the same claim cannot be revived by a later lien notice under this Act. A properly served 10(j) demand can shorten the response to thirty days.
Where is an enforcement case brought?
Section 10(g) calls for a complaint and sworn recorded-lien affidavit in circuit court in the property county. It requires the specified agreement, services, amount, property and other allegations, known interested parties and proper process. It refers foreclosure to the Illinois Mortgage Foreclosure Law. This page does not audit the complete foreclosure procedure.
Does the broker lien outrank an older mortgage?
Section 15 gives priority to prior recorded liens and mortgages. Its examples include a valid later-recorded mechanic's lien that relates back before the broker's recording and specified revolving-credit and construction-loan future-advance liens. The broker's agreement date does not defeat those priorities.
Can escrow keep a disputed lien from blocking closing?
Section 20 generally requires transaction-proceeds escrow sufficient to release a recorded claim that would prevent closing. The escrow requirement is not itself a reason to refuse to close. Once the claimed amount is escrowed, the broker supplies a release. Rights to the funds are resolved later. The statute permits an available alternative acceptable to the transferee and excludes its mandatory procedure when proceeds cannot release all claimed liens.
What are the ten-day and five-day release rules?
Under 10(i), a condition precluding compensation triggers a written release or satisfaction within ten days following the record owner's demand. Under 10(k), a paid claim or failure to institute suit in time requires written acknowledgment on written owner demand, with five-day wording measured from payment or expiration. Do not simply teach five days after any later demand. A disputed real deadline requires reading the complete provision and applicable procedure. The ten-day and five-day provisions are not interchangeable, and a disputed interpretation is not resolved by an exam memory shortcut.
Who pays the litigation costs?
Section 10(l) places the prevailing party's reasonable attorney fees, costs and prejudgment interest due on the nonprevailing party or parties, with equitable court apportionment when several are responsible. Do not invent a universal fee amount or an automatic fixed interest rate from this section.
Does losing the lien erase every right to a commission?
Not automatically. A separate contract claim depends on its own agreement, performance, defenses and applicable law. An excluded property or defective lien does not itself prove either that the commission is owed or that no contract claim remains. These are original study questions, not PSI questions or validated passing predictions.
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Official sources and scope
Checked October 25, 2026. The cited PSI outline and complete relevant codified provisions of 770 ILCS 15 were read through official text or official indexed text. Direct retrieval of some ILGA pages returned errors. General Act and foreclosure-code links are not presented as a complete procedural review. No proposal, other state's lien law or private filing template supplies these rules.
- PSI June 24, 2026: IllinoisIII.J Commercial Broker Lien Act
- 770 ILCS 15/5: covered real estate and exclusions
- 770 ILCS 15/10: entitlement, recording, notice and enforcement
- 770 ILCS 15/15: prior interests and relation back
- 770 ILCS 15/20: escrow of disputed amounts
This is exam preparation, not advice for a specific transaction. State law and the applicable facts control. Our editorial and corrections process explains how to report an issue.