Homestead Waivers and Mortgage Payments Effect on Non-Marital Property

Illinois is an equitable distribution state, meaning that marital property must be divided in “just proportions.” In re Marriage of Fraiser, 164 Ill.App.3d 207, 210. Marital property does not include property obtained before the marriage. 750 Ill. App. Comp. Stat. Ann. § 5/503 (a)(6). When a party makes a contribution to non-marital property, the contributor shall be reimbursed from the benefitting estate. 750 Ill. Comp. Stat. Ann. § 5/503(c)(2)(A). Evidence of this contribution must be traceable by clear and convincing proof and cannot be a gift. Id. It is common for lenders to require borrowers to waive the homestead exemption on properties for purposes of a mortgage, as the consequences in case of foreclosure could be great for the lender. 2 Illinois Real Property Law and Practice § 2.02 (2025). These waivers are only binding when signed by both the individual property owner and their spouse, regardless of if they are a titleholder or not. 735 Ill. Comp. Stat. Ann. § 5/12-904. Therefore, as it is required by statute for the spouse to assent to the waiver via signature, it is no indication that she has contributed to mortgage or other personal effort to the property.

However, if clear and convincing evidence does arise demonstrating that one of the spouses did pay mortgage and/or contribute personal effort into the marital residence, a court may still find that they are not entitled to proceeds from the sale of the property. In a Second District Court of Appeals case from 2007, the court vacated portions of a previous dissolution judgement awarding reimbursements to the wife for mortgage payment contributions she made to the marital residence, which her former husband owned. In re Marriage of Ford, 377 Ill.App.3d 181, 182. The court reasoned that the benefit of the use of residence during the marriage fully compensated the marital estate for the contribution. Id. In conclusion, a spouse’s signature on a homestead waiver is not sufficient to change a non marital estate to marital property.