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Illinois Restores Ten-Year Statute of Limitations for Mortgage-Secured Debt

August 28, 2026

Illinois Enacts Legislation Restoring Ten-Year Statute of Limitations for Mortgage-Secured Debt

Following our recent update regarding Senate Bill 2951 (“SB2951”), we are pleased to report that Governor Pritzker signed the legislation into law on August 21, 2026. The bill is now Public Act 104-0842 and became effective immediately upon signing. The new law amends both 735 ILCS 5/13-115 and 735 ILCS 5/13-206 to expressly provide that any indebtedness of any kind secured by a mortgage or deed of trust in the nature of a mortgage is subject to a ten-year period to commence an action.

Legislative Response to BMO Bank N.A. v. Zbroszczyk

As discussed in our prior alert, the First District Appellate Court’s decision in BMO Bank N.A. v. Zbroszczyk, 2025 IL App (1st) 241333, created significant concern within the mortgage servicing and lending industry. In that case, the court held that a Home Equity Line of Credit (“HELOC”) agreement was more akin to a revolving credit account than a traditional promissory note and concluded that the lender’s foreclosure action was subject to the five-year statute of limitations set forth in 735 ILCS 5/13-205 rather than the ten-year limitations period contained in 735 ILCS 5/13-206.

Public Act 104-0842 appears to be a direct legislative response to that decision. By amending both sections 13-115 and 13-206 to expressly encompass “any indebtedness of any kind” secured by a mortgage, the General Assembly has clarified its intent that mortgage-secured obligations are entitled to a ten-year limitations period regardless of the particular form of the underlying debt instrument.

Practical Impact for Lenders and Servicers

The amendments provide substantially greater certainty for mortgage lenders, investors, and servicers when enforcing mortgage-secured obligations, including HELOCs and other open-end credit products. Going forward, borrowers will face a significantly more difficult argument when attempting to characterize mortgage-secured debt as subject to the five-year limitations period applicable to certain other contractual obligations.

The legislation also strengthens lenders’ ability to distinguish or challenge reliance on Zbroszczyk in pending and future litigation. While courts will ultimately decide the extent to which the amendments apply to claims arising before August 21, 2026, the statutory changes reflect a clear legislative determination that mortgage-secured indebtedness should be governed by a ten-year limitations period, and same is effective immediately. Our firm will continue to monitor judicial interpretation of Public Act 104-0842, particularly concerning its application to existing claims and pending litigation