Bill Text: IL SB1846 | 2011-2012 | 97th General Assembly | Introduced
Bill Title: Amends the High Risk Home Loan Act. Provides that "high risk home loan" does not include a loan for reverse mortgage financing of residential real estate, including under programs regulated by the Federal Housing Administration (FHA).
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2013-01-08 - Session Sine Die [SB1846 Detail]
Download: Illinois-2011-SB1846-Introduced.html
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
1 | AN ACT concerning business.
| |||||||||||||||||||
2 | Be it enacted by the People of the State of Illinois,
| |||||||||||||||||||
3 | represented in the General Assembly:
| |||||||||||||||||||
4 | Section 5. The High Risk Home Loan Act is amended by | |||||||||||||||||||
5 | changing Section 10 as follows:
| |||||||||||||||||||
6 | (815 ILCS 137/10)
| |||||||||||||||||||
7 | Sec. 10. Definitions. As used in this Act:
| |||||||||||||||||||
8 | "Approved credit counselor" means a credit counselor | |||||||||||||||||||
9 | approved by the
Director of Financial Institutions.
| |||||||||||||||||||
10 | "Borrower" means a natural person who seeks or obtains a | |||||||||||||||||||
11 | high risk
home loan.
| |||||||||||||||||||
12 | "Commissioner" means the Commissioner of the Office of | |||||||||||||||||||
13 | Banks and Real
Estate.
| |||||||||||||||||||
14 | "Department" means the Department of Financial | |||||||||||||||||||
15 | Institutions.
| |||||||||||||||||||
16 | "Director" means the Director of Financial Institutions.
| |||||||||||||||||||
17 | "Good faith" means honesty in fact in the conduct or | |||||||||||||||||||
18 | transaction concerned.
| |||||||||||||||||||
19 | "High risk home loan"
means a home equity loan in which (i) | |||||||||||||||||||
20 | at the time of origination, the annual
percentage rate
exceeds | |||||||||||||||||||
21 | by more than 6 percentage points in the case of a first lien | |||||||||||||||||||
22 | mortgage,
or
by more than 8 percentage points in the case of a | |||||||||||||||||||
23 | junior mortgage, the yield on
U.S. Treasury securities having |
| |||||||
| |||||||
1 | comparable periods of maturity to the loan
maturity as of the | ||||||
2 | fifteenth day of the month immediately preceding the month
in
| ||||||
3 | which the application for the loan is received by the lender or | ||||||
4 | (ii) the total
points
and fees payable by the consumer at or | ||||||
5 | before closing will exceed the greater
of
5% of the total loan | ||||||
6 | amount or $800. The $800 figure shall be adjusted annually
on | ||||||
7 | January 1 by the annual percentage change in the Consumer Price | ||||||
8 | Index for
All Urban Consumers for all items published by the | ||||||
9 | United States Department of
Labor.
"High risk home loan"
does
| ||||||
10 | not include a loan for reverse mortgage financing of | ||||||
11 | residential real estate, including under programs regulated by | ||||||
12 | the Federal Housing Administration (FHA), or a loan that is | ||||||
13 | made primarily for a business purpose unrelated to
the
| ||||||
14 | residential real property securing the loan or to an open-end | ||||||
15 | credit plan
subject to
12 CFR 226 (2000, no subsequent | ||||||
16 | amendments or editions are included).
| ||||||
17 | "Home equity loan" means any loan secured by the borrower's | ||||||
18 | primary
residence where the proceeds are not used as purchase | ||||||
19 | money for the
residence.
| ||||||
20 | "Lender" means a natural or artificial person who | ||||||
21 | transfers, deals in,
offers, or makes a high risk home loan. | ||||||
22 | "Lender" includes, but is not limited
to,
creditors and
brokers | ||||||
23 | who transfer, deal in, offer, or make high risk home loans. | ||||||
24 | "Lender"
does not include purchasers, assignees, or subsequent | ||||||
25 | holders of high risk home
loans.
| ||||||
26 | "Office" means the Office of Banks and Real Estate.
|
| |||||||
| |||||||
1 | "Points and fees" means all items required to be disclosed | ||||||
2 | as points and
fees under 12 CFR 226.32 (2000, no subsequent | ||||||
3 | amendments or editions
included); the premium of any single | ||||||
4 | premium credit life, credit disability,
credit
unemployment, | ||||||
5 | or any other life or health insurance that is financed directly
| ||||||
6 | or
indirectly into the loan; and compensation paid directly or | ||||||
7 | indirectly to a
mortgage
broker, including a broker that | ||||||
8 | originates a loan in its own name in a
table-funded
| ||||||
9 | transaction, not otherwise included in 12 CFR 226.4.
| ||||||
10 | "Reasonable" means fair, proper, just, or prudent under the | ||||||
11 | circumstances.
| ||||||
12 | "Servicer" means any entity chartered under the Illinois | ||||||
13 | Banking Act, the
Savings Bank Act, the Illinois Credit Union | ||||||
14 | Act, or the Illinois Savings and
Loan Act of 1985 and any | ||||||
15 | person or entity licensed under the Residential
Mortgage | ||||||
16 | License Act of 1987, the Consumer Installment Loan Act, or the | ||||||
17 | Sales
Finance Agency Act who
is responsible for the collection | ||||||
18 | or remittance for, or has the right or
obligation to collect or | ||||||
19 | remit for, any lender, note owner, or note holder or
for a | ||||||
20 | licensee's own account, of payments, interest, principal, and | ||||||
21 | trust items
(such as hazard
insurance and taxes on a | ||||||
22 | residential mortgage loan) in accordance with the
terms of the | ||||||
23 | residential mortgage loan, including loan payment follow-up,
| ||||||
24 | delinquency loan follow-up, loan analysis, and any | ||||||
25 | notifications to
the borrower that are necessary to enable the | ||||||
26 | borrower to keep the loan current
and in good
standing.
|
| |||||||
| |||||||
1 | "Total loan amount" has the same meaning as that term is | ||||||
2 | given in 12
CFR 226.32 and shall be calculated in accordance | ||||||
3 | with the Federal Reserve
Board's Official Staff Commentary to | ||||||
4 | that regulation.
| ||||||
5 | (Source: P.A. 93-561, eff. 1-1-04.)
|