Public Act 100-1153
HB5542 EnrolledLRB100 17500 XWW 32669 b
AN ACT concerning regulation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Student Loan Servicing Rights Act is amended
by changing Sections 15-15, 15-20, 15-25, 15-30, 15-40, 20-5,
and 20-30 as follows:
(110 ILCS 992/15-15)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 15-15. Application process; investigation; fees.
(a) The Secretary shall issue a license upon completion of
all of the following:
(1) the filing of an application for license with the
Secretary or the Nationwide Multistate Mortgage Licensing
System and Registry as approved by the Secretary;
(2) the filing with the Secretary of a listing of
judgments entered against, and bankruptcy petitions by,
the license applicant for the preceding 10 years;
(3) the payment, in certified funds, of investigation
and application fees, the total of which shall be in an
amount equal to $1,000 for an initial application and $800
for a background investigation;
(4) the filing of an audited balance sheet, including
all footnotes prepared by a certified public accountant in
accordance with generally accepted accounting principles
and generally accepted auditing standards; notwithstanding
the requirements of this subsection, an applicant that is a
subsidiary may submit audited consolidated financial
statements of its parent, intermediary parent, or ultimate
parent as long as the consolidated statements are supported
by consolidating statements that include the applicant's
financial statement; if the consolidating statements are
unaudited, the applicant's chief financial officer shall
attest to the applicant's financial statements disclosed
in the consolidating statements; and
(5) an investigation of the averments required by
Section 15-30, which investigation must allow the
Secretary to issue positive findings stating that the
financial responsibility, experience, character, and
general fitness of the license applicant and of the members
thereof if the license applicant is a partnership or
association, of the officers and directors thereof if the
license applicant is a corporation, and of the managers and
members that retain any authority or responsibility under
the operating agreement if the license applicant is a
limited liability company, are such as to command the
confidence of the community and to warrant belief that the
business will be operated honestly, fairly, and
efficiently within the purpose of this Act; if the
Secretary does not so find, he or she shall not issue the
license, and he or she shall notify the license applicant
of the denial.
The Secretary may impose conditions on a license if the
Secretary determines that those conditions are necessary or
appropriate. These conditions shall be imposed in writing and
shall continue in effect for the period prescribed by the
Secretary.
(b) All licenses shall be issued to the license applicant.
Upon receipt of the license, a student loan servicing licensee
shall be authorized to engage in the business regulated by this
Act. The license shall remain in full force and effect until it
expires without renewal, is surrendered by the licensee, or
revoked or suspended as hereinafter provided.
(Source: P.A. 100-540, eff. 12-31-18.)
(110 ILCS 992/15-20)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 15-20. Application form.
(a) Application for a student loan servicer license must be
made in accordance with Section 15-40 and, if applicable, in
accordance with requirements of the Nationwide Multistate
Mortgage Licensing System and Registry. The application shall
be in writing, under oath, and on a form obtained from and
prescribed by the Secretary, or may be submitted
electronically, with attestation, to the Nationwide Multistate
Mortgage Licensing System and Registry.
(b) The application shall contain the name and complete
business and residential address or addresses of the license
applicant. If the license applicant is a partnership,
association, corporation, or other form of business
organization, the application shall contain the names and
complete business and residential addresses of each member,
director, and principal officer thereof. The application shall
also include a description of the activities of the license
applicant in such detail and for such periods as the Secretary
may require, including all of the following:
(1) an affirmation of financial solvency noting such
capitalization requirements as may be required by the
Secretary and access to such credit as may be required by
the Secretary;
(2) an affirmation that the license applicant or its
members, directors, or principals, as may be appropriate,
are at least 18 years of age;
(3) information as to the character, fitness,
financial and business responsibility, background,
experience, and criminal record of any (i) person, entity,
or ultimate equitable owner that owns or controls, directly
or indirectly, 10% or more of any class of stock of the
license applicant; (ii) person, entity, or ultimate
equitable owner that is not a depository institution, as
defined in Section 1007.50 of the Savings Bank Act, that
lends, provides, or infuses, directly or indirectly, in any
way, funds to or into a license applicant in an amount
equal to or more than 10% of the license applicant's net
worth; (iii) person, entity, or ultimate equitable owner
that controls, directly or indirectly, the election of 25%
or more of the members of the board of directors of a
license applicant; or (iv) person, entity, or ultimate
equitable owner that the Secretary finds influences
management of the license applicant; the provisions of this
subsection shall not apply to a public official serving on
the board of directors of a State guaranty agency;
(4) upon written request by the licensee and
notwithstanding the provisions of paragraphs (1), (2), and
(3) of this subsection, the Secretary may permit the
licensee to omit all or part of the information required by
those paragraphs if, in lieu of the omitted information,
the licensee submits an affidavit stating that the
information submitted on the licensee's previous renewal
application is still true and accurate; the Secretary may
adopt rules prescribing the form and content of the
affidavit that are necessary to accomplish the purposes of
this Section; and
(5) such other information as required by rules of the
Secretary.
(Source: P.A. 100-540, eff. 12-31-18.)
(110 ILCS 992/15-25)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 15-25. Student loan servicer license application and
issuance.
(a) Applicants for a license shall apply in a form
prescribed by the Secretary. Each form shall contain content as
set forth by rule, regulation, instruction, or procedure of the
Secretary and may be changed or updated as necessary by the
Secretary in order to carry out the purposes of this Act.
(b) In order to fulfill the purposes of this Act, the
Secretary is authorized to establish relationships or
contracts with the Nationwide Multistate Mortgage Licensing
System and Registry or other entities designated by the
Nationwide Multistate Mortgage Licensing System and Registry
to collect and maintain records and process transaction fees or
other fees related to licensees or other persons subject to
this Act.
(c) In connection with an application for licensing, the
applicant may be required, at a minimum, to furnish to the
Nationwide Multistate Mortgage Licensing System and Registry
information concerning the applicant's identity, including:
(1) fingerprints for submission to the Federal Bureau
of Investigation or any governmental agency or entity
authorized to receive such information for a State,
national, and international criminal history background
check; and
(2) personal history and experience in a form
prescribed by the Nationwide Multistate Mortgage Licensing
System and Registry, including the submission of
authorization for the Nationwide Multistate Mortgage
Licensing System and Registry and the Secretary to obtain:
(A) an independent credit report obtained from a
consumer reporting agency described in Section 603(p)
of the Fair Credit Reporting Act (15 U.S.C. 1681a(p));
and
(B) information related to any administrative,
civil, or criminal findings by any governmental
jurisdiction.
(d) For the purposes of this Section, and in order to
reduce the points of contact that the Federal Bureau of
Investigation may have to maintain for purposes of subsection
(c) of this Section, the Secretary may use the Nationwide
Multistate Mortgage Licensing System and Registry as a
channeling agent for requesting information from and
distributing information to the federal Department of Justice
or any governmental agency.
(e) For the purposes of this Section, and in order to
reduce the points of contact that the Secretary may have to
maintain for purposes of paragraph (2) of subsection (c) of
this Section, the Secretary may use the Nationwide Multistate
Mortgage Licensing System and Registry as a channeling agent
for requesting and distributing information to and from any
source as directed by the Secretary.
(f) The provisions of this Section shall not apply to a
public official serving on the board of directors of a State
guaranty agency.
(Source: P.A. 100-540, eff. 12-31-18.)
(110 ILCS 992/15-30)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 15-30. Averments of licensee. Each application for
license shall be accompanied by the following averments stating
that the applicant:
(1) will file with the Secretary or Nationwide
Multistate Mortgage Licensing System and Registry, as
applicable, when due, any report or reports that it is
required to file under any of the provisions of this Act;
(2) has not committed a crime against the law of this
State, any other state, or of the United States involving
moral turpitude or fraudulent or dishonest dealing, and
that no final judgment has been entered against it in a
civil action upon grounds of fraud, misrepresentation, or
deceit that has not been previously reported to the
Secretary;
(3) has not engaged in any conduct that would be cause
for denial of a license;
(4) has not become insolvent;
(5) has not submitted an application for a license
under this Act that contains a material misstatement;
(6) has not demonstrated by course of conduct,
negligence or incompetence in performing any act for which
it is required to hold a license under this Act;
(7) will advise the Secretary in writing or the
Nationwide Multistate Mortgage Licensing System and
Registry, as applicable, of any changes to the information
submitted on the most recent application for license or
averments of record within 30 days of the change; the
written notice must be signed in the same form as the
application for the license being amended;
(8) will comply with the provisions of this Act and
with any lawful order, rule, or regulation made or issued
under the provisions of this Act;
(9) will submit to periodic examination by the
Secretary as required by this Act; and
(10) will advise the Secretary in writing of judgments
entered against and bankruptcy petitions by the license
applicant within 5 days after the occurrence.
A licensee who fails to fulfill the obligations of an
averment, fails to comply with averments made, or otherwise
violates any of the averments made under this Section shall be
subject to the penalties of this Act.
(Source: P.A. 100-540, eff. 12-31-18.)
(110 ILCS 992/15-40)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 15-40. License issuance and renewal; fees.
(a) Licenses shall be renewed every year using the common
renewal date of the Nationwide Multistate Mortgage Licensing
System and Registry, as adopted by the Secretary. Properly
completed renewal application forms and filing fees may be
received by the Secretary 60 days prior to the license
expiration date, but, to be deemed timely, the completed
renewal application forms and filing fees must be received by
the Secretary no later than 30 days prior to the license
expiration date.
(b) It shall be the responsibility of each licensee to
accomplish renewal of its license. Failure by a licensee to
submit a properly completed renewal application form and fees
in a timely fashion, absent a written extension from the
Secretary, shall result in the license becoming inactive.
(c) No activity regulated by this Act shall be conducted by
the licensee when a license becomes inactive. An inactive
license may be reactivated by the Secretary upon payment of the
renewal fee and payment of a reactivation fee equal to the
renewal fee.
(d) A licensee ceasing an activity or activities regulated
by this Act and desiring to no longer be licensed shall so
inform the Secretary in writing and, at the same time, convey
any license issued and all other symbols or indicia of
licensure. The licensee shall include a plan for the withdrawal
from regulated business, including a timetable for the
disposition of the business, and comply with the surrender
guidelines or requirements of the Secretary. Upon receipt of
such written notice, the Secretary shall post the cancellation
or issue a certified statement canceling the license.
(e) The expenses of administering this Act, including
investigations and examinations provided for in this Act, shall
be borne by and assessed against entities regulated by this
Act. Subject to the limitations set forth in Section 15-15 of
this Act, the Secretary shall establish fees by rule in at
least the following categories:
(1) investigation of licensees and license applicant
fees;
(2) examination fees;
(3) contingent fees; and
(4) such other categories as may be required to
administer this Act.
(Source: P.A. 100-540, eff. 12-31-18.)
(110 ILCS 992/20-5)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 20-5. Functions; powers; duties. The functions,
powers, and duties of the Secretary shall include the
following:
(1) to issue or refuse to issue any license as provided
by this Act;
(2) to revoke or suspend for cause any license issued
under this Act;
(3) to keep records of all licenses issued under this
Act;
(4) to receive, consider, investigate, and act upon
complaints made by any person in connection with any
student loan servicing licensee in this State;
(5) to prescribe the forms of and receive:
(A) applications for licenses; and
(B) all reports and all books and records required
to be made by any licensee under this Act, including
annual audited financial statements and annual reports
of student loan activity;
(6) to adopt rules necessary and proper for the
administration of this Act;
(7) to subpoena documents and witnesses and compel
their attendance and production, to administer oaths, and
to require the production of any books, papers, or other
materials relevant to any inquiry authorized by this Act;
(8) to issue orders against any person if the Secretary
has reasonable cause to believe that an unsafe, unsound, or
unlawful practice has occurred, is occurring, or is about
to occur; if any person has violated, is violating, or is
about to violate any law, rule, or written agreement with
the Secretary; or for the purpose of administering the
provisions of this Act and any rule adopted in accordance
with this Act;
(9) to address any inquiries to any licensee, or the
officers thereof, in relation to its activities and
conditions, or any other matter connected with its affairs,
and it shall be the duty of any licensee or person so
addressed to promptly reply in writing to those inquiries;
the Secretary may also require reports from any licensee at
any time the Secretary may deem desirable;
(10) to examine the books and records of every licensee
under this Act;
(11) to enforce provisions of this Act;
(12) to levy fees, fines, and charges for services
performed in administering this Act; the aggregate of all
fees collected by the Secretary on and after the effective
date of this Act shall be paid promptly after receipt,
accompanied by a detailed statement thereof, into the Bank
and Trust Company Fund under Section 20-10; the amounts
deposited into that Fund shall be used for the ordinary and
contingent expenses of the Department; nothing in this Act
shall prevent the continuation of the practice of paying
expenses involving salaries, retirement, social security,
and State-paid insurance of State officers by
appropriation from the General Revenue Fund;
(13) to appoint examiners, supervisors, experts, and
special assistants as needed to effectively and
efficiently administer this Act;
(14) to conduct hearings for the purpose of:
(A) appeals of orders of the Secretary;
(B) suspensions or revocations of licenses, or
fining of licensees;
(C) investigating:
(i) complaints against licensees; or
(ii) annual gross delinquency rates; and
(D) carrying out the purposes of this Act;
(15) to exercise exclusive visitorial power over a
licensee unless otherwise authorized by this Act or as
vested in the courts, or upon prior consultation with the
Secretary, a foreign student loan servicing regulator with
an appropriate supervisory interest in the parent or
affiliate of a licensee;
(16) to enter into cooperative agreements with state
regulatory authorities of other states to provide for
examination of corporate offices or branches of those
states and to accept reports of such examinations;
(17) to assign an examiner or examiners to monitor the
affairs of a licensee with whatever frequency the Secretary
determines appropriate and to charge the licensee for
reasonable and necessary expenses of the Secretary if in
the opinion of the Secretary an emergency exists or appears
likely to occur;
(18) to impose civil penalties of up to $50 per day
against a licensee for failing to respond to a regulatory
request or reporting requirement; and
(19) to enter into agreements in connection with the
Nationwide Multistate Mortgage Licensing System and
Registry.
(Source: P.A. 100-540, eff. 12-31-18.)
(110 ILCS 992/20-30)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 20-30. Suspension; revocation of licenses; fines.
(a) Upon written notice to a licensee, the Secretary may
suspend or revoke any license issued pursuant to this Act if,
in the notice, he or she makes a finding of one or more of the
following:
(1) that through separate acts or an act or a course of
conduct, the licensee has violated any provisions of this
Act, any rule adopted by the Secretary, or any other law,
rule, or regulation of this State or the United States;
(2) that any fact or condition exists that, if it had
existed at the time of the original application for the
license, would have warranted the Secretary in refusing
originally to issue the license; or
(3) that if a licensee is other than an individual, any
ultimate equitable owner, officer, director, or member of
the licensed partnership, association, corporation, or
other entity has acted or failed to act in a way that would
be cause for suspending or revoking a license to that party
as an individual.
(b) No license shall be suspended or revoked, except as
provided in this Section, nor shall any licensee be fined
without notice of his or her right to a hearing as provided in
Section 20-65 of this Act.
(c) The Secretary, on good cause shown that an emergency
exists, may suspend any license for a period not exceeding 180
days, pending investigation.
(d) The provisions of subsection (d) of Section 15-40 of
this Act shall not affect a licensee's civil or criminal
liability for acts committed prior to surrender of a license.
(e) No revocation, suspension, or surrender of any license
shall impair or affect the obligation of any pre-existing
lawful contract between the licensee and any person.
(f) Every license issued under this Act shall remain in
force and effect until the license expires without renewal, is
surrendered, is revoked, or is suspended in accordance with the
provisions of this Act, but the Secretary shall have authority
to reinstate a suspended license or to issue a new license to a
licensee whose license has been revoked if no fact or condition
then exists which would have warranted the Secretary in
refusing originally to issue that license under this Act.
(g) Whenever the Secretary revokes or suspends a license
issued pursuant to this Act or fines a licensee under this Act,
he or she shall execute a written order to that effect. The
Secretary shall post notice of the order on an agency Internet
site maintained by the Secretary or on the Nationwide
Multistate Mortgage Licensing System and Registry and shall
serve a copy of the order upon the licensee. Any such order may
be reviewed in the manner provided by Section 20-65 of this
Act.
(h) If the Secretary finds any person in violation of the
grounds set forth in subsection (i), he or she may enter an
order imposing one or more of the following penalties:
(1) revocation of license;
(2) suspension of a license subject to reinstatement
upon satisfying all reasonable conditions the Secretary
may specify;
(3) placement of the licensee or applicant on probation
for a period of time and subject to all reasonable
conditions as the Secretary may specify;
(4) issuance of a reprimand;
(5) imposition of a fine not to exceed $25,000 for each
count of separate offense; except that a fine may be
imposed not to exceed $75,000 for each separate count of
offense of paragraph (2) of subsection (i) of this Section;
or
(6) denial of a license.
(i) The following acts shall constitute grounds for which
the disciplinary actions specified in subsection (h) may be
taken:
(1) being convicted or found guilty, regardless of
pendency of an appeal, of a crime in any jurisdiction that
involves fraud, dishonest dealing, or any other act of
moral turpitude;
(2) fraud, misrepresentation, deceit, or negligence in
any student loan transaction;
(3) a material or intentional misstatement of fact on
an initial or renewal application;
(4) insolvency or filing under any provision of the
federal Bankruptcy Code as a debtor;
(5) failure to account or deliver to any person any
property, such as any money, fund, deposit, check, draft,
or other document or thing of value, that has come into his
or her hands and that is not his or her property or that he
or she is not in law or equity entitled to retain, under
the circumstances and at the time which has been agreed
upon or is required by law or, in the absence of a fixed
time, upon demand of the person entitled to such accounting
and delivery;
(6) failure to disburse funds in accordance with
agreements;
(7) having a license, or the equivalent, to practice
any profession or occupation revoked, suspended, or
otherwise acted against, including the denial of licensure
by a licensing authority of this State or another state,
territory, or country for fraud, dishonest dealing, or any
other act of moral turpitude;
(8) failure to comply with an order of the Secretary or
rule made or issued under the provisions of this Act;
(9) engaging in activities regulated by this Act
without a current, active license unless specifically
exempted by this Act;
(10) failure to pay in a timely manner any fee, charge,
or fine under this Act;
(11) failure to maintain, preserve, and keep available
for examination all books, accounts, or other documents
required by the provisions of this Act and the rules of the
Secretary;
(12) refusing, obstructing, evading, or unreasonably
delaying an investigation, information request, or
examination authorized under this Act, or refusing,
obstructing, evading, or unreasonably delaying compliance
with the Secretary's subpoena or subpoena duces tecum; and
(13) failure to comply with or a violation of any
provision of this Act.
(j) A licensee shall be subject to the disciplinary actions
specified in this Act for violations of subsection (i) by any
officer, director, shareholder, joint venture, partner,
ultimate equitable owner, or employee of the licensee.
(k) A licensee shall be subject to suspension or revocation
for unauthorized employee actions only if there is a pattern of
repeated violations by employees or the licensee has knowledge
of the violations or there is substantial harm to a consumer.
(l) Procedures for surrender of a license include the
following:
(1) The Secretary may, after 10 days' notice by
certified mail to the licensee at the address set forth on
the license, stating the contemplated action and in general
the grounds for the contemplated action and the date, time,
and place of a hearing thereon, and after providing the
licensee with a reasonable opportunity to be heard prior to
such action, fine such licensee an amount not exceeding
$25,000 per violation, or revoke or suspend any license
issued under this Act if he or she finds that:
(i) the licensee has failed to comply with any
provision of this Act or any order, decision, finding,
rule, regulation, or direction of the Secretary
lawfully made pursuant to the authority of this Act; or
(ii) any fact or condition exists that, if it had
existed at the time of the original application for the
license, clearly would have warranted the Secretary in
refusing to issue the license.
(2) Any licensee may submit an application to surrender
a license, but, upon the Secretary approving the surrender,
it shall not affect the licensee's civil or criminal
liability for acts committed prior to surrender or entitle
the licensee to a return of any part of the license fee.
(Source: P.A. 100-540, eff. 12-31-18.)
Section 10. The Residential Mortgage License Act of 1987 is
amended by changing Sections 1-3, 1-4, 2-2, 2-3, 2-3A, 2-4,
2-6, 3-2, 4-1, 4-5, 4-8, 4-8.1A, 4-8.3, 4-9.1, 5-9, 7-1A, 7-2,
7-4, 7-5, 7-6, 7-7, 7-8, 7-9, 7-10, and 7-13 as follows:
(205 ILCS 635/1-3) (from Ch. 17, par. 2321-3)
Sec. 1-3. Necessity for license; scope of Act.
(a) No person, partnership, association, corporation or
other entity shall engage in the business of brokering,
funding, originating, servicing or purchasing of residential
mortgage loans without first obtaining a license from the
Secretary in accordance with the licensing procedure provided
in this Article I and such regulations as may be promulgated by
the Secretary. The licensing provisions of this Section shall
not apply to any entity engaged solely in commercial mortgage
lending or to any person, partnership association, corporation
or other entity exempted pursuant to Section 1-4, subsection
(d), of this Act or in accordance with regulations promulgated
by the Secretary hereunder. No provision of this Act shall
apply to an exempt person or entity as defined in items (1) and
(1.5) of subsection (d) of Section 1-4 of this Act.
Notwithstanding anything to the contrary in the preceding
sentence, an individual acting as a mortgage loan originator
who is not employed by and acting for an entity described in
item (1) of subsection (tt) of Section 1-4 of this Act shall be
subject to the mortgage loan originator licensing requirements
of Article VII of this Act.
Effective January 1, 2011, no provision of this Act shall
apply to an exempt person or entity as defined in item (1.8) of
subsection (d) of Section 1-4 of this Act. Notwithstanding
anything to the contrary in the preceding sentence, an
individual acting as a mortgage loan originator who is not
employed by and acting for an entity described in item (1) of
subsection (tt) of Section 1-4 of this Act shall be subject to
the mortgage loan originator licensing requirements of Article
VII of this Act, and provided that an individual acting as a
mortgage loan originator under item (1.8) of subsection (d) of
Section 1-4 of this Act shall be further subject to a
determination by the U.S. Department of Housing and Urban
Development through final rulemaking or other authorized
agency determination under the federal Secure and Fair
Enforcement for Mortgage Licensing Act of 2008.
(a-1) A person who is exempt from licensure pursuant to
paragraph (ii) of item (1) of subsection (d) of Section 1-4 of
this Act as a federally chartered savings bank that is
registered with the Nationwide Multistate Mortgage Licensing
System and Registry may apply to the Secretary for an exempt
company registration for the purpose of sponsoring one or more
individuals subject to the mortgage loan originator licensing
requirements of Article VII of this Act. Registration with the
Division of Banking of the Department shall not affect the
exempt status of the applicant.
(1) A mortgage loan originator eligible for licensure
under this subsection shall (A) be covered under an
exclusive written contract with, and originate residential
mortgage loans solely on behalf of, that exempt person; and
(B) hold a current, valid insurance producer license under
Article XXXI of the Illinois Insurance Code.
(2) An exempt person shall: (A) fulfill any reporting
requirements required by the Nationwide Multistate
Mortgage Licensing System and Registry or the Secretary;
(B) provide a blanket surety bond pursuant to Section 7-12
of this Act covering the activities of all its sponsored
mortgage loan originators; (C) reasonably supervise the
activities of all its sponsored mortgage loan originators;
(D) comply with all rules and orders (including the
averments contained in Section 2-4 of this Act as
applicable to a non-licensed exempt entity provided for in
this Section) that the Secretary deems necessary to ensure
compliance with the federal SAFE Act; and (E) pay an annual
registration fee established by the Director.
(3) The Secretary may deny an exempt company
registration to an exempt person or fine, suspend, or
revoke an exempt company registration if the Secretary
finds one of the following:
(A) that the exempt person is not a person of
honesty, truthfulness, or good character;
(B) that the exempt person violated any applicable
law, rule, or order;
(C) that the exempt person refused or failed to
furnish, within a reasonable time, any information or
make any report that may be required by the Secretary;
(D) that the exempt person had a final judgment
entered against him or her in a civil action on grounds
of fraud, deceit, or misrepresentation, and the
conduct on which the judgment is based indicates that
it would be contrary to the interest of the public to
permit the exempt person to manage a loan originator;
(E) that the exempt person had an order entered
against him or her involving fraud, deceit, or
misrepresentation by an administrative agency of this
State, the federal government, or any other state or
territory of the United States, and the facts relating
to the order indicate that it would be contrary to the
interest of the public to permit the exempt person to
manage a loan originator;
(F) that the exempt person made a material
misstatement or suppressed or withheld information on
the application for an exempt company registration or
any document required to be filed with the Secretary;
or
(G) that the exempt person violated Section 4-5 of
this Act.
(b) No person, partnership, association, corporation, or
other entity except a licensee under this Act or an entity
exempt from licensing pursuant to Section 1-4, subsection (d),
of this Act shall do any business under any name or title, or
circulate or use any advertising or make any representation or
give any information to any person, which indicates or
reasonably implies activity within the scope of this Act.
(c) The Secretary may, through the Attorney General,
request the circuit court of either Cook or Sangamon County to
issue an injunction to restrain any person from violating or
continuing to violate any of the foregoing provisions of this
Section.
(d) When the Secretary has reasonable cause to believe that
any entity which has not submitted an application for licensure
is conducting any of the activities described in subsection (a)
hereof, the Secretary shall have the power to examine all books
and records of the entity and any additional documentation
necessary in order to determine whether such entity should
become licensed under this Act.
(d-1) The Secretary may issue orders against any person if
the Secretary has reasonable cause to believe that an unsafe,
unsound, or unlawful practice has occurred, is occurring, or is
about to occur, if any person has violated, is violating, or is
about to violate any law, rule, or written agreement with the
Secretary, or for the purposes of administering the provisions
of this Act and any rule adopted in accordance with this Act.
(e) Any person, partnership, association, corporation or
other entity who violates any provision of this Section commits
a business offense and shall be fined an amount not to exceed
$25,000. A mortgage loan brokered, funded, originated,
serviced, or purchased by a party who is not licensed under
this Section shall not be held to be invalid solely on the
basis of a violation under this Section. The changes made to
this Section by this amendatory Act of the 99th General
Assembly are declarative of existing law.
(f) Each person, partnership, association, corporation or
other entity conducting activities regulated by this Act shall
be issued one license. Each office, place of business or
location at which a residential mortgage licensee conducts any
part of his or her business must be recorded with the Secretary
pursuant to Section 2-8 of this Act.
(g) Licensees under this Act shall solicit, broker, fund,
originate, service and purchase residential mortgage loans
only in conformity with the provisions of this Act and such
rules and regulations as may be promulgated by the Secretary.
(h) This Act applies to all entities doing business in
Illinois as residential mortgage bankers, as defined by "An Act
to provide for the regulation of mortgage bankers", approved
September 15, 1977, as amended, regardless of whether licensed
under that or any prior Act. Any existing residential mortgage
lender or residential mortgage broker in Illinois whether or
not previously licensed, must operate in accordance with this
Act.
(i) This Act is a successor Act to and a continuance of the
regulation of residential mortgage bankers provided in, "An Act
to provide for the regulation of mortgage bankers", approved
September 15, 1977, as amended.
Entities and persons subject to the predecessor Act shall
be subject to this Act from and after its effective date.
(Source: P.A. 98-492, eff. 8-16-13; 99-113, eff. 7-23-15.)
(205 ILCS 635/1-4)
Sec. 1-4. Definitions. The following words and phrases have
the meanings given to them in this Section:
(a) "Residential real property" or "residential real
estate" shall mean any real property located in Illinois,
upon which is constructed or intended to be constructed a
dwelling. Those terms include a manufactured home as
defined in subdivision (53) of Section 9-102 of the Uniform
Commercial Code which is real property as defined in
Section 5-35 of the Conveyance and Encumbrance of
Manufactured Homes as Real Property and Severance Act.
(b) "Making a residential mortgage loan" or "funding a
residential mortgage loan" shall mean for compensation or
gain, either directly or indirectly, advancing funds or
making a commitment to advance funds to a loan applicant
for a residential mortgage loan.
(c) "Soliciting, processing, placing, or negotiating a
residential mortgage loan" shall mean for compensation or
gain, either directly or indirectly, accepting or offering
to accept an application for a residential mortgage loan,
assisting or offering to assist in the processing of an
application for a residential mortgage loan on behalf of a
borrower, or negotiating or offering to negotiate the terms
or conditions of a residential mortgage loan with a lender
on behalf of a borrower including, but not limited to, the
submission of credit packages for the approval of lenders,
the preparation of residential mortgage loan closing
documents, including a closing in the name of a broker.
(d) "Exempt person or entity" shall mean the following:
(1) (i) Any banking organization or foreign
banking corporation licensed by the Illinois
Commissioner of Banks and Real Estate or the United
States Comptroller of the Currency to transact
business in this State; (ii) any national bank,
federally chartered savings and loan association,
federal savings bank, federal credit union; (iii)
(blank); (iv) any bank, savings and loan association,
savings bank, or credit union organized under the laws
of this or any other state; (v) any Illinois Consumer
Installment Loan Act licensee; (vi) any insurance
company authorized to transact business in this State;
(vii) any entity engaged solely in commercial mortgage
lending; (viii) any service corporation of a savings
and loan association or savings bank organized under
the laws of this State or the service corporation of a
federally chartered savings and loan association or
savings bank having its principal place of business in
this State, other than a service corporation licensed
or entitled to reciprocity under the Real Estate
License Act of 2000; or (ix) any first tier subsidiary
of a bank, the charter of which is issued under the
Illinois Banking Act by the Illinois Commissioner of
Banks and Real Estate, or the first tier subsidiary of
a bank chartered by the United States Comptroller of
the Currency and that has its principal place of
business in this State, provided that the first tier
subsidiary is regularly examined by the Illinois
Commissioner of Banks and Real Estate or the
Comptroller of the Currency, or a consumer compliance
examination is regularly conducted by the Federal
Reserve Board.
(1.5) Any employee of a person or entity mentioned
in item (1) of this subsection, when acting for such
person or entity, or any registered mortgage loan
originator when acting for an entity described in
subsection (tt) of this Section.
(1.8) Any person or entity that does not originate
mortgage loans in the ordinary course of business, but
makes or acquires residential mortgage loans with his
or her own funds for his or her or its own investment
without intent to make, acquire, or resell more than 3
residential mortgage loans in any one calendar year.
(2) (Blank).
(2.1) A bona fide nonprofit organization.
(2.2) An employee of a bona fide nonprofit
organization when acting on behalf of that
organization.
(3) Any person employed by a licensee to assist in
the performance of the residential mortgage licensee's
activities regulated by this Act who is compensated in
any manner by only one licensee.
(4) (Blank).
(5) Any individual, corporation, partnership, or
other entity that originates, services, or brokers
residential mortgage loans, as these activities are
defined in this Act, and who or which receives no
compensation for those activities, subject to the
Commissioner's regulations and the federal Secure and
Fair Enforcement for Mortgage Licensing Act of 2008 and
the rules promulgated under that Act with regard to the
nature and amount of compensation.
(6) (Blank).
(e) "Licensee" or "residential mortgage licensee"
shall mean a person, partnership, association,
corporation, or any other entity who or which is licensed
pursuant to this Act to engage in the activities regulated
by this Act.
(f) "Mortgage loan" "residential mortgage loan" or
"home mortgage loan" shall mean any loan primarily for
personal, family, or household use that is secured by a
mortgage, deed of trust, or other equivalent consensual
security interest on a dwelling as defined in Section
103(v) of the federal Truth in Lending Act, or residential
real estate upon which is constructed or intended to be
constructed a dwelling.
(g) "Lender" shall mean any person, partnership,
association, corporation, or any other entity who either
lends or invests money in residential mortgage loans.
(h) "Ultimate equitable owner" shall mean a person who,
directly or indirectly, owns or controls an ownership
interest in a corporation, foreign corporation, alien
business organization, trust, or any other form of business
organization regardless of whether the person owns or
controls the ownership interest through one or more persons
or one or more proxies, powers of attorney, nominees,
corporations, associations, partnerships, trusts, joint
stock companies, or other entities or devices, or any
combination thereof.
(i) "Residential mortgage financing transaction" shall
mean the negotiation, acquisition, sale, or arrangement
for or the offer to negotiate, acquire, sell, or arrange
for, a residential mortgage loan or residential mortgage
loan commitment.
(j) "Personal residence address" shall mean a street
address and shall not include a post office box number.
(k) "Residential mortgage loan commitment" shall mean
a contract for residential mortgage loan financing.
(l) "Party to a residential mortgage financing
transaction" shall mean a borrower, lender, or loan broker
in a residential mortgage financing transaction.
(m) "Payments" shall mean payment of all or any of the
following: principal, interest and escrow reserves for
taxes, insurance and other related reserves, and
reimbursement for lender advances.
(n) "Commissioner" shall mean the Commissioner of
Banks and Real Estate, except that, beginning on April 6,
2009 (the effective date of Public Act 95-1047), all
references in this Act to the Commissioner of Banks and
Real Estate are deemed, in appropriate contexts, to be
references to the Secretary of Financial and Professional
Regulation, or his or her designee, including the Director
of the Division of Banking of the Department of Financial
and Professional Regulation.
(n-1) "Director" shall mean the Director of the
Division of Banking of the Department of Financial and
Professional Regulation, except that, beginning on July
31, 2009 (the effective date of Public Act 96-112), all
references in this Act to the Director are deemed, in
appropriate contexts, to be the Secretary of Financial and
Professional Regulation, or his or her designee, including
the Director of the Division of Banking of the Department
of Financial and Professional Regulation.
(o) "Loan brokering", "brokering", or "brokerage
service" shall mean the act of helping to obtain from
another entity, for a borrower, a loan secured by
residential real estate situated in Illinois or assisting a
borrower in obtaining a loan secured by residential real
estate situated in Illinois in return for consideration to
be paid by either the borrower or the lender including, but
not limited to, contracting for the delivery of residential
mortgage loans to a third party lender and soliciting,
processing, placing, or negotiating residential mortgage
loans.
(p) "Loan broker" or "broker" shall mean a person,
partnership, association, corporation, or limited
liability company, other than those persons, partnerships,
associations, corporations, or limited liability companies
exempted from licensing pursuant to Section 1-4,
subsection (d), of this Act, who performs the activities
described in subsections (c), (o), and (yy) of this
Section.
(q) "Servicing" shall mean the collection or
remittance for or the right or obligation to collect or
remit for any lender, noteowner, noteholder, or for a
licensee's own account, of payments, interests, principal,
and trust items such as hazard insurance and taxes on a
residential mortgage loan in accordance with the terms of
the residential mortgage loan; and includes loan payment
follow-up, delinquency loan follow-up, loan analysis and
any notifications to the borrower that are necessary to
enable the borrower to keep the loan current and in good
standing. "Servicing" includes management of third-party
entities acting on behalf of a residential mortgage
licensee for the collection of delinquent payments and the
use by such third-party entities of said licensee's
servicing records or information, including their use in
foreclosure.
(r) "Full service office" shall mean an office,
provided by the licensee and not subleased from the
licensee's employees, and staff in Illinois reasonably
adequate to handle efficiently communications, questions,
and other matters relating to any application for, or an
existing home mortgage secured by residential real estate
situated in Illinois with respect to which the licensee is
brokering, funding originating, purchasing, or servicing.
The management and operation of each full service office
must include observance of good business practices such as
proper signage; adequate, organized, and accurate books
and records; ample phone lines, hours of business, staff
training and supervision, and provision for a mechanism to
resolve consumer inquiries, complaints, and problems. The
Commissioner shall issue regulations with regard to these
requirements and shall include an evaluation of compliance
with this Section in his or her periodic examination of
each licensee.
(s) "Purchasing" shall mean the purchase of
conventional or government-insured mortgage loans secured
by residential real estate situated in Illinois from either
the lender or from the secondary market.
(t) "Borrower" shall mean the person or persons who
seek the services of a loan broker, originator, or lender.
(u) "Originating" shall mean the issuing of
commitments for and funding of residential mortgage loans.
(v) "Loan brokerage agreement" shall mean a written
agreement in which a broker or loan broker agrees to do
either of the following:
(1) obtain a residential mortgage loan for the
borrower or assist the borrower in obtaining a
residential mortgage loan; or
(2) consider making a residential mortgage loan to
the borrower.
(w) "Advertisement" shall mean the attempt by
publication, dissemination, or circulation to induce,
directly or indirectly, any person to enter into a
residential mortgage loan agreement or residential
mortgage loan brokerage agreement relative to a mortgage
secured by residential real estate situated in Illinois.
(x) "Residential Mortgage Board" shall mean the
Residential Mortgage Board created in Section 1-5 of this
Act.
(y) "Government-insured mortgage loan" shall mean any
mortgage loan made on the security of residential real
estate insured by the Department of Housing and Urban
Development or Farmers Home Loan Administration, or
guaranteed by the Veterans Administration.
(z) "Annual audit" shall mean a certified audit of the
licensee's books and records and systems of internal
control performed by a certified public accountant in
accordance with generally accepted accounting principles
and generally accepted auditing standards.
(aa) "Financial institution" shall mean a savings and
loan association, savings bank, credit union, or a bank
organized under the laws of Illinois or a savings and loan
association, savings bank, credit union or a bank organized
under the laws of the United States and headquartered in
Illinois.
(bb) "Escrow agent" shall mean a third party,
individual or entity charged with the fiduciary obligation
for holding escrow funds on a residential mortgage loan
pending final payout of those funds in accordance with the
terms of the residential mortgage loan.
(cc) "Net worth" shall have the meaning ascribed
thereto in Section 3-5 of this Act.
(dd) "Affiliate" shall mean:
(1) any entity that directly controls or is
controlled by the licensee and any other company that
is directly affecting activities regulated by this Act
that is controlled by the company that controls the
licensee;
(2) any entity:
(A) that is controlled, directly or
indirectly, by a trust or otherwise, by or for the
benefit of shareholders who beneficially or
otherwise control, directly or indirectly, by
trust or otherwise, the licensee or any company
that controls the licensee; or
(B) a majority of the directors or trustees of
which constitute a majority of the persons holding
any such office with the licensee or any company
that controls the licensee;
(3) any company, including a real estate
investment trust, that is sponsored and advised on a
contractual basis by the licensee or any subsidiary or
affiliate of the licensee.
(ee) "First tier subsidiary" shall be defined by
regulation incorporating the comparable definitions used
by the Office of the Comptroller of the Currency and the
Illinois Commissioner of Banks and Real Estate.
(ff) "Gross delinquency rate" means the quotient
determined by dividing (1) the sum of (i) the number of
government-insured residential mortgage loans funded or
purchased by a licensee in the preceding calendar year that
are delinquent and (ii) the number of conventional
residential mortgage loans funded or purchased by the
licensee in the preceding calendar year that are delinquent
by (2) the sum of (i) the number of government-insured
residential mortgage loans funded or purchased by the
licensee in the preceding calendar year and (ii) the number
of conventional residential mortgage loans funded or
purchased by the licensee in the preceding calendar year.
(gg) "Delinquency rate factor" means the factor set by
rule of the Commissioner that is multiplied by the average
gross delinquency rate of licensees, determined annually
for the immediately preceding calendar year, for the
purpose of determining which licensees shall be examined by
the Commissioner pursuant to subsection (b) of Section 4-8
of this Act.
(hh) (Blank). "Loan originator" means any natural
person who, for compensation or in the expectation of
compensation, either directly or indirectly makes, offers
to make, solicits, places, or negotiates a residential
mortgage loan. This definition applies only to Section 7-1
of this Act.
(ii) "Confidential supervisory information" means any
report of examination, visitation, or investigation
prepared by the Commissioner under this Act, any report of
examination visitation, or investigation prepared by the
state regulatory authority of another state that examines a
licensee, any document or record prepared or obtained in
connection with or relating to any examination,
visitation, or investigation, and any record prepared or
obtained by the Commissioner to the extent that the record
summarizes or contains information derived from any
report, document, or record described in this subsection.
"Confidential supervisory information" does not include
any information or record routinely prepared by a licensee
and maintained in the ordinary course of business or any
information or record that is required to be made publicly
available pursuant to State or federal law or rule.
(jj) "Mortgage loan originator" means an individual
who for compensation or gain or in the expectation of
compensation or gain:
(i) takes a residential mortgage loan application;
or
(ii) offers or negotiates terms of a residential
mortgage loan.
"Mortgage loan originator" includes an individual
engaged in loan modification activities as defined in
subsection (yy) of this Section. A mortgage loan originator
engaged in loan modification activities shall report those
activities to the Department of Financial and Professional
Regulation in the manner provided by the Department;
however, the Department shall not impose a fee for
reporting, nor require any additional qualifications to
engage in those activities beyond those provided pursuant
to this Act for mortgage loan originators.
"Mortgage loan originator" does not include an
individual engaged solely as a loan processor or
underwriter except as otherwise provided in subsection (d)
of Section 7-1A of this Act.
"Mortgage loan originator" does not include a person or
entity that only performs real estate brokerage activities
and is licensed in accordance with the Real Estate License
Act of 2000, unless the person or entity is compensated by
a lender, a mortgage broker, or other mortgage loan
originator, or by any agent of that lender, mortgage
broker, or other mortgage loan originator.
"Mortgage loan originator" does not include a person or
entity solely involved in extensions of credit relating to
timeshare plans, as that term is defined in Section
101(53D) of Title 11, United States Code.
(kk) "Depository institution" has the same meaning as
in Section 3 of the Federal Deposit Insurance Act, and
includes any credit union.
(ll) "Dwelling" means a residential structure or
mobile home which contains one to 4 family housing units,
or individual units of condominiums or cooperatives.
(mm) "Immediate family member" means a spouse, child,
sibling, parent, grandparent, or grandchild, and includes
step-parents, step-children, step-siblings, or adoptive
relationships.
(nn) "Individual" means a natural person.
(oo) "Loan processor or underwriter" means an
individual who performs clerical or support duties as an
employee at the direction of and subject to the supervision
and instruction of a person licensed, or exempt from
licensing, under this Act. "Clerical or support duties"
includes subsequent to the receipt of an application:
(i) the receipt, collection, distribution, and
analysis of information common for the processing or
underwriting of a residential mortgage loan; and
(ii) communicating with a consumer to obtain the
information necessary for the processing or
underwriting of a loan, to the extent that the
communication does not include offering or negotiating
loan rates or terms, or counseling consumers about
residential mortgage loan rates or terms. An
individual engaging solely in loan processor or
underwriter activities shall not represent to the
public, through advertising or other means of
communicating or providing information, including the
use of business cards, stationery, brochures, signs,
rate lists, or other promotional items, that the
individual can or will perform any of the activities of
a mortgage loan originator.
(pp) "Nationwide Multistate Mortgage Licensing System
and Registry" means a mortgage licensing system developed
and maintained by the Conference of State Bank Supervisors
and the American Association of Residential Mortgage
Regulators for the licensing and registration of licensed
mortgage loan originators.
(qq) "Nontraditional mortgage product" means any
mortgage product other than a 30-year fixed rate mortgage.
(rr) "Person" means a natural person, corporation,
company, limited liability company, partnership, or
association.
(ss) "Real estate brokerage activity" means any
activity that involves offering or providing real estate
brokerage services to the public, including:
(1) acting as a real estate agent or real estate
broker for a buyer, seller, lessor, or lessee of real
property;
(2) bringing together parties interested in the
sale, purchase, lease, rental, or exchange of real
property;
(3) negotiating, on behalf of any party, any
portion of a contract relating to the sale, purchase,
lease, rental, or exchange of real property, other than
in connection with providing financing with respect to
any such transaction;
(4) engaging in any activity for which a person
engaged in the activity is required to be registered or
licensed as a real estate agent or real estate broker
under any applicable law; or
(5) offering to engage in any activity, or act in
any capacity, described in this subsection (ss).
(tt) "Registered mortgage loan originator" means any
individual that:
(1) meets the definition of mortgage loan
originator and is an employee of:
(A) a depository institution;
(B) a subsidiary that is:
(i) owned and controlled by a depository
institution; and
(ii) regulated by a federal banking
agency; or
(C) an institution regulated by the Farm
Credit Administration; and
(2) is registered with, and maintains a unique
identifier through, the Nationwide Multistate Mortgage
Licensing System and Registry.
(uu) "Unique identifier" means a number or other
identifier assigned by protocols established by the
Nationwide Multistate Mortgage Licensing System and
Registry.
(vv) "Residential mortgage license" means a license
issued pursuant to Section 1-3, 2-2, or 2-6 of this Act.
(ww) "Mortgage loan originator license" means a
license issued pursuant to Section 7-1A, 7-3, or 7-6 of
this Act.
(xx) "Secretary" means the Secretary of the Department
of Financial and Professional Regulation, or a person
authorized by the Secretary or by this Act to act in the
Secretary's stead.
(yy) "Loan modification" means, for compensation or
gain, either directly or indirectly offering or
negotiating on behalf of a borrower or homeowner to adjust
the terms of a residential mortgage loan in a manner not
provided for in the original or previously modified
mortgage loan.
(zz) "Short sale facilitation" means, for compensation
or gain, either directly or indirectly offering or
negotiating on behalf of a borrower or homeowner to
facilitate the sale of residential real estate subject to
one or more residential mortgage loans or debts
constituting liens on the property in which the proceeds
from selling the residential real estate will fall short of
the amount owed and the lien holders are contacted to agree
to release their lien on the residential real estate and
accept less than the full amount owed on the debt.
(aaa) "Bona fide nonprofit organization" means an
organization that is described in Section 501(c)(3) of the
Internal Revenue Code, is exempt from federal income tax
under Section 501(a) of the Internal Revenue Code, does not
operate in a commercial context, and does all of the
following:
(1) Promotes affordable housing or provides home
ownership education or similar services.
(2) Conducts its activities in a manner that serves
public or charitable purposes.
(3) Receives funding and revenue and charges fees
in a manner that does not create an incentive for
itself or its employees to act other than in the best
interests of its clients.
(4) Compensates its employees in a manner that does
not create an incentive for its employees to act other
than in the best interests of its clients.
(5) Provides to, or identifies for, the borrower
residential mortgage loans with terms favorable to the
borrower and comparable to residential mortgage loans
and housing assistance provided under government
housing assistance programs.
The Commissioner may define by rule and regulation any
terms used in this Act for the efficient and clear
administration of this Act.
(Source: P.A. 98-749, eff. 7-16-14; 98-1081, eff. 1-1-15;
99-78, eff. 7-20-15.)
(205 ILCS 635/2-2)
Sec. 2-2. Application process; investigation; fee.
(a) The Secretary shall issue a license upon completion of
all of the following:
(1) The filing of an application for license with the
Director or the Nationwide Multistate Mortgage Licensing
System and Registry as approved by the Director.
(2) The filing with the Secretary of a listing of
judgments entered against, and bankruptcy petitions by,
the license applicant for the preceding 10 years.
(3) The payment, in certified funds, of investigation
and application fees, the total of which shall be in an
amount equal to $2,700 annually.
(4) Except for a broker applying to renew a license,
the filing of an audited balance sheet including all
footnotes prepared by a certified public accountant in
accordance with generally accepted accounting principles
and generally accepted auditing standards which evidences
that the applicant meets the net worth requirements of
Section 3-5. Notwithstanding the requirements of this
subsection, an applicant that is a subsidiary may submit
audited consolidated financial statements of its parent,
intermediary parent, or ultimate parent as long as the
consolidated statements are supported by consolidating
statements which include the applicant's financial
statement. If the consolidating statements are unaudited,
the applicant's chief financial officer shall attest to the
applicant's financial statements disclosed in the
consolidating statements.
(5) The filing of proof satisfactory to the Secretary
Commissioner that the applicant, the members thereof if the
applicant is a partnership or association, the members or
managers thereof that retain any authority or
responsibility under the operating agreement if the
applicant is a limited liability company, or the officers
thereof if the applicant is a corporation have 3 years
experience preceding application in real estate finance.
Instead of this requirement, the applicant and the
applicant's officers or members, as applicable, may
satisfactorily complete a program of education in real
estate finance and fair lending, as approved by the
Secretary Commissioner, prior to receiving the initial
license. The Secretary Commissioner shall adopt promulgate
rules regarding proof of experience requirements and
educational requirements and the satisfactory completion
of those requirements. The Secretary Commissioner may
establish by rule a list of duly licensed professionals and
others who may be exempt from this requirement.
(6) An investigation of the application averments
required by Section 2-4, which investigation must allow the
Secretary Commissioner to issue positive findings stating
that the financial responsibility, experience, character,
and general fitness of the license applicant and of the
members thereof if the license applicant is a partnership
or association, of the officers and directors thereof if
the license applicant is a corporation, and of the managers
and members that retain any authority or responsibility
under the operating agreement if the license applicant is a
limited liability company are such as to command the
confidence of the community and to warrant belief that the
business will be operated honestly, fairly and efficiently
within the purpose of this Act. If the Secretary
Commissioner shall not so find, he or she shall not issue
such license, and he or she shall notify the license
applicant of the denial.
The Secretary Commissioner may impose conditions on a
license if the Secretary Commissioner determines that the
conditions are necessary or appropriate. These conditions
shall be imposed in writing and shall continue in effect for
the period prescribed by the Secretary Commissioner.
(b) All licenses shall be issued to the license applicant.
Upon receipt of such license, a residential mortgage
licensee shall be authorized to engage in the business
regulated by this Act. Such license shall remain in full force
and effect until it expires without renewal, is surrendered by
the licensee or revoked or suspended as hereinafter provided.
(Source: P.A. 98-1081, eff. 1-1-15; 99-15, eff. 1-1-16.)
(205 ILCS 635/2-3) (from Ch. 17, par. 2322-3)
Sec. 2-3. Application form.
(a) Application for a residential mortgage license must be
made in accordance with Section 2-6 and, if applicable, in
accordance with requirements of the Nationwide Multistate
Mortgage Licensing System and Registry. The application shall
be in writing, under oath, and on a form obtained from and
prescribed by the Commissioner, or may be submitted
electronically, with attestation, to the Nationwide Multistate
Mortgage Licensing System and Registry.
(b) The application shall contain the name and complete
business and residential address or addresses of the license
applicant. If the license applicant is a partnership,
association, corporation or other form of business
organization, the application shall contain the names and
complete business and residential addresses of each member,
director and principal officer thereof. Such application shall
also include a description of the activities of the license
applicant, in such detail and for such periods, as the
Commissioner may require, including all of the following:
(1) An affirmation of financial solvency noting such
capitalization requirements as may be required by the
Commissioner, and access to such credit as may be required
by the Commissioner.
(2) An affirmation that the license applicant or its
members, directors or principals as may be appropriate, are
at least 18 years of age.
(3) Information as to the character, fitness,
financial and business responsibility, background,
experience, and criminal record of any (i) person, entity,
or ultimate equitable owner that owns or controls, directly
or indirectly, 10% or more of any class of stock of the
license applicant; (ii) person, entity, or ultimate
equitable owner that is not a depository institution, as
defined in Section 1007.50 of the Savings Bank Act, that
lends, provides, or infuses, directly or indirectly, in any
way, funds to or into a license applicant, in an amount
equal to or more than 10% of the license applicant's net
worth; (iii) person, entity, or ultimate equitable owner
that controls, directly or indirectly, the election of 25%
or more of the members of the board of directors of a
license applicant; or (iv) person, entity, or ultimate
equitable owner that the Commissioner finds influences
management of the license applicant.
(4) Upon written request by the licensee and
notwithstanding the provisions of paragraphs (1), (2), and
(3) of this subsection, the Commissioner may permit the
licensee to omit all or part of the information required by
those paragraphs if, in lieu of the omitted information,
the licensee submits an affidavit stating that the
information submitted on the licensee's previous renewal
application is still true and accurate. The Commissioner
may promulgate rules prescribing the form and content of
the affidavit that are necessary to accomplish the purposes
of this Section.
(5) Such other information as required by regulations
of the Commissioner.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/2-3A)
Sec. 2-3A. Residential mortgage license application and
issuance.
(a) Applicants for a license shall apply in a form
prescribed by the Director. Each form shall contain content as
set forth by rule, regulation, instruction, or procedure of the
Director and may be changed or updated as necessary by the
Director in order to carry out the purposes of this Act.
(b) In order to fulfill the purposes of this Act, the
Director is authorized to establish relationships or contracts
with the Nationwide Multistate Mortgage Licensing System and
Registry or other entities designated by the Nationwide
Multistate Mortgage Licensing System and Registry to collect
and maintain records and process transaction fees or other fees
related to licensees or other persons subject to this Act.
(c) In connection with an application for licensing, the
applicant may be required, at a minimum, to furnish to the
Nationwide Multistate Mortgage Licensing System and Registry
information concerning the applicant's identity, including:
(1) fingerprints for submission to the Federal Bureau
of Investigation or any governmental agency or entity
authorized to receive such information for a State,
national, and international criminal history background
check; and
(2) personal history and experience in a form
prescribed by the Nationwide Multistate Mortgage Licensing
System and Registry, including the submission of
authorization for the Nationwide Multistate Mortgage
Licensing System and Registry and the Director to obtain:
(A) an independent credit report obtained from a
consumer reporting agency described in Section 603(p)
of the Fair Credit Reporting Act (15 U.S.C. 1681a(p));
and
(B) information related to any administrative,
civil, or criminal findings by any governmental
jurisdiction.
(d) For the purposes of this Section, and in order to
reduce the points of contact that the Federal Bureau of
Investigation may have to maintain for purposes of subsection
(c) of this Section, the Director may use the Nationwide
Multistate Mortgage Licensing System and Registry as a
channeling agent for requesting information from and
distributing information to the Department of Justice or any
governmental agency.
(e) For the purposes of this Section, and in order to
reduce the points of contact that the Director may have to
maintain for purposes of item (2) of subsection (c) of this
Section, the Director may use the Nationwide Multistate
Mortgage Licensing System and Registry as a channeling agent
for requesting and distributing information to and from any
source so directed by the Director.
(Source: P.A. 97-891, eff. 8-3-12.)
(205 ILCS 635/2-4) (from Ch. 17, par. 2322-4)
Sec. 2-4. Prohibited acts and practices for licensees.
Averments of Licensee. It is a violation of this Act for a
licensee subject to this Act to Each application for license
shall be accompanied by the following averments stating that
the applicant:
(a) fail to Will maintain at least one full service
office within the State of Illinois if required to do so
pursuant to Section 3-4 of this Act;
(b) fail to Will maintain staff reasonably adequate to
meet the requirements of Section 3-4 of this Act;
(c) fail to Will keep and maintain for 36 months the
same written records as required by the federal Equal
Credit Opportunity Act, and any other information required
by regulations of the Secretary Commissioner regarding any
home mortgage in the course of the conduct of its
residential mortgage business;
(d) fail to Will file with the Secretary Commissioner
or Nationwide Multistate Mortgage Licensing System and
Registry as applicable, when due, any report or reports
which it is required to file under any of the provisions of
this Act;
(e) engage Will not engage, whether as principal or
agent, in the practice of rejecting residential mortgage
applications without reasonable cause, or varying terms or
application procedures without reasonable cause, for home
mortgages on real estate within any specific geographic
area from the terms or procedures generally provided by the
licensee within other geographic areas of the State;
(f) engage Will not engage in fraudulent home mortgage
underwriting practices;
(g) make Will not make payment, whether directly or
indirectly, of any kind to any in house or fee appraiser of
any government or private money lending agency with which
an application for a home mortgage has been filed for the
purpose of influencing the independent judgment of the
appraiser with respect to the value of any real estate
which is to be covered by such home mortgage;
(h) fail to file Has filed tax returns (State and
Federal) for the past 3 years or filed with the Secretary
Commissioner an accountant's or attorney's statement as to
why no return was filed;
(i) engage Will not engage in any discrimination or
redlining activities prohibited by Section 3-8 of this Act;
(j) knowingly Will not knowingly make any false
promises likely to influence or persuade, or pursue a
course of misrepresentation and false promises through
agents, solicitors, advertising or otherwise;
(k) knowingly Will not knowingly misrepresent,
circumvent or conceal, through whatever subterfuge or
device, any of the material particulars or the nature
thereof, regarding a transaction to which it is a party to
the injury of another party thereto;
(l) fail to Will disburse funds in accordance with its
agreements;
(m) commit Has not committed a crime against the law of
this State, any other state or of the United States,
involving moral turpitude, fraudulent or dishonest
dealing, and that no final judgment has been entered
against it in a civil action upon grounds of fraud,
misrepresentation or deceit which has not been previously
reported to the Secretary Commissioner;
(n) fail to Will account or deliver to the owner upon
request any personal property such as money, fund, deposit,
check, draft, mortgage, other document or thing of value
which it is not in law or equity entitled to retain under
the circumstances;
(o) engage Has not engaged in any conduct which would
be cause for denial of a license;
(p) become Has not become insolvent;
(q) submit Has not submitted an application for a
license under this Act which contains a material
misstatement;
(r) demonstrate Has not demonstrated by course of
conduct, negligence or incompetence in performing any act
for which it is required to hold a license under this Act;
(s) fail to Will advise the Secretary Commissioner in
writing, or the Nationwide Multistate Mortgage Licensing
System and Registry, as applicable, of any changes to the
information submitted on the most recent application for
license or averments of record within 30 days of said
change. The written notice must be signed in the same form
as the application for license being amended;
(t) fail to Will comply with the provisions of this
Act, or with any lawful order, rule or regulation made or
issued under the provisions of this Act;
(u) fail to Will submit to periodic examination by the
Secretary Commissioner as required by this Act;
(v) fail to Will advise the Secretary Commissioner in
writing of judgments entered against, and bankruptcy
petitions by, the license applicant within 5 days of
occurrence;
(w) fail to Will advise the Secretary Commissioner in
writing within 30 days of any request made to a licensee
under this Act to repurchase a loan in a manner that
completely and clearly identifies to whom the request was
made, the loans involved, and the reason therefor;
(x) fail to Will advise the Secretary Commissioner in
writing within 30 days of any request from any entity to
repurchase a loan in a manner that completely and clearly
identifies to whom the request was made, the loans
involved, and the reason for the request;
(y) fail to Will at all times act in a manner
consistent with subsections (a) and (b) of Section 1-2 of
this Act;
(z) knowingly Will not knowingly hire or employ a loan
originator who is not registered, or mortgage loan
originator who is not licensed, with the Secretary
Commissioner as required under Section 7-1 or Section 7-1A,
as applicable, of this Act;
(aa) charge Will not charge or collect advance payments
from borrowers or homeowners for engaging in loan
modification; or and
(bb) structure Will not structure activities or
contracts to evade provisions of this Act.
A licensee who fails to fulfill obligations of an averment,
to comply with this Section averments made, or otherwise
violates any of the provisions of averments made under this
Section shall be subject to the penalties in Section 4-5 of
this Act.
(Source: P.A. 97-891, eff. 8-3-12; 98-1081, eff. 1-1-15.)
(205 ILCS 635/2-6)
Sec. 2-6. License issuance and renewal; fee.
(a) Licenses shall be renewed every year using the common
renewal date of the Nationwide Multistate Mortgage Licensing
System and Registry as adopted by the Director. Properly
completed renewal application forms and filing fees may be
received by the Secretary 60 days prior to the license
expiration date, but, to be deemed timely, the completed
renewal application forms and filing fees must be received by
the Secretary no later than 30 days prior to the license
expiration date.
(b) It shall be the responsibility of each licensee to
accomplish renewal of its license. Failure by a licensee to
submit a properly completed renewal application form and fees
in a timely fashion, absent a written extension from the
Secretary, will result in the license becoming inactive.
(c) No activity regulated by this Act shall be conducted by
the licensee when a license becomes inactive. The Commissioner
may require the licensee to provide a plan for the disposition
of any residential mortgage loans not closed or funded when the
license becomes inactive. The Commissioner may allow a licensee
with an inactive license to conduct activities regulated by
this Act for the sole purpose of assisting borrowers in the
closing or funding of loans for which the loan application was
taken from a borrower while the license was active. An inactive
license may be reactivated by the Commissioner upon payment of
the renewal fee, and payment of a reactivation fee equal to the
renewal fee.
(d) (Blank).
(e) A licensee ceasing an activity or activities regulated
by this Act and desiring to no longer be licensed shall so
inform the Commissioner in writing and, at the same time,
convey any license issued and all other symbols or indicia of
licensure. The licensee shall include a plan for the withdrawal
from regulated business, including a timetable for the
disposition of the business, and comply with the surrender
guidelines or requirements of the Director. Upon receipt of
such written notice, the Commissioner shall post the
cancellation or issue a certified statement canceling the
license.
(Source: P.A. 99-15, eff. 1-1-16.)
(205 ILCS 635/3-2) (from Ch. 17, par. 2323-2)
Sec. 3-2. Annual audit.
(a) At the licensee's fiscal year-end, but in no case more
than 12 months after the last audit conducted pursuant to this
Section, except as otherwise provided in this Section, it shall
be mandatory for each residential mortgage licensee to cause
its books and accounts to be audited by a certified public
accountant not connected with such licensee. The books and
records of all licensees under this Act shall be maintained on
an accrual basis. The audit must be sufficiently comprehensive
in scope to permit the expression of an opinion on the
financial statements, which must be prepared in accordance with
generally accepted accounting principles, and must be
performed in accordance with generally accepted auditing
standards. Notwithstanding the requirements of this
subsection, a licensee that is a subsidiary may submit audited
consolidated financial statements of its parent, intermediary
parent, or ultimate parent as long as the consolidated
statements are supported by consolidating statements which
include the licensee's financial statement. If the
consolidating statements are unaudited, the licensee's chief
financial officer shall attest to the licensee's financial
statements disclosed in the consolidating statements.
(b) As used herein, the term "expression of opinion"
includes either (1) an unqualified opinion, (2) a qualified
opinion, (3) a disclaimer of opinion, or (4) an adverse
opinion.
(c) If a qualified or adverse opinion is expressed or if an
opinion is disclaimed, the reasons therefore must be fully
explained. An opinion, qualified as to a scope limitation,
shall not be acceptable.
(d) The most recent audit report shall be filed with the
Commissioner within 90 days after the end of the licensee's
fiscal year, or with the Nationwide Multistate Mortgage
Licensing System and Registry, if applicable, pursuant to
Mortgage Call Report requirements. The report filed with the
Commissioner shall be certified by the certified public
accountant conducting the audit. The Commissioner may
promulgate rules regarding late audit reports.
(e) (Blank).
(f) In lieu of the audit or compilation financial statement
required by this Section, a licensee shall submit and the
Commissioner may accept any audit made in conformance with the
audit requirements of the U.S. Department of Housing and Urban
Development.
(g) With respect to licensees who solely broker residential
mortgage loans as defined in subsection (o) of Section 1-4,
instead of the audit required by this Section, the Commissioner
may accept compilation financial statements prepared at least
every 12 months, and the compilation financial statement must
be submitted within 90 days after the end of the licensee's
fiscal year, or with the Nationwide Multistate Mortgage
Licensing System and Registry, if applicable, pursuant to
Mortgage Call Report requirements. A licensee who files false
or misleading compilation financial statements is guilty of a
business offense and shall be fined not less than $5,000.
(h) The workpapers of the certified public accountants
employed by each licensee for purposes of this Section are to
be made available to the Commissioner or the Commissioner's
designee upon request and may be reproduced by the Commissioner
or the Commissioner's designee to enable to the Commissioner to
carry out the purposes of this Act.
(i) Notwithstanding any other provision of this Section, if
a licensee relying on subsection (g) of this Section causes its
books to be audited at any other time or causes its financial
statements to be reviewed, a complete copy of the audited or
reviewed financial statements shall be delivered to the
Commissioner at the time of the annual license renewal payment
following receipt by the licensee of the audited or reviewed
financial statements. All workpapers shall be made available to
the Commissioner upon request. The financial statements and
workpapers may be reproduced by the Commissioner or the
Commissioner's designee to carry out the purposes of this Act.
(Source: P.A. 98-463, eff. 8-16-13; 98-1081, eff. 1-1-15;
99-933, eff. 1-27-17.)
(205 ILCS 635/4-1) (from Ch. 17, par. 2324-1)
Sec. 4-1. Commissioner of Banks and Real Estate; functions,
powers, and duties. The functions, powers, and duties of the
Commissioner of Banks and Real Estate shall include the
following:
(a) to issue or refuse to issue any license as provided
by this Act;
(b) to revoke or suspend for cause any license issued
under this Act;
(c) to keep records of all licenses issued under this
Act;
(d) to receive, consider, investigate, and act upon
complaints made by any person in connection with any
residential mortgage licensee in this State;
(e) to consider and act upon any recommendations from
the Residential Mortgage Board;
(f) to prescribe the forms of and receive:
(1) applications for licenses; and
(2) all reports and all books and records required
to be made by any licensee under this Act, including
annual audited financial statements and annual reports
of mortgage activity;
(g) to adopt rules and regulations necessary and proper
for the administration of this Act;
(h) to subpoena documents and witnesses and compel
their attendance and production, to administer oaths, and
to require the production of any books, papers, or other
materials relevant to any inquiry authorized by this Act;
(h-1) to issue orders against any person, if the
Commissioner has reasonable cause to believe that an
unsafe, unsound, or unlawful practice has occurred, is
occurring, or is about to occur, if any person has
violated, is violating, or is about to violate any law,
rule, or written agreement with the Commissioner, or for
the purpose of administering the provisions of this Act and
any rule adopted in accordance with the Act;
(h-2) to address any inquiries to any licensee, or the
officers thereof, in relation to its activities and
conditions, or any other matter connected with its affairs,
and it shall be the duty of any licensee or person so
addressed, to promptly reply in writing to such inquiries.
The Commissioner may also require reports from any licensee
at any time the Commissioner may deem desirable;
(i) to require information with regard to any license
applicant as he or she may deem desirable, with due regard
to the paramount interests of the public as to the
experience, background, honesty, truthfulness, integrity,
and competency of the license applicant as to financial
transactions involving primary or subordinate mortgage
financing, and where the license applicant is an entity
other than an individual, as to the honesty, truthfulness,
integrity, and competency of any officer or director of the
corporation, association, or other entity, or the members
of a partnership;
(j) to examine the books and records of every licensee
under this Act at intervals as specified in Section 4-2;
(k) to enforce provisions of this Act;
(l) to levy fees, fines, and charges for services
performed in administering this Act; the aggregate of all
fees collected by the Commissioner on and after the
effective date of this Act shall be paid promptly after
receipt of the same, accompanied by a detailed statement
thereof, into the Residential Finance Regulatory Fund
under Section 4-1.5 of this Act; the amounts deposited into
that Fund shall be used for the ordinary and contingent
expenses of the Office of Banks and Real Estate. Nothing in
this Act shall prevent continuing the practice of paying
expenses involving salaries, retirement, social security,
and State-paid insurance of State officers by
appropriation from the General Revenue Fund.
(m) to appoint examiners, supervisors, experts, and
special assistants as needed to effectively and
efficiently administer this Act;
(n) to conduct hearings for the purpose of:
(1) appeals of orders of the Commissioner;
(2) suspensions or revocations of licenses, or
fining of licensees;
(3) investigating:
(i) complaints against licensees; or
(ii) annual gross delinquency rates; and
(4) carrying out the purposes of this Act;
(o) to exercise exclusive visitorial power over a
licensee unless otherwise authorized by this Act or as
vested in the courts, or upon prior consultation with the
Commissioner, a foreign residential mortgage regulator
with an appropriate supervisory interest in the parent or
affiliate of a licensee;
(p) to enter into cooperative agreements with state
regulatory authorities of other states to provide for
examination of corporate offices or branches of those
states and to accept reports of such examinations;
(q) to assign an examiner or examiners to monitor the
affairs of a licensee with whatever frequency the
Commissioner determines appropriate and to charge the
licensee for reasonable and necessary expenses of the
Commissioner, if in the opinion of the Commissioner an
emergency exists or appears likely to occur;
(r) to impose civil penalties of up to $50 per day
against a licensee for failing to respond to a regulatory
request or reporting requirement; and
(s) to enter into agreements in connection with the
Nationwide Multistate Mortgage Licensing System and
Registry.
(Source: P.A. 98-1081, eff. 1-1-15.)
(205 ILCS 635/4-5) (from Ch. 17, par. 2324-5)
Sec. 4-5. Suspension, revocation of licenses; fines.
(a) Upon written notice to a licensee, the Commissioner may
suspend or revoke any license issued pursuant to this Act if he
or she shall make a finding of one or more of the following in
the notice that:
(1) Through separate acts or an act or a course of
conduct, the licensee has violated any provisions of this
Act, any rule or regulation promulgated by the Commissioner
or of any other law, rule or regulation of this State or
the United States.
(2) Any fact or condition exists which, if it had
existed at the time of the original application for such
license would have warranted the Commissioner in refusing
originally to issue such license.
(3) If a licensee is other than an individual, any
ultimate equitable owner, officer, director, or member of
the licensed partnership, association, corporation, or
other entity has so acted or failed to act as would be
cause for suspending or revoking a license to that party as
an individual.
(b) No license shall be suspended or revoked, except as
provided in this Section, nor shall any licensee be fined
without notice of his or her right to a hearing as provided in
Section 4-12 of this Act.
(c) The Commissioner, on good cause shown that an emergency
exists, may suspend any license for a period not exceeding 180
days, pending investigation. Upon a showing that a licensee has
failed to meet the experience or educational requirements of
Section 2-2 or the requirements of subsection (g) of Section
3-2, the Commissioner shall suspend, prior to hearing as
provided in Section 4-12, the license until those requirements
have been met.
(d) The provisions of subsection (e) of Section 2-6 of this
Act shall not affect a licensee's civil or criminal liability
for acts committed prior to surrender of a license.
(e) No revocation, suspension or surrender of any license
shall impair or affect the obligation of any pre-existing
lawful contract between the licensee and any person.
(f) Every license issued under this Act shall remain in
force and effect until the same shall have expired without
renewal, have been surrendered, revoked or suspended in
accordance with the provisions of this Act, but the
Commissioner shall have authority to reinstate a suspended
license or to issue a new license to a licensee whose license
shall have been revoked if no fact or condition then exists
which would have warranted the Commissioner in refusing
originally to issue such license under this Act.
(g) Whenever the Commissioner shall revoke or suspend a
license issued pursuant to this Act or fine a licensee under
this Act, he or she shall forthwith execute a written order to
that effect. The Commissioner shall post notice of the order on
an agency Internet site maintained by the Commissioner or on
the Nationwide Multistate Mortgage Licensing System and
Registry and shall forthwith serve a copy of such order upon
the licensee. Any such order may be reviewed in the manner
provided by Section 4-12 of this Act.
(h) When the Commissioner finds any person in violation of
the grounds set forth in subsection (i), he or she may enter an
order imposing one or more of the following penalties:
(1) Revocation of license;
(2) Suspension of a license subject to reinstatement
upon satisfying all reasonable conditions the Commissioner
may specify;
(3) Placement of the licensee or applicant on probation
for a period of time and subject to all reasonable
conditions as the Commissioner may specify;
(4) Issuance of a reprimand;
(5) Imposition of a fine not to exceed $25,000 for each
count of separate offense, provided that a fine may be
imposed not to exceed $75,000 for each separate count of
offense of paragraph (2) of subsection (i) of this Section;
and
(6) Denial of a license.
(i) The following acts shall constitute grounds for which
the disciplinary actions specified in subsection (h) above may
be taken:
(1) Being convicted or found guilty, regardless of
pendency of an appeal, of a crime in any jurisdiction which
involves fraud, dishonest dealing, or any other act of
moral turpitude;
(2) Fraud, misrepresentation, deceit or negligence in
any mortgage financing transaction;
(3) A material or intentional misstatement of fact on
an initial or renewal application;
(4) Failure to follow the Commissioner's regulations
with respect to placement of funds in escrow accounts;
(5) Insolvency or filing under any provision of the
Bankruptcy Code as a debtor;
(6) Failure to account or deliver to any person any
property such as any money, fund, deposit, check, draft,
mortgage, or other document or thing of value, which has
come into his or her hands and which is not his or her
property or which he or she is not in law or equity
entitled to retain, under the circumstances and at the time
which has been agreed upon or is required by law or, in the
absence of a fixed time, upon demand of the person entitled
to such accounting and delivery;
(7) Failure to disburse funds in accordance with
agreements;
(8) Any misuse, misapplication, or misappropriation of
trust funds or escrow funds;
(9) Having a license, or the equivalent, to practice
any profession or occupation revoked, suspended, or
otherwise acted against, including the denial of licensure
by a licensing authority of this State or another state,
territory or country for fraud, dishonest dealing or any
other act of moral turpitude;
(10) Failure to issue a satisfaction of mortgage when
the residential mortgage has been executed and proceeds
were not disbursed to the benefit of the mortgagor and when
the mortgagor has fully paid licensee's costs and
commission;
(11) Failure to comply with any order of the
Commissioner or rule made or issued under the provisions of
this Act;
(12) Engaging in activities regulated by this Act
without a current, active license unless specifically
exempted by this Act;
(13) Failure to pay in a timely manner any fee, charge
or fine under this Act;
(14) Failure to maintain, preserve, and keep available
for examination, all books, accounts or other documents
required by the provisions of this Act and the rules of the
Commissioner;
(15) Refusing, obstructing, evading, or unreasonably
delaying an investigation, information request, or
examination authorized under this Act, or refusing,
obstructing, evading, or unreasonably delaying compliance
with the Director's subpoena or subpoena duces tecum;
(16) A pattern of substantially underestimating the
maximum closing costs;
(17) Failure to comply with or violation of any
provision of this Act;
(18) Failure to comply with or violation of any
provision of Article 3 of the Residential Real Property
Disclosure Act.
(j) A licensee shall be subject to the disciplinary actions
specified in this Act for violations of subsection (i) by any
officer, director, shareholder, joint venture, partner,
ultimate equitable owner, or employee of the licensee.
(k) Such licensee shall be subject to suspension or
revocation for unauthorized employee actions only if there is a
pattern of repeated violations by employees or the licensee has
knowledge of the violations, or there is substantial harm to a
consumer.
(l) Procedure for surrender of license:
(1) The Commissioner may, after 10 days notice by
certified mail to the licensee at the address set forth on
the license, stating the contemplated action and in general
the grounds therefor and the date, time and place of a
hearing thereon, and after providing the licensee with a
reasonable opportunity to be heard prior to such action,
fine such licensee an amount not exceeding $25,000 per
violation, or revoke or suspend any license issued
hereunder if he or she finds that:
(i) The licensee has failed to comply with any
provision of this Act or any order, decision, finding,
rule, regulation or direction of the Commissioner
lawfully made pursuant to the authority of this Act; or
(ii) Any fact or condition exists which, if it had
existed at the time of the original application for the
license, clearly would have warranted the Commissioner
in refusing to issue the license.
(2) Any licensee may submit application to surrender a
license, but upon the Director approving the surrender, it
shall not affect the licensee's civil or criminal liability
for acts committed prior to surrender or entitle the
licensee to a return of any part of the license fee.
(Source: P.A. 99-15, eff. 1-1-16.)
(205 ILCS 635/4-8) (from Ch. 17, par. 2324-8)
Sec. 4-8. Delinquency; examination.
(a) (Blank). The Commissioner shall obtain from the U.S.
Department of Housing and Urban Development that Department's
loan delinquency data.
(b) The Secretary Commissioner shall conduct as part of an
examination of each licensee a review of the licensee's loan
delinquency data.
This subsection shall not be construed as a limitation of
the Secretary's Commissioner's examination authority under
Section 4-2 of this Act or as otherwise provided in this Act.
The Secretary Commissioner may require a licensee to provide
loan delinquency data as the Secretary Commissioner deems
necessary for the proper enforcement of the Act.
(c) The purpose of the examination under subsection (b)
shall be to determine whether the loan delinquency data of the
licensee has resulted from practices which deviate from sound
and accepted mortgage underwriting practices, including, but
not limited to, credit fraud, appraisal fraud, and property
inspection fraud. For the purpose of conducting this
examination, the Secretary Commissioner may accept materials
prepared for the U.S. Department of Housing and Urban
Development. At the conclusion of the examination, the
Secretary Commissioner shall make his or her findings available
to the Residential Mortgage Board.
(d) The Secretary Commissioner, at his or her discretion,
may hold public hearings, or at the direction of the
Residential Mortgage Board, shall hold public hearings. Such
testimony shall be by a homeowner or mortgagor or his agent,
whose residential interest is affected by the activities of the
residential mortgage licensee subject to such hearing. At such
public hearing, a witness may present testimony on his or her
behalf concerning only his or her home, or home mortgage or a
witness may authorize a third party to appear on his or her
behalf. The testimony shall be restricted to information and
comments related to a specific residence or specific
residential mortgage application or applications for a
residential mortgage or residential loan transaction. The
testimony must be preceded by either a letter of complaint or a
completed consumer complaint form prescribed by the Secretary
Commissioner.
(e) The Secretary Commissioner shall, at the conclusion of
the public hearings, release his or her findings and shall also
make public any action taken with respect to the licensee. The
Secretary Commissioner shall also give full consideration to
the findings of this examination whenever reapplication is made
by the licensee for a new license under this Act.
(f) A licensee that is examined pursuant to subsection (b)
shall submit to the Secretary Commissioner a plan which shall
be designed to reduce that licensee's loan delinquencies. The
plan shall be implemented by the licensee as approved by the
Secretary Commissioner. A licensee that is examined pursuant to
subsection (b) shall report monthly, for a one year period,
one, 2, and 3 month loan delinquencies.
(g) Whenever the Secretary Commissioner finds that a
licensee's loan delinquencies on insured mortgages is
unusually high within a particular geographic area, he or she
shall require that licensee to submit such information as is
necessary to determine whether that licensee's practices have
constituted credit fraud, appraisal fraud or property
inspection fraud. The Secretary Commissioner shall promulgate
such rules as are necessary to determine whether any licensee's
loan delinquencies are unusually high within a particular area.
(Source: P.A. 99-15, eff. 1-1-16.)
(205 ILCS 635/4-8.1A)
Sec. 4-8.1A. Confidentiality.
(a) In order to promote more effective regulation and
reduce regulatory burden through supervisory information
sharing, except as otherwise provided in federal Public Law
110-289, Section 1512, the requirements under any federal law
or state law regarding the privacy or confidentiality of any
information or material provided to the Nationwide Multistate
Mortgage Licensing System and Registry, and any privilege
arising under federal or state law, including the rules of any
federal or state court, with respect to such information or
material, shall continue to apply to information or material
after the information or material has been disclosed to the
Nationwide Multistate Mortgage Licensing System and Registry.
The information and material may be shared with all state and
federal regulatory officials with mortgage industry oversight
authority without the loss of privilege or the loss of
confidentiality protections provided by federal law or state
law.
(b) In order to promote more effective regulation and
reduce regulatory burden through supervisory information
sharing, the Director is authorized to enter agreements or
sharing arrangements with other governmental agencies, the
Conference of State Bank Supervisors, the American Association
of Residential Mortgage Regulators or other associations
representing governmental agencies as established by rule,
regulation or order of the Director. The sharing of
confidential supervisory information or any information or
material described in subsection (a) of this Section pursuant
to an agreement or sharing arrangement shall not result in the
loss of privilege or the loss of confidentiality protections
provided by federal law or state law.
(c) In order to promote more effective regulation and
reduce regulatory burden through supervisory information
sharing, information or material that is subject to a privilege
or confidentiality under subsection (a) of this Section shall
not be subject to the following:
(1) disclosure under any State law governing the
disclosure to the public of information held by an officer
or an agency of the State; or
(2) subpoena or discovery, or admission into evidence,
in any private civil action or administrative process,
unless with respect to any privilege held by the Nationwide
Multistate Mortgage Licensing System and Registry with
respect to the information or material, the person to whom
such information or material pertains waives, in whole or
in part, in the discretion of that person, that privilege.
(d) In order to promote more effective regulation and
reduce regulatory burden through supervisory information
sharing, other law relating to the disclosure of confidential
supervisory information or any information or material
described in subsection (a) of this Section that is
inconsistent with subsection (a) of this Section shall be
superseded by the requirements of this Section to the extent
the other law provides less confidentiality or a weaker
privilege.
(e) In order to promote more effective regulation and
reduce regulatory burden through supervisory information
sharing, this Section shall not apply to the employment history
of a mortgage loan originator, and the record of publicly
adjudicated disciplinary and enforcement actions against a
mortgage loan originator.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/4-8.3)
Sec. 4-8.3. Annual report of mortgage brokerage and
servicing activity. On or before March 1 of each year or the
date selected for Mortgage Call Reports under Section 4-9.1 of
this Act, each licensee shall file a report with the Secretary
Commissioner that discloses shall disclose such information as
the Secretary Commissioner requires. A licensee filing a
Mortgage Call Report is not required to file an annual report.
Exempt entities as defined in subsection (d) of Section 1-4
shall not file the annual report of mortgage and servicing
activity required by this Section.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/4-9.1)
Sec. 4-9.1. Mortgage call reports. Each residential
mortgage licensee shall submit to the Nationwide Multistate
Mortgage Licensing System and Registry reports of condition,
which shall be in the form and shall contain the information
that the Nationwide Multistate Mortgage Licensing System and
Registry may require.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/5-9)
Sec. 5-9. Notice of change in loan terms.
(a) No licensee may fail to do either of the following:
(1) Provide timely notice to the borrower of any
material change in the terms of the residential mortgage
loan prior to the closing of the loan. For purposes of this
Section, a "material change means" any of the following:
(A) A change in the type of loan being offered,
such as a fixed or variable rate loan or a loan with a
balloon payment.
(B) A change in the term of the loan, as reflected
in the number of monthly payments due before a final
payment is scheduled to be made.
(C) An increase in the interest rate of more than
0.15%, or an equivalent increase in the amount of
discount points charged.
(D) An increase in the regular monthly payment of
principal and interest of more than 5%.
(E) A change regarding the requirement or amount of
escrow of taxes or insurance.
(F) A change regarding the requirement or payment,
or both, of private mortgage insurance.
(2) Timely inform the borrower if any fees payable by
the borrower to the licensee increase by more than 10% or
$100, whichever is greater.
(b) The disclosures required by this Section shall be
deemed timely if the licensee provides the borrower with the
revised information not later than 3 days after learning of the
change or 24 hours before the residential mortgage loan is
closed, whichever is earlier. If the licensee discloses a
material change more than the 3 days after learning of the
change but still 24 hours before the residential mortgage loan
is closed, it will not be liable for penalties or forfeitures
if the licensee cures in time for the borrower to avoid any
damage.
(c) If an increase in the total amount of the fee to be
paid by the borrower to the broker is not disclosed in
accordance with this Section, the broker shall refund to the
borrower the amount by which the fee was increased. If the fee
is financed into the residential mortgage loan, the broker
shall also refund to the borrower the interest charged to
finance the fee.
(d) The requirements of this Section do not apply to a
licensee providing a notice of change in loan terms pursuant to
the federal Consumer Financial Protection Bureau's Know Before
You Owe mortgage disclosure procedure pursuant to the federal
Truth in Lending Act and amendments promulgated under 12 CFR
1026 and the federal Real Estate Settlement Procedures Act and
amendments promulgated under 12 CFR 1024. Licensees limited to
soliciting residential mortgage loan applications as approved
by the Director under Title 38, Section 1050.2115(c)(1) of the
Illinois Administrative Code are not required to provide the
disclosures under this Section as long as the solicitor does
not discuss the terms and conditions with the potential
borrower.
(Source: P.A. 95-691, eff. 6-1-08.)
(205 ILCS 635/7-1A)
Sec. 7-1A. Mortgage loan originator license.
(a) It is unlawful for any individual to act or assume to
act as a mortgage loan originator, as defined in subsection
(jj) of Section 1-4 of this Act, without obtaining a license
from the Director, unless the individual is exempt under
subsection (c) of this Section. It is unlawful for any
individual who holds a mortgage loan originator license to
provide short sale facilitation services unless he or she holds
a license under the Real Estate License Act of 2000. Each
licensed mortgage loan originator must register with and
maintain a valid unique identifier issued by the Nationwide
Multistate Mortgage Licensing System and Registry.
(b) (Blank). In order to facilitate an orderly transition
to licensing and minimize disruption in the mortgage
marketplace, the operability date for subsection (a) of this
Section shall be as provided in this subsection (b). For this
purpose, the Director may require submission of licensing
information to the Nationwide Mortgage Licensing System and
Registry prior to the operability dates designated by the
Director pursuant to items (1) and (2) of this subsection (b).
(1) For all individuals other than individuals
described in item (2) of this subsection (b), the
operability date as designated by the Director shall be no
later than July 31, 2010, or any date approved by the
Secretary of the U.S. Department of Housing and Urban
Development, pursuant to the authority granted under
federal Public Law 110-289, Section 1508.
(2) For all individuals registered as loan originators
as of the effective date of this amendatory Act of the 96th
General Assembly, the operability date as designated by the
Director shall be no later than January 1, 2011, or any
date approved by the Secretary of the U.S. Department of
Housing and Urban Development, pursuant to the authority
granted under Public Law 110-289, Section 1508.
(3) For all individuals described in item (1) or (2) of
this subsection (b) who are loss mitigation specialists
employed by servicers, the operability date shall be July
31, 2011, or any date approved by the Secretary of the U.S.
Department of Housing and Urban Development pursuant to
authority granted under Public Law 110-289, Section 1508.
(c) The following, when engaged in the following
activities, are exempt from this Act:
(1) Registered mortgage loan originators, when acting
for an entity described in subsection (tt) of Section 1-4.
(2) Any individual who offers or negotiates terms of a
residential mortgage loan with or on behalf of an immediate
family member of the individual.
(3) Any individual who offers or negotiates terms of a
residential mortgage loan secured by a dwelling that served
as the individual's residence.
(4) A licensed attorney who negotiates the terms of a
residential mortgage loan on behalf of a client as an
ancillary matter to the attorney's representation of the
client, unless the attorney is compensated by a lender, a
mortgage broker, or other mortgage loan originator or by
any agent of a lender, mortgage broker, or other mortgage
loan originator.
(5) Any individual described in paragraph (2.2) of
subsection (d) of Section 1-4.
(d) A loan processor or underwriter who is an independent
contractor may not engage in the activities of a loan processor
or underwriter unless he or she obtains and maintains a license
under subsection (a) of this Section. Each independent
contractor loan processor or underwriter licensed as a mortgage
loan originator must have and maintain a valid unique
identifier issued by the Nationwide Multistate Mortgage
Licensing System and Registry.
(e) For the purposes of implementing an orderly and
efficient licensing process, the Director may establish
licensing rules or regulations and interim procedures for
licensing and acceptance of applications. For previously
registered or licensed individuals, the Director may establish
expedited review and licensing procedures.
(Source: P.A. 96-112, eff. 7-31-09; 97-891, eff. 8-3-12.)
(205 ILCS 635/7-2)
Sec. 7-2. State license application and issuance.
(a) Applicants for a license shall apply in a form
prescribed by the Director. Each form shall contain content as
set forth by rule, regulation, instruction, or procedure of the
Director and may be changed or updated as necessary by the
Director in order to carry out the purposes of this Act.
(b) In order to fulfill the purposes of this Act, the
Director is authorized to establish relationships or contracts
with the Nationwide Multistate Mortgage Licensing System and
Registry or other entities designated by the Nationwide
Multistate Mortgage Licensing System and Registry to collect
and maintain records and process transaction fees or other fees
related to licensees or other persons subject to this Act.
(c) In connection with an application for licensing as a
mortgage loan originator, the applicant shall, at a minimum,
furnish to the Nationwide Multistate Mortgage Licensing System
and Registry information concerning the applicant's identity,
including the following:
(1) Fingerprints for submission to the Federal Bureau
of Investigation, and any governmental agency or entity
authorized to receive such information for a state,
national and international criminal history background
check.
(2) Personal history and experience in a form
prescribed by the Nationwide Multistate Mortgage Licensing
System and Registry, including the submission of
authorization for the Nationwide Multistate Mortgage
Licensing System and Registry and the Director to obtain:
(A) an independent credit report obtained from a
consumer reporting agency described in Section 603(p)
of the Fair Credit Reporting Act; and
(B) information related to any administrative,
civil, or criminal findings by any governmental
jurisdiction.
(d) For the purpose of this Section, and in order to reduce
the points of contact which the Federal Bureau of Investigation
may have to maintain for purposes of subsection (c) of this
Section, the Director may use the Nationwide Multistate
Mortgage Licensing System and Registry as a channeling agent
for requesting information from and distributing information
to the Department of Justice or any governmental agency.
(e) For the purposes of this Section and in order to reduce
the points of contact which the Director may have to maintain
for purposes of item (2) of subsection (c) of this Section, the
Director may use the Nationwide Multistate Mortgage Licensing
System and Registry as a channeling agent for requesting and
distributing information to and from any source so directed by
the Director.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/7-4)
Sec. 7-4. Pre-licensing and education of mortgage loan
originators.
(a) In order to meet the pre-licensing education
requirement referred to in item (4) of Section 7-3 of this Act
an individual shall complete at least 20 hours of education
approved in accordance with subsection (b) of this Section,
which shall include at least:
(1) 3 hours of Federal law and regulations;
(2) 3 hours of ethics, which shall include instruction
on fraud, consumer protection, and fair lending issues; and
(3) 2 hours of training related to lending standards
for the nontraditional mortgage product marketplace.
(b) For purposes of subsection (a) of this Section,
pre-licensing education courses shall be reviewed and approved
by the Nationwide Multistate Mortgage Licensing System and
Registry based upon reasonable standards. Review and approval
of a pre-licensing education course shall include review and
approval of the course provider.
(c) Nothing in this Section shall preclude any
pre-licensing education course, as approved by the Nationwide
Multistate Mortgage Licensing System and Registry, that is
provided by the employer of the applicant or an entity which is
affiliated with the applicant by an agency contract, or any
subsidiary or affiliate of such an employer or entity.
(d) Pre-licensing education may be offered in a classroom,
online, or by any other means approved by the Nationwide
Multistate Mortgage Licensing System and Registry.
(e) The pre-licensing education requirements approved by
the Nationwide Multistate Mortgage Licensing System and
Registry for the subjects listed in items (1) through (3) of
subsection (a) for any state shall be accepted as credit
towards completion of pre-licensing education requirements in
Illinois.
(f) An individual previously registered under this Act who
is applying to be licensed after the effective date of this
amendatory Act of the 96th General Assembly must prove that he
or she has completed all of the continuing education
requirements for the year in which the registration or license
was last held.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/7-5)
Sec. 7-5. Testing of mortgage loan originators.
(a) In order to meet the written test requirement referred
to in item (5) of Section 7-3, an individual shall pass, in
accordance with the standards established under this
subsection (a), a qualified written test developed by the
Nationwide Multistate Mortgage Licensing System and Registry
and administered by a test provider approved by the Nationwide
Multistate Mortgage Licensing System and Registry based upon
reasonable standards.
(b) A written test shall not be treated as a qualified
written test for purposes of subsection (a) of this Section
unless the test adequately measures the applicant's knowledge
and comprehension in appropriate subject areas, including:
(1) ethics;
(2) federal law and regulation pertaining to mortgage
origination;
(3) State law and regulation pertaining to mortgage
origination; and
(4) federal and State law and regulation, including
instruction on fraud, consumer protection, the
nontraditional mortgage marketplace, and fair lending
issues.
(c) Nothing in this Section shall prohibit a test provider
approved by the Nationwide Multistate Mortgage Licensing
System and Registry from providing a test at the location of
the employer of the applicant or the location of any subsidiary
or affiliate of the employer of the applicant, or the location
of any entity with which the applicant holds an exclusive
arrangement to conduct the business of a mortgage loan
originator.
(d) An individual shall not be considered to have passed a
qualified written test unless the individual achieves a test
score of not less than 75% correct answers to questions.
An individual may retake a test 3 consecutive times with
each consecutive taking occurring at least 30 days after the
preceding test.
After failing 3 consecutive tests, an individual shall wait
at least 6 months before taking the test again.
A licensed mortgage loan originator who fails to maintain a
valid license for a period of 5 years or longer shall retake
the test, not taking into account any time during which such
individual is a registered mortgage loan originator.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/7-6)
Sec. 7-6. Standards for license renewal.
(a) The minimum standards for license renewal for mortgage
loan originators shall include the following:
(1) The mortgage loan originator continues to meet the
minimum standards for license issuance under Section 7-3.
(2) The mortgage loan originator has satisfied the
annual continuing education requirements described in
Section 7-7.
(3) The mortgage loan originator has paid all required
fees for renewal of the license.
(b) The license of a mortgage loan originator failing to
satisfy the minimum standards for license renewal shall expire.
The Director may adopt procedures for the reinstatement of
expired licenses consistent with the standards established by
the Nationwide Multistate Mortgage Licensing System and
Registry.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/7-7)
Sec. 7-7. Continuing education for mortgage loan
originators.
(a) In order to meet the annual continuing education
requirements referred to in Section 7-6, a licensed mortgage
loan originator shall complete at least 8 hours of education
approved in accordance with subsection (b) of this Section,
which shall include at least:
(1) 3 hours of Federal law and regulations;
(2) 2 hours of ethics, which shall include instruction
on fraud, consumer protection, and fair lending issues; and
(3) 2 hours of training related to lending standards
for the nontraditional mortgage product marketplace.
(b) For purposes of this subsection (a), continuing
education courses shall be reviewed and approved by the
Nationwide Multistate Mortgage Licensing System and Registry
based upon reasonable standards. Review and approval of a
continuing education course shall include review and approval
of the course provider.
(c) Nothing in this Section shall preclude any education
course, as approved by the Nationwide Multistate Mortgage
Licensing System and Registry, that is provided by the employer
of the mortgage loan originator or an entity which is
affiliated with the mortgage loan originator by an agency
contract, or any subsidiary or affiliate of the employer or
entity.
(d) Continuing education may be offered either in a
classroom, online, or by any other means approved by the
Nationwide Multistate Mortgage Licensing System and Registry.
(e) A licensed mortgage loan originator:
(1) Except as provided in Section 7-6 and subsection
(i) of this Section, may only receive credit for a
continuing education course in the year in which the course
is taken; and
(2) May not take the same approved course in the same
or successive years to meet the annual requirements for
continuing education.
(f) A licensed mortgage loan originator who is an approved
instructor of an approved continuing education course may
receive credit for the licensed mortgage loan originator's own
annual continuing education requirement at the rate of 2 hours
credit for every one hour taught.
(g) A person having successfully completed the education
requirements approved by the Nationwide Multistate Mortgage
Licensing System and Registry for the subjects listed in
subsection (a) of this Section for any state shall be accepted
as credit towards completion of continuing education
requirements in this State.
(h) A licensed mortgage loan originator who subsequently
becomes unlicensed must complete the continuing education
requirements for the last year in which the license was held
prior to issuance of a new or renewed license.
(i) A person meeting the requirements of Section 7-6 may
make up any deficiency in continuing education as established
by rule or regulation of the Director.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/7-8)
Sec. 7-8. Authority to require license. In addition to any
other duties imposed upon the Director by law, the Director
shall require mortgage loan originators to be licensed and
registered through the Nationwide Multistate Mortgage
Licensing System and Registry. In order to carry out this
requirement the Director is authorized to participate in the
Nationwide Multistate Mortgage Licensing System and Registry.
For this purpose, the Director may establish by agreement,
order or rule requirements as necessary, including, but not
limited to, the following:
(1) Background checks for:
(A) criminal history through fingerprint or other
databases;
(B) civil or administrative records;
(C) credit history; or
(D) any other information as deemed necessary by
the Nationwide Multistate Mortgage Licensing System
and Registry.
(2) The payment of fees to apply for or renew licenses
through the Nationwide Multistate Mortgage Licensing
System and Registry;
(3) The setting or resetting as necessary of renewal or
reporting dates; and
(4) Requirements for amending or surrendering a
license or any other such activities as the Director deems
necessary for participation in the Nationwide Multistate
Mortgage Licensing System and Registry.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/7-9)
Sec. 7-9. Report to Nationwide Multistate Mortgage
Licensing System and Registry. Subject to State privacy laws,
the Director is required to report regularly violations of this
Act, as well as enforcement actions and other relevant
information, to the Nationwide Multistate Mortgage Licensing
System and Registry subject to the provisions contained in
Section 4-8.1A of this Act.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/7-10)
Sec. 7-10. Nationwide Multistate Mortgage Licensing System
and Registry information challenge process. The Director shall
establish a process whereby mortgage loan originators may
challenge information entered into the Nationwide Multistate
Mortgage Licensing System and Registry by the Director.
(Source: P.A. 96-112, eff. 7-31-09.)
(205 ILCS 635/7-13)
Sec. 7-13. Prohibited acts and practices for mortgage loan
originators. It is a violation of this Act for an individual
subject to this Act to:
(1) Directly or indirectly employ any scheme, device,
or artifice to defraud or mislead borrowers or lenders or
to defraud any person.
(2) Engage in any unfair or deceptive practice toward
any person.
(3) Obtain property by fraud or misrepresentation.
(4) Solicit or enter into a contract with a borrower
that provides in substance that the person or individual
subject to this Act may earn a fee or commission through
"best efforts" to obtain a loan even though no loan is
actually obtained for the borrower.
(5) Solicit, advertise, or enter into a contract for
specific interest rates, points, or other financing terms
unless the terms are actually available at the time of
soliciting, advertising, or contracting.
(6) Conduct any business covered by this Act without
holding a valid license as required under this Act, or
assist or aid and abet any person in the conduct of
business under this Act without a valid license as required
under this Act.
(7) Fail to make disclosures as required by this Act
and any other applicable State or federal law, including
regulations thereunder.
(8) Fail to comply with this Act or rules or
regulations promulgated under this Act, or fail to comply
with any other state or federal law, including the rules
and regulations thereunder, applicable to any business
authorized or conducted under this Act.
(9) Make, in any manner, any false or deceptive
statement or representation of a material fact, or any
omission of a material fact, required on any document or
application subject to this Act.
(10) Negligently make any false statement or knowingly
and willfully make any omission of material fact in
connection with any information or report filed with a
governmental agency or the Nationwide Multistate Mortgage
Licensing System and Registry or in connection with any
investigation conducted by the Director or another
governmental agency.
(11) Make any payment, threat or promise, directly or
indirectly, to any person for the purpose of influencing
the independent judgment of the person in connection with a
residential mortgage loan, or make any payment threat or
promise, directly or indirectly, to any appraiser of a
property, for the purpose of influencing the independent
judgment of the appraiser with respect to the value of the
property.
(12) Collect, charge, attempt to collect or charge, or
use or propose any agreement purporting to collect or
charge any fee prohibited by this Act, including advance
fees for loan modification.
(13) Cause or require a borrower to obtain property
insurance coverage in an amount that exceeds the
replacement cost of the improvements as established by the
property insurer.
(14) Fail to truthfully account for monies belonging to
a party to a residential mortgage loan transaction.
(15) Engage in conduct that constitutes dishonest
dealings.
(16) Knowingly instruct, solicit, propose, or cause a
person other than the borrower to sign a borrower's
signature on a mortgage related document, or solicit,
accept or execute any contract or other document related to
the residential mortgage transaction that contains any
blanks to be filled in after signing or initialing the
contract or other document, except for forms authorizing
the verification of application information.
(17) Discourage any applicant from seeking or
participating in housing or financial counseling either
before or after the consummation of a loan transaction, or
fail to provide information on counseling resources upon
request.
(18) Charge for any ancillary products or services, not
essential to the basic loan transaction for which the
consumer has applied, without the applicant's knowledge
and written authorization, or charge for any ancillary
products or services not actually provided in the
transaction.
(19) Fail to give reasonable consideration to a
borrower's ability to repay the debt.
(20) Interfere or obstruct an investigation or
examination conducted pursuant to this Act.
(21) Structure activities or contracts to evade
provisions of this Act.
(Source: P.A. 96-112, eff. 7-31-09; 97-891, eff. 8-3-12.)
(205 ILCS 635/7-1 rep.)
Section 15. The Residential Mortgage License Act of 1987 is
amended by repealing Section 7-1.