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Rep. Margo McDermed
Filed: 4/17/2018
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1 | | AMENDMENT TO HOUSE BILL 4404
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2 | | AMENDMENT NO. ______. Amend House Bill 4404, AS AMENDED, by |
3 | | replacing everything after the enacting clause with the |
4 | | following:
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5 | | "Section 5. The Residential Mortgage License Act of 1987 is |
6 | | amended by changing Sections 1-3 and 1-4 as follows: |
7 | | (205 ILCS 635/1-3) (from Ch. 17, par. 2321-3) |
8 | | Sec. 1-3. Necessity for license; scope of Act. |
9 | | (a) No person, partnership, association, corporation or |
10 | | other entity
shall engage in the business of brokering, |
11 | | funding, originating, servicing
or purchasing of residential |
12 | | mortgage loans without first obtaining a
license from the |
13 | | Secretary in accordance with the licensing procedure
provided |
14 | | in this Article I and such regulations as may be promulgated by
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15 | | the Secretary. The licensing provisions of this Section shall |
16 | | not apply
to any entity engaged solely in commercial mortgage |
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1 | | lending or
to any person, partnership association, corporation |
2 | | or other entity
exempted pursuant to Section 1-4, subsection |
3 | | (d), of this Act or in accordance
with regulations promulgated |
4 | | by the Secretary hereunder. No provision of this Act shall |
5 | | apply to an exempt person or entity as defined in items (1) and |
6 | | (1.5) of subsection (d) of Section 1-4 of this Act. |
7 | | Notwithstanding anything to the contrary in the preceding |
8 | | sentence, an individual acting as a mortgage loan originator |
9 | | who is not employed by and acting for an entity described in |
10 | | item (1) of subsection (tt) of Section 1-4 of this Act shall be |
11 | | subject to the mortgage loan originator licensing requirements |
12 | | of Article VII of this Act. |
13 | | Effective January 1, 2011, no provision of this Act shall |
14 | | apply to an exempt person or entity as defined in item (1.8) of |
15 | | subsection (d) of Section 1-4 of this Act. Notwithstanding |
16 | | anything to the contrary in the preceding sentence, an |
17 | | individual acting as a mortgage loan originator who is not |
18 | | employed by and acting for an entity described in item (1) of |
19 | | subsection (tt) of Section 1-4 of this Act shall be subject to |
20 | | the mortgage loan originator licensing requirements of Article |
21 | | VII of this Act, and provided that an individual acting as a |
22 | | mortgage loan originator under item (1.8) of subsection (d) of |
23 | | Section 1-4 of this Act shall be further subject to a |
24 | | determination by the U.S. Department of Housing and Urban |
25 | | Development through final rulemaking or other authorized |
26 | | agency determination under the federal Secure and Fair |
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1 | | Enforcement for Mortgage Licensing Act of 2008. |
2 | | (a-1) A person who is exempt from licensure pursuant to |
3 | | paragraph (ii) of item (1) of subsection (d) of Section 1-4 of |
4 | | this Act as a federally chartered savings bank that is |
5 | | registered with the Nationwide Multistate Mortgage Licensing |
6 | | System and Registry may apply to the Secretary for an exempt |
7 | | company registration for the purpose of sponsoring one or more |
8 | | individuals subject to the mortgage loan originator licensing |
9 | | requirements of Article VII of this Act. Registration with the |
10 | | Division of Banking of the Department shall not affect the |
11 | | exempt status of the applicant. |
12 | | (1) A mortgage loan originator eligible for licensure |
13 | | under this subsection shall (A) be covered under an |
14 | | exclusive written contract with, and originate residential |
15 | | mortgage loans solely on behalf of, that exempt person; and |
16 | | (B) hold a current, valid insurance producer license under |
17 | | Article XXXI of the Illinois Insurance Code. |
18 | | (2) An exempt person shall: (A) fulfill any reporting |
19 | | requirements required by the Nationwide Mortgage Licensing |
20 | | System and Registry or the Secretary; (B) provide a blanket |
21 | | surety bond pursuant to Section 7-12 of this Act covering |
22 | | the activities of all its sponsored mortgage loan |
23 | | originators; (C) reasonably supervise the activities of |
24 | | all its sponsored mortgage loan originators; (D) comply |
25 | | with all rules and orders (including the averments |
26 | | contained in Section 2-4 of this Act as applicable to a |
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1 | | non-licensed exempt entity provided for in this Section) |
2 | | that the Secretary deems necessary to ensure compliance |
3 | | with the federal SAFE Act; and (E) pay an annual |
4 | | registration fee established by the Director. |
5 | | (3) The Secretary may deny an exempt company |
6 | | registration to an exempt person or fine, suspend, or |
7 | | revoke an exempt company registration if the Secretary |
8 | | finds one of the following: |
9 | | (A) that the exempt person is not a person of |
10 | | honesty, truthfulness, or good character; |
11 | | (B) that the exempt person violated any applicable |
12 | | law, rule, or order; |
13 | | (C) that the exempt person refused or failed to |
14 | | furnish, within a reasonable time, any information or |
15 | | make any report that may be required by the Secretary; |
16 | | (D) that the exempt person had a final judgment |
17 | | entered against him or her in a civil action on grounds |
18 | | of fraud, deceit, or misrepresentation, and the |
19 | | conduct on which the judgment is based indicates that |
20 | | it would be contrary to the interest of the public to |
21 | | permit the exempt person to manage a loan originator; |
22 | | (E) that the exempt person had an order entered |
23 | | against him or her involving fraud, deceit, or |
24 | | misrepresentation by an administrative agency of this |
25 | | State, the federal government, or any other state or |
26 | | territory of the United States, and the facts relating |
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1 | | to the order indicate that it would be contrary to the |
2 | | interest of the public to permit the exempt person to |
3 | | manage a loan originator; |
4 | | (F) that the exempt person made a material |
5 | | misstatement or suppressed or withheld information on |
6 | | the application for an exempt company registration or |
7 | | any document required to be filed with the Secretary; |
8 | | or |
9 | | (G) that the exempt person violated Section 4-5 of |
10 | | this Act. |
11 | | (a-5) An entity that is exempt from licensure pursuant to |
12 | | item (7) of subsection (d) of Section 1-4 of this Act as an |
13 | | independent loan processing entity shall annually apply to the |
14 | | Secretary through the Nationwide Multistate Licensing System |
15 | | and Registry for an exempt company registration for the purpose |
16 | | of sponsoring one or more individuals subject to the mortgage |
17 | | loan originator licensing requirements of Article VII of this |
18 | | Act. A loan processor who performs clerical or support duties |
19 | | at the direction of and subject to the supervision and |
20 | | instruction of a licensed mortgage loan originator sponsored by |
21 | | an independent loan processing entity shall be exempt from his |
22 | | or her own licensing as a mortgage loan originator. An |
23 | | independent loan processing entity shall not be subject to |
24 | | examination by the Secretary. The Secretary may adopt rules to |
25 | | implement any provisions necessary for the administration of |
26 | | this subsection. |
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1 | | (b) No person, partnership, association, corporation, or |
2 | | other entity
except a licensee under this Act or an entity |
3 | | exempt from licensing
pursuant to Section 1-4, subsection (d), |
4 | | of this Act shall do any business
under any name or title, or |
5 | | circulate or use any advertising or make any
representation or |
6 | | give any information to any person, which indicates or
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7 | | reasonably implies activity within the scope
of this Act. |
8 | | (c) The Secretary may, through the Attorney General, |
9 | | request the circuit
court of either Cook or Sangamon County to |
10 | | issue an injunction to restrain
any person from violating or |
11 | | continuing to violate any of the foregoing
provisions of this |
12 | | Section. |
13 | | (d) When the Secretary has reasonable cause to believe that |
14 | | any
entity which has not submitted an application for licensure |
15 | | is conducting
any of the activities described in subsection (a) |
16 | | hereof, the Secretary
shall have the power to examine all books |
17 | | and records of the entity and any
additional documentation |
18 | | necessary in order to determine whether such
entity should |
19 | | become licensed under this Act. |
20 | | (d-1) The Secretary may issue orders against any person if |
21 | | the Secretary has reasonable cause to believe that an unsafe, |
22 | | unsound, or unlawful practice has occurred, is occurring, or is |
23 | | about to occur, if any person has violated, is violating, or is |
24 | | about to violate any law, rule, or written agreement with the |
25 | | Secretary, or for the purposes of administering the provisions |
26 | | of this Act and any rule adopted in accordance with this Act.
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1 | | (e) Any person, partnership, association, corporation or |
2 | | other entity
who violates any provision of this Section commits |
3 | | a business offense and
shall be fined an amount not to exceed |
4 | | $25,000. A mortgage loan brokered, funded, originated, |
5 | | serviced, or purchased by a party who is not licensed under |
6 | | this Section shall not be held to be invalid solely on the |
7 | | basis of a violation under this Section. The changes made to |
8 | | this Section by this amendatory Act of the 99th General |
9 | | Assembly are declarative of existing law. |
10 | | (f) Each person, partnership, association, corporation or |
11 | | other entity
conducting activities regulated by this Act shall |
12 | | be issued one license.
Each office, place of business or |
13 | | location at which a residential mortgage
licensee conducts any |
14 | | part of his or her business must
be recorded with the Secretary |
15 | | pursuant to Section 2-8 of this Act. |
16 | | (g) Licensees under this Act shall solicit, broker, fund, |
17 | | originate,
service and purchase residential mortgage loans |
18 | | only in conformity with the
provisions of this Act and such |
19 | | rules and regulations as may be promulgated
by the Secretary. |
20 | | (h) This Act applies to all entities doing business in |
21 | | Illinois as
residential mortgage bankers, as defined by "An Act |
22 | | to provide for the
regulation of mortgage bankers", approved |
23 | | September 15, 1977, as amended,
regardless of whether licensed |
24 | | under that or any prior Act. Any existing
residential mortgage |
25 | | lender or residential mortgage broker in Illinois
whether or |
26 | | not previously licensed, must operate in accordance with this |
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1 | | Act. |
2 | | (i) This Act is a successor Act to and a continuance of the |
3 | | regulation
of residential mortgage bankers provided in, "An Act |
4 | | to provide for the
regulation of mortgage bankers", approved |
5 | | September 15, 1977, as amended. |
6 | | Entities and persons subject to the predecessor Act shall |
7 | | be subject to
this Act from and after its effective date. |
8 | | (Source: P.A. 98-492, eff. 8-16-13; 99-113, eff. 7-23-15.) |
9 | | (205 ILCS 635/1-4) |
10 | | Sec. 1-4. Definitions. The following words and phrases have |
11 | | the meanings given to them in this Section: |
12 | | (a) "Residential real property" or "residential real |
13 | | estate" shall mean any real property located in Illinois, |
14 | | upon which is constructed or intended to be constructed a |
15 | | dwelling. Those terms include a manufactured home as |
16 | | defined in subdivision (53) of Section 9-102 of the Uniform |
17 | | Commercial Code which is real property as defined in |
18 | | Section 5-35 of the Conveyance and Encumbrance of |
19 | | Manufactured Homes as Real Property and Severance Act. |
20 | | (b) "Making a residential mortgage loan" or "funding a |
21 | | residential mortgage
loan" shall mean for compensation or |
22 | | gain, either directly or indirectly,
advancing funds or |
23 | | making a commitment to advance funds to a loan applicant
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24 | | for a residential mortgage loan. |
25 | | (c) "Soliciting, processing, placing, or negotiating a |
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1 | | residential
mortgage loan" shall mean for compensation or |
2 | | gain, either directly or
indirectly, accepting or offering |
3 | | to accept an application for a
residential mortgage loan, |
4 | | assisting or offering to assist in the
processing of an |
5 | | application for a residential mortgage loan on behalf of a
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6 | | borrower, or negotiating or offering to negotiate the terms |
7 | | or conditions
of a residential mortgage loan with a lender |
8 | | on behalf of a borrower
including, but not limited to, the |
9 | | submission of credit packages for the
approval of lenders, |
10 | | the preparation of residential mortgage loan closing
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11 | | documents, including a closing in the name of a broker. |
12 | | (d) "Exempt person or entity" shall mean the following: |
13 | | (1) (i) Any banking organization or foreign |
14 | | banking corporation
licensed by the Illinois |
15 | | Commissioner of Banks and Real Estate or the
United |
16 | | States Comptroller of the Currency to transact |
17 | | business in this
State; (ii) any national bank, |
18 | | federally chartered savings and loan
association, |
19 | | federal savings bank, federal credit union; (iii) |
20 | | (blank); (iv) any bank, savings and loan
association, |
21 | | savings bank, or credit union organized under the laws |
22 | | of this
or any other state; (v) any Illinois Consumer |
23 | | Installment Loan Act licensee;
(vi) any insurance |
24 | | company authorized to transact business in this State;
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25 | | (vii) any entity engaged solely in commercial mortgage |
26 | | lending; (viii) any
service corporation of a savings |
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1 | | and loan association or savings bank organized
under |
2 | | the laws of this State or the service corporation of a |
3 | | federally
chartered savings and loan association or |
4 | | savings bank having
its principal place of business in |
5 | | this State, other than a service
corporation licensed |
6 | | or entitled to reciprocity under the Real Estate
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7 | | License Act of 2000; or (ix) any first tier subsidiary |
8 | | of a
bank, the charter of which is issued under the |
9 | | Illinois Banking Act
by the Illinois Commissioner of |
10 | | Banks and Real Estate,
or the first tier subsidiary of |
11 | | a bank chartered by the United States
Comptroller of |
12 | | the Currency and that has its principal place of |
13 | | business
in this State, provided that the first tier |
14 | | subsidiary is regularly
examined by the Illinois |
15 | | Commissioner of Banks and Real Estate
or the |
16 | | Comptroller of the Currency, or a consumer compliance |
17 | | examination is
regularly conducted by the Federal |
18 | | Reserve Board. |
19 | | (1.5) Any employee of a person or entity mentioned |
20 | | in
item (1) of this subsection, when acting for such |
21 | | person or entity, or any registered mortgage loan |
22 | | originator when acting for an entity described in |
23 | | subsection (tt) of this Section. |
24 | | (1.8) Any person or entity that does not originate |
25 | | mortgage loans in the ordinary course of business, but |
26 | | makes or acquires residential mortgage loans with his |
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1 | | or her own funds for his or her or its own investment |
2 | | without intent to make, acquire, or resell more than 3 |
3 | | residential mortgage loans in any one calendar year. |
4 | | (2) (Blank). |
5 | | (3) Any person employed by a licensee to assist in |
6 | | the performance of
the residential mortgage licensee's |
7 | | activities regulated by this Act who is compensated in |
8 | | any manner by
only one licensee. |
9 | | (4) (Blank). |
10 | | (5) Any individual, corporation, partnership, or |
11 | | other entity that
originates, services, or brokers |
12 | | residential mortgage loans, as these
activities are |
13 | | defined in this Act, and who or which receives no
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14 | | compensation for those activities, subject to the |
15 | | Commissioner's
regulations and the federal Secure and |
16 | | Fair Enforcement for Mortgage Licensing Act of 2008 and |
17 | | the rules promulgated under that Act with regard to the |
18 | | nature and amount of compensation. |
19 | | (6) (Blank). |
20 | | (7) Any entity engaged solely in providing loan |
21 | | processing services through the sponsoring of |
22 | | individuals acting pursuant to subsection (d) of |
23 | | Section 7-1A of this Act. |
24 | | (e) "Licensee" or "residential mortgage licensee" |
25 | | shall mean a person,
partnership, association, |
26 | | corporation, or any other entity who or which is
licensed |
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1 | | pursuant to this Act to engage in the activities regulated |
2 | | by
this Act. |
3 | | (f) "Mortgage loan" "residential mortgage loan" or |
4 | | "home
mortgage loan" shall mean any loan primarily for |
5 | | personal, family, or household use that is secured by a |
6 | | mortgage, deed of trust, or other equivalent consensual |
7 | | security interest on a dwelling as defined in Section |
8 | | 103(v) of the federal Truth in Lending Act, or residential |
9 | | real estate upon which is constructed or intended to be |
10 | | constructed a dwelling. |
11 | | (g) "Lender" shall mean any person, partnership, |
12 | | association,
corporation, or any other entity who either |
13 | | lends or invests money in
residential mortgage loans. |
14 | | (h) "Ultimate equitable owner" shall mean a person who, |
15 | | directly
or indirectly, owns or controls an ownership |
16 | | interest in a corporation,
foreign corporation, alien |
17 | | business organization, trust, or any other form
of business |
18 | | organization regardless of whether the person owns or |
19 | | controls
the ownership interest through one or more persons |
20 | | or one or more proxies,
powers of attorney, nominees, |
21 | | corporations, associations, partnerships,
trusts, joint |
22 | | stock companies, or other entities or devices, or any
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23 | | combination thereof. |
24 | | (i) "Residential mortgage financing transaction" shall |
25 | | mean the negotiation,
acquisition, sale, or arrangement |
26 | | for or the offer to negotiate, acquire,
sell, or arrange |
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1 | | for, a residential mortgage loan or residential mortgage
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2 | | loan commitment. |
3 | | (j) "Personal residence address" shall mean a street |
4 | | address and shall
not include a post office box number. |
5 | | (k) "Residential mortgage loan commitment" shall mean |
6 | | a contract for
residential mortgage loan financing. |
7 | | (l) "Party to a residential mortgage financing |
8 | | transaction" shall mean a
borrower, lender, or loan broker |
9 | | in a residential mortgage financing
transaction. |
10 | | (m) "Payments" shall mean payment of all or any of the |
11 | | following:
principal, interest and escrow reserves for |
12 | | taxes, insurance and other related
reserves, and |
13 | | reimbursement for lender advances. |
14 | | (n) "Commissioner" shall mean the Commissioner of |
15 | | Banks and Real Estate, except that, beginning on April 6, |
16 | | 2009 (the effective date of Public Act 95-1047), all |
17 | | references in this Act to the Commissioner of Banks and |
18 | | Real Estate are deemed, in appropriate contexts, to be |
19 | | references to the Secretary of Financial and Professional |
20 | | Regulation, or his or her designee, including the Director |
21 | | of the Division of Banking of the Department of Financial |
22 | | and Professional Regulation. |
23 | | (n-1) "Director" shall mean the Director of the |
24 | | Division of Banking of the Department of Financial and |
25 | | Professional Regulation, except that, beginning on July |
26 | | 31, 2009 (the effective date of Public Act 96-112), all |
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1 | | references in this Act to the Director are deemed, in |
2 | | appropriate contexts, to be the Secretary of Financial and |
3 | | Professional Regulation, or his or her designee, including |
4 | | the Director of the Division of Banking of the Department |
5 | | of Financial and Professional Regulation. |
6 | | (o) "Loan brokering", "brokering", or "brokerage |
7 | | service" shall mean the act
of helping to obtain from |
8 | | another entity, for a borrower, a loan secured by
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9 | | residential real estate situated in Illinois or assisting a |
10 | | borrower in
obtaining a loan secured by residential real |
11 | | estate situated in Illinois in
return for consideration to |
12 | | be paid by either the borrower or the lender
including, but |
13 | | not limited to, contracting for the delivery of residential
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14 | | mortgage loans to a third party lender and soliciting, |
15 | | processing, placing,
or negotiating residential mortgage |
16 | | loans. |
17 | | (p) "Loan broker" or "broker" shall mean a person, |
18 | | partnership,
association, corporation, or limited |
19 | | liability company, other than
those persons, partnerships,
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20 | | associations, corporations, or limited liability companies |
21 | | exempted
from licensing pursuant to Section
1-4, |
22 | | subsection (d), of this Act, who performs the activities |
23 | | described
in subsections (c), (o), and (yy) of this |
24 | | Section. |
25 | | (q) "Servicing" shall mean the collection or |
26 | | remittance for or the
right or obligation to collect or |
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1 | | remit for any lender, noteowner,
noteholder, or for a |
2 | | licensee's own account, of payments, interests,
principal, |
3 | | and trust items such as hazard insurance and taxes on a
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4 | | residential mortgage loan in accordance with the terms of |
5 | | the residential
mortgage loan; and includes loan payment |
6 | | follow-up, delinquency loan
follow-up, loan analysis and |
7 | | any notifications to the borrower that are
necessary to |
8 | | enable the borrower to keep the loan current and in good |
9 | | standing. "Servicing" includes management of third-party |
10 | | entities acting on behalf of a residential mortgage |
11 | | licensee for the collection of delinquent payments and the |
12 | | use by such third-party entities of said licensee's |
13 | | servicing records or information, including their use in |
14 | | foreclosure. |
15 | | (r) "Full service office" shall mean an office, |
16 | | provided by the licensee and not subleased from the |
17 | | licensee's employees, and staff in Illinois
reasonably |
18 | | adequate to handle efficiently communications, questions, |
19 | | and
other matters relating to any application for, or an |
20 | | existing home mortgage
secured by residential real estate |
21 | | situated in Illinois
with respect to which the licensee is |
22 | | brokering, funding originating,
purchasing, or servicing. |
23 | | The management and operation of each full service
office |
24 | | must include observance of good business practices such as |
25 | | proper signage; adequate,
organized, and accurate books |
26 | | and records; ample phone lines, hours of
business, staff |
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1 | | training and supervision, and provision for a mechanism to
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2 | | resolve consumer inquiries, complaints, and problems. The |
3 | | Commissioner
shall issue regulations with regard to these |
4 | | requirements and shall include
an evaluation of compliance |
5 | | with this Section in his or her periodic
examination of |
6 | | each licensee. |
7 | | (s) "Purchasing" shall mean the purchase of |
8 | | conventional or
government-insured mortgage loans secured |
9 | | by residential real estate
situated in Illinois from either |
10 | | the lender or from the secondary market. |
11 | | (t) "Borrower" shall mean the person or persons who |
12 | | seek the services of
a loan broker, originator, or lender. |
13 | | (u) "Originating" shall mean the issuing of |
14 | | commitments for and funding of
residential mortgage loans. |
15 | | (v) "Loan brokerage agreement" shall mean a written |
16 | | agreement in which a
broker or loan broker agrees to do |
17 | | either of the following: |
18 | | (1) obtain a residential mortgage loan for the |
19 | | borrower or assist the
borrower in obtaining a |
20 | | residential mortgage loan; or |
21 | | (2) consider making a residential mortgage loan to |
22 | | the borrower. |
23 | | (w) "Advertisement" shall mean the attempt by |
24 | | publication,
dissemination, or circulation to induce, |
25 | | directly or indirectly,
any person to enter into a |
26 | | residential mortgage loan agreement or
residential |
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1 | | mortgage loan brokerage agreement relative to a
mortgage |
2 | | secured by residential real estate situated in Illinois. |
3 | | (x) "Residential Mortgage Board" shall mean the |
4 | | Residential Mortgage
Board created in Section 1-5 of this |
5 | | Act. |
6 | | (y) "Government-insured mortgage loan" shall mean any |
7 | | mortgage loan made
on the security of residential real |
8 | | estate insured by the Department of
Housing and Urban |
9 | | Development or Farmers Home Loan Administration, or
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10 | | guaranteed by the Veterans Administration. |
11 | | (z) "Annual audit" shall mean a certified audit of the |
12 | | licensee's books and
records and systems of internal |
13 | | control performed by a certified public
accountant in |
14 | | accordance with generally accepted accounting principles
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15 | | and generally accepted auditing standards. |
16 | | (aa) "Financial institution" shall mean a savings and |
17 | | loan
association, savings bank, credit union, or a bank |
18 | | organized under the
laws of Illinois or a savings and loan |
19 | | association, savings bank,
credit union or a bank organized |
20 | | under the laws of the United States and
headquartered in |
21 | | Illinois. |
22 | | (bb) "Escrow agent" shall mean a third party, |
23 | | individual or entity
charged with the fiduciary obligation |
24 | | for holding escrow funds on a
residential mortgage loan |
25 | | pending final payout of those funds
in accordance with the |
26 | | terms of the residential mortgage loan. |
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1 | | (cc) "Net worth" shall have the meaning ascribed |
2 | | thereto in Section 3-5
of this Act. |
3 | | (dd) "Affiliate" shall mean: |
4 | | (1) any entity that directly controls or is |
5 | | controlled by the licensee
and any other company that |
6 | | is directly affecting activities regulated by
this Act |
7 | | that is controlled by the company that controls the |
8 | | licensee; |
9 | | (2) any entity: |
10 | | (A) that is controlled, directly or |
11 | | indirectly, by a trust or otherwise,
by or for the |
12 | | benefit of shareholders who beneficially or |
13 | | otherwise
control, directly or indirectly, by |
14 | | trust or otherwise, the licensee or any
company |
15 | | that controls the licensee; or |
16 | | (B) a majority of the directors or trustees of |
17 | | which constitute a
majority of the persons holding |
18 | | any such office with the licensee or any
company |
19 | | that controls the licensee; |
20 | | (3) any company, including a real estate |
21 | | investment trust, that is
sponsored and advised on a |
22 | | contractual basis by the licensee or any
subsidiary or |
23 | | affiliate of the licensee. |
24 | | (ee) "First tier subsidiary" shall be defined by |
25 | | regulation
incorporating the comparable definitions used |
26 | | by the Office of the
Comptroller of the Currency and the |
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1 | | Illinois Commissioner of Banks
and Real Estate. |
2 | | (ff) "Gross delinquency rate" means the quotient |
3 | | determined by dividing
(1) the sum of (i) the number of |
4 | | government-insured residential mortgage loans
funded or |
5 | | purchased by a licensee in the preceding calendar year that |
6 | | are
delinquent and (ii) the number of conventional |
7 | | residential mortgage loans
funded or purchased by the |
8 | | licensee in the preceding calendar year that are
delinquent |
9 | | by (2) the sum of (i) the number of government-insured |
10 | | residential
mortgage loans funded or purchased by the |
11 | | licensee in the preceding calendar
year and (ii) the number |
12 | | of conventional residential mortgage loans funded or
|
13 | | purchased by the licensee in the preceding calendar year. |
14 | | (gg) "Delinquency rate factor" means the factor set by |
15 | | rule of the
Commissioner that is multiplied by the average |
16 | | gross delinquency rate of
licensees, determined annually |
17 | | for the immediately preceding calendar year, for
the |
18 | | purpose of determining which licensees shall be examined by |
19 | | the
Commissioner pursuant to subsection (b) of Section 4-8 |
20 | | of this Act. |
21 | | (hh) "Loan originator" means any natural person who, |
22 | | for compensation or in
the expectation of compensation, |
23 | | either directly or indirectly makes, offers to
make, |
24 | | solicits, places, or negotiates a residential mortgage |
25 | | loan. This definition applies only to Section 7-1 of this |
26 | | Act. |
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1 | | (ii) "Confidential supervisory information" means any |
2 | | report of examination, visitation, or investigation |
3 | | prepared by the Commissioner under this Act, any report of |
4 | | examination visitation, or investigation prepared by the |
5 | | state regulatory authority of another state that examines a |
6 | | licensee, any document or record prepared or obtained in |
7 | | connection with or relating to any examination, |
8 | | visitation, or investigation, and any record prepared or |
9 | | obtained by the Commissioner to the extent that the record |
10 | | summarizes or contains information derived from any |
11 | | report, document, or record described in this subsection. |
12 | | "Confidential supervisory information" does not include |
13 | | any information or record routinely prepared by a licensee |
14 | | and maintained in the ordinary course of business or any |
15 | | information or record that is required to be made publicly |
16 | | available pursuant to State or federal law or rule.
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17 | | (jj) "Mortgage loan originator" means an individual |
18 | | who for compensation or gain or in the expectation of |
19 | | compensation or gain: |
20 | | (i) takes a residential mortgage loan application; |
21 | | or |
22 | | (ii) offers or negotiates terms of a residential |
23 | | mortgage loan. |
24 | | "Mortgage loan originator" includes an individual |
25 | | engaged in loan modification activities as defined in |
26 | | subsection (yy) of this Section. A mortgage loan originator |
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1 | | engaged in loan modification activities shall report those |
2 | | activities to the Department of Financial and Professional |
3 | | Regulation in the manner provided by the Department; |
4 | | however, the Department shall not impose a fee for |
5 | | reporting, nor require any additional qualifications to |
6 | | engage in those activities beyond those provided pursuant |
7 | | to this Act for mortgage loan originators. |
8 | | "Mortgage loan originator" does not include an |
9 | | individual engaged solely as a loan processor or |
10 | | underwriter except as otherwise provided in subsection (d) |
11 | | of Section 7-1A of this Act. |
12 | | "Mortgage loan originator" does not include a person or |
13 | | entity that only performs real estate brokerage activities |
14 | | and is licensed in accordance with the Real Estate License |
15 | | Act of 2000, unless the person or entity is compensated by |
16 | | a lender, a mortgage broker, or other mortgage loan |
17 | | originator, or by any agent of that lender, mortgage |
18 | | broker, or other mortgage loan originator. |
19 | | "Mortgage loan originator" does not include a person or |
20 | | entity solely involved in extensions of credit relating to |
21 | | timeshare plans, as that term is defined in Section |
22 | | 101(53D) of Title 11, United States Code. |
23 | | (kk) "Depository institution" has the same meaning as |
24 | | in Section 3 of the Federal Deposit Insurance Act, and |
25 | | includes any credit union. |
26 | | (ll) "Dwelling" means a residential structure or |
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1 | | mobile home which contains one to 4 family housing units, |
2 | | or individual units of condominiums or cooperatives. |
3 | | (mm) "Immediate family member" means a spouse, child, |
4 | | sibling, parent, grandparent, or grandchild, and includes |
5 | | step-parents, step-children, step-siblings, or adoptive |
6 | | relationships. |
7 | | (nn) "Individual" means a natural person. |
8 | | (oo) "Loan processor or underwriter" means an |
9 | | individual who performs clerical or support duties as an |
10 | | employee at the direction of and subject to the supervision |
11 | | and instruction of a person licensed, or exempt from |
12 | | licensing, under this Act. "Clerical or support duties" |
13 | | includes subsequent to the receipt of an application: |
14 | | (i) the receipt, collection, distribution, and |
15 | | analysis of information common for the processing or |
16 | | underwriting of a residential mortgage loan; and |
17 | | (ii) communicating with a consumer to obtain the |
18 | | information necessary for the processing or |
19 | | underwriting of a loan, to the extent that the |
20 | | communication does not include offering or negotiating |
21 | | loan rates or terms, or counseling consumers about |
22 | | residential mortgage loan rates or terms. An |
23 | | individual engaging solely in loan processor or |
24 | | underwriter activities shall not represent to the |
25 | | public, through advertising or other means of |
26 | | communicating or providing information, including the |
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1 | | use of business cards, stationery, brochures, signs, |
2 | | rate lists, or other promotional items, that the |
3 | | individual can or will perform any of the activities of |
4 | | a mortgage loan originator. |
5 | | (pp) "Nationwide Mortgage Licensing System and |
6 | | Registry" means a mortgage licensing system developed and |
7 | | maintained by the Conference of State Bank Supervisors and |
8 | | the American Association of Residential Mortgage |
9 | | Regulators for the licensing and registration of licensed |
10 | | mortgage loan originators. |
11 | | (qq) "Nontraditional mortgage product" means any |
12 | | mortgage product other than a 30-year fixed rate mortgage. |
13 | | (rr) "Person" means a natural person, corporation, |
14 | | company, limited liability company, partnership, or |
15 | | association. |
16 | | (ss) "Real estate brokerage activity" means any |
17 | | activity that involves offering or providing real estate |
18 | | brokerage services to the public, including: |
19 | | (1) acting as a real estate agent or real estate |
20 | | broker for a buyer, seller, lessor, or lessee of real |
21 | | property; |
22 | | (2) bringing together parties interested in the |
23 | | sale, purchase, lease, rental, or exchange of real |
24 | | property; |
25 | | (3) negotiating, on behalf of any party, any |
26 | | portion of a contract relating to the sale, purchase, |
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1 | | lease, rental, or exchange of real property, other than |
2 | | in connection with providing financing with respect to |
3 | | any such transaction; |
4 | | (4) engaging in any activity for which a person |
5 | | engaged in the activity is required to be registered or |
6 | | licensed as a real estate agent or real estate broker |
7 | | under any applicable law; or |
8 | | (5) offering to engage in any activity, or act in |
9 | | any capacity, described in this subsection (ss). |
10 | | (tt) "Registered mortgage loan originator" means any |
11 | | individual that: |
12 | | (1) meets the definition of mortgage loan |
13 | | originator and is an employee of: |
14 | | (A) a depository institution; |
15 | | (B) a subsidiary that is: |
16 | | (i) owned and controlled by a depository |
17 | | institution; and |
18 | | (ii) regulated by a federal banking |
19 | | agency; or |
20 | | (C) an institution regulated by the Farm |
21 | | Credit Administration; and |
22 | | (2) is registered with, and maintains a unique |
23 | | identifier through, the Nationwide Mortgage Licensing |
24 | | System and Registry. |
25 | | (uu) "Unique identifier" means a number or other |
26 | | identifier assigned by protocols established by the |
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1 | | Nationwide Mortgage Licensing System and Registry. |
2 | | (vv) "Residential mortgage license" means a license |
3 | | issued pursuant to Section 1-3, 2-2, or 2-6 of this Act. |
4 | | (ww) "Mortgage loan originator license" means a |
5 | | license issued pursuant to Section 7-1A, 7-3, or 7-6 of |
6 | | this Act. |
7 | | (xx) "Secretary" means the Secretary of the Department |
8 | | of Financial and Professional Regulation, or a person |
9 | | authorized by the Secretary or by this Act to act in the |
10 | | Secretary's stead. |
11 | | (yy) "Loan modification" means, for compensation or |
12 | | gain, either directly or indirectly offering or |
13 | | negotiating on behalf of a borrower or homeowner to adjust |
14 | | the terms of a residential mortgage loan in a manner not |
15 | | provided for in the original or previously modified |
16 | | mortgage loan. |
17 | | (zz) "Short sale facilitation" means, for compensation |
18 | | or gain, either directly or indirectly offering or |
19 | | negotiating on behalf of a borrower or homeowner to |
20 | | facilitate the sale of residential real estate subject to |
21 | | one or more residential mortgage loans or debts |
22 | | constituting liens on the property in which the proceeds |
23 | | from selling the residential real estate will fall short of |
24 | | the amount owed and the lien holders are contacted to agree |
25 | | to release their lien on the residential real estate and |
26 | | accept less than the full amount owed on the debt. |