Section 1050.1280  Counseling Prior to Perfecting Foreclosure Proceedings

a)         In the event that a high risk home loan becomes delinquent by more than 30 days, the servicer shall send a notice advising the borrower that he or she may wish to seek consumer credit counseling.

b)         The notice required in subsection (a) shall, at a minimum, include the following language:

            "YOUR LOAN IS OR WAS MORE THAN 30 DAYS PAST DUE.  YOU MAY BE EXPERIENCING FINANCIAL DIFFICULTY.  IT MAY BE IN YOUR BEST INTEREST TO SEEK APPROVED CONSUMER CREDIT COUNSELING.  A LIST OF APPROVED CREDIT COUNSELORS MAY BE OBTAINED FROM THE ILLINOIS DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION-DIVISION OF BANKING."

c)         If, within 15 days after mailing the notice provided for under subsection (b), a lender or its agent is notified in writing by an approved consumer credit counselor and the approved consumer credit counselor advises the lender or its agent that the borrower is seeking approved consumer credit counseling, then the lender and its agent shall not institute legal action under Part 15 of Article XV of the Code of Civil Procedure for 30 days from the date of that notice.  Only one such 30-day period of forbearance is allowed under this Section per subject loan.

d)         If, within the 30-day period provided under subsection (c), the lender or its agent, the approved consumer credit counselor, and the borrower agree to a debt management plan, then the lender and its agent shall not institute legal action under Part 15 of Article XV of the Code of Civil Procedure for so long as the debt management plan is complied with by the borrower.

1)         The agreed debt management plan must be in writing and signed by the lender or its agent, the approved consumer credit counselor, and the borrower.  No modification of an approved debt management plan can be made without the mutual agreement of the lender or its agent, the approved consumer credit counselor, and the borrower.

2)         Upon written notice to the lender or its agent, the borrower may change approved consumer credit counselors.

e)         If the borrower fails to comply with the agreed debt management plan, then nothing in this Subpart K shall be construed to impair the legal right of the lender or its agent to enforce contracts or mortgage agreements.

f)         This Section applies only to high risk home loans as defined by Section 1050.155.

(Source:  Amended at 29 Ill. Reg. 14808, effective September 26, 2005)