| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
1 | AN ACT concerning regulation.
| |||||||||||||||||||
2 | Be it enacted by the People of the State of Illinois,
| |||||||||||||||||||
3 | represented in the General Assembly:
| |||||||||||||||||||
4 | Section 5. The Illinois Act on the Aging is amended by | |||||||||||||||||||
5 | changing Section 4.01 as follows:
| |||||||||||||||||||
6 | (20 ILCS 105/4.01) (from Ch. 23, par. 6104.01)
| |||||||||||||||||||
7 | Sec. 4.01. Additional powers and duties of the Department. | |||||||||||||||||||
8 | In addition
to powers and duties otherwise provided by law, the | |||||||||||||||||||
9 | Department shall have the
following powers and duties:
| |||||||||||||||||||
10 | (1) To evaluate all programs, services, and facilities for | |||||||||||||||||||
11 | the aged
and for minority senior citizens within the State and | |||||||||||||||||||
12 | determine the extent
to which present public or private | |||||||||||||||||||
13 | programs, services and facilities meet the
needs of the aged.
| |||||||||||||||||||
14 | (2) To coordinate and evaluate all programs, services, and | |||||||||||||||||||
15 | facilities
for the Aging and for minority senior citizens | |||||||||||||||||||
16 | presently furnished by State
agencies and make appropriate | |||||||||||||||||||
17 | recommendations regarding such services, programs
and | |||||||||||||||||||
18 | facilities to the Governor and/or the General Assembly.
| |||||||||||||||||||
19 | (2-a) To request, receive, and share information | |||||||||||||||||||
20 | electronically through the use of data-sharing agreements for | |||||||||||||||||||
21 | the purpose of (i) establishing and verifying the initial and | |||||||||||||||||||
22 | continuing eligibility of older adults to participate in | |||||||||||||||||||
23 | programs administered by the Department; (ii) maximizing |
| |||||||
| |||||||
1 | federal financial participation in State assistance | ||||||
2 | expenditures; and (iii) investigating allegations of fraud or | ||||||
3 | other abuse of publicly funded benefits. Notwithstanding any | ||||||
4 | other law to the contrary, but only for the limited purposes | ||||||
5 | identified in the preceding sentence, this paragraph (2-a) | ||||||
6 | expressly authorizes the exchanges of income, identification, | ||||||
7 | and other pertinent eligibility information by and among the | ||||||
8 | Department and the Social Security Administration, the | ||||||
9 | Department of Employment Security, the Department of | ||||||
10 | Healthcare and Family Services, the Department of Human | ||||||
11 | Services, the Department of Revenue, the Secretary of State, | ||||||
12 | the U.S. Department of Veterans Affairs, and any other | ||||||
13 | governmental entity. The confidentiality of information | ||||||
14 | otherwise shall be maintained as required by law. In addition, | ||||||
15 | the Department on Aging shall verify employment information at | ||||||
16 | the request of a community care provider for the purpose of | ||||||
17 | ensuring program integrity under the Community Care Program. | ||||||
18 | (3) To function as the sole State agency to develop a | ||||||
19 | comprehensive
plan to meet the needs of the State's senior | ||||||
20 | citizens and the State's
minority senior citizens.
| ||||||
21 | (4) To receive and disburse State and federal funds made | ||||||
22 | available
directly to the Department including those funds made | ||||||
23 | available under the
Older Americans Act and the Senior | ||||||
24 | Community Service Employment Program for
providing services | ||||||
25 | for senior citizens and minority senior citizens or for
| ||||||
26 | purposes related thereto, and shall develop and administer any |
| |||||||
| |||||||
1 | State Plan
for the Aging required by federal law.
| ||||||
2 | (5) To solicit, accept, hold, and administer in behalf of | ||||||
3 | the State
any grants or legacies of money, securities, or | ||||||
4 | property to the State of
Illinois for services to senior | ||||||
5 | citizens and minority senior citizens or
purposes related | ||||||
6 | thereto.
| ||||||
7 | (6) To provide consultation and assistance to communities, | ||||||
8 | area agencies
on aging, and groups developing local services | ||||||
9 | for senior citizens and
minority senior citizens.
| ||||||
10 | (7) To promote community education regarding the problems | ||||||
11 | of senior
citizens and minority senior citizens through | ||||||
12 | institutes, publications,
radio, television and the local | ||||||
13 | press.
| ||||||
14 | (8) To cooperate with agencies of the federal government in | ||||||
15 | studies
and conferences designed to examine the needs of senior | ||||||
16 | citizens and minority
senior citizens and to prepare programs | ||||||
17 | and facilities to meet those needs.
| ||||||
18 | (9) To establish and maintain information and referral | ||||||
19 | sources
throughout the State when not provided by other | ||||||
20 | agencies.
| ||||||
21 | (10) To provide the staff support that may reasonably be | ||||||
22 | required
by the Council.
| ||||||
23 | (11) To make and enforce rules and regulations necessary | ||||||
24 | and proper
to the performance of its duties.
| ||||||
25 | (12) To establish and fund programs or projects or | ||||||
26 | experimental facilities
that are specially designed as |
| |||||||
| |||||||
1 | alternatives to institutional care.
| ||||||
2 | (13) To develop a training program to train the counselors | ||||||
3 | presently
employed by the Department's aging network to provide | ||||||
4 | Medicare
beneficiaries with counseling and advocacy in | ||||||
5 | Medicare, private health
insurance, and related health care | ||||||
6 | coverage plans. The Department shall
report to the General | ||||||
7 | Assembly on the implementation of the training
program on or | ||||||
8 | before December 1, 1986.
| ||||||
9 | (14) To make a grant to an institution of higher learning | ||||||
10 | to study the
feasibility of establishing and implementing an | ||||||
11 | affirmative action
employment plan for the recruitment, | ||||||
12 | hiring, training and retraining of
persons 60 or more years old | ||||||
13 | for jobs for which their employment would not
be precluded by | ||||||
14 | law.
| ||||||
15 | (15) To present one award annually in each of the | ||||||
16 | categories of community
service, education, the performance | ||||||
17 | and graphic arts, and the labor force
to outstanding Illinois | ||||||
18 | senior citizens and minority senior citizens in
recognition of | ||||||
19 | their individual contributions to either community service,
| ||||||
20 | education, the performance and graphic arts, or the labor | ||||||
21 | force. The awards
shall be presented to 4 senior citizens and | ||||||
22 | minority senior citizens
selected from a list of 44 nominees | ||||||
23 | compiled annually by
the Department. Nominations shall be | ||||||
24 | solicited from senior citizens'
service providers, area | ||||||
25 | agencies on aging, senior citizens'
centers, and senior | ||||||
26 | citizens' organizations. The Department shall establish a |
| |||||||
| |||||||
1 | central location within
the State to be designated as the | ||||||
2 | Senior Illinoisans Hall of Fame for the
public display of all | ||||||
3 | the annual awards, or replicas thereof.
| ||||||
4 | (16) To establish multipurpose senior centers through area | ||||||
5 | agencies on
aging and to fund those new and existing | ||||||
6 | multipurpose senior centers
through area agencies on aging, the | ||||||
7 | establishment and funding to begin in
such areas of the State | ||||||
8 | as the Department shall designate by rule and as
specifically | ||||||
9 | appropriated funds become available.
| ||||||
10 | (17) To develop the content and format of a statement | ||||||
11 | regarding non-recourse reverse mortgage loans under Section | ||||||
12 | 6.1 of the Illinois Banking Act. The statement shall provide | ||||||
13 | independent consumer information regarding the potential | ||||||
14 | benefits and risks associated with non-recourse reverse | ||||||
15 | mortgages, potential alternatives to non-recourse reverse | ||||||
16 | mortgages, and the availability of independent counseling | ||||||
17 | services, including services provided by nonprofit agencies | ||||||
18 | certified by the federal government to provide required | ||||||
19 | counseling for non-recourse reverse mortgages insured by the | ||||||
20 | federal Government. To develop the content and format of the | ||||||
21 | acknowledgment regarding
non-recourse reverse mortgage loans | ||||||
22 | under Section 6.1 of the Illinois
Banking Act; to provide | ||||||
23 | independent consumer information on reverse
mortgages and | ||||||
24 | alternatives; and to refer consumers to independent
counseling | ||||||
25 | services with expertise in reverse mortgages.
| ||||||
26 | (18) To develop a pamphlet in English and Spanish which may |
| |||||||
| |||||||
1 | be used by
physicians licensed to practice medicine in all of | ||||||
2 | its branches pursuant
to the Medical Practice Act of 1987, | ||||||
3 | pharmacists licensed pursuant to the
Pharmacy Practice Act, and | ||||||
4 | Illinois residents 65 years of age or
older for the purpose of | ||||||
5 | assisting physicians, pharmacists, and patients in
monitoring | ||||||
6 | prescriptions provided by various physicians and to aid persons
| ||||||
7 | 65 years of age or older in complying with directions for | ||||||
8 | proper use of
pharmaceutical prescriptions. The pamphlet may | ||||||
9 | provide space for recording
information including but not | ||||||
10 | limited to the following:
| ||||||
11 | (a) name and telephone number of the patient;
| ||||||
12 | (b) name and telephone number of the prescribing | ||||||
13 | physician;
| ||||||
14 | (c) date of prescription;
| ||||||
15 | (d) name of drug prescribed;
| ||||||
16 | (e) directions for patient compliance; and
| ||||||
17 | (f) name and telephone number of dispensing pharmacy.
| ||||||
18 | In developing the pamphlet, the Department shall consult | ||||||
19 | with the
Illinois State Medical Society, the Center for | ||||||
20 | Minority Health Services,
the Illinois Pharmacists Association | ||||||
21 | and
senior citizens organizations. The Department shall | ||||||
22 | distribute the
pamphlets to physicians, pharmacists and | ||||||
23 | persons 65 years of age or older
or various senior citizen | ||||||
24 | organizations throughout the State.
| ||||||
25 | (19) To conduct a study of the feasibility of
implementing | ||||||
26 | the Senior Companion Program throughout the State.
|
| |||||||
| |||||||
1 | (20) The reimbursement rates paid through the community | ||||||
2 | care program
for chore housekeeping services and home care | ||||||
3 | aides
shall be the same.
| ||||||
4 | (21) From funds appropriated to the Department from the | ||||||
5 | Meals on Wheels
Fund, a special fund in the State treasury that | ||||||
6 | is hereby created, and in
accordance with State and federal | ||||||
7 | guidelines and the intrastate funding
formula, to make grants | ||||||
8 | to area agencies on aging, designated by the
Department, for | ||||||
9 | the sole purpose of delivering meals to homebound persons 60
| ||||||
10 | years of age and older.
| ||||||
11 | (22) To distribute, through its area agencies on aging, | ||||||
12 | information
alerting seniors on safety issues regarding | ||||||
13 | emergency weather
conditions, including extreme heat and cold, | ||||||
14 | flooding, tornadoes, electrical
storms, and other severe storm | ||||||
15 | weather. The information shall include all
necessary | ||||||
16 | instructions for safety and all emergency telephone numbers of
| ||||||
17 | organizations that will provide additional information and | ||||||
18 | assistance.
| ||||||
19 | (23) To develop guidelines for the organization and | ||||||
20 | implementation of
Volunteer Services Credit Programs to be | ||||||
21 | administered by Area Agencies on
Aging or community based | ||||||
22 | senior service organizations. The Department shall
hold public | ||||||
23 | hearings on the proposed guidelines for public comment, | ||||||
24 | suggestion,
and determination of public interest. The | ||||||
25 | guidelines shall be based on the
findings of other states and | ||||||
26 | of community organizations in Illinois that are
currently |
| |||||||
| |||||||
1 | operating volunteer services credit programs or demonstration
| ||||||
2 | volunteer services credit programs. The Department shall offer | ||||||
3 | guidelines for
all aspects of the programs including, but not | ||||||
4 | limited to, the following:
| ||||||
5 | (a) types of services to be offered by volunteers;
| ||||||
6 | (b) types of services to be received upon the | ||||||
7 | redemption of service
credits;
| ||||||
8 | (c) issues of liability for the volunteers and the | ||||||
9 | administering
organizations;
| ||||||
10 | (d) methods of tracking service credits earned and | ||||||
11 | service credits
redeemed;
| ||||||
12 | (e) issues of time limits for redemption of service | ||||||
13 | credits;
| ||||||
14 | (f) methods of recruitment of volunteers;
| ||||||
15 | (g) utilization of community volunteers, community | ||||||
16 | service groups, and
other resources for delivering | ||||||
17 | services to be received by service credit
program clients;
| ||||||
18 | (h) accountability and assurance that services will be | ||||||
19 | available to
individuals who have earned service credits; | ||||||
20 | and
| ||||||
21 | (i) volunteer screening and qualifications.
| ||||||
22 | The Department shall submit a written copy of the guidelines to | ||||||
23 | the General
Assembly by July 1, 1998.
| ||||||
24 | (24) To function as the sole State agency to receive and | ||||||
25 | disburse State and federal funds for providing adult protective | ||||||
26 | services in a domestic living situation in accordance with the |
| |||||||
| |||||||
1 | Adult Protective Services Act. | ||||||
2 | (25) To hold conferences, trainings, and other programs for | ||||||
3 | which the Department shall determine by rule a reasonable fee | ||||||
4 | to cover related administrative costs. Rules to implement the | ||||||
5 | fee authority granted by this paragraph (25) must be adopted in | ||||||
6 | accordance with all provisions of the Illinois Administrative | ||||||
7 | Procedure Act and all rules and procedures of the Joint | ||||||
8 | Committee on Administrative Rules; any purported rule not so | ||||||
9 | adopted, for whatever reason, is unauthorized. | ||||||
10 | (Source: P.A. 98-8, eff. 5-3-13; 98-49, eff. 7-1-13; 98-380, | ||||||
11 | eff. 8-16-13; 98-756, eff. 7-16-14.)
| ||||||
12 | Section 10. The Illinois Banking Act is amended by changing | ||||||
13 | Sections 6.1 and 6.2 and by adding Sections 6.3, 6.4, 6.5, 6.6, | ||||||
14 | 6.7, and 6.8 as follows:
| ||||||
15 | (205 ILCS 5/6.1) (from Ch. 17, par. 313.1)
| ||||||
16 | Sec. 6.1. Non-recourse reverse mortgage loans.
| ||||||
17 | (a) It is the intent of this amendatory Act of 1991 that | ||||||
18 | homeowners at
least 62 years of age be permitted to meet their | ||||||
19 | financial needs by
accessing the equity in their homes through | ||||||
20 | a reverse mortgage. The
General Assembly recognizes that many | ||||||
21 | restrictions and requirements that
exist to govern traditional | ||||||
22 | mortgage transactions are inapplicable in the
context of | ||||||
23 | reverse mortgages. In order to foster reverse mortgage
| ||||||
24 | transactions and better serve the citizens of this State, this |
| |||||||
| |||||||
1 | Section
authorizes the making of reverse mortgages, and | ||||||
2 | expressly relieves reverse
mortgage lenders and borrowers from | ||||||
3 | compliance with inappropriate requirements.
| ||||||
4 | As used in this Section, "borrower" means any homeowner who | ||||||
5 | is, or whose
spouse is, at least 62 years of age.
| ||||||
6 | (a) For purposes of this Section, "real property" includes | ||||||
7 | a manufactured home as defined in subdivision (53) of Section | ||||||
8 | 9-102 of the Uniform Commercial Code which is real property as | ||||||
9 | defined in Section 5-35 of the Conveyance and Encumbrance of | ||||||
10 | Manufactured Homes as Real Property and Severance Act. | ||||||
11 | As used in this Section, "reverse mortgage" means a | ||||||
12 | non-recourse loan,
secured by real property or a homestead | ||||||
13 | property , that complies with all of the following:
| ||||||
14 | (1) Provides cash advances to a borrower based on the | ||||||
15 | equity in a
borrower's owner-occupied principal residence, | ||||||
16 | provided that it is a
residence with designed to be | ||||||
17 | occupied by not more than 4 units families .
| ||||||
18 | (2) Requires no payment of principal or interest until | ||||||
19 | the entire loan
becomes due and payable.
| ||||||
20 | (b) Reverse mortgage loans shall be subject only to all of | ||||||
21 | the following
provisions:
| ||||||
22 | (1) Payment, in whole or in part, shall be permitted | ||||||
23 | without penalty
at any time during the term of the | ||||||
24 | mortgage.
| ||||||
25 | (2) A reverse mortgage may provide for an interest rate | ||||||
26 | that is fixed
or adjustable and may provide for interest |
| |||||||
| |||||||
1 | that is contingent on
appreciation in the value of the | ||||||
2 | property.
| ||||||
3 | (3) If a reverse mortgage provides for periodic | ||||||
4 | advances to a
borrower, the advances may not be reduced in | ||||||
5 | amount or number based on any
adjustment in the interest | ||||||
6 | rate.
| ||||||
7 | (4) A reverse mortgage may be subject to any additional | ||||||
8 | terms and
conditions imposed by a lender that are required | ||||||
9 | under the provisions of
the federal Housing and Community | ||||||
10 | Development Act of 1987 to enable the
lender to obtain | ||||||
11 | federal government insurance on the mortgage borrowers 62 | ||||||
12 | years of age or older if the loans
are to be insured under | ||||||
13 | that Act.
| ||||||
14 | (c) The repayment obligation under a reverse mortgage is | ||||||
15 | subject to all
of the following:
| ||||||
16 | (1) (Blank). Temporary absences from the home not | ||||||
17 | exceeding 60 consecutive days
shall not cause the mortgage | ||||||
18 | to become due and payable.
| ||||||
19 | (2) Temporary absences from the home exceeding 60 days, | ||||||
20 | but not
exceeding one year shall not cause the mortgage to | ||||||
21 | become due and payable ,
provided that the borrower has | ||||||
22 | taken action that secures the home in a
manner satisfactory | ||||||
23 | to the lender .
| ||||||
24 | (3) The lender must disclose any interest or other fees | ||||||
25 | to be charged
during the period that commences on the date | ||||||
26 | the mortgage becomes due and
payable and ends when |
| |||||||
| |||||||
1 | repayment in full is made in accordance with
applicable | ||||||
2 | State and federal laws, rules, and regulations.
| ||||||
3 | (d) A reverse mortgage shall become due and payable upon | ||||||
4 | the occurrence
of any of the following events:
| ||||||
5 | (1) The real property securing the loan is sold.
| ||||||
6 | (2) All borrowers cease to occupy the home as a | ||||||
7 | principal residence.
| ||||||
8 | (3) A fixed maturity date agreed to by the lender and | ||||||
9 | the borrower
is reached.
| ||||||
10 | (4) Default by the borrower in the performance of its | ||||||
11 | obligations under the loan agreement. An event that is | ||||||
12 | specified in the loan documents and that
jeopardizes the | ||||||
13 | lender's security occurs.
| ||||||
14 | (5) The death of the borrower, or, for homestead | ||||||
15 | properties in joint tenancy, the death of the last | ||||||
16 | surviving joint tenant who had an interest in the property | ||||||
17 | at the time the loan was initiated. | ||||||
18 | (e) (Blank). No reverse mortgage commitment may be made by | ||||||
19 | a lender unless the
loan applicant attests, in writing, that | ||||||
20 | the applicant has received from
the lender, at the time of | ||||||
21 | initial inquiry, a statement prepared by the
Department on | ||||||
22 | Aging regarding the advisability and availability of
| ||||||
23 | independent information and counseling services on reverse | ||||||
24 | mortgages.
| ||||||
25 | (f) For purposes of this Section, "homestead property" | ||||||
26 | means the domicile and contiguous real estate owned and |
| |||||||
| |||||||
1 | occupied by the borrower. | ||||||
2 | (g) For purposes of this Section, "real property" and | ||||||
3 | "homestead property" include a manufactured home as defined in | ||||||
4 | subdivision (53) of Section 9-102 of the Uniform Commercial | ||||||
5 | Code which is real property as defined in Section 5-35 of the | ||||||
6 | Conveyance and Encumbrance of Manufactured Homes as Real | ||||||
7 | Property and Severance Act. | ||||||
8 | (Source: P.A. 98-749, eff. 7-16-14.)
| ||||||
9 | (205 ILCS 5/6.2)
| ||||||
10 | Sec. 6.2. Non-recourse reverse mortgages; good faith | ||||||
11 | dealings; fraudulent or deceptive practices. Reverse mortgage; | ||||||
12 | disclosure. A licensee must act in good faith in all relations | ||||||
13 | with a borrower, including, but not limited to, transferring, | ||||||
14 | dealing in, offering, or making a reverse mortgage loan. No | ||||||
15 | licensee shall employ fraudulent or deceptive acts or practices | ||||||
16 | in the making of a reverse mortgage loan, including deceptive | ||||||
17 | marketing and sales efforts. At the time a reverse mortgage
| ||||||
18 | loan is made, the lender must provide to the mortgagor a | ||||||
19 | separate document
that informs the mortgagor that by obtaining | ||||||
20 | the reverse mortgage the
mortgagor's eligibility to obtain a | ||||||
21 | tax deferral under the Senior Citizens Real
Estate Tax Deferral | ||||||
22 | Act may be adversely affected. The mortgagor must sign
the | ||||||
23 | disclosure document as part of the reverse mortgage | ||||||
24 | transaction.
| ||||||
25 | (Source: P.A. 92-577, eff. 6-26-02.)
|
| |||||||
| |||||||
1 | (205 ILCS 5/6.3 new) | ||||||
2 | Sec. 6.3. Non-recourse reverse mortgages; counseling | ||||||
3 | disclosure. At the time of initial inquiry regarding a reverse | ||||||
4 | mortgage, a licensee must provide to the borrower a document | ||||||
5 | regarding reverse mortgage counseling. The licensee may not | ||||||
6 | steer, direct, recommend, or otherwise encourage a client to | ||||||
7 | seek the services of any one particular counselor or counseling | ||||||
8 | agency. This document shall be in at least 12-point font, | ||||||
9 | contain contact information (including agency name, address, | ||||||
10 | telephone number, and website) for all agencies with an office | ||||||
11 | in Illinois that are approved by the U.S. Department of Housing | ||||||
12 | and Urban Development (HUD) to conduct reverse mortgage | ||||||
13 | counseling and contain the following statement: | ||||||
14 | "IMPORTANT NOTICE: Under Illinois law, reverse mortgages | ||||||
15 | are non-recourse loans secured by real or homestead property. | ||||||
16 | Reverse mortgages insured by the federal government, known as | ||||||
17 | Home Equity Conversion Mortgages, or HECM loans, require people | ||||||
18 | considering reverse mortgages to get counseling from a | ||||||
19 | federally approved counselor working for a HECM counseling | ||||||
20 | agency prior to closing on the loan. The purpose of the | ||||||
21 | counseling is to help the prospective borrower understand the | ||||||
22 | financial implications, alternatives to securing a reverse | ||||||
23 | mortgage, borrower obligations, costs of obtaining the loan, | ||||||
24 | repayment conditions, and other issues. Counseling can also be | ||||||
25 | a benefit to people considering reverse mortgages not insured |
| |||||||
| |||||||
1 | by the federal government. | ||||||
2 | There are advantages to receiving this counseling in | ||||||
3 | person, but it can also be conducted over the telephone. | ||||||
4 | Illinois State law requires that prospective reverse mortgage | ||||||
5 | borrowers be provided a list including contact information for | ||||||
6 | all agencies with an office in Illinois that are approved by | ||||||
7 | the U.S. Department of Housing and Urban Development (HUD) to | ||||||
8 | conduct reverse mortgage counseling. Contact information for | ||||||
9 | approved counseling agencies located outside of Illinois is | ||||||
10 | available from HUD.". | ||||||
11 | (205 ILCS 5/6.4 new) | ||||||
12 | Sec. 6.4. Non-recourse reverse mortgages; Department on | ||||||
13 | Aging disclosure. At the time of initial inquiry regarding a | ||||||
14 | reverse mortgage, a licensee shall provide to the applicant a | ||||||
15 | statement prepared by the Department on Aging under Section | ||||||
16 | 4.01 of the Illinois Act on the Aging. | ||||||
17 | (205 ILCS 5/6.5 new) | ||||||
18 | Sec. 6.5. Non-recourse reverse mortgages; Senior Citizens | ||||||
19 | Real Estate Tax Deferral Act disclosure. At the time of initial | ||||||
20 | inquiry regarding a reverse mortgage, a licensee must provide | ||||||
21 | to the applicant a separate document and in at least 22-point | ||||||
22 | font that informs the applicant that obtaining a reverse | ||||||
23 | mortgage may adversely affect the applicant's eligibility to | ||||||
24 | obtain a tax deferral under the Senior Citizens Real Estate Tax |
| |||||||
| |||||||
1 | Deferral Act. | ||||||
2 | (205 ILCS 5/6.6 new) | ||||||
3 | Sec. 6.6. Non-recourse reverse mortgages; 7-day cooling | ||||||
4 | off period; disclosure. A borrower shall not be bound for 7 | ||||||
5 | days after the borrower's acceptance, in writing, of a lender's | ||||||
6 | written commitment to make a reverse mortgage loan and cannot | ||||||
7 | be required to close or proceed with the loan during that time | ||||||
8 | period. A borrower may revoke his or her acceptance within this | ||||||
9 | 7-day period. A borrower may not waive the provisions of this | ||||||
10 | Section. At the time of making a written commitment, the lender | ||||||
11 | shall provide the borrower a separate document in at least | ||||||
12 | 22-point font that contains the following statement: | ||||||
13 | "IMPORTANT NOTICE REGARDING COOLING OFF PERIOD: Illinois | ||||||
14 | State Law requires a 7-day cooling off period for reverse | ||||||
15 | mortgage loans, during which time a potential borrower cannot | ||||||
16 | be required to close or proceed with the loan. The purpose of | ||||||
17 | this requirement is to provide potential borrowers additional | ||||||
18 | time to consider whether a reverse mortgage loan is in their | ||||||
19 | best interest. Potential borrowers may want to seek additional | ||||||
20 | information and an analysis of the commitment from a reverse | ||||||
21 | mortgage counselor during this 7-day period. The 7-day cooling | ||||||
22 | off period cannot be waived.". | ||||||
23 | (205 ILCS 5/6.7 new) | ||||||
24 | Sec. 6.7. Non-recourse reverse mortgages; restriction on |
| |||||||
| |||||||
1 | cross-selling. No lender or licensee under the Residential | ||||||
2 | Mortgage License Act of 1987 may: | ||||||
3 | (1) require the purchase of an annuity, investment, or | ||||||
4 | insurance (including life insurance and long-term care | ||||||
5 | insurance) product as a condition of obtaining a reverse | ||||||
6 | mortgage loan; | ||||||
7 | (2) enter into any agreement to make a reverse mortgage | ||||||
8 | loan that requires the borrower to purchase an annuity, | ||||||
9 | investment, or insurance (including life insurance and | ||||||
10 | long-term care insurance) product; or | ||||||
11 | (3) receive compensation for providing the borrower | ||||||
12 | with information relating to an annuity, investment, or | ||||||
13 | insurance (including life insurance and long-term care | ||||||
14 | insurance) product. | ||||||
15 | (205 ILCS 5/6.8 new) | ||||||
16 | Sec. 6.8. Non-recourse reverse mortgages; certification | ||||||
17 | requirements. No reverse mortgage commitment may be made by a | ||||||
18 | lender unless the applicant, lender, and, if applicable, any | ||||||
19 | licensee under the Residential Mortgage License Act of 1987 | ||||||
20 | receiving compensation or gain, either directly or indirectly, | ||||||
21 | related to the reverse mortgage, certify, in writing, that: | ||||||
22 | (1) the applicant has received from the lender or | ||||||
23 | licensee, at the time of initial inquiry, the statement | ||||||
24 | prepared by the Department on Aging required in Section 6.4 | ||||||
25 | of this Act regarding the advisability and availability of |
| |||||||
| |||||||
1 | independent information and counseling services on reverse | ||||||
2 | mortgages. | ||||||
3 | (2) if applicable, that the applicant has received | ||||||
4 | federally mandated housing counseling from an agency | ||||||
5 | approved by the U.S. Department of Housing and Urban | ||||||
6 | Development to conduct reverse mortgage counseling and | ||||||
7 | that the counseling was conducted in person, unless the | ||||||
8 | certification specifies that the applicant elected to | ||||||
9 | receive the counseling in a manner other than in person. | ||||||
10 | (3) if applicable, that the reverse mortgage product | ||||||
11 | did not have any federally mandated counseling requirement | ||||||
12 | and specifying whether the loan applicant received | ||||||
13 | counseling or chose not to get counseling. | ||||||
14 | (4) if applicable, the date of the counseling and the | ||||||
15 | name, address, and telephone number of the counseling | ||||||
16 | agency and counselor. | ||||||
17 | (5) the applicant has received from the lender or | ||||||
18 | licensee, at the time of initial inquiry, the document | ||||||
19 | required in Section 6.5 of this Act that informs the | ||||||
20 | applicant that by obtaining the reverse mortgage, the | ||||||
21 | applicant's eligibility to obtain a tax deferral under the | ||||||
22 | Senior Citizens Real Estate Tax Deferral Act may be | ||||||
23 | adversely affected. | ||||||
24 | (6) the applicant has received from the lender, at the | ||||||
25 | time a written commitment was made to the applicant to | ||||||
26 | provide a reverse mortgage loan, the disclosure document |
| |||||||
| |||||||
1 | required in Section 6.6 regarding the 7-day cooling off | ||||||
2 | period and that at least 7 days have passed since the | ||||||
3 | document was provided. The certification shall also | ||||||
4 | include the date the cooling off period disclosure was | ||||||
5 | provided. | ||||||
6 | (7) the reverse mortgage loan does not include any | ||||||
7 | current or future requirement for the applicant to purchase | ||||||
8 | an annuity, investment, or insurance (including life | ||||||
9 | insurance and long-term care insurance) product. | ||||||
10 | The certification regarding these requirements shall be in | ||||||
11 | a separate document in at least 12-point font. The lender shall | ||||||
12 | maintain the certification in an accurate, reproducible, and | ||||||
13 | accessible format for the term of the reverse mortgage.
| ||||||
14 | (205 ILCS 5/5a rep.)
| ||||||
15 | Section 15. The Illinois Banking Act is amended by | ||||||
16 | repealing Section 5a.
| ||||||
17 | (205 ILCS 205/1010 rep.)
| ||||||
18 | Section 20. The Savings Bank Act is amended by repealing | ||||||
19 | Section 1010. | ||||||
20 | Section 25. The Illinois Credit Union Act is amended by | ||||||
21 | changing Sections 46 and 46.1 as follows: | ||||||
22 | (205 ILCS 305/46) (from Ch. 17, par. 4447)
|
| |||||||
| |||||||
1 | Sec. 46. Loans and interest rate.
| ||||||
2 | (1) A credit union may make loans
to its members for such | ||||||
3 | purpose and upon such security and terms, including
rates of | ||||||
4 | interest, as the credit committee, credit manager, or loan | ||||||
5 | officer
approves.
Notwithstanding the provisions of any other | ||||||
6 | law in connection with extensions
of credit, a credit union may | ||||||
7 | elect to
contract for and receive interest and fees and other | ||||||
8 | charges for extensions of
credit subject only to the provisions | ||||||
9 | of this Act and rules promulgated under
this Act, except that | ||||||
10 | extensions of credit secured by residential real estate
shall | ||||||
11 | be subject to the laws applicable thereto.
The rates of | ||||||
12 | interest to be charged on loans to members shall be
set by the | ||||||
13 | board of directors of each individual credit union in | ||||||
14 | accordance with Section 30 of this Act and such
rates may be | ||||||
15 | less than, but may not exceed, the maximum rate set forth in
| ||||||
16 | this Section. A borrower may repay his loan prior to maturity, | ||||||
17 | in whole or
in part, without penalty. The credit contract may | ||||||
18 | provide for the payment
by the member and receipt by the credit | ||||||
19 | union of all costs and
disbursements, including reasonable | ||||||
20 | attorney's fees and collection agency
charges, incurred by the | ||||||
21 | credit union to collect or enforce the debt in the
event of a | ||||||
22 | delinquency by the member, or in the event of a breach of any
| ||||||
23 | obligation of the member under the credit contract. A | ||||||
24 | contingency or
hourly arrangement established under an | ||||||
25 | agreement entered into by a credit
union with an attorney or | ||||||
26 | collection agency to collect a loan of a member
in default |
| |||||||
| |||||||
1 | shall be presumed prima facie reasonable.
| ||||||
2 | (2) Credit unions may make loans based upon the security of | ||||||
3 | any
interest or equity in real estate, subject to rules and | ||||||
4 | regulations
promulgated by the Secretary. In any contract or | ||||||
5 | loan which
is secured by a mortgage, deed of
trust, or | ||||||
6 | conveyance in the nature of a mortgage, on residential real
| ||||||
7 | estate, the interest which is computed, calculated, charged, or | ||||||
8 | collected
pursuant to such contract or loan, or pursuant to any | ||||||
9 | regulation or rule
promulgated pursuant to this Act, may not be | ||||||
10 | computed, calculated, charged
or collected for any period of | ||||||
11 | time occurring after the date on which the
total indebtedness, | ||||||
12 | with the exception of late payment penalties, is paid
in full.
| ||||||
13 | For purposes of this subsection (2) of this Section 46, a | ||||||
14 | prepayment
shall mean the payment of the total indebtedness, | ||||||
15 | with the exception of
late payment penalties if incurred or | ||||||
16 | charged, on any date before the date
specified in the contract | ||||||
17 | or loan agreement on which the total indebtedness
shall be paid | ||||||
18 | in full, or before the date on which all payments, if timely
| ||||||
19 | made, shall have been made. In the event of a prepayment of the
| ||||||
20 | indebtedness which is made on a date
after the date on which | ||||||
21 | interest on the indebtedness was last computed,
calculated, | ||||||
22 | charged, or collected but before the next date on which | ||||||
23 | interest
on the indebtedness was to be calculated, computed, | ||||||
24 | charged, or collected,
the lender may calculate, charge and | ||||||
25 | collect interest on the indebtedness
for the period which | ||||||
26 | elapsed between the date on which the prepayment is
made and |
| |||||||
| |||||||
1 | the date on which interest on the indebtedness was last | ||||||
2 | computed,
calculated, charged or collected at a rate equal to | ||||||
3 | 1/360 of the annual
rate for each day which so elapsed, which | ||||||
4 | rate shall be applied to the
indebtedness outstanding as of the | ||||||
5 | date of prepayment. The lender shall
refund to the borrower any | ||||||
6 | interest charged or collected which exceeds that
which the | ||||||
7 | lender may charge or collect pursuant to the preceding | ||||||
8 | sentence.
The provisions of this amendatory Act of 1985 shall | ||||||
9 | apply only to contracts
or loans entered into on or after the | ||||||
10 | effective date of this amendatory
Act.
| ||||||
11 | (3) (Blank). Notwithstanding any other provision of this | ||||||
12 | Act, a credit union
authorized under this Act to make loans | ||||||
13 | secured by an interest or equity in
real estate may engage in | ||||||
14 | making "reverse mortgage" loans to persons for
the purpose of | ||||||
15 | making home improvements or repairs, paying insurance
premiums | ||||||
16 | or paying real estate taxes on the homestead properties
of such | ||||||
17 | persons. If made, such loans shall be made on such terms and
| ||||||
18 | conditions as the credit union shall determine and as shall be | ||||||
19 | consistent
with the provisions of this Section and such rules | ||||||
20 | and regulations as the Secretary
shall promulgate hereunder. | ||||||
21 | For purposes of this Section, a
"reverse mortgage" loan shall | ||||||
22 | be a loan extended on the basis of existing
equity in homestead | ||||||
23 | property and secured by a mortgage on such property.
Such loans | ||||||
24 | shall be repaid upon the sale of the property or upon the death
| ||||||
25 | of the owner or, if the property is in joint tenancy, upon the | ||||||
26 | death of the
last surviving joint tenant who had such an |
| |||||||
| |||||||
1 | interest in the property at the
time the loan was initiated, | ||||||
2 | provided, however, that the credit union and
its member may by | ||||||
3 | mutual agreement, establish other repayment terms. A
credit | ||||||
4 | union, in making a "reverse mortgage" loan, may add deferred
| ||||||
5 | interest to principal or otherwise provide for the charging of | ||||||
6 | interest or
premiums on such deferred interest. "Homestead" | ||||||
7 | property, for purposes of
this Section, means the domicile and | ||||||
8 | contiguous real estate owned and
occupied by the mortgagor.
| ||||||
9 | (4) Notwithstanding any other provisions of this Act, a | ||||||
10 | credit union
authorized under this Act to make loans secured by | ||||||
11 | an interest or equity
in real property may engage in making | ||||||
12 | revolving credit loans secured by
mortgages or deeds of trust | ||||||
13 | on such real property or by security
assignments of beneficial | ||||||
14 | interests in land trusts.
| ||||||
15 | For purposes of this Section, "revolving credit" has the | ||||||
16 | meaning defined
in Section 4.1 of the Interest Act.
| ||||||
17 | Any mortgage or deed of trust given to secure a revolving | ||||||
18 | credit loan may,
and when so expressed therein shall, secure | ||||||
19 | not only the existing indebtedness
but also such future | ||||||
20 | advances, whether such advances are obligatory or to
be made at | ||||||
21 | the option of the lender, or otherwise, as are made within | ||||||
22 | twenty
years from the date thereof, to the same extent as if | ||||||
23 | such future advances
were made on the date of the execution of | ||||||
24 | such mortgage or deed of trust,
although there may be no | ||||||
25 | advance made at the time of execution of such mortgage
or other | ||||||
26 | instrument, and although there may be no indebtedness |
| |||||||
| |||||||
1 | outstanding
at the time any advance is made. The lien of such | ||||||
2 | mortgage or deed of trust,
as to third persons
without actual | ||||||
3 | notice thereof, shall be valid as to all such indebtedness
and | ||||||
4 | future advances form the time said mortgage or deed of trust is | ||||||
5 | filed
for record in the office of the recorder of deeds or the | ||||||
6 | registrar of titles
of the county where the real property | ||||||
7 | described therein is located. The
total amount of indebtedness | ||||||
8 | that may be so secured may increase or decrease
from time to | ||||||
9 | time, but the total unpaid balance so secured at any one time
| ||||||
10 | shall not exceed a maximum principal amount which must be | ||||||
11 | specified in such
mortgage or deed of trust, plus interest | ||||||
12 | thereon, and any disbursements
made for the payment of taxes, | ||||||
13 | special assessments, or insurance on said
real property, with | ||||||
14 | interest on such disbursements.
| ||||||
15 | Any such mortgage or deed of trust shall be valid and have | ||||||
16 | priority over
all subsequent liens and encumbrances, including | ||||||
17 | statutory liens, except
taxes and assessments levied on said | ||||||
18 | real property.
| ||||||
19 | (4-5) For purposes of this Section, "real estate" and "real | ||||||
20 | property" include a manufactured home as defined in subdivision | ||||||
21 | (53) of Section 9-102 of the Uniform Commercial Code which is | ||||||
22 | real property as defined in Section 5-35 of the Conveyance and | ||||||
23 | Encumbrance of Manufactured Homes as Real Property and | ||||||
24 | Severance Act. | ||||||
25 | (5) Compliance with federal or Illinois preemptive laws or | ||||||
26 | regulations
governing loans made by a credit union chartered |
| |||||||
| |||||||
1 | under this Act shall
constitute compliance with this Act.
| ||||||
2 | (6) Credit unions may make residential real estate mortgage | ||||||
3 | loans on terms and conditions established by the United States | ||||||
4 | Department of Agriculture through its Rural Development | ||||||
5 | Housing and Community Facilities Program. The portion of any | ||||||
6 | loan in excess of the appraised value of the real estate shall | ||||||
7 | be allocable only to the guarantee fee required under the | ||||||
8 | program. | ||||||
9 | (7) For a renewal, refinancing, or restructuring of an | ||||||
10 | existing loan that is secured by an interest or equity in real | ||||||
11 | estate, a new appraisal of the collateral shall not be required | ||||||
12 | when the transaction involves an existing extension of credit | ||||||
13 | at the credit union, no new moneys are advanced other than | ||||||
14 | funds necessary to cover reasonable closing costs, and there | ||||||
15 | has been no obvious or material change in market conditions or | ||||||
16 | physical aspects of the real estate that threatens the adequacy | ||||||
17 | of the credit union's real estate collateral protection after | ||||||
18 | the transaction. | ||||||
19 | (Source: P.A. 97-133, eff. 1-1-12; 98-749, eff. 7-16-14; | ||||||
20 | 98-784, eff. 7-24-14; revised 10-2-14.)
| ||||||
21 | (205 ILCS 305/46.1) (from Ch. 17, par. 4447.1)
| ||||||
22 | Sec. 46.1. Non-recourse reverse mortgage loans. Any credit | ||||||
23 | union
authorized under this Act to make loans secured by an | ||||||
24 | interest or equity in
real estate may make non-recourse reverse | ||||||
25 | mortgage loans as provided in
Section 6.1 of the Illinois |
| |||||||
| |||||||
1 | Banking Act.
| ||||||
2 | For purposes of this Section, "real estate" includes a | ||||||
3 | manufactured home as defined in subdivision (53) of Section | ||||||
4 | 9-102 of the Uniform Commercial Code that is real property as | ||||||
5 | defined in Section 5-35 of the Conveyance and Encumbrance of | ||||||
6 | Manufactured Homes as Real Property and Severance Act. | ||||||
7 | (Source: P.A. 98-749, eff. 7-16-14.)
| ||||||
8 | (205 ILCS 305/46.2 rep.)
| ||||||
9 | Section 30. The Illinois Credit Union Act is amended by | ||||||
10 | repealing Section 46.2. | ||||||
11 | Section 35. The Residential Mortgage License Act of 1987 is | ||||||
12 | amended by changing Section 5-5 as follows:
| ||||||
13 | (205 ILCS 635/5-5)
| ||||||
14 | Sec. 5-5. Reverse mortgages ; disclosure; good faith | ||||||
15 | dealings, fraudulent or deceptive practices . Licensees engaged | ||||||
16 | in the business of brokering, funding, originating, servicing, | ||||||
17 | or purchasing funding of non-recourse reverse mortgage loans as | ||||||
18 | defined in Section 6.1 of the Illinois Banking Act are required | ||||||
19 | to comply with Sections 6.2, 6.3, 6.4, 6.5, 6.6, 6.7 and 6.8 of | ||||||
20 | the Illinois Banking Act. | ||||||
21 | (a) At the time a reverse mortgage
loan is made or | ||||||
22 | brokered, a licensee must provide to the mortgagor a separate
| ||||||
23 | document that informs the mortgagor that by obtaining the |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
1 | reverse mortgage
the mortgagor's eligibility to obtain a tax | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2 | deferral under the Senior Citizens
Real Estate Tax Deferral Act | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
3 | may be adversely affected. The mortgagor must
sign the | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
4 | disclosure document as part of the reverse mortgage | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
5 | transaction. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
6 | (b) A licensee must act in good faith in all relations with | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
7 | a borrower, including but not limited to, transferring, dealing | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
8 | in, offering, or making a reverse mortgage loan. No licensee | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
9 | shall employ fraudulent or deceptive acts or practices in the | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10 | making of a reverse mortgage loan, including deceptive | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
11 | marketing and sales efforts.
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
12 | (Source: P.A. 92-577, eff. 6-26-02; 93-863, eff. 8-5-04.)
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||