Full Text of SB0253 96th General Assembly
SB0253ham001 96TH GENERAL ASSEMBLY
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Rep. Angelo Saviano
Filed: 10/16/2009
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| AMENDMENT TO SENATE BILL 253
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| AMENDMENT NO. ______. Amend Senate Bill 253 by replacing | 3 |
| everything after the enacting clause with the following:
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| "Section 5. The Mortgage Escrow Account Act is amended by | 5 |
| adding Section 6.5 as follows: | 6 |
| (765 ILCS 910/6.5 new)
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| Sec. 6.5. Homeownership preservation program. | 8 |
| (a) For purposes of this Section, | 9 |
| "Homeownership Preservation Program" means | 10 |
| (1) a program that is expressly intended to assist | 11 |
| homeowners by refinancing or restructuring existing | 12 |
| mortgage obligations either (i) to avoid default or | 13 |
| foreclosure, or both, or (ii) to lower interest rates, and | 14 |
| that is sponsored by a federal, state, or local government | 15 |
| authority or a non-profit organization; or | 16 |
| (2) a lender-sponsored program that is expressly |
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| intended to assist homeowners by restructuring existing | 2 |
| mortgage obligations to avoid default or foreclosure, or | 3 |
| both. | 4 |
| "Subprime Mortgage Lender" means a mortgage lender that | 5 |
| has, for at least 2 of the prior 3 reporting years, reported | 6 |
| the rate spread, as required under 12 C.F.R. § 203.4(a)(12), | 7 |
| for at least 75% of the loans reported by the mortgage lender | 8 |
| in the Loan/Application Register filed in compliance with the | 9 |
| federal Home Mortgage Disclosure Act, 12 U.S.C. 2801 et seq., | 10 |
| and implementing Regulation C, 12 C.F.R. 201 et seq. | 11 |
| (b) Section 6 shall not apply: | 12 |
| (1) to a mortgage loan made by a subprime mortgage | 13 |
| lender in compliance with the requirements for | 14 |
| higher-priced mortgage loans established in Regulation Z | 15 |
| 12 C.F.R. Part 226, issued by the Board of Governors of the | 16 |
| Federal Reserve System to implement the federal Truth in | 17 |
| Lending Act, whether or not the mortgage loan is a | 18 |
| higher-priced mortgage loan, provided that: | 19 |
| (A) for loans that are not higher-priced mortgage | 20 |
| loans, the escrow account must be terminated upon the | 21 |
| borrower's request at no cost to the borrower; and | 22 |
| (B) for loans that are higher-priced mortgage | 23 |
| loans, the escrow account must be terminated upon the | 24 |
| borrower's request at no cost to the borrower on terms | 25 |
| no stricter than the following conditions: | 26 |
| (i) the escrow termination requirements |
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| established in Regulation Z are satisfied; | 2 |
| (ii) the borrower has maintained a | 3 |
| satisfactory payment history (no payments more | 4 |
| than 30 days late) for the 12 months prior to the | 5 |
| mortgage lender's receipt of the borrower's | 6 |
| termination request; and | 7 |
| (iii) the borrower has reimbursed the mortgage | 8 |
| lender for any escrow advances or escrow | 9 |
| deficiencies existing at the time of the | 10 |
| borrower's termination request. | 11 |
| (2) to a refinance or modification made by a subprime | 12 |
| mortgage lender under a homeownership preservation program | 13 |
| that requires establishment of an escrow account as a | 14 |
| condition or requirement of the refinance or modification, | 15 |
| provided that the escrow account must be terminated upon | 16 |
| the borrower's request at no cost to the borrower on terms | 17 |
| no stricter than the following conditions: | 18 |
| (A) termination is permitted under the terms of the | 19 |
| government or non-profit sponsored homeownership | 20 |
| preservation program, if applicable, and the borrower | 21 |
| complies with all conditions or requirements for | 22 |
| termination established by or allowed under such | 23 |
| program; | 24 |
| (B) the borrower has maintained a satisfactory | 25 |
| payment history (no payments more than 30 days late) | 26 |
| for the 12 months prior to the mortgage lender's |
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| receipt of the borrower's termination request; and | 2 |
| (C) the borrower has reimbursed the mortgage | 3 |
| lender for any escrow advances or escrow deficiencies | 4 |
| existing at the time of the borrower's termination | 5 |
| request. | 6 |
| Termination may not be denied for failure to reimburse | 7 |
| escrow advances or escrow deficiencies under item (iii) of | 8 |
| subparagraph (B) of paragraph (1) of subsection (b), or | 9 |
| subparagraph (C) of paragraph (2) of subsection (b) if the | 10 |
| borrower claims, in writing, that there is an error with such | 11 |
| advances or deficiencies. In such case, the lender must | 12 |
| terminate the escrow account if all other conditions of | 13 |
| termination are satisfied; however, such termination will not | 14 |
| alter or affect any other rights of the mortgage lender or the | 15 |
| borrower with respect to the collection of such escrow advances | 16 |
| or escrow deficiencies.
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| Section 99. Effective date. This Act takes effect upon | 18 |
| becoming law.".
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