Illinois General Assembly - Full Text of SB1792
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Full Text of SB1792  101st General Assembly

SB1792enr 101ST GENERAL ASSEMBLY

  
  
  

 


 
SB1792 EnrolledLRB101 09871 AMC 54973 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4
Article 1.

 
5    Section 1-5. The Farmer Equity Act is amended by adding
6Section 25 as follows:
 
7    (505 ILCS 72/25 new)
8    Sec. 25. Disparity study; report.
9    (a) The Department shall conduct a study and use the data
10collected to determine economic and other disparities
11associated with farm ownership and farm operations in this
12State. The study shall focus primarily on identifying and
13comparing economic, land ownership, education, and other
14related differences between African American farmers and white
15farmers, but may include data collected in regards to farmers
16from other socially disadvantaged groups. The study shall
17collect, compare, and analyze data relating to disparities or
18differences in farm operations for the following areas:
19        (1) Farm ownership and the size or acreage of the
20    farmland owned compared to the number of farmers who are
21    farm tenants.
22        (2) The distribution of farm-related generated income

 

 

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1    and wealth.
2        (3) The accessibility and availability to grants,
3    loans, commodity subsidies, and other financial
4    assistance.
5        (4) Access to technical assistance programs and
6    mechanization.
7        (5) Participation in continuing education, outreach,
8    or other agriculturally related services or programs.
9        (6) Interest in farming by young or beginning farmers.
10    (b) The Department shall submit a report of study to the
11Governor and General Assembly on or before January 1, 2022. The
12report shall be made available on the Department's Internet
13website.
 
14
Article 5.

 
15    Section 5-5. The Cannabis Regulation and Tax Act is amended
16by adding Section 10-45 as follows:
 
17    (410 ILCS 705/10-45 new)
18    Sec. 10-45. Cannabis Equity Commission.
19    (a) The Cannabis Equity Commission is created and shall
20reflect the diversity of the State of Illinois, including
21geographic, racial, and ethnic diversity. The Cannabis Equity
22Commission shall be responsible for the following:
23        (1) Ensuring that equity goals in the Illinois cannabis

 

 

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1    industry, as stated in Section 10-40, are met.
2        (2) Tracking and analyzing minorities in the
3    marketplace.
4        (3) Ensuring that revenue is being invested properly
5    into R3 areas under Section 10-40.
6        (4) Recommending changes to make the law more equitable
7    to communities harmed the most by the war on drugs.
8        (5) Create standards to protect true social equity
9    applicants from predatory businesses.
10    (b) The Cannabis Equity Commission's ex officio members
11shall, within 4 months after the effective date of this
12amendatory Act of the 101st General Assembly, convene the
13Commission to appoint a full Cannabis Equity Commission and
14oversee, provide guidance to, and develop an administrative
15structure for the Cannabis Equity Commission. The ex officio
16members are:
17        (1) The Governor, or his or her designee, who shall
18    serve as chair.
19        (2) The Attorney General, or his or her designee.
20        (3) The Director of Commerce and Economic Opportunity,
21    or his or her designee.
22        (4) The Director of Public Health, or his or her
23    designee.
24        (5) The Director of Corrections, or his or her
25    designee.
26        (6) The Director of Financial and Professional

 

 

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1    Regulation, or his or her designee.
2        (7) The Director of Agriculture, or his or her
3    designee.
4        (8) The Executive Director of the Illinois Criminal
5    Justice Information Authority, or his or her designee.
6        (9) The Secretary of Human Services, or his or her
7    designee.
8        (10) A member of the Senate, designated by the
9    President of the Senate.
10        (11) A member of the House of Representatives,
11    designated by the Speaker of the House of Representatives.
12        (12) A member of the Senate, designated by the Minority
13    Leader of the Senate.
14        (13) A member of the House of Representatives,
15    designated by the Minority Leader of the House of
16    Representatives.
17    (c) Within 90 days after the ex officio members convene,
18the following members shall be appointed to the Commission by
19the chair:
20        (1) Four community-based providers or community
21    development organization representatives who provide
22    services to treat violence and address the social
23    determinants of health, or promote community investment,
24    including, but not limited to, services such as job
25    placement and training, educational services, workforce
26    development programming, and wealth building. No more than

 

 

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1    2 community-based organization representatives shall work
2    primarily in Cook County. At least one of the
3    community-based providers shall have expertise in
4    providing services to an immigrant population.
5        (2) Two experts in the field of violence reduction.
6        (3) One male who has previously been incarcerated and
7    is over the age of 24 at the time of appointment.
8        (4) One female who has previously been incarcerated and
9    is over the age of 24 at the time of appointment.
10        (5) Two individuals who have previously been
11    incarcerated and are between the ages of 17 and 24 at the
12    time of appointment.
13    As used in this subsection (c), "an individual who has been
14previously incarcerated" has the same meaning as defined in
15paragraph (2) of subsection (e) of Section 10-40.
 
16
Article 15.

 
17
Division 1. General Provisions

 
18    Section 15-1-1. Short title. This Act may be cited as the
19Predatory Loan Prevention Act. References in this Article to
20"this Act" mean this Article.
 
21    Section 15-1-5. Purpose and construction. Illinois
22families pay over $500,000,000 per year in consumer

 

 

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1installment, payday, and title loan fees. As reported by the
2Department in 2020, nearly half of Illinois payday loan
3borrowers earn less than $30,000 per year, and the average
4annual percentage rate of a payday loan is 297%. The purpose of
5this Act is to protect consumers from predatory loans
6consistent with federal law and the Military Lending Act which
7protects active duty members of the military. This Act shall be
8construed as a consumer protection law for all purposes. This
9Act shall be liberally construed to effectuate its purpose.
 
10    Section 15-1-10. Definitions. As used in this Act:
11    "Consumer" means any natural person, including consumers
12acting jointly.
13    "Department" means the Department of Financial and
14Professional Regulation.
15    "Lender" means any person or entity, including any
16affiliate or subsidiary of a lender, that offers or makes a
17loan, buys a whole or partial interest in a loan, arranges a
18loan for a third party, or acts as an agent for a third party in
19making a loan, regardless of whether approval, acceptance, or
20ratification by the third party is necessary to create a legal
21obligation for the third party, and includes any other person
22or entity if the Department determines that the person or
23entity is engaged in a transaction that is in substance a
24disguised loan or a subterfuge for the purpose of avoiding this
25Act.

 

 

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1    "Person" means any natural person.
2    "Secretary" means the Secretary of Financial and
3Professional Regulation or a person authorized by the
4Secretary.
5    "Loan" means money or credit provided to a consumer in
6exchange for the consumer's agreement to a certain set of
7terms, including, but not limited to, any finance charges,
8interest, or other conditions. "Loan" includes closed-end and
9open-end credit, retail installment sales contracts, motor
10vehicle retail installment sales contracts, and any
11transaction conducted via any medium whatsoever, including,
12but not limited to, paper, facsimile, Internet, or telephone.
13"Loan" does not include a commercial loan.
 
14    Section 15-1-15. Applicability.
15    (a) Except as otherwise provided in this Section, this Act
16applies to any person or entity that offers or makes a loan to
17a consumer in Illinois.
18    (b) The provisions of this Act apply to any person or
19entity that seeks to evade its applicability by any device,
20subterfuge, or pretense whatsoever.
21    (c) Banks, savings banks, savings and loan associations,
22credit unions, and insurance companies organized, chartered,
23or holding a certificate of authority to do business under the
24laws of this State or any other state or under the laws of the
25United States are exempt from the provisions of this Act.
 

 

 

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1
Division 5. Predatory Loan Prevention

 
2    Section 15-5-5. Rate cap. Notwithstanding any other
3provision of law, for loans made or renewed on and after the
4effective date of this Act, a lender shall not contract for or
5receive charges exceeding a 36% annual percentage rate on the
6unpaid balance of the amount financed for a loan. For purposes
7of this Section, the annual percentage rate shall be calculated
8as such rate is calculated using the system for calculating a
9military annual percentage rate under Section 232.4 of Title 32
10of the Code of Federal Regulations as in effect on the
11effective date of this Act. Nothing in this Act shall be
12construed to permit a person or entity to contract for or
13receive a charge exceeding that permitted by the Interest Act
14or other law.
 
15    Section 15-5-10. Violation. Any loan made in violation of
16this Act is null and void and no person or entity shall have
17any right to collect, attempt to collect, receive, or retain
18any principal, fee, interest, or charges related to the loan.
 
19    Section 15-5-15. No evasion.
20    (a) No person or entity may engage in any device,
21subterfuge, or pretense to evade the requirements of this Act,
22including, but not limited to, making loans disguised as a

 

 

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1personal property sale and leaseback transaction; disguising
2loan proceeds as a cash rebate for the pretextual installment
3sale of goods or services; or making, offering, assisting, or
4arranging a debtor to obtain a loan with a greater rate or
5interest, consideration, or charge than is permitted by this
6Act through any method including mail, telephone, internet, or
7any electronic means regardless of whether the person or entity
8has a physical location in the State.
9    (b) If a loan exceeds the rate permitted by Section 15-5-5,
10a person or entity is a lender subject to the requirements of
11this Act notwithstanding the fact that the person or entity
12purports to act as an agent, service provider, or in another
13capacity for another entity that is exempt from this Act, if,
14among other things:
15        (1) the person or entity holds, acquires, or maintains,
16    directly or indirectly, the predominant economic interest
17    in the loan; or
18        (2) the person or entity markets, brokers, arranges, or
19    facilitates the loan and holds the right, requirement, or
20    first right of refusal to purchase loans, receivables, or
21    interests in the loans; or
22        (3) the totality of the circumstances indicate that the
23    person or entity is the lender and the transaction is
24    structured to evade the requirements of this Act.
25    Circumstances that weigh in favor of a person or entity
26    being a lender include, without limitation, where the

 

 

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1    person or entity:
2            (i) indemnifies, insures, or protects an exempt
3        person or entity for any costs or risks related to the
4        loan;
5            (ii) predominantly designs, controls, or operates
6        the loan program; or
7            (iii) purports to act as an agent, service
8        provider, or in another capacity for an exempt entity
9        while acting directly as a lender in other states.
 
10    Section 15-5-20. Rules. The Secretary may adopt rules
11consistent with this Act and rescind or amend rules that are
12inconsistent. The adoption, amendment, or rescission of rules
13shall be in conformity with the Illinois Administrative
14Procedure Act.
 
15
Division 10. Administrative Provisions

 
16    Section 15-10-5. Enforcement and remedies.
17    (a) The remedies provided in this Act are cumulative and
18apply to persons or entities subject to this Act.
19    (b) Any violation of this Act, including the commission of
20an act prohibited under Article 5, constitutes a violation of
21the Consumer Fraud and Deceptive Business Practices Act.
22    (c) Subject to the Illinois Administrative Procedure Act,
23the Secretary may hold hearings, make findings of fact,

 

 

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1conclusions of law, issue cease and desist orders, have the
2power to issue fines of up to $10,000 per violation, and refer
3the matter to the appropriate law enforcement agency for
4prosecution under this Act. All proceedings shall be open to
5the public.
6    (d) The Secretary may issue a cease and desist order to any
7person or entity, when in the opinion of the Secretary the
8person or entity is violating or is about to violate any
9provision of this Act. The cease and desist order permitted by
10this subsection (d) may be issued prior to a hearing.
11    The Secretary shall serve notice of the action, including,
12but not limited to, a statement of the reasons for the action,
13either personally or by certified mail. Service by certified
14mail shall be deemed completed when the notice is deposited in
15the U.S. Mail.
16    Within 10 days of service of the cease and desist order,
17the person or entity may request a hearing in writing.
18    If it is determined that the Secretary had the authority to
19issue the cease and desist order, the Secretary may issue such
20orders as may be reasonably necessary to correct, eliminate, or
21remedy the conduct.
22    The powers vested in the Secretary by this subsection (d)
23are additional to any and all other powers and remedies vested
24in the Secretary by law, and nothing in this subsection (d)
25shall be construed as requiring that the Secretary shall employ
26the power conferred in this subsection instead of or as a

 

 

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1condition precedent to the exercise of any other power or
2remedy vested in the Secretary.
3    (e) After 10 days' notice by certified mail to the person
4or entity stating the contemplated action and in general the
5grounds therefor, the Secretary may fine the person or entity
6an amount not exceeding $10,000 per violation if the person or
7entity has failed to comply with any provision of this Act or
8any order, decision, finding, rule, regulation, or direction of
9the Secretary lawfully made in accordance with the authority of
10this Act. Service by certified mail shall be deemed completed
11when the notice is deposited in the U.S. Mail.
12    (f) A violation of this Act by a person or entity licensed
13under another Act including, but not limited to, the Consumer
14Installment Loan Act, the Payday Loan Reform Act, and the Sales
15Finance Agency Act shall subject the person or entity to
16discipline in accordance with the Act or Acts under which the
17person or entity is licensed.
 
18    Section 15-10-10. Preemption of administrative rules. Any
19administrative rule regarding loans that is adopted by the
20Department prior to the effective date of this Act and that is
21inconsistent with the provisions of this Act is hereby
22preempted to the extent of the inconsistency.
 
23    Section 15-10-15. Reporting of violations. The Department
24shall report to the Attorney General all material violations of

 

 

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1this Act of which it becomes aware.
 
2    Section 15-10-20. Judicial review. All final
3administrative decisions of the Department under this Act are
4subject to judicial review under the Administrative Review Law
5and any rules adopted under the Administrative Review Law.
 
6    Section 15-10-25. No waivers. There shall be no waiver of
7any provision of this Act.
 
8    Section 15-10-30. Superiority of Act. To the extent this
9Act conflicts with any other State laws, this Act is superior
10and supersedes those laws, except that nothing in this Act
11applies to any lender that is a bank, savings bank, savings and
12loan association, or credit union chartered under laws of the
13United States.
 
14    Section 15-10-35. Severability. The provisions of this Act
15are severable under Section 1.31 of the Statute on Statutes.
 
16
Division 90. Amendatory Provisions

 
17    Section 15-90-5. The Financial Institutions Code is
18amended by changing Section 6 as follows:
 
19    (20 ILCS 1205/6)  (from Ch. 17, par. 106)

 

 

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1    Sec. 6. In addition to the duties imposed elsewhere in this
2Act, the Department has the following powers:
3    (1) To exercise the rights, powers and duties vested by law
4in the Auditor of Public Accounts under "An Act to provide for
5the incorporation, management and regulation of pawners'
6societies and limiting the rate of compensation to be paid for
7advances, storage and insurance on pawns and pledges and to
8allow the loaning of money upon personal property", approved
9March 29, 1899, as amended.
10    (2) To exercise the rights, powers and duties vested by law
11in the Auditor of Public Accounts under "An Act in relation to
12the definition, licensing and regulation of community currency
13exchanges and ambulatory currency exchanges, and the operators
14and employees thereof, and to make an appropriation therefor,
15and to provide penalties and remedies for the violation
16thereof", approved June 30, 1943, as amended.
17    (3) To exercise the rights, powers, and duties vested by
18law in the Auditor of Public Accounts under "An Act in relation
19to the buying and selling of foreign exchange and the
20transmission or transfer of money to foreign countries",
21approved June 28, 1923, as amended.
22    (4) To exercise the rights, powers, and duties vested by
23law in the Auditor of Public Accounts under "An Act to provide
24for and regulate the business of guaranteeing titles to real
25estate by corporations", approved May 13, 1901, as amended.
26    (5) To exercise the rights, powers and duties vested by law

 

 

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1in the Department of Insurance under "An Act to define,
2license, and regulate the business of making loans of eight
3hundred dollars or less, permitting an interest charge thereon
4greater than otherwise allowed by law, authorizing and
5regulating the assignment of wages or salary when taken as
6security for any such loan or as consideration for a payment of
7eight hundred dollars or less, providing penalties, and to
8repeal Acts therein named", approved July 11, 1935, as amended.
9    (6) To administer and enforce "An Act to license and
10regulate the keeping and letting of safety deposit boxes,
11safes, and vaults, and the opening thereof, and to repeal a
12certain Act therein named", approved June 13, 1945, as amended.
13    (7) Whenever the Department is authorized or required by
14law to consider some aspect of criminal history record
15information for the purpose of carrying out its statutory
16powers and responsibilities, then, upon request and payment of
17fees in conformance with the requirements of Section 2605-400
18of the Department of State Police Law (20 ILCS 2605/2605-400),
19the Department of State Police is authorized to furnish,
20pursuant to positive identification, such information
21contained in State files as is necessary to fulfill the
22request.
23    (8) To administer the Payday Loan Reform Act, the Consumer
24Installment Loan Act, the Predatory Loan Prevention Act, the
25Motor Vehicle Retail Installment Sales Act, and the Retail
26Installment Sales Act.

 

 

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1(Source: P.A. 94-13, eff. 12-6-05.)
 
2    Section 15-90-10. The Consumer Installment Loan Act is
3amended by changing Sections 1, 15, 15d, and 17.5 as follows:
 
4    (205 ILCS 670/1)  (from Ch. 17, par. 5401)
5    Sec. 1. License required to engage in business. No person,
6partnership, association, limited liability company, or
7corporation shall engage in the business of making loans of
8money in a principal amount not exceeding $40,000, and charge,
9contract for, or receive on any such loan a greater annual
10percentage rate than 9% rate of interest, discount, or
11consideration therefor than the lender would be permitted by
12law to charge if he were not a licensee hereunder, except as
13authorized by this Act after first obtaining a license from the
14Director of Financial Institutions (hereinafter called the
15Director). No licensee, or employee or affiliate thereof, that
16is licensed under the Payday Loan Reform Act shall obtain a
17license under this Act except that a licensee under the Payday
18Loan Reform Act may obtain a license under this Act for the
19exclusive purpose and use of making title-secured loans, as
20defined in subsection (a) of Section 15 of this Act and
21governed by Title 38, Section 110.300 of the Illinois
22Administrative Code. For the purpose of this Section,
23"affiliate" means any person or entity that directly or
24indirectly controls, is controlled by, or shares control with

 

 

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1another person or entity. A person or entity has control over
2another if the person or entity has an ownership interest of
325% or more in the other.
4    In this Act, "Director" means the Director of Financial
5Institutions of the Department of Financial and Professional
6Regulation.
7(Source: P.A. 96-936, eff. 3-21-11; 97-420, eff. 1-1-12.)
 
8    (205 ILCS 670/15)  (from Ch. 17, par. 5415)
9    Sec. 15. Charges permitted.
10    (a) Every licensee may lend a principal amount not
11exceeding $40,000 and, except as to small consumer loans as
12defined in this Section, may charge, contract for and receive
13thereon interest at an annual percentage rate of no more than
1436%, subject to the provisions of this Act; provided, however,
15that the limitation on the annual percentage rate contained in
16this subsection (a) does not apply to title-secured loans,
17which are loans upon which interest is charged at an annual
18percentage rate exceeding 36%, in which, at commencement, an
19obligor provides to the licensee, as security for the loan,
20physical possession of the obligor's title to a motor vehicle,
21and upon which a licensee may charge, contract for, and receive
22thereon interest at the rate agreed upon by the licensee and
23borrower. For purposes of this Section, the annual percentage
24rate shall be calculated as such rate is calculated using the
25system for calculating a military annual percentage rate under

 

 

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1Section 232.4 of Title 32 of the Code of Federal Regulations as
2in effect on the effective date of this amendatory Act of the
3101st General Assembly in accordance with the federal Truth in
4Lending Act.
5    (b) For purpose of this Section, the following terms shall
6have the meanings ascribed herein.
7    "Applicable interest" for a precomputed loan contract
8means the amount of interest attributable to each monthly
9installment period. It is computed as if each installment
10period were one month and any interest charged for extending
11the first installment period beyond one month is ignored. The
12applicable interest for any monthly installment period is, for
13loans other than small consumer loans as defined in this
14Section, that portion of the precomputed interest that bears
15the same ratio to the total precomputed interest as the
16balances scheduled to be outstanding during that month bear to
17the sum of all scheduled monthly outstanding balances in the
18original contract. With respect to a small consumer loan, the
19applicable interest for any installment period is that portion
20of the precomputed monthly installment account handling charge
21attributable to the installment period calculated based on a
22method at least as favorable to the consumer as the actuarial
23method, as defined by the federal Truth in Lending Act.
24    "Interest-bearing loan" means a loan in which the debt is
25expressed as a principal amount plus interest charged on actual
26unpaid principal balances for the time actually outstanding.

 

 

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1    "Precomputed loan" means a loan in which the debt is
2expressed as the sum of the original principal amount plus
3interest computed actuarially in advance, assuming all
4payments will be made when scheduled.
5    "Small consumer loan" means a loan upon which interest is
6charged at an annual percentage rate exceeding 36% and with an
7amount financed of $4,000 or less. "Small consumer loan" does
8not include a title-secured loan as defined by subsection (a)
9of this Section or a payday loan as defined by the Payday Loan
10Reform Act.
11    "Substantially equal installment" includes a last
12regularly scheduled payment that may be less than, but not more
13than 5% larger than, the previous scheduled payment according
14to a disclosed payment schedule agreed to by the parties.
15    (c) Loans may be interest-bearing or precomputed.
16    (d) To compute time for either interest-bearing or
17precomputed loans for the calculation of interest and other
18purposes, a month shall be a calendar month and a day shall be
19considered 1/30th of a month when calculation is made for a
20fraction of a month. A month shall be 1/12th of a year. A
21calendar month is that period from a given date in one month to
22the same numbered date in the following month, and if there is
23no same numbered date, to the last day of the following month.
24When a period of time includes a month and a fraction of a
25month, the fraction of the month is considered to follow the
26whole month. In the alternative, for interest-bearing loans,

 

 

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1the licensee may charge interest at the rate of 1/365th of the
2agreed annual rate for each day actually elapsed.
3    (d-5) No licensee or other person may condition an
4extension of credit to a consumer on the consumer's repayment
5by preauthorized electronic fund transfers. Payment options,
6including, but not limited to, electronic fund transfers and
7Automatic Clearing House (ACH) transactions may be offered to
8consumers as a choice and method of payment chosen by the
9consumer.
10    (e) With respect to interest-bearing loans:
11        (1) Interest shall be computed on unpaid principal
12    balances outstanding from time to time, for the time
13    outstanding, until fully paid. Each payment shall be
14    applied first to the accumulated interest and the remainder
15    of the payment applied to the unpaid principal balance;
16    provided however, that if the amount of the payment is
17    insufficient to pay the accumulated interest, the unpaid
18    interest continues to accumulate to be paid from the
19    proceeds of subsequent payments and is not added to the
20    principal balance.
21        (2) Interest shall not be payable in advance or
22    compounded. However, if part or all of the consideration
23    for a new loan contract is the unpaid principal balance of
24    a prior loan, then the principal amount payable under the
25    new loan contract may include any unpaid interest which has
26    accrued. The unpaid principal balance of a precomputed loan

 

 

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1    is the balance due after refund or credit of unearned
2    interest as provided in paragraph (f), clause (3). The
3    resulting loan contract shall be deemed a new and separate
4    loan transaction for all purposes.
5        (3) Loans must be fully amortizing and be repayable in
6    substantially equal and consecutive weekly, biweekly,
7    semimonthly, or monthly installments. Notwithstanding this
8    requirement, rates may vary according to an index that is
9    independently verifiable and beyond the control of the
10    licensee.
11        (4) The lender or creditor may, if the contract
12    provides, collect a delinquency or collection charge on
13    each installment in default for a period of not less than
14    10 days in an amount not exceeding 5% of the installment on
15    installments in excess of $200, or $10 on installments of
16    $200 or less, but only one delinquency and collection
17    charge may be collected on any installment regardless of
18    the period during which it remains in default.
19    (f) With respect to precomputed loans:
20        (1) Loans shall be repayable in substantially equal and
21    consecutive weekly, biweekly, semimonthly, or monthly
22    installments of principal and interest combined, except
23    that the first installment period may be longer than one
24    month by not more than 15 days, and the first installment
25    payment amount may be larger than the remaining payments by
26    the amount of interest charged for the extra days; and

 

 

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1    provided further that monthly installment payment dates
2    may be omitted to accommodate borrowers with seasonal
3    income.
4        (2) Payments may be applied to the combined total of
5    principal and precomputed interest until the loan is fully
6    paid. Payments shall be applied in the order in which they
7    become due, except that any insurance proceeds received as
8    a result of any claim made on any insurance, unless
9    sufficient to prepay the contract in full, may be applied
10    to the unpaid installments of the total of payments in
11    inverse order.
12        (3) When any loan contract is paid in full by cash,
13    renewal or refinancing, or a new loan, one month or more
14    before the final installment due date, a licensee shall
15    refund or credit the obligor with the total of the
16    applicable interest for all fully unexpired installment
17    periods, as originally scheduled or as deferred, which
18    follow the day of prepayment; provided, if the prepayment
19    occurs prior to the first installment due date, the
20    licensee may retain 1/30 of the applicable interest for a
21    first installment period of one month for each day from the
22    date of the loan to the date of prepayment, and shall
23    refund or credit the obligor with the balance of the total
24    interest contracted for. If the maturity of the loan is
25    accelerated for any reason and judgment is entered, the
26    licensee shall credit the borrower with the same refund as

 

 

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1    if prepayment in full had been made on the date the
2    judgement is entered.
3        (4) The lender or creditor may, if the contract
4    provides, collect a delinquency or collection charge on
5    each installment in default for a period of not less than
6    10 days in an amount not exceeding 5% of the installment on
7    installments in excess of $200, or $10 on installments of
8    $200 or less, but only one delinquency or collection charge
9    may be collected on any installment regardless of the
10    period during which it remains in default.
11        (5) If the parties agree in writing, either in the loan
12    contract or in a subsequent agreement, to a deferment of
13    wholly unpaid installments, a licensee may grant a
14    deferment and may collect a deferment charge as provided in
15    this Section. A deferment postpones the scheduled due date
16    of the earliest unpaid installment and all subsequent
17    installments as originally scheduled, or as previously
18    deferred, for a period equal to the deferment period. The
19    deferment period is that period during which no installment
20    is scheduled to be paid by reason of the deferment. The
21    deferment charge for a one month period may not exceed the
22    applicable interest for the installment period immediately
23    following the due date of the last undeferred payment. A
24    proportionate charge may be made for deferment for periods
25    of more or less than one month. A deferment charge is
26    earned pro rata during the deferment period and is fully

 

 

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1    earned on the last day of the deferment period. Should a
2    loan be prepaid in full during a deferment period, the
3    licensee shall credit to the obligor a refund of the
4    unearned deferment charge in addition to any other refund
5    or credit made for prepayment of the loan in full.
6        (6) If two or more installments are delinquent one full
7    month or more on any due date, and if the contract so
8    provides, the licensee may reduce the unpaid balance by the
9    refund credit which would be required for prepayment in
10    full on the due date of the most recent maturing
11    installment in default. Thereafter, and in lieu of any
12    other default or deferment charges, the agreed rate of
13    interest or, in the case of small consumer loans, interest
14    at the rate of 18% per annum, may be charged on the unpaid
15    balance until fully paid.
16        (7) Fifteen days after the final installment as
17    originally scheduled or deferred, the licensee, for any
18    loan contract which has not previously been converted to
19    interest-bearing under paragraph (f), clause (6), may
20    compute and charge interest on any balance remaining
21    unpaid, including unpaid default or deferment charges, at
22    the agreed rate of interest or, in the case of small
23    consumer loans, interest at the rate of 18% per annum,
24    until fully paid. At the time of payment of said final
25    installment, the licensee shall give notice to the obligor
26    stating any amounts unpaid.

 

 

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1(Source: P.A. 101-563, eff. 8-23-19.)
 
2    (205 ILCS 670/15d)  (from Ch. 17, par. 5419)
3    Sec. 15d. Extra charges prohibited; exceptions. No amount
4in addition to the charges authorized by this Act shall be
5directly or indirectly charged, contracted for, or received,
6except (1) lawful fees paid to any public officer or agency to
7record, file or release security; (2) (i) costs and
8disbursements actually incurred in connection with a real
9estate loan, for any title insurance, title examination,
10abstract of title, survey, or appraisal, or paid to a trustee
11in connection with a trust deed, and (ii) in connection with a
12real estate loan those charges authorized by Section 4.1a of
13the Interest Act, whether called "points" or otherwise, which
14charges are imposed as a condition for making the loan and are
15not refundable in the event of prepayment of the loan; (3)
16costs and disbursements, including reasonable attorney's fees,
17incurred in legal proceedings to collect a loan or to realize
18on a security after default; and (4) an amount not exceeding
19$25, plus any actual expenses incurred in connection with a
20check or draft that is not honored because of insufficient or
21uncollected funds or because no such account exists; and (5) a
22document preparation fee not to exceed $25 for obtaining and
23reviewing credit reports and preparation of other documents.
24This Section does not prohibit the receipt of a commission,
25dividend, charge, or other benefit by the licensee or by an

 

 

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1employee, affiliate, or associate of the licensee from the
2insurance permitted by Sections 15a and 15b of this Act or from
3insurance in lieu of perfecting a security interest provided
4that the premiums for such insurance do not exceed the fees
5that otherwise could be contracted for by the licensee under
6this Section. Obtaining any of the items referred to in clause
7(i) of item (2) of this Section through the licensee or from
8any person specified by the licensee shall not be a condition
9precedent to the granting of the loan.
10(Source: P.A. 89-400, eff. 8-20-95; 90-437, eff. 1-1-98.)
 
11    (205 ILCS 670/17.5)
12    Sec. 17.5. Consumer reporting service.
13    (a) For the purpose of this Section, "certified database"
14means the consumer reporting service database established
15pursuant to the Payday Loan Reform Act. "Title-secured loan"
16means a loan in which, at commencement, a consumer provides to
17the licensee, as security for the loan, physical possession of
18the consumer's title to a motor vehicle.
19    (b) Licensees shall enter information regarding each loan
20into the certified database and shall follow the Department's
21related rules. Within 90 days after making a small consumer
22loan, a licensee shall enter information about the loan into
23the certified database.
24    (c) For every title-secured loan small consumer loan made,
25the licensee shall input information as provided in 38 Ill.

 

 

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1Adm. Code 110.420. the following information into the certified
2database within 90 days after the loan is made:
3        (i) the consumer's name and official identification
4    number (for purposes of this Act, "official identification
5    number" includes a Social Security Number, an Individual
6    Taxpayer Identification Number, a Federal Employer
7    Identification Number, an Alien Registration Number, or an
8    identification number imprinted on a passport or consular
9    identification document issued by a foreign government);
10        (ii) the consumer's gross monthly income;
11        (iii) the date of the loan;
12        (iv) the amount financed;
13        (v) the term of the loan;
14        (vi) the acquisition charge;
15        (vii) the monthly installment account handling charge;
16        (viii) the verification fee;
17        (ix) the number and amount of payments; and
18        (x) whether the loan is a first or subsequent
19    refinancing of a prior small consumer loan.
20    (d) Once a loan is entered with the certified database, the
21certified database shall provide to the licensee a dated,
22time-stamped statement acknowledging the certified database's
23receipt of the information and assigning each loan a unique
24loan number.
25    (e) The licensee shall update the certified database within
2690 days if any of the following events occur:

 

 

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1        (i) the loan is paid in full by cash;
2        (ii) the loan is refinanced;
3        (iii) the loan is renewed;
4        (iv) the loan is satisfied in full or in part by
5    collateral being sold after default;
6        (v) the loan is cancelled or rescinded; or
7        (vi) the consumer's obligation on the loan is otherwise
8    discharged by the licensee.
9    (f) To the extent a licensee sells a product or service to
10a consumer, other than a small consumer loan, and finances any
11portion of the cost of the product or service, the licensee
12shall, in addition to and at the same time as the information
13inputted under subsection (d) of this Section, enter into the
14certified database:
15        (i) a description of the product or service sold;
16        (ii) the charge for the product or service; and
17        (iii) the portion of the charge for the product or
18    service, if any, that is included in the amount financed by
19    a small consumer loan.
20    (d) (g) The certified database provider shall indemnify the
21licensee against all claims and actions arising from illegal or
22willful or wanton acts on the part of the certified database
23provider. The certified database provider may charge a fee not
24to exceed $1 for each loan entered into the certified database
25under subsection (d) of this Section. The database provider
26shall not charge any additional fees or charges to the

 

 

SB1792 Enrolled- 29 -LRB101 09871 AMC 54973 b

1licensee.
2    (h) All personally identifiable information regarding any
3consumer obtained by way of the certified database and
4maintained by the Department is strictly confidential and shall
5be exempt from disclosure under subsection (c) of Section 7 of
6the Freedom of Information Act.
7    (i) A licensee who submits information to a certified
8database provider in accordance with this Section shall not be
9liable to any person for any subsequent release or disclosure
10of that information by the certified database provider, the
11Department, or any other person acquiring possession of the
12information, regardless of whether such subsequent release or
13disclosure was lawful, authorized, or intentional.
14    (j) To the extent the certified database becomes
15unavailable to a licensee as a result of some event or events
16outside the control of the licensee or the certified database
17is decertified, the requirements of this Section and Section
1817.4 of this Act are suspended until such time as the certified
19database becomes available.
20(Source: P.A. 96-936, eff. 3-21-11; 97-813, eff. 7-13-12.)
 
21    (205 ILCS 670/17.1 rep.)
22    (205 ILCS 670/17.2 rep.)
23    (205 ILCS 670/17.3 rep.)
24    (205 ILCS 670/17.4 rep.)
25    Section 15-90-15. The Consumer Installment Loan Act is

 

 

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1amended by repealing Sections 17.1, 17.2, 17.3, and 17.4.
 
2    Section 15-90-20. The Payday Loan Reform Act is amended by
3changing Sections 1-10, 2-5, 2-10, 2-15, 2-20, 2-30, 2-40,
42-45, and 4-5 as follows:
 
5    (815 ILCS 122/1-10)
6    Sec. 1-10. Definitions. As used in this Act:
7    "Check" means a "negotiable instrument", as defined in
8Article 3 of the Uniform Commercial Code, that is drawn on a
9financial institution.
10    "Commercially reasonable method of verification" or
11"certified database" means a consumer reporting service
12database certified by the Department as effective in verifying
13that a proposed loan agreement is permissible under this Act,
14or, in the absence of the Department's certification, any
15reasonably reliable written verification by the consumer
16concerning (i) whether the consumer has any outstanding payday
17loans, (ii) the principal amount of those outstanding payday
18loans, and (iii) whether any payday loans have been paid in
19full by the consumer in the preceding 7 days.
20    "Consumer" means any natural person who, singly or jointly
21with another consumer, enters into a loan.
22    "Consumer reporting service" means an entity that provides
23a database certified by the Department.
24    "Department" means the Department of Financial and

 

 

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1Professional Regulation.
2    "Secretary" means the Secretary of Financial and
3Professional Regulation.
4    "Gross monthly income" means monthly income as
5demonstrated by official documentation of the income,
6including, but not limited to, a pay stub or a receipt
7reflecting payment of government benefits, for the period 30
8days prior to the date on which the loan is made.
9    "Lender" and "licensee" mean any person or entity,
10including any affiliate or subsidiary of a lender or licensee,
11that offers or makes a payday loan, buys a whole or partial
12interest in a payday loan, arranges a payday loan for a third
13party, or acts as an agent for a third party in making a payday
14loan, regardless of whether approval, acceptance, or
15ratification by the third party is necessary to create a legal
16obligation for the third party, and includes any other person
17or entity if the Department determines that the person or
18entity is engaged in a transaction that is in substance a
19disguised payday loan or a subterfuge for the purpose of
20avoiding this Act.
21    "Loan agreement" means a written agreement between a lender
22and consumer to make a loan to the consumer, regardless of
23whether any loan proceeds are actually paid to the consumer on
24the date on which the loan agreement is made.
25    "Member of the military" means a person serving in the
26armed forces of the United States, the Illinois National Guard,

 

 

SB1792 Enrolled- 32 -LRB101 09871 AMC 54973 b

1or any reserve component of the armed forces of the United
2States. "Member of the military" includes those persons engaged
3in (i) active duty, (ii) training or education under the
4supervision of the United States preliminary to induction into
5military service, or (iii) a period of active duty with the
6State of Illinois under Title 10 or Title 32 of the United
7States Code pursuant to order of the President or the Governor
8of the State of Illinois.
9    "Outstanding balance" means the total amount owed by the
10consumer on a loan to a lender, including all principal,
11finance charges, fees, and charges of every kind.
12    "Payday loan" or "loan" means a loan with a finance charge
13exceeding an annual percentage rate of 36% and with a term that
14does not exceed 120 days, including any transaction conducted
15via any medium whatsoever, including, but not limited to,
16paper, facsimile, Internet, or telephone, in which:
17        (1) A lender accepts one or more checks dated on the
18    date written and agrees to hold them for a period of days
19    before deposit or presentment, or accepts one or more
20    checks dated subsequent to the date written and agrees to
21    hold them for deposit; or
22        (2) A lender accepts one or more authorizations to
23    debit a consumer's bank account; or
24        (3) A lender accepts an interest in a consumer's wages,
25    including, but not limited to, a wage assignment.
26    The term "payday loan" includes "installment payday loan",

 

 

SB1792 Enrolled- 33 -LRB101 09871 AMC 54973 b

1unless otherwise specified in this Act.
2    "Principal amount" means the amount received by the
3consumer from the lender due and owing on a loan, excluding any
4finance charges, interest, fees, or other loan-related
5charges.
6    "Rollover" means to refinance, renew, amend, or extend a
7loan beyond its original term.
8(Source: P.A. 96-936, eff. 3-21-11.)
 
9    (815 ILCS 122/2-5)
10    Sec. 2-5. Loan terms.
11    (a) Without affecting the right of a consumer to prepay at
12any time without cost or penalty, no payday loan may have a
13minimum term of less than 13 days.
14    (b) No Except for an installment payday loan as defined in
15this Section, no payday loan may be made to a consumer if the
16loan would result in the consumer being indebted to one or more
17payday lenders for a period in excess of 45 consecutive days.
18Except as provided under subsection (c) of this Section and
19Section 2-40, if a consumer has or has had loans outstanding
20for a period in excess of 45 consecutive days, no payday lender
21may offer or make a loan to the consumer for at least 7
22calendar days after the date on which the outstanding balance
23of all payday loans made during the 45 consecutive day period
24is paid in full. For purposes of this subsection, the term
25"consecutive days" means a series of continuous calendar days

 

 

SB1792 Enrolled- 34 -LRB101 09871 AMC 54973 b

1in which the consumer has an outstanding balance on one or more
2payday loans; however, if a payday loan is made to a consumer
3within 6 days or less after the outstanding balance of all
4loans is paid in full, those days are counted as "consecutive
5days" for purposes of this subsection.
6    (c) (Blank). Notwithstanding anything in this Act to the
7contrary, a payday loan shall also include any installment loan
8otherwise meeting the definition of payday loan contained in
9Section 1-10, but that has a term agreed by the parties of not
10less than 112 days and not exceeding 180 days; hereinafter an
11"installment payday loan". The following provisions shall
12apply:
13        (i) Any installment payday loan must be fully
14    amortizing, with a finance charge calculated on the
15    principal balances scheduled to be outstanding and be
16    repayable in substantially equal and consecutive
17    installments, according to a payment schedule agreed by the
18    parties with not less than 13 days and not more than one
19    month between payments; except that the first installment
20    period may be longer than the remaining installment periods
21    by not more than 15 days, and the first installment payment
22    may be larger than the remaining installment payments by
23    the amount of finance charges applicable to the extra days.
24    In calculating finance charges under this subsection, when
25    the first installment period is longer than the remaining
26    installment periods, the amount of the finance charges

 

 

SB1792 Enrolled- 35 -LRB101 09871 AMC 54973 b

1    applicable to the extra days shall not be greater than
2    $15.50 per $100 of the original principal balance divided
3    by the number of days in a regularly scheduled installment
4    period and multiplied by the number of extra days
5    determined by subtracting the number of days in a regularly
6    scheduled installment period from the number of days in the
7    first installment period.
8        (ii) An installment payday loan may be refinanced by a
9    new installment payday loan one time during the term of the
10    initial loan; provided that the total duration of
11    indebtedness on the initial installment payday loan
12    combined with the total term of indebtedness of the new
13    loan refinancing that initial loan, shall not exceed 180
14    days. For purposes of this Act, a refinancing occurs when
15    an existing installment payday loan is paid from the
16    proceeds of a new installment payday loan.
17        (iii) In the event an installment payday loan is paid
18    in full prior to the date on which the last scheduled
19    installment payment before maturity is due, other than
20    through a refinancing, no licensee may offer or make a
21    payday loan to the consumer for at least 2 calendar days
22    thereafter.
23        (iv) No installment payday loan may be made to a
24    consumer if the loan would result in the consumer being
25    indebted to one or more payday lenders for a period in
26    excess of 180 consecutive days. The term "consecutive days"

 

 

SB1792 Enrolled- 36 -LRB101 09871 AMC 54973 b

1    does not include the date on which a consumer makes the
2    final installment payment.
3    (d) (Blank).
4    (e) No lender may make a payday loan to a consumer if the
5total of all payday loan payments coming due within the first
6calendar month of the loan, when combined with the payment
7amount of all of the consumer's other outstanding payday loans
8coming due within the same month, exceeds the lesser of:
9        (1) $1,000; or
10        (2) in the case of one or more payday loans, 25% of the
11    consumer's gross monthly income. ; or
12        (3) in the case of one or more installment payday
13    loans, 22.5% of the consumer's gross monthly income; or
14        (4) in the case of a payday loan and an installment
15    payday loan, 22.5% of the consumer's gross monthly income.
16    No loan shall be made to a consumer who has an outstanding
17balance on 2 payday loans, except that, for a period of 12
18months after March 21, 2011 (the effective date of Public Act
1996-936), consumers with an existing CILA loan may be issued an
20installment loan issued under this Act from the company from
21which their CILA loan was issued.
22    (e-5) A lender shall not contract for or receive a charge
23exceeding a 36% annual percentage rate on the unpaid balance of
24the amount financed for a payday loan. For purposes of this
25Section, the annual percentage rate shall be calculated as such
26rate is calculated using the system for calculating a military

 

 

SB1792 Enrolled- 37 -LRB101 09871 AMC 54973 b

1annual percentage rate under 32 CFR 232.4 as in effect on the
2effective date of this amendatory Act of the 101st General
3Assembly. Except as provided in subsection (c)(i), no lender
4may charge more than $15.50 per $100 loaned on any payday loan,
5or more than $15.50 per $100 on the initial principal balance
6and on the principal balances scheduled to be outstanding
7during any installment period on any installment payday loan.
8Except for installment payday loans and except as provided in
9Section 2-25, this charge is considered fully earned as of the
10date on which the loan is made. For purposes of determining the
11finance charge earned on an installment payday loan, the
12disclosed annual percentage rate shall be applied to the
13principal balances outstanding from time to time until the loan
14is paid in full, or until the maturity date, whichever occurs
15first. No finance charge may be imposed after the final
16scheduled maturity date.
17    When any loan contract is paid in full, the licensee shall
18refund any unearned finance charge. The unearned finance charge
19that is refunded shall be calculated based on a method that is
20at least as favorable to the consumer as the actuarial method,
21as defined by the federal Truth in Lending Act. The sum of the
22digits or rule of 78ths method of calculating prepaid interest
23refunds is prohibited.
24    (f) A lender may not take or attempt to take an interest in
25any of the consumer's personal property to secure a payday
26loan.

 

 

SB1792 Enrolled- 38 -LRB101 09871 AMC 54973 b

1    (g) A consumer has the right to redeem a check or any other
2item described in the definition of payday loan under Section
31-10 issued in connection with a payday loan from the lender
4holding the check or other item at any time before the payday
5loan becomes payable by paying the full amount of the check or
6other item.
7    (h) (Blank). For the purpose of this Section,
8"substantially equal installment" includes a last regularly
9scheduled payment that may be less than, but no more than 5%
10larger than, the previous scheduled payment according to a
11disclosed payment schedule agreed to by the parties.
12(Source: P.A. 100-201, eff. 8-18-17; 101-563, eff. 8-23-19.)
 
13    (815 ILCS 122/2-10)
14    Sec. 2-10. Permitted fees.
15    (a) If there are insufficient funds to pay a check,
16Automatic Clearing House (ACH) debit, or any other item
17described in the definition of payday loan under Section 1-10
18on the day of presentment and only after the lender has
19incurred an expense, a lender may charge a fee not to exceed
20$25. Only one such fee may be collected by the lender with
21respect to a particular check, ACH debit, or item even if it
22has been deposited and returned more than once. A lender shall
23present the check, ACH debit, or other item described in the
24definition of payday loan under Section 1-10 for payment not
25more than twice. A fee charged under this subsection (a) is a

 

 

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1lender's exclusive charge for late payment.
2    (a-5) A lender may charge a borrower a fee not to exceed $1
3for the verification required under Section 2-15 of this Act in
4connection with a payday loan. and, until July 1, 2020, in
5connection with an installment payday loan. Beginning July 1,
62020, a lender may charge a borrower a fee not to exceed $3 for
7the verification required under Section 2-15 of this Act in
8connection with an installment payday loan. In no event may a
9fee be greater than the amount charged by the certified
10consumer reporting service. Only one such fee may be collected
11by the lender with respect to a particular loan.
12    (b) Except for the finance charges described in Section 2-5
13and as specifically allowed by this Section, a lender may not
14impose on a consumer any additional finance charges, interest,
15fees, or charges of any sort for any purpose.
16(Source: P.A. 100-1168, eff. 6-1-19.)
 
17    (815 ILCS 122/2-15)
18    Sec. 2-15. Verification.
19    (a) Before entering into a loan agreement with a consumer,
20a lender must use a commercially reasonable method of
21verification to verify that the proposed loan agreement is
22permissible under this Act.
23    (b) Within 6 months after the effective date of this Act,
24the Department shall certify that one or more consumer
25reporting service databases are commercially reasonable

 

 

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1methods of verification. Upon certifying that a consumer
2reporting service database is a commercially reasonable method
3of verification, the Department shall:
4        (1) provide reasonable notice to all licensees
5    identifying the commercially reasonable methods of
6    verification that are available; and
7        (2) immediately upon certification, require each
8    licensee to use a commercially reasonable method of
9    verification as a means of complying with subsection (a) of
10    this Section.
11    (c) Except as otherwise provided in this Section, all
12personally identifiable information regarding any consumer
13obtained by way of the certified database and maintained by the
14Department is strictly confidential and shall be exempt from
15disclosure under Section 7(1)(b)(i) of the Freedom of
16Information Act.
17    (d) Notwithstanding any other provision of law to the
18contrary, a consumer seeking a payday loan may make a direct
19inquiry to the consumer reporting service to request a more
20detailed explanation of the basis for a consumer reporting
21service's determination that the consumer is ineligible for a
22new payday loan.
23    (e) In certifying a commercially reasonable method of
24verification, the Department shall ensure that the certified
25database:
26        (1) provides real-time access through an Internet

 

 

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1    connection or, if real-time access through an Internet
2    connection becomes unavailable to lenders due to a consumer
3    reporting service's technical problems incurred by the
4    consumer reporting service, through alternative
5    verification mechanisms, including, but not limited to,
6    verification by telephone;
7        (2) is accessible to the Department and to licensees in
8    order to ensure compliance with this Act and in order to
9    provide any other information that the Department deems
10    necessary;
11        (3) requires licensees to input whatever information
12    is required by the Department;
13        (4) maintains a real-time copy of the required
14    reporting information that is available to the Department
15    at all times and is the property of the Department;
16        (5) provides licensees only with a statement that a
17    consumer is eligible or ineligible for a new payday loan
18    and a description of the reason for the determination; and
19        (6) contains safeguards to ensure that all information
20    contained in the database regarding consumers is kept
21    strictly confidential.
22    (f) The licensee shall update the certified database by
23inputting all information required under item (3) of subsection
24(e):
25        (1) on the same day that a payday loan is made;
26        (2) on the same day that a consumer elects a repayment

 

 

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1    plan, as provided in Section 2-40; and
2        (3) on the same day that a consumer's payday loan is
3    paid in full. , including the refinancing of an installment
4    payday loan as permitted under subsection (c) of Section
5    2-5.
6    (g) A licensee may rely on the information contained in the
7certified database as accurate and is not subject to any
8administrative penalty or liability as a result of relying on
9inaccurate information contained in the database.
10    (h) The certified consumer reporting service shall
11indemnify the licensee against all claims and actions arising
12from illegal or willful or wanton acts on the part of the
13certified consumer reporting service.
14    (i) The certified consumer reporting service may charge a
15verification fee not to exceed $1 upon a loan being made or
16entered into in the database. Beginning July 1, 2020, the
17certified consumer reporting service may charge a verification
18fee not to exceed $3 for an installment payday loan being made
19or entered into the data base. The certified consumer reporting
20service shall not charge any additional fees or charges.
21(Source: P.A. 100-1168, eff. 6-1-19.)
 
22    (815 ILCS 122/2-20)
23    Sec. 2-20. Required disclosures.
24    (a) Before a payday loan is made, a lender shall deliver to
25the consumer a pamphlet prepared by the Secretary that:

 

 

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1        (1) explains, in simple English and Spanish, all of the
2    consumer's rights and responsibilities in a payday loan
3    transaction;
4        (2) includes a toll-free number to the Secretary's
5    office to handle concerns or provide information about
6    whether a lender is licensed, whether complaints have been
7    filed with the Secretary, and the resolution of those
8    complaints; and
9        (3) provides information regarding the availability of
10    debt management services.
11    (b) Lenders shall provide consumers with a written
12agreement that may be kept by the consumer. The written
13agreement must include the following information in English and
14in the language in which the loan was negotiated:
15        (1) the name and address of the lender making the
16    payday loan, and the name and title of the individual
17    employee who signs the agreement on behalf of the lender;
18        (2) disclosures required by the federal Truth in
19    Lending Act;
20        (3) a clear description of the consumer's payment
21    obligations under the loan;
22        (4) the following statement, in at least 14-point bold
23    type face: "You cannot be prosecuted in criminal court to
24    collect this loan." The information required to be
25    disclosed under this subdivision (4) must be conspicuously
26    disclosed in the loan document and shall be located

 

 

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1    immediately preceding the signature of the consumer; and
2        (5) the following statement, in at least 14-point bold
3    type face:
4        "WARNING: This loan is not intended to meet long-term
5    financial needs. This loan should be used only to meet
6    short-term cash needs. The cost of your loan may be higher
7    than loans offered by other lending institutions. This loan
8    is regulated by the Department of Financial and
9    Professional Regulation."
10    (c) The following notices in English and Spanish must be
11conspicuously posted by a lender in each location of a business
12providing payday loans:
13        (1) A notice that informs consumers that the lender
14    cannot use the criminal process against a consumer to
15    collect any payday loan.
16        (2) The schedule of all finance charges to be charged
17    on loans with an example of the amounts that would be
18    charged on a $100 loan payable in 13 days and , a $400 loan
19    payable in 30 days, and an installment payday loan of $400
20    payable on a monthly basis over 180 days, giving the
21    corresponding annual percentage rate.
22        (3) In one-inch bold type, a notice to the public in
23    the lending area of each business location containing the
24    following statement:
25        "WARNING: This loan is not intended to meet long-term
26    financial needs. This loan should be used only to meet

 

 

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1    short-term cash needs. The cost of your loan may be higher
2    than loans offered by other lending institutions. This loan
3    is regulated by the Department of Financial and
4    Professional Regulation."
5        (4) In one-inch bold type, a notice to the public in
6    the lending area of each business location containing the
7    following statement:
8        "INTEREST-FREE REPAYMENT PLAN: If you still owe on one
9    or more payday loans, other than an installment payday
10    loan, after 35 days, you are entitled to enter into a
11    repayment plan. The repayment plan will give you at least
12    55 days to repay your loan in installments with no
13    additional finance charges, interest, fees, or other
14    charges of any kind."
15(Source: P.A. 96-936, eff. 3-21-11.)
 
16    (815 ILCS 122/2-30)
17    Sec. 2-30. Rollovers prohibited. Rollover of a payday loan
18by any lender is prohibited. , except as provided in subsection
19(c) of Section 2-5. This Section does not prohibit entering
20into a repayment plan, as provided under Section 2-40.
21(Source: P.A. 96-936, eff. 3-21-11.)
 
22    (815 ILCS 122/2-40)
23    Sec. 2-40. Repayment plan.
24    (a) At the time a payday loan is made, the lender must

 

 

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1provide the consumer with a separate written notice signed by
2the consumer of the consumer's right to request a repayment
3plan. The written notice must comply with the requirements of
4subsection (c).
5    (b) The loan agreement must include the following language
6in at least 14-point bold type: IF YOU STILL OWE ON ONE OR MORE
7PAYDAY LOANS AFTER 35 DAYS, YOU ARE ENTITLED TO ENTER INTO A
8REPAYMENT PLAN. THE REPAYMENT PLAN WILL GIVE YOU AT LEAST 55
9DAYS TO REPAY YOUR LOAN IN INSTALLMENTS WITH NO ADDITIONAL
10FINANCE CHARGES, INTEREST, FEES, OR OTHER CHARGES OF ANY KIND.
11    (c) At the time a payday loan is made, on the first page of
12the loan agreement and in a separate document signed by the
13consumer, the following shall be inserted in at least 14-point
14bold type: I UNDERSTAND THAT IF I STILL OWE ON ONE OR MORE
15PAYDAY LOANS AFTER 35 DAYS, I AM ENTITLED TO ENTER INTO A
16REPAYMENT PLAN THAT WILL GIVE ME AT LEAST 55 DAYS TO REPAY THE
17LOAN IN INSTALLMENTS WITH NO ADDITIONAL FINANCE CHARGES,
18INTEREST, FEES, OR OTHER CHARGES OF ANY KIND.
19    (d) If the consumer has or has had one or more payday loans
20outstanding for 35 consecutive days, any payday loan
21outstanding on the 35th consecutive day shall be payable under
22the terms of a repayment plan as provided for in this Section,
23if the consumer requests the repayment plan. As to any loan
24that becomes eligible for a repayment plan under this
25subsection, the consumer has until 28 days after the default
26date of the loan to request a repayment plan. Within 48 hours

 

 

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1after the request for a repayment plan is made, the lender must
2prepare the repayment plan agreement and both parties must
3execute the agreement. Execution of the repayment plan
4agreement shall be made in the same manner in which the loan
5was made and shall be evidenced in writing.
6    (e) The terms of the repayment plan for a payday loan must
7include the following:
8        (1) The lender may not impose any charge on the
9    consumer for requesting or using a repayment plan.
10    Performance of the terms of the repayment plan extinguishes
11    the consumer's obligation on the loan.
12        (2) No lender shall charge the consumer any finance
13    charges, interest, fees, or other charges of any kind,
14    except a fee for insufficient funds, as provided under
15    Section 2-10.
16        (3) The consumer shall be allowed to repay the loan in
17    at least 4 equal installments with at least 13 days between
18    installments, provided that the term of the repayment plan
19    does not exceed 90 days. The first payment under the
20    repayment plan shall not be due before at least 13 days
21    after the repayment plan is signed by both parties. The
22    consumer may prepay the amount due under the repayment plan
23    at any time, without charge or penalty.
24        (4) The length of time between installments may be
25    extended by the parties so long as the total period of
26    repayment does not exceed 90 days. Any such modification

 

 

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1    must be in writing and signed by both parties.
2    (f) Notwithstanding any provision of law to the contrary, a
3lender is prohibited from making a payday loan to a consumer
4who has a payday loan outstanding under a repayment plan and
5for at least 14 days after the outstanding balance of the loan
6under the repayment plan and the outstanding balance of all
7other payday loans outstanding during the term of the repayment
8plan are paid in full.
9    (g) A lender may not accept postdated checks for payments
10under a repayment plan.
11    (h) Notwithstanding any provision of law to the contrary, a
12lender may voluntarily agree to enter into a repayment plan
13with a consumer at any time. If a consumer is eligible for a
14repayment plan under subsection (d), any repayment agreement
15constitutes a repayment plan under this Section and all
16provisions of this Section apply to that agreement.
17    (i) (Blank). The provisions of this Section 2-40 do not
18apply to an installment payday loan, except for subsection (f)
19of this Section.
20(Source: P.A. 96-936, eff. 3-21-11.)
 
21    (815 ILCS 122/2-45)
22    Sec. 2-45. Default.
23    (a) No legal proceeding of any kind, including, but not
24limited to, a lawsuit or arbitration, may be filed or initiated
25against a consumer to collect on a payday loan until 28 days

 

 

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1after the default date of the loan, or, in the case of a payday
2loan under a repayment plan, for 28 days after the default date
3under the terms of the repayment plan. , or in the case of an
4installment payday loan, for 28 days after default in making a
5scheduled payment.
6    (b) Upon and after default, a lender shall not charge the
7consumer any finance charges, interest, fees, or charges of any
8kind, other than the insufficient fund fee described in Section
92-10.
10    (c) Notwithstanding whether a loan is or has been in
11default, once the loan becomes subject to a repayment plan, the
12loan shall not be construed to be in default until the default
13date provided under the terms of the repayment plan.
14(Source: P.A. 96-936, eff. 3-21-11.)
 
15    (815 ILCS 122/4-5)
16    Sec. 4-5. Prohibited acts. A licensee or unlicensed person
17or entity making payday loans may not commit, or have committed
18on behalf of the licensee or unlicensed person or entity, any
19of the following acts:
20        (1) Threatening to use or using the criminal process in
21    this or any other state to collect on the loan.
22        (2) Using any device or agreement that would have the
23    effect of charging or collecting more fees or charges than
24    allowed by this Act, including, but not limited to,
25    entering into a different type of transaction with the

 

 

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1    consumer.
2        (3) Engaging in unfair, deceptive, or fraudulent
3    practices in the making or collecting of a payday loan.
4        (4) Using or attempting to use the check provided by
5    the consumer in a payday loan as collateral for a
6    transaction not related to a payday loan.
7        (5) Knowingly accepting payment in whole or in part of
8    a payday loan through the proceeds of another payday loan
9    provided by any licensee, except as provided in subsection
10    (c) of Section 2.5.
11        (6) Knowingly accepting any security, other than that
12    specified in the definition of payday loan in Section 1-10,
13    for a payday loan.
14        (7) Charging any fees or charges other than those
15    specifically authorized by this Act.
16        (8) Threatening to take any action against a consumer
17    that is prohibited by this Act or making any misleading or
18    deceptive statements regarding the payday loan or any
19    consequences thereof.
20        (9) Making a misrepresentation of a material fact by an
21    applicant for licensure in obtaining or attempting to
22    obtain a license.
23        (10) Including any of the following provisions in loan
24    documents required by subsection (b) of Section 2-20:
25            (A) a confession of judgment clause;
26            (B) a waiver of the right to a jury trial, if

 

 

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1        applicable, in any action brought by or against a
2        consumer, unless the waiver is included in an
3        arbitration clause allowed under subparagraph (C) of
4        this paragraph (11);
5            (C) a mandatory arbitration clause that is
6        oppressive, unfair, unconscionable, or substantially
7        in derogation of the rights of consumers; or
8            (D) a provision in which the consumer agrees not to
9        assert any claim or defense arising out of the
10        contract.
11        (11) Selling any insurance of any kind whether or not
12    sold in connection with the making or collecting of a
13    payday loan.
14        (12) Taking any power of attorney.
15        (13) Taking any security interest in real estate.
16        (14) Collecting a delinquency or collection charge on
17    any installment regardless of the period in which it
18    remains in default.
19        (15) Collecting treble damages on an amount owing from
20    a payday loan.
21        (16) Refusing, or intentionally delaying or
22    inhibiting, the consumer's right to enter into a repayment
23    plan pursuant to this Act.
24        (17) Charging for, or attempting to collect,
25    attorney's fees, court costs, or arbitration costs
26    incurred in connection with the collection of a payday

 

 

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1    loan.
2        (18) Making a loan in violation of this Act.
3        (19) Garnishing the wages or salaries of a consumer who
4    is a member of the military.
5        (20) Failing to suspend or defer collection activity
6    against a consumer who is a member of the military and who
7    has been deployed to a combat or combat-support posting.
8        (21) Contacting the military chain of command of a
9    consumer who is a member of the military in an effort to
10    collect on a payday loan.
11        (22) Making or offering to make any loan other than a
12    payday loan or a title-secured loan, provided however, that
13    to make or offer to make a title-secured loan, a licensee
14    must obtain a license under the Consumer Installment Loan
15    Act.
16        (23) Making or offering a loan in violation of the
17    Predatory Loan Prevention Act.
18(Source: P.A. 96-936, eff. 3-21-11.)
 
19    Section 15-90-25. The Interest Act is amended by changing
20Sections 4 and 4a as follows:
 
21    (815 ILCS 205/4)  (from Ch. 17, par. 6404)
22    Sec. 4. General interest rate.
23    (1) Except as otherwise provided in Section 4.05, in all
24written contracts it shall be lawful for the parties to

 

 

SB1792 Enrolled- 53 -LRB101 09871 AMC 54973 b

1stipulate or agree that an annual percentage rate of 9% per
2annum, or any less sum of interest, shall be taken and paid
3upon every $100 of money loaned or in any manner due and owing
4from any person to any other person or corporation in this
5state, and after that rate for a greater or less sum, or for a
6longer or shorter time, except as herein provided.
7    The maximum rate of interest that may lawfully be
8contracted for is determined by the law applicable thereto at
9the time the contract is made. Any provision in any contract,
10whether made before or after July 1, 1969, which provides for
11or purports to authorize, contingent upon a change in the
12Illinois law after the contract is made, any rate of interest
13greater than the maximum lawful rate at the time the contract
14is made, is void.
15    It is lawful for a state bank or a branch of an
16out-of-state bank, as those terms are defined in Section 2 of
17the Illinois Banking Act, to receive or to contract to receive
18and collect interest and charges at any rate or rates agreed
19upon by the bank or branch and the borrower. It is lawful for a
20savings bank chartered under the Savings Bank Act or a savings
21association chartered under the Illinois Savings and Loan Act
22of 1985 to receive or contract to receive and collect interest
23and charges at any rate agreed upon by the savings bank or
24savings association and the borrower.
25    It is lawful to receive or to contract to receive and
26collect interest and charges as authorized by this Act and as

 

 

SB1792 Enrolled- 54 -LRB101 09871 AMC 54973 b

1authorized by the Consumer Installment Loan Act, and by the
2"Consumer Finance Act", approved July 10, 1935, as now or
3hereafter amended, or by the Payday Loan Reform Act, the Retail
4Installment Sales Act, the Illinois Financial Services
5Development Act, or the Motor Vehicle Retail Installment Sales
6Act. It is lawful to charge, contract for, and receive any rate
7or amount of interest or compensation, except as otherwise
8provided in the Predatory Loan Prevention Act, with respect to
9the following transactions:
10        (a) Any loan made to a corporation;
11        (b) Advances of money, repayable on demand, to an
12    amount not less than $5,000, which are made upon warehouse
13    receipts, bills of lading, certificates of stock,
14    certificates of deposit, bills of exchange, bonds or other
15    negotiable instruments pledged as collateral security for
16    such repayment, if evidenced by a writing;
17        (c) Any credit transaction between a merchandise
18    wholesaler and retailer; any business loan to a business
19    association or copartnership or to a person owning and
20    operating a business as sole proprietor or to any persons
21    owning and operating a business as joint venturers, joint
22    tenants or tenants in common, or to any limited
23    partnership, or to any trustee owning and operating a
24    business or whose beneficiaries own and operate a business,
25    except that any loan which is secured (1) by an assignment
26    of an individual obligor's salary, wages, commissions or

 

 

SB1792 Enrolled- 55 -LRB101 09871 AMC 54973 b

1    other compensation for services, or (2) by his household
2    furniture or other goods used for his personal, family or
3    household purposes shall be deemed not to be a loan within
4    the meaning of this subsection; and provided further that a
5    loan which otherwise qualifies as a business loan within
6    the meaning of this subsection shall not be deemed as not
7    so qualifying because of the inclusion, with other security
8    consisting of business assets of any such obligor, of real
9    estate occupied by an individual obligor solely as his
10    residence. The term "business" shall be deemed to mean a
11    commercial, agricultural or industrial enterprise which is
12    carried on for the purpose of investment or profit, but
13    shall not be deemed to mean the ownership or maintenance of
14    real estate occupied by an individual obligor solely as his
15    residence;
16        (d) Any loan made in accordance with the provisions of
17    Subchapter I of Chapter 13 of Title 12 of the United States
18    Code, which is designated as "Housing Renovation and
19    Modernization";
20        (e) Any mortgage loan insured or upon which a
21    commitment to insure has been issued under the provisions
22    of the National Housing Act, Chapter 13 of Title 12 of the
23    United States Code;
24        (f) Any mortgage loan guaranteed or upon which a
25    commitment to guaranty has been issued under the provisions
26    of the Veterans' Benefits Act, Subchapter II of Chapter 37

 

 

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1    of Title 38 of the United States Code;
2        (g) Interest charged by a broker or dealer registered
3    under the Securities Exchange Act of 1934, as amended, or
4    registered under the Illinois Securities Law of 1953,
5    approved July 13, 1953, as now or hereafter amended, on a
6    debit balance in an account for a customer if such debit
7    balance is payable at will without penalty and is secured
8    by securities as defined in Uniform Commercial
9    Code-Investment Securities;
10        (h) Any loan made by a participating bank as part of
11    any loan guarantee program which provides for loans and for
12    the refinancing of such loans to medical students, interns
13    and residents and which are guaranteed by the American
14    Medical Association Education and Research Foundation;
15        (i) Any loan made, guaranteed, or insured in accordance
16    with the provisions of the Housing Act of 1949, Subchapter
17    III of Chapter 8A of Title 42 of the United States Code and
18    the Consolidated Farm and Rural Development Act,
19    Subchapters I, II, and III of Chapter 50 of Title 7 of the
20    United States Code;
21        (j) Any loan by an employee pension benefit plan, as
22    defined in Section 3 (2) of the Employee Retirement Income
23    Security Act of 1974 (29 U.S.C.A. Sec. 1002), to an
24    individual participating in such plan, provided that such
25    loan satisfies the prohibited transaction exemption
26    requirements of Section 408 (b) (1) (29 U.S.C.A. Sec. 1108

 

 

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1    (b) (1)) or Section 2003 (a) (26 U.S.C.A. Sec. 4975 (d)
2    (1)) of the Employee Retirement Income Security Act of
3    1974;
4        (k) Written contracts, agreements or bonds for deed
5    providing for installment purchase of real estate,
6    including a manufactured home as defined in subdivision
7    (53) of Section 9-102 of the Uniform Commercial Code that
8    is real property as defined in the Conveyance and
9    Encumbrance of Manufactured Homes as Real Property and
10    Severance Act;
11        (l) Loans secured by a mortgage on real estate,
12    including a manufactured home as defined in subdivision
13    (53) of Section 9-102 of the Uniform Commercial Code that
14    is real property as defined in the Conveyance and
15    Encumbrance of Manufactured Homes as Real Property and
16    Severance Act;
17        (m) Loans made by a sole proprietorship, partnership,
18    or corporation to an employee or to a person who has been
19    offered employment by such sole proprietorship,
20    partnership, or corporation made for the sole purpose of
21    transferring an employee or person who has been offered
22    employment to another office maintained and operated by the
23    same sole proprietorship, partnership, or corporation;
24        (n) Loans to or for the benefit of students made by an
25    institution of higher education.
26    (2) Except for loans described in subparagraph (a), (c),

 

 

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1(d), (e), (f) or (i) of subsection (1) of this Section, and
2except to the extent permitted by the applicable statute for
3loans made pursuant to Section 4a or pursuant to the Consumer
4Installment Loan Act:
5        (a) Whenever the rate of interest exceeds an annual
6    percentage rate of 8% per annum on any written contract,
7    agreement or bond for deed providing for the installment
8    purchase of residential real estate, or on any loan secured
9    by a mortgage on residential real estate, it shall be
10    unlawful to provide for a prepayment penalty or other
11    charge for prepayment.
12        (b) No agreement, note or other instrument evidencing a
13    loan secured by a mortgage on residential real estate, or
14    written contract, agreement or bond for deed providing for
15    the installment purchase of residential real estate, may
16    provide for any change in the contract rate of interest
17    during the term thereof. However, if the Congress of the
18    United States or any federal agency authorizes any class of
19    lender to enter, within limitations, into mortgage
20    contracts or written contracts, agreements or bonds for
21    deed in which the rate of interest may be changed during
22    the term of the contract, any person, firm, corporation or
23    other entity not otherwise prohibited from entering into
24    mortgage contracts or written contracts, agreements or
25    bonds for deed in Illinois may enter into mortgage
26    contracts or written contracts, agreements or bonds for

 

 

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1    deed in which the rate of interest may be changed during
2    the term of the contract, within the same limitations.
3    (3) In any contract or loan which is secured by a mortgage,
4deed of trust, or conveyance in the nature of a mortgage, on
5residential real estate, the interest which is computed,
6calculated, charged, or collected pursuant to such contract or
7loan, or pursuant to any regulation or rule promulgated
8pursuant to this Act, may not be computed, calculated, charged
9or collected for any period of time occurring after the date on
10which the total indebtedness, with the exception of late
11payment penalties, is paid in full.
12    (4) For purposes of this Section, a prepayment shall mean
13the payment of the total indebtedness, with the exception of
14late payment penalties if incurred or charged, on any date
15before the date specified in the contract or loan agreement on
16which the total indebtedness shall be paid in full, or before
17the date on which all payments, if timely made, shall have been
18made. In the event of a prepayment of the indebtedness which is
19made on a date after the date on which interest on the
20indebtedness was last computed, calculated, charged, or
21collected but before the next date on which interest on the
22indebtedness was to be calculated, computed, charged, or
23collected, the lender may calculate, charge and collect
24interest on the indebtedness for the period which elapsed
25between the date on which the prepayment is made and the date
26on which interest on the indebtedness was last computed,

 

 

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1calculated, charged or collected at a rate equal to 1/360 of
2the annual rate for each day which so elapsed, which rate shall
3be applied to the indebtedness outstanding as of the date of
4prepayment. The lender shall refund to the borrower any
5interest charged or collected which exceeds that which the
6lender may charge or collect pursuant to the preceding
7sentence. The provisions of this amendatory Act of 1985 shall
8apply only to contracts or loans entered into on or after the
9effective date of this amendatory Act, but shall not apply to
10contracts or loans entered into on or after that date that are
11subject to Section 4a of this Act, the Consumer Installment
12Loan Act, the Payday Loan Reform Act, the Predatory Loan
13Prevention Act, or the Retail Installment Sales Act, or that
14provide for the refund of precomputed interest on prepayment in
15the manner provided by such Act.
16    (5) For purposes of items (a) and (c) of subsection (1) of
17this Section, a rate or amount of interest may be lawfully
18computed when applying the ratio of the annual interest rate
19over a year based on 360 days. The provisions of this
20amendatory Act of the 96th General Assembly are declarative of
21existing law.
22    (6) For purposes of this Section, "real estate" and "real
23property" include a manufactured home, as defined in
24subdivision (53) of Section 9-102 of the Uniform Commercial
25Code that is real property as defined in the Conveyance and
26Encumbrance of Manufactured Homes as Real Property and

 

 

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1Severance Act.
2(Source: P.A. 98-749, eff. 7-16-14.)
 
3    (815 ILCS 205/4a)  (from Ch. 17, par. 6410)
4    Sec. 4a. Installment loan rate.
5    (a) On money loaned to or in any manner owing from any
6person, whether secured or unsecured, except where the money
7loaned or in any manner owing is directly or indirectly for the
8purchase price of real estate or an interest therein and is
9secured by a lien on or retention of title to that real estate
10or interest therein, to an amount not more than $25,000
11(excluding interest) which is evidenced by a written instrument
12providing for the payment thereof in 2 or more periodic
13installments over a period of not more than 181 months from the
14date of the execution of the written instrument, it is lawful
15to receive or to contract to receive and collect either of the
16following:
17        (i) Interest interest in an amount equivalent to
18    interest computed at a rate not exceeding an annual
19    percentage rate of 9% per year on the entire principal
20    amount of the money loaned or in any manner owing for the
21    period from the date of the making of the loan or the
22    incurring of the obligation for the amount owing evidenced
23    by the written instrument until the date of the maturity of
24    the last installment thereof, and to add that amount to the
25    principal, except that there shall be no limit on the rate

 

 

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1    of interest which may be received or contracted to be
2    received and collected by (1) any bank that has its main
3    office or, after May 31, 1997, a branch in this State; or
4    (2) a savings and loan association chartered under the
5    Illinois Savings and Loan Act of 1985, or a savings bank
6    chartered under the Savings Bank Act, or a federal savings
7    and loan association established under the laws of the
8    United States and having its main office in this State.
9        It is lawful to receive or to contract to receive and
10    collect interest and charges as authorized by the Interest
11    Act, the Consumer Installment Loan Act, the Retail
12    Installment Sales Act, the Motor Vehicle Retail
13    Installment Sales Act, the Payday Loan Reform Act, and the
14    Illinois Financial Services Development Act.
15        In any case in which interest is received, contracted
16    for, or collected on the basis of paragraph (i) of
17    subsection (a) of Section 4a, the debtor may satisfy in
18    full at any time before maturity the debt evidenced by the
19    written instrument, and in so satisfying must receive a
20    refund credit against the total amount of interest added to
21    the principal computed in the manner provided under
22    paragraph (3) of subsection (f) of Section 15 of the
23    Consumer Installment Loan Act for refunds or credits of
24    applicable interest on payment in full of precomputed loans
25    before the final installment due date. ; or (3) any lender
26    licensed under either the Consumer Finance Act or the

 

 

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1    Consumer Installment Loan Act, but in any case in which
2    interest is received, contracted for or collected on the
3    basis of this clause (i), the debtor may satisfy in full at
4    any time before maturity the debt evidenced by the written
5    instrument, and in so satisfying must receive a refund
6    credit against the total amount of interest added to the
7    principal computed in the manner provided under Section
8    15(f)(3) of the Consumer Installment Loan Act for refunds
9    or credits of applicable interest on payment in full of
10    precomputed loans before the final installment due date; or
11        (ii) Interest interest accrued on the principal
12    balance from time to time remaining unpaid, from the date
13    of making of the loan or the incurring of the obligation to
14    the date of the payment of the debt in full, at a rate not
15    exceeding the annual percentage rate equivalent of the rate
16    permitted to be charged under clause (i) above, but in any
17    such case the debtor may, provided that the debtor shall
18    have paid in full all interest and other charges accrued to
19    the date of such prepayment, prepay the principal balance
20    in full or in part at any time, and interest shall, upon
21    any such prepayment, cease to accrue on the principal
22    amount which has been prepaid.
23    (b) Whenever the principal amount of an installment loan is
24$300 or more and the repayment period is 6 months or more, a
25minimum charge of $15 may be collected instead of interest, but
26only one minimum charge may be collected from the same person

 

 

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1during one year. When the principal amount of the loan
2(excluding interest) is $800 or less, the lender or creditor
3may contract for and receive a service charge not to exceed $5
4in addition to interest; and that service charge may be
5collected when the loan is made, but only one service charge
6may be contracted for, received, or collected from the same
7person during one year.
8    (c) Credit life insurance and credit accident and health
9insurance, and any charge therefor which is deducted from the
10loan or paid by the obligor, must comply with Article IX 1/2 of
11the Illinois Insurance Code and all lawful requirements of the
12Director of Insurance related thereto. When there are 2 or more
13obligors on the loan contract, only one charge for credit life
14insurance and credit accident and health insurance may be made
15and only one of the obligors may be required to be insured.
16Insurance obtained from, by or through the lender or creditor
17must be in effect when the loan is transacted. The purchase of
18that insurance from an agent, broker or insurer specified by
19the lender or creditor may not be a condition precedent to the
20granting of the loan.
21    (d) The lender or creditor may require the obligor to
22provide property insurance on security other than household
23goods, furniture and personal effects. The amount and term of
24the insurance must be reasonable in relation to the amount and
25term of the loan contract and the type and value of the
26security, and the insurance must be procured in accordance with

 

 

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1the insurance laws of this State. The purchase of that
2insurance from an agent, broker or insurer specified by the
3lender or creditor may not be a condition precedent to the
4granting of the loan.
5    (e) The lender or creditor may, if the contract provides,
6collect a delinquency and collection charge on each installment
7in default for a period of not less than 10 days in an amount
8not exceeding 5% of the installment on installments in excess
9of $200 or $10 on installments of $200 or less, but only one
10delinquency and collection charge may be collected on any
11installment regardless of the period during which it remains in
12default. In addition, the contract may provide for the payment
13by the borrower or debtor of attorney's fees incurred by the
14lender or creditor. The lender or creditor may enforce such a
15provision to the extent of the reasonable attorney's fees
16incurred by him in the collection or enforcement of the
17contract or obligation. Whenever interest is contracted for or
18received under this Section, no amount in addition to the
19charges authorized by this Section may be directly or
20indirectly charged, contracted for or received, except lawful
21fees paid to a public officer or agency to record, file or
22release security, and except costs and disbursements including
23reasonable attorney's fees, incurred in legal proceedings to
24collect a loan or to realize on a security after default. This
25Section does not prohibit the receipt of any commission,
26dividend or other benefit by the creditor or an employee,

 

 

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1affiliate or associate of the creditor from the insurance
2authorized by this Section.
3    (f) When interest is contracted for or received under this
4Section, the lender must disclose the following items to the
5obligor in a written statement before the loan is consummated:
6        (1) the amount and date of the loan contract;
7        (2) the amount of loan credit using the term "amount
8    financed";
9        (3) every deduction from the amount financed or payment
10    made by the obligor for insurance and the type of insurance
11    for which each deduction or payment was made;
12        (4) every other deduction from the loan or payment made
13    by the obligor in connection with obtaining the loan;
14        (5) the date on which the finance charge begins to
15    accrue if different from the date of the transaction;
16        (6) the total amount of the loan charge for the
17    scheduled term of the loan contract with a description of
18    each amount included using the term "finance charge";
19        (7) the finance charge expressed as an annual
20    percentage rate using the term "annual percentage rate".
21    "Annual percentage rate" means the nominal annual
22    percentage rate of finance charge determined in accordance
23    with the actuarial method of computation with an accuracy
24    at least to the nearest 1/4 of 1%; or at the option of the
25    lender by application of the United States rule so that it
26    may be disclosed with an accuracy at least to the nearest

 

 

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1    1/4 of 1%;
2        (8) the number, amount and due dates or periods of
3    payments scheduled to repay the loan and the sum of such
4    payments using the term "total of payments";
5        (9) the amount, or method of computing the amount of
6    any default, delinquency or similar charges payable in the
7    event of late payments;
8        (10) the right of the obligor to prepay the loan and
9    the fact that such prepayment will reduce the charge for
10    the loan;
11        (11) a description or identification of the type of any
12    security interest held or to be retained or acquired by the
13    lender in connection with the loan and a clear
14    identification of the property to which the security
15    interest relates. If after-acquired property will be
16    subject to the security interest, or if other or future
17    indebtedness is or may be secured by any such property,
18    this fact shall be clearly set forth in conjunction with
19    the description or identification of the type of security
20    interest held, retained or acquired;
21        (12) a description of any penalty charge that may be
22    imposed by the lender for prepayment of the principal of
23    the obligation with an explanation of the method of
24    computation of such penalty and the conditions under which
25    it may be imposed;
26        (13) unless the contract provides for the accrual and

 

 

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1    payment of the finance charge on the balance of the amount
2    financed from time to time remaining unpaid, an
3    identification of the method of computing any unearned
4    portion of the finance charge in the event of prepayment of
5    the loan.
6    The terms "finance charge" and "annual percentage rate"
7shall be printed more conspicuously than other terminology
8required by this Section.
9    (g) At the time disclosures are made, the lender shall
10deliver to the obligor a duplicate of the instrument or
11statement by which the required disclosures are made and on
12which the lender and obligor are identified and their addresses
13stated. All of the disclosures shall be made clearly,
14conspicuously and in meaningful sequence and made together on
15either:
16        (i) the note or other instrument evidencing the
17    obligation on the same side of the page and above or
18    adjacent to the place for the obligor's signature; however,
19    where a creditor elects to combine disclosures with the
20    contract, security agreement, and evidence of a
21    transaction in a single document, the disclosures required
22    under this Section shall be made on the face of the
23    document, on the reverse side, or on both sides, provided
24    that the amount of the finance charge and the annual
25    percentage rate shall appear on the face of the document,
26    and, if the reverse side is used, the printing on both

 

 

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1    sides of the document shall be equally clear and
2    conspicuous, both sides shall contain the statement,
3    "NOTICE: See other side for important information", and the
4    place for the customer's signature shall be provided
5    following the full content of the document; or
6        (ii) one side of a separate statement which identifies
7    the transaction.
8    The amount of the finance charge shall be determined as the
9sum of all charges, payable directly or indirectly by the
10obligor and imposed directly or indirectly by the lender as an
11incident to or as a condition to the extension of credit,
12whether paid or payable by the obligor, any other person on
13behalf of the obligor, to the lender or to a third party,
14including any of the following types of charges:
15        (1) Interest, time price differential, and any amount
16    payable under a discount or other system of additional
17    charges.
18        (2) Service, transaction, activity, or carrying
19    charge.
20        (3) Loan fee, points, finder's fee, or similar charge.
21        (4) Fee for an appraisal, investigation, or credit
22    report.
23        (5) Charges or premiums for credit life, accident,
24    health, or loss of income insurance, written in connection
25    with any credit transaction unless (a) the insurance
26    coverage is not required by the lender and this fact is

 

 

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1    clearly and conspicuously disclosed in writing to the
2    obligor; and (b) any obligor desiring such insurance
3    coverage gives specific dated and separately signed
4    affirmative written indication of such desire after
5    receiving written disclosure to him of the cost of such
6    insurance.
7        (6) Charges or premiums for insurance, written in
8    connection with any credit transaction, against loss of or
9    damage to property or against liability arising out of the
10    ownership or use of property, unless a clear, conspicuous,
11    and specific statement in writing is furnished by the
12    lender to the obligor setting forth the cost of the
13    insurance if obtained from or through the lender and
14    stating that the obligor may choose the person through
15    which the insurance is to be obtained.
16        (7) Premium or other charges for any other guarantee or
17    insurance protecting the lender against the obligor's
18    default or other credit loss.
19        (8) Any charge imposed by a lender upon another lender
20    for purchasing or accepting an obligation of an obligor if
21    the obligor is required to pay any part of that charge in
22    cash, as an addition to the obligation, or as a deduction
23    from the proceeds of the obligation.
24    A late payment, delinquency, default, reinstatement or
25other such charge is not a finance charge if imposed for actual
26unanticipated late payment, delinquency, default or other

 

 

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1occurrence.
2    (h) Advertising for loans transacted under this Section may
3not be false, misleading, or deceptive. That advertising, if it
4states a rate or amount of interest, must state that rate as an
5annual percentage rate of interest charged. In addition, if
6charges other than for interest are made in connection with
7those loans, those charges must be separately stated. No
8advertising may indicate or imply that the rates or charges for
9loans are in any way "recommended", "approved", "set" or
10"established" by the State government or by this Act.
11    (i) A lender or creditor who complies with the federal
12Truth in Lending Act, amendments thereto, and any regulations
13issued or which may be issued thereunder, shall be deemed to be
14in compliance with the provisions of subsections (f), (g) and
15(h) of this Section.
16    (j) For purposes of this Section, "real estate" and "real
17property" include a manufactured home as defined in subdivision
18(53) of Section 9-102 of the Uniform Commercial Code that is
19real property as defined in the Conveyance and Encumbrance of
20Manufactured Homes as Real Property and Severance Act.
21(Source: P.A. 98-749, eff. 7-16-14.)
 
22    Section 15-90-30. The Motor Vehicle Retail Installment
23Sales Act is amended by changing Section 21 and by adding
24Section 26.1 as follows:
 

 

 

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1    (815 ILCS 375/21)  (from Ch. 121 1/2, par. 581)
2    Sec. 21. The finance charge on any motor vehicle retail
3installment contract shall be no more than the maximum rate
4permissible under the Predatory Loan Prevention Act.
5Notwithstanding the provisions of any other statute, for motor
6vehicle retail installment contracts executed after September
725, 1981, there shall be no limit on the finance charges which
8may be charged, collected, and received.
9(Source: P.A. 90-437, eff. 1-1-98; 91-357, eff. 7-29-99.)
 
10    (815 ILCS 375/26.1 new)
11    Sec. 26.1. Rulemaking authority. The Secretary of
12Financial and Professional Regulation and his or her designees
13shall have authority to adopt and enforce reasonable rules,
14directions, orders, decisions, and findings necessary to
15execute and enforce this Act and protect consumers in this
16State. The Secretary's authority to adopt rules shall include,
17but not be limited to: licensing, examination, supervision, and
18enforcement.
 
19    Section 15-90-35. The Retail Installment Sales Act is
20amended by changing Sections 27 and 28 and by adding Section
2133.1 as follows:
 
22    (815 ILCS 405/27)  (from Ch. 121 1/2, par. 527)
23    Sec. 27. The finance charge on any retail installment

 

 

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1contract shall be no more than the maximum rate permissible
2under the Predatory Loan Prevention Act. Notwithstanding the
3provisions of any other statute, retail installment contracts
4executed after the effective date of this amendatory Act of
51981, there shall be no limit on the finance charges which may
6be charged, collected and received.
7(Source: P.A. 90-437, eff. 1-1-98.)
 
8    (815 ILCS 405/28)  (from Ch. 121 1/2, par. 528)
9    Sec. 28. The finance charge on any retail charge agreement
10shall be no more than the maximum rate permissible under the
11Predatory Loan Prevention Act. Notwithstanding the provisions
12of any other statute, a retail charge agreement may provide for
13the charging, collection and receipt of finance charges at any
14specified rate on the unpaid balances incurred after the
15effective date of this amendatory Act of 1981. If a seller or
16holder under a retail charge agreement entered into on, prior
17to or after the effective date of this amendatory Act of 1981
18notifies the retail buyer at least 15 days in advance of any
19lawful increase in the finance charges to be charged under the
20agreement, and the retail buyer, after the effective date of
21such notice, makes a new or additional purchase or incurs
22additional debt pursuant to the agreement, the increased
23finance charges may be applied only to any such new or
24additional purchase or additional debt incurred regardless of
25any other terms of the agreement. For purposes of determining

 

 

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1the balances to which the increased interest rate applies, all
2payments and other credits may be deemed to be applied to the
3balance existing prior to the change in rate until that balance
4is paid in full.
5(Source: P.A. 90-437, eff. 1-1-98.)
 
6    (815 ILCS 405/33.1 new)
7    Sec. 33.1. Rulemaking authority. The Secretary of
8Financial and Professional Regulation and his or her designees
9shall have authority to adopt and enforce reasonable rules,
10directions, orders, decisions, and findings necessary to
11execute and enforce this Act and protect consumers in this
12State. The Secretary's authority to adopt rules shall include,
13but not be limited to: licensing, examination, supervision, and
14enforcement.
 
15    Section 15-90-40. The Consumer Fraud and Deceptive
16Business Practices Act is amended by changing Section 2Z as
17follows:
 
18    (815 ILCS 505/2Z)  (from Ch. 121 1/2, par. 262Z)
19    Sec. 2Z. Violations of other Acts. Any person who knowingly
20violates the Automotive Repair Act, the Automotive Collision
21Repair Act, the Home Repair and Remodeling Act, the Dance
22Studio Act, the Physical Fitness Services Act, the Hearing
23Instrument Consumer Protection Act, the Illinois Union Label

 

 

SB1792 Enrolled- 75 -LRB101 09871 AMC 54973 b

1Act, the Installment Sales Contract Act, the Job Referral and
2Job Listing Services Consumer Protection Act, the Travel
3Promotion Consumer Protection Act, the Credit Services
4Organizations Act, the Automatic Telephone Dialers Act, the
5Pay-Per-Call Services Consumer Protection Act, the Telephone
6Solicitations Act, the Illinois Funeral or Burial Funds Act,
7the Cemetery Oversight Act, the Cemetery Care Act, the Safe and
8Hygienic Bed Act, the Illinois Pre-Need Cemetery Sales Act, the
9High Risk Home Loan Act, the Payday Loan Reform Act, the
10Predatory Loan Prevention Act, the Mortgage Rescue Fraud Act,
11subsection (a) or (b) of Section 3-10 of the Cigarette Tax Act,
12subsection (a) or (b) of Section 3-10 of the Cigarette Use Tax
13Act, the Electronic Mail Act, the Internet Caller
14Identification Act, paragraph (6) of subsection (k) of Section
156-305 of the Illinois Vehicle Code, Section 11-1431, 18d-115,
1618d-120, 18d-125, 18d-135, 18d-150, or 18d-153 of the Illinois
17Vehicle Code, Article 3 of the Residential Real Property
18Disclosure Act, the Automatic Contract Renewal Act, the Reverse
19Mortgage Act, Section 25 of the Youth Mental Health Protection
20Act, the Personal Information Protection Act, or the Student
21Online Personal Protection Act commits an unlawful practice
22within the meaning of this Act.
23(Source: P.A. 99-331, eff. 1-1-16; 99-411, eff. 1-1-16; 99-642,
24eff. 7-28-16; 100-315, eff. 8-24-17; 100-416, eff. 1-1-18;
25100-863, eff. 8-14-18.)
 

 

 

SB1792 Enrolled- 76 -LRB101 09871 AMC 54973 b

1
Article 20.

 
2    Section 20-5. The Department of Commerce and Economic
3Opportunity Law of the Civil Administrative Code of Illinois is
4amended by adding Section 605-1055 as follows:
 
5    (20 ILCS 605/605-1055 new)
6    Sec. 605-1055. Personal care products industry supplier
7disparity study.
8    (a) The Department shall compile and publish a disparity
9study by December 31, 2022 that: (1) evaluates whether there
10exists intentional discrimination at the supplier or
11distribution level for retailers of beauty products,
12cosmetics, hair care supplies, and personal care products in
13the State of Illinois; and (2) if so, evaluates the impact of
14such discrimination on the State and includes recommendations
15for reducing or eliminating any barriers to entry to those
16wishing to establish businesses at the retail level involving
17such products. The Department shall forward a copy of its
18findings and recommendations to the General Assembly and
19Governor.
20    (b) The Department may compile, collect, or otherwise
21gather data necessary for the administration of this Section
22and to carry out the Department's duty relating to the
23recommendation of policy changes. The Department shall compile
24all of the data into a single report, submit the report to the

 

 

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1Governor and the General Assembly, and publish the report on
2its website.
3    (c) This Section is repealed on January 1, 2024.
 
4
Article 99.

 
5    Section 99-99. Effective date. This Act takes effect upon
6becoming law.