Cx1311 is provided pursuant to the provisions of the Illinois Mortgage Insurance Limitation and Notification Act (“MILNA”), specifically 765 Ill. Comp. Stat. Ann. 930/15, which requires the following:
“After July 1, 1998, if a person enters into a transaction to obtain a mortgage for his or her principal residence and private mortgage insurance may be required in connection with that transaction, the mortgagee shall disclose in writing all of the following:
(1) Whether private mortgage insurance will be required to be obtained or maintained with respect to the mortgage.
(2) The period during which the insurance shall be required to be in effect.
(3) The conditions under which the mortgagor may cancel the insurance.
(4) That the mortgagor will be notified not less than annually of an address and telephone number that may be used to contact the mortgagee to determine whether or not the insurance may be terminated and, if the insurance may be terminated, the conditions and procedures for termination.”
Cx1311 is substantively comprised of two paragraphs with corresponding checkboxes, which indicate whether private mortgage insurance (PMI) is required or not in connection with the loan and, when it is required, the additional disclosure items set forth under Subsections (2) through (4).
Upon further examination of this document, we have decided to make changes to its print conditions, so that it prints under the following conditions:
- “Base Type” equals “Conventional” (since FHA/VA/RD loans are exempt from MILNA; see Ibid. 930/10);
- “CLTV/LTV is greater than 80%?” equals “Yes” (since MILNA only requires the disclosure if PMI may be required; under the Federal Homeowner’s Protection Act, as a practical matter, PMI may only be required if the loan-to-value of the loan exceeds 80%; see 12 USCA §§ 4902 & 4903);
- “Document Package Type” equals either “Initial Disclosure” or “Closing Disclosure” (since Supra does not specify when the notice should be provided and we want to ensure that all of our clients provide Cx1311 when required);
- “HELOC” equals “Allow Any” (there is nothing under MILNA which excludes HELOCs);
- “Loan Purpose” equals “Allow Any” (there are no restrictions under MILNA as to what the purpose of the loan should be);
- “Monthly Mortgage Insurance” equals “Allow Any” (because the disclosure requirements apply to any loans in which PMI may be required, not just to those in which it is required);
- “Occupancy” equals “PrimaryResidence” (because MILNA only applies to mortgages secured by the principal single family residence of the mortgagor; see Supra 930/5);
- “Property Type” equals all types except “2 unit/duplex” and “3+ unit” (for the reasons stated above); and
- “State Code” equals “Illinois”.
In addition, we will be modifying some of the text in the second paragraph to fix a typographical error in the first sentence, as well as to add the phrase “unless applicable law provides otherwise” after the fourth sentence.
These changes will take effect on August 12, 2014. If you have any questions or concerns about these changes, please contact Client Support at 1.800.497.3584.
August 4, 2014