On December 19, 2018 Gov. Bruce Rauner (R-IL) approved IL HB 5542 (2018) which amends several parts of Illinois’ statutes, including 205 Ill. Comp. Stat. Ann. 635/5-9 (see http://www.ilga.gov/legislation/billstatus.asp?DocNum=5542&GAID=14&GA=100&DocTypeID=HB&LegID=111507&SessionID=91). These amendments took effect immediately.
Ibid. 635/5-9(a) requires a licensee to “provide timely notice to the borrower of any material change in the terms of the residential mortgage loan prior to the closing of the loan” and to “timely inform the borrower if any fees payable by the borrower to the licensee increase by more than 10% or $100, whichever is greater.” Ibid. 635/5-9(b) set forth timing requirements for these disclosures.
IL HB 5542 (2018) amends 205 Ill. Comp. Stat. Ann. 635/5-9(d) to stipulate that compliance with RESPA and TRID are sufficient for complying with these disclosure requirements. To wit:
“The requirements of this Section do not apply to a licensee providing a notice of change in loan terms pursuant to the federal Consumer Financial Protection Bureau’s Know Before You Owe mortgage disclosure procedure pursuant to the federal Truth in Lending Act and amendments promulgated under 12 CFR 1026 and the federal Real Estate Settlement Procedures Act and amendments promulgated under 12 CFR 1024.”
We have been providing our “IL Notice of Material Change in Loan Terms” (Cx16217) document as an “upon request” document for these disclosure requirements. Since Illinois’ requirements apply to a “residential mortgage loan” which, under 205 Ill. Stat. Ann. § 635/1-4(f), could apply to loans not subject to the “Know Before You Owe” rule (e.g. HELOCs), we will continue to provide Cx16217 as an “upon request” document, but we will be modifying the default configurations for this document by adding the following condition:
- Integrated Disclosure Loan Indicator = No
All clients currently using Cx16217 have custom print conditions on the document. Therefore clients will not be affected unless a change to their custom print conditions is requested. If you have any questions or concerns about this change, please contact Client Support at 1.800.497.3584.