The Illinois Department of Professional and Financial Regulation (“IDFPR”) adopted amendments to the regulation implementing the Residential Mortgage License Act of 1987 (“RMLA”). The amendments became effective on October 6, 2017. The amendments were adopted to remove conflicting and outdated provisions in the regulations given the federal Consumer Financial Protection Bureau (“CFPB”) regulations and amendments to the RMLA. The following is a summary of the of the adopted amendments to the regulations:
- Repeal Section 1050.320 (Application for Renewal of an Illinois Residential Mortgage License) to remove a conflict with the 30-day timely renewal application deadline in Section 2-6 of the RMLA.
- Amend Section 1050.490 (Bonding Requirements) to remove the submission by licensees of paper surety bonds and facilitate use of the new electronic surety bond feature that Illinois has adopted through the NMLS.
- Repeal Sections 1050.710-1050.750 (Foreclosure Rate) as Public Act 99-0015 amended the regulations’ underlying RMLA Section 4-8 to now instead address Loan Delinquency data and its implementation.
- Amend Sections 1050.810-1050.820 & 1050.860 (Transfer of Servicing & Payoff Notices) to repeal consumer notice provisions preempted by the CFPB in its amendments to federal Regulation Z, effective 1/1/2014, and also changes a deadline for payoff statements to conform to this CFPB rulemaking.
- Amend Section 1050.1010 (Loan Brokerage Agreement) including to update and add references to the CFPB’s adopted TILA-RESPA Integrated Disclosure (TRID) Loan Estimate form replacing the Good Faith Estimate form in most residential mortgage transactions.
- Amend Section 1050.1110 (Borrower Information Document) to update and add references to the CFPB’s adopted TRID Loan Estimate form replacing the Good Faith Estimate form in most residential mortgage transactions. Also updates and adds reference to the CFPB’s “Your Home Loan Toolkit” that has replaced the settlement cost booklet.
- Amend Section 1050.1176 (Record Retention) to permit servicers to eliminate the paper record-keeping requirement and retain their records in electronic or digital format as is currently permitted for all other licensees.
- Repeal Section 1050.1230 (Changes Affecting Loans in Process) to reflect new CFPB-required notifications to consumers of loan term changes in TRID process.
- Repeal Section 1050.1305 (Approval Notice) to reflect new CFPB-required notifications to consumers of loan term changes in TRID process.
- Amend Section 1050.1320 (Charges to Seller) to update and add a reference to the CFPB’s adopted TRID Loan Estimate form replacing the Good Faith Estimate form in most residential mortgage transactions.
- Repeal Subparts R (Registration of Loan Originators) & S (Provisional Registration of Loan Originators) to reflect that both Subparts have been superseded by Section 7-1A, et seq. of Article VII (Mortgage Loan Originator License Required) of the RMLA.
Required Action
Lenders (and brokers) operating in Illinois and subject to the RMLA should update their disclosure packages and notices to conform to the amended regulations. Policies and procedures addressing compliance with Illinois requirements should also be revised to conform to these amendments.
If you have any questions concerning the amendments to the RMLA regulations, please reach out to our Contact Attorney.
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