Section 160.505  Applicability of Rule

This Subpart shall apply to a home equity loan in which:

a)         At the time of origination, the APR exceeds by more than 6 percentage points in the case of a first lien mortgage, or by more than 8 percentage points in the case of a junior mortgage, the yield on U.S. Treasury securities having comparable periods of maturity to the loan maturity as of the fifteenth day of the month immediately preceding the month in which the application for the loan is received by the lender; or

b)         The total points and fees payable by the consumer at or before closing will exceed the greater of 5% of the total loan amount or $800.  The $800 figure shall be adjusted annually on January 1 by the annual percentage change in the Consumer Price Index.

However, this Subpart shall not apply to a loan that is made primarily for a business purpose unrelated to the residential real property securing the loan or to an open-end credit plan subject to 12 CFR 226 (2000, no subsequent amendments or editions included).

(Source:  Added at 25 Ill. Reg. 6261, effective May 17, 2001)