[ Search ] [ Legislation ]
[ Home ] [ Back ] [ Bottom ]
| [ Introduced ] | [ Engrossed ] |
91_HB1712ham001
LRB9104059MWmbam02
1 AMENDMENT TO HOUSE BILL 1712
2 AMENDMENT NO. . Amend House Bill 1712 by replacing
3 the title with the following:
4 "AN ACT concerning home mortgages."; and
5 by replacing everything after the enacting clause with the
6 following:
7 "Section 1. Short title. This Act may be cited as the
8 Local Government Housing Finance Act.
9 Section 5. Definitions. In this Act:
10 "Appraised value" means the fair market value of a home
11 determined in accordance with generally accepted procedures
12 and standards applicable to the appraisal of real property.
13 "Authority" means any county or any municipality in this
14 State.
15 "Bonds" means any revenue bonds authorized under this
16 Act and payable as provided hereunder.
17 "Corporate authorities" means the county board or the
18 corporate authorities of a municipality as defined in the
19 Illinois Municipal Code.
20 "Home" means real property and improvements thereon
21 located with the Authority consisting of not more than 4
-2- LRB9104059MWmbam02
1 dwelling units, including but not limited to, condominium
2 units owned by one mortgagor who occupies or intends to
3 occupy one of the units.
4 "Home mortgage loan" means an interest bearing loan to a
5 mortgagor evidenced by a promissory note and secured by a
6 mortgage on a home, purchased or originated in accordance
7 with this Act made for the purpose of acquiring a home having
8 a purchase price less than the maximum home value.
9 "Lender" means any lending institution participating in a
10 residential housing finance plan as the originator of home
11 mortgage loans.
12 "Lending institution" means any bank, bank holding
13 company, credit union, trust company, savings bank, national
14 banking association, savings and loan association, building
15 and loan association, mortgage banker, or other financial
16 institution that customarily provides service or otherwise
17 aids in the financing of home mortgages, or any holding
18 company for any of the foregoing.
19 "Maximum home value" means the amount determined by the
20 corporate authorities.
21 "Mortgagor" means a person of low or moderate income who
22 has received or qualifies to receive a home mortgage loan on
23 a home.
24 "Ordinance" means an ordinance adopted and approved by
25 the corporate authorities of an Authority.
26 "Purchase price" means the actual consideration paid to
27 the seller of a home.
28 "Person" means a natural person or persons or a trust,
29 provided that the trust is for the benefit of a natural
30 person or members of that person's immediate family.
31 "Participation commitment" means any undertaking or
32 agreement by a lending institution to participate in the
33 implementation of a residential housing finance plan.
34 "Persons of low or moderate income" means a person or
-3- LRB9104059MWmbam02
1 family (consisting of one or more persons all of whom occupy
2 or will occupy the home) whose aggregate gross income
3 including the gross income of any co-signer or guarantor of
4 the promissory note made in connection with the making of a
5 home mortgage loan does not exceed a maximum amount to be
6 established by the corporate authorities and determined in
7 accordance with appropriate criteria, rules, and regulations,
8 approved by the corporate authorities in connection with the
9 implementation of a residential housing finance plan.
10 "Residential housing finance plan" means a program
11 implemented under this Act by an Authority to assist persons
12 of low or moderate income in acquiring safe, decent, and
13 sanitary housing that they can afford.
14 "State" means the State of Illinois.
15 "Trustee" means any State or national bank or trust
16 company, having trust powers, located within or outside the
17 State of Illinois, that may be appointed to act in any
18 capacity with respect to a residential housing finance plan
19 and the issuance of bonds to finance that plan whether
20 designated as a trustee, custodian, or administrator.
21 Section 10. Powers. In addition to powers that an
22 Authority may now have, Authorities have the following
23 powers:
24 (a) To acquire, and to contract and enter into advance
25 commitments to acquire, directly or indirectly, home
26 mortgages owned by lending institutions at any prices and
27 upon any other terms and conditions that shall be determined
28 by the Authority or trustee that the Authority designates as
29 its agent.
30 (b) To make and execute contracts with lending
31 institutions for the origination and servicing of home
32 mortgage loans on behalf of an Authority and to pay the
33 reasonable value of services rendered in accordance with
-4- LRB9104059MWmbam02
1 those contracts.
2 (c) To make loans to lenders to enable those lenders to
3 make home mortgage loans in accordance with this Act.
4 (d) To establish, by rules, regulations, or ordinances
5 relating to the issuance of bonds or in any financing
6 documents relating to the issuance of bonds, any standards
7 and requirements applicable to the purchase of home mortgage
8 loans or the origination of home mortgage loans or loans to
9 lenders that the Authority deems necessary or desirable to
10 effectuate the public purposes of this Act, including but not
11 limited to: (i) the time within which lending institutions
12 must make participation commitments and make disbursements
13 for home mortgage loans; (ii) the terms and conditions of
14 home mortgage loans to be acquired or originated; (iii) the
15 standards and criteria to be applied by the Authority in
16 defining persons of low or moderate income; (iv) the amounts
17 and types of insurance coverage required on homes, home
18 mortgage loans, and bonds; (v) the representations and
19 warranties to be required of persons and lending institutions
20 as evidence of compliance with the standards and
21 requirements; (vi) restrictions as to interest rate and other
22 terms of home mortgage loans or the return realized therefrom
23 by lending institutions; (vii) the type and amount of
24 collateral security to be provided to assure repayment of any
25 loans to lenders by the Authority and to assure repayment of
26 bonds; and (viii) any other matters related to the purchase
27 or origination of home mortgage loans or the making of loans
28 to lenders that shall be deemed relevant or necessary by the
29 corporate authorities.
30 (e) To require from each lending institution from which
31 home mortgage loans are to be purchased or that will
32 originate home mortgage loans on behalf of the Authority or
33 from lenders to which loans are made the submission, at the
34 time of making participation commitments, of evidence
-5- LRB9104059MWmbam02
1 satisfactory to the Authority of the ability and intention of
2 the lending institutions to make home mortgage loans and the
3 submission, within the time specified by the Authority for
4 making disbursements for home mortgage loans, of evidence
5 satisfactory to the Authority of the making of home mortgage
6 loans and of compliance with any standards and requirements
7 established by the Authority.
8 (f) To require that a lending institution or lender
9 furnish, prior to or concurrent with the delivery of any
10 participation commitment by a lending institution, a
11 commitment fee in the form of a cash deposit, letter of
12 credit, promissory note, surety bond, or other instrument
13 approved by the corporate authorities executed by or on
14 behalf of the lending institution, in an amount to be
15 determined by the corporate authorities.
16 (g) To issue its bonds to defray, in whole or in part,
17 (i) the cost of acquiring or originating home mortgage loans
18 or making loans to lenders in order to enable them to make
19 home mortgage loans; (ii) if deemed necessary or advisable,
20 the cost of paying interest on bonds during a reasonable
21 period necessary to acquire or originate the home mortgage
22 loans or to make the loans to the lender; (iii) the costs of
23 studies and surveys, insurance premiums, underwriting fees,
24 legal, accounting, and marketing services incurred in
25 connection with the issuance and the sale of the bonds,
26 including amounts required to establish reasonably necessary
27 bond and interest reserve accounts, and trustee, custodian,
28 and rating agency fees; (iv) the costs of reasonable
29 reserves; and (v) any other costs that are reasonably related
30 to the foregoing.
31 (h) To authorize the sale or other disposition of any
32 home mortgage loan, in whole or in part, upon any terms, at
33 any price and time, and from time to time, as may be
34 necessary to assure that the revenues and receipts to be
-6- LRB9104059MWmbam02
1 derived with respect to the home mortgage loans, together
2 with any insurance proceeds, funds held in reserve accounts,
3 and earnings thereon, shall produce and provide revenues and
4 receipts at least sufficient to provide for the prompt
5 payment of the principal, redemption premiums, if any, and
6 interest at maturity of all bonds issued pursuant to this Act
7 or to otherwise authorize the sale or other disposition of
8 any home mortgage loan after the bonds have been paid or
9 deemed to be paid.
10 (i) To pledge any revenues and receipts to be received
11 from any home mortgage loans to the punctual payment of bonds
12 authorized under this Act, and the interest and redemption
13 premiums, if any, thereon.
14 (j) To mortgage, pledge, or grant security interests in
15 any home mortgage loans, notes, or other property in favor of
16 the holder or holders of bonds issued therefor.
17 (k) To issue its bonds in any amount that may be
18 necessary (and not limited by the amount of bonds refunded)
19 for the purpose of refunding, in whole or in part, at any
20 time, bonds theretofore issued, the proceeds of which
21 refunding bonds may be used, at the discretion of the
22 corporate authorities, for paying bonds at maturity, calling
23 bonds for payment, and paying bonds prior to maturity, or for
24 deposit into an escrow or trust fund in advance of maturity
25 of bonds to be held for payment thereof at maturity or
26 earlier.
27 (l) To appoint or designate a trustee or trustees for
28 the benefit of the bondholders and to delegate and assign
29 thereto, insofar as it may lawfully do so, its rights,
30 duties, and responsibilities with respect to carrying out and
31 enforcing the terms and provisions of its residential housing
32 finance plan.
33 (m) To provide for and authorize the use and disposition
34 of any funds remaining in the possession of the Authority or
-7- LRB9104059MWmbam02
1 its trustees following payment and retirement of the bonds of
2 a designated series issued under this Act.
3 (n) To make and execute contracts and other instruments
4 necessary or convenient to the exercise of any of the powers
5 granted herein.
6 Section 15. Ordinance authorizing exercise of powers.
7 The exercise of any or all powers granted by this Act shall
8 be authorized and the bonds shall be authorized to be issued
9 under this Act for the purposes set forth in this Act, by an
10 ordinance adopted by the corporate authorities that shall
11 take effect immediately upon adoption. The ordinance shall
12 set forth a finding and declaration (i) of the public purpose
13 therefor and (ii) that the ordinance is adopted pursuant to
14 this Act, which finding and declaration shall be conclusive
15 evidence of the existence and sufficiency of the public
16 purpose and of the power to carry out and give effect to the
17 public purpose.
18 The bonds shall bear interest at any rate or rates
19 without regard to any other law pertaining to interest rate
20 limitations, may be payable at any time or times, may be in
21 one or more series, may bear any date or dates, may mature at
22 any time or times not exceeding 40 years from their
23 respective dates, may be payable in any medium of payment at
24 any place or places, may carry any registration privileges,
25 may be subject to any terms of redemption at any premiums,
26 may be executed in any manner, may contain any terms,
27 covenants, and conditions, and may be in any form, either
28 coupon or registered, that the corporate authorities shall
29 provide. The bonds may be sold at public or private sale at
30 any price, in any manner and upon any terms that the
31 corporate authorities may authorize, and may be issued to the
32 purchaser or purchasers of bonds sold under this Act. The
33 bonds and interim notes shall be deemed to be securities and
-8- LRB9104059MWmbam02
1 negotiable instruments within the meaning of and for all
2 purposes of the Uniform Commercial Code.
3 Section 20. Covenants. Any ordinances authorizing the
4 issuance of the bonds under this Act may contain covenants
5 regarding (i) the use and disposition of the revenues and
6 receipts from any home mortgage loans for which the bonds are
7 to be issued, including the creation and maintenance of any
8 reasonable and adequate reserves that the corporate
9 authorities may determine; (ii) the insurance to be carried
10 on any home mortgage loan or bonds and the use and
11 disposition of the proceeds of that insurance; (iii) the
12 appointment of one or more trustees for the benefit of the
13 bondholders, paying agents, or bond registrants; (iv) the
14 investment of any funds held by the trustee or lender,
15 notwithstanding any other law to the contrary; (v) the
16 maximum rate payable on any home mortgage loan; and (vi) the
17 terms and conditions upon which the holders of the bonds or
18 any portion thereof, or any trustees therefor, are entitled
19 to the appointment of a receiver by a court of competent
20 jurisdiction, and any terms and conditions may provide that
21 the receiver may take possession of the home mortgage loans
22 or any part thereof and maintain, sell, or otherwise dispose
23 of the home mortgage loans, prescribe other payments, and
24 collect, receive, and apply all income and revenues
25 thereafter derived therefrom. An ordinance authorizing the
26 issuance of bonds under this Act may provide that payment of
27 the principal of, redemption premium, if any, and interest on
28 any bonds issued under this Act shall be secured by a
29 mortgage, pledge, security interest, insurance agreement, or
30 indenture of trust of or with respect to any home mortgage
31 loans and a lien upon the revenues and receipts derived
32 therefrom or from any notes or other obligations of lending
33 institutions with respect to which the bonds are issued. The
-9- LRB9104059MWmbam02
1 mortgage, pledge, security interest, insurance agreement, or
2 indenture of trust shall constitute a contract with the
3 holder or holders of the bonds and continue in effect until
4 the principal of, the interest on, and the redemption
5 premiums, if any, on the bonds have been fully paid or
6 provision made for the payment thereof, and the duties of the
7 Authority and its corporate authorities and officers under
8 this Act and any ordinance and any mortgage, pledge, security
9 interest, insurance agreement, or indenture of trust shall be
10 enforceable as provided therein by any bondholder by
11 mandamus, foreclosure of any mortgage, pledge, security
12 interest, insurance agreement, or indenture of trust, or
13 other appropriate suit, action, or proceeding in any court of
14 competent jurisdiction; provided the ordinance or any
15 mortgage, pledge, security interest, insurance agreement, or
16 indenture of trust under which the bonds are issued may
17 provide that all remedies and rights to enforcement may be
18 vested in a trustee (with full power of appointment) for the
19 benefit of all the bondholders, which trustee shall be
20 subject to the control of any number of holders or owners of
21 any outstanding bonds as provided therein.
22 Section 25. Signatures. The bonds shall bear the manual
23 or facsimile signatures of such officers of the Authority as
24 may be designated in the ordinance authorizing such bonds and
25 such signatures shall constitute the valid and binding
26 signatures of such officers, notwithstanding that before the
27 delivery thereof and payment therefor any or all of the
28 persons whose signatures appear thereon have ceased to be
29 officers of the Authority. The validity of the bonds shall
30 not be dependent on nor affected by the validity or
31 regularity of any proceedings relating to the home mortgage
32 loans acquired or made from proceeds of the bonds. A recital
33 in the bonds that they are issued pursuant to this Act shall
-10- LRB9104059MWmbam02
1 be conclusive evidence of their validity and of the
2 regularity of their issuance.
3 Section 30. Pledges; validity. Any pledge made to secure
4 bonds shall be valid and binding from the time when the
5 pledge is made. The revenues and receipts or property or
6 interests in property pledged and thereafter received by the
7 Authority or trustee shall immediately be subject to the lien
8 of such pledge without any physical delivery thereof or
9 further act, and the lien of any such pledge shall be valid
10 and binding as against all parties having claims of any kind
11 in tort, contract, or otherwise against such Authority or
12 trustee irrespective of whether the parties have notice
13 thereof. Neither the ordinance, nor any other instrument by
14 which a pledge is created, need be recorded.
15 Section 35. Bonds; obligations of the Authority. All
16 bonds issued under this Act shall be limited obligations of
17 the Authority issuing the same, payable solely from the (i)
18 bond proceeds, (ii) revenues and receipts derived from the
19 home mortgage loans or from any notes or other obligations of
20 persons with respect to which such bonds are issued and
21 secured by a mortgage, pledge, security interest, insurance
22 agreement, or indenture of trust of or with respect to such
23 home mortgage loans, (iii) certain insurance proceeds which
24 may relate to the bonds or the home mortgage loans, (iv)
25 participation fees, or (v) certain reserve funds. No
26 Authority shall have any right or authority to levy taxes to
27 pay any of the principal of, redemption premium, if any, or
28 interest on any bonds issued pursuant to this Act or any
29 judgment against an Authority on account thereof. No holder
30 of any bonds issued under this Act shall have the right to
31 compel any exercise of the taxing power of any Authority to
32 pay the bonds, the interest, or redemption premium, if any,
-11- LRB9104059MWmbam02
1 thereon, and the bonds shall not constitute an indebtedness
2 of the Authority, or a loan of the faith and credit thereof,
3 within the meaning of any constitutional or statutory
4 provision, nor shall the bonds be construed to create any
5 moral obligation on the part of the Authority to provide for
6 the payment of such bonds. It shall be plainly stated on the
7 face of each bond that it has been issued under the
8 provisions of this Act and that it does not constitute an
9 indebtedness of the Authority, or a loan of the faith and
10 credit thereof, within the meaning of any constitutional or
11 statutory provision. Bonds may be issued pursuant to this
12 Act without regard to (i) any statutory limitation as to
13 bonded indebtedness and shall not be included in computing
14 total bonded indebtedness within the meaning of any statutory
15 limitation, (ii) any requirement of competitive bidding or
16 procedure for award of contracts applicable by any statute,
17 (iii) any requirement of publication of ordinance or other
18 documents, or (iv) any requirement of referendum or petition.
19 Section 40. Personal liability; corporate authorities.
20 Neither the members of the corporate authorities of an
21 Authority, nor any official or employee thereof, nor any
22 person executing bonds issued under this Act shall be liable
23 personally for payment of the bonds or the interest or
24 redemption premium, if any, thereon or be subject to any
25 personal liability or accountability by reason of the
26 issuance thereof.
27 Section 45. Joint or cooperative action; Authorities. One
28 or more Authorities (whether or not any of them are home rule
29 units) may join together or cooperate with one another in the
30 exercise, either jointly, on behalf of the Authorities, or
31 otherwise, of any one or more of the powers conferred upon
32 Authorities under this Act or other enabling acts or powers.
-12- LRB9104059MWmbam02
1 Notwithstanding any other law to the contrary, one or more
2 Authorities may issue bonds on behalf of other Authorities
3 (whether or not any of the Authorities are home rule units of
4 government), whether or not the home mortgage loan is made
5 within the corporate limits of the Authority issuing the
6 bonds or any other cooperating Authority. Such joint or
7 cooperative action shall be taken only in accordance with and
8 pursuant to a written agreement entered into between or among
9 such cooperating parties.
10 Section 50. Legal investments. Notwithstanding any other
11 provision of law, bonds issued pursuant to this Act shall be
12 legal investments for all trust funds, insurance companies,
13 savings and loan associations, investment companies, and
14 banks, both savings and commercial, and shall be legal
15 investments for executors, administrators, trustees, and all
16 other fiduciaries. Such bonds shall be legal investments for
17 State school funds and for any funds which may be invested in
18 county, municipal, or school district bonds, and such bonds
19 shall be deemed to be securities which may properly and
20 legally be deposited with, and received by, any State or
21 municipal officer or by any agency or political subdivision
22 of the State for any purpose for which the deposit of bonds
23 or obligations of the State is now, or may hereafter, be
24 authorized by law, including deposits to secure public funds.
25 Section 55. Interests of corporate officers or employees;
26 participating lending institutions. Notwithstanding the
27 provisions of any other law to the contrary, a member of the
28 corporate authorities, or an officer or employee of the
29 Authority, may be an officer, employee, or stockholder of a
30 lending institution or lender participating in a residential
31 housing finance plan of the corporate authorities, provided
32 such member (if a member of such corporate authorities)
-13- LRB9104059MWmbam02
1 declares such position or interest at a regular meeting of
2 the corporate authorities prior to passage of an ordinance
3 establishing the plan and abstains from voting on such
4 ordinance.
5 Section 60. Scope of additional powers. The powers
6 conferred by this Act are in addition and supplemental to,
7 and the limitations imposed by this Act shall not affect, the
8 powers conferred upon Authorities by any other law. This Act
9 is not a limitation upon the powers of home rule units. Home
10 mortgage loans may be acquired, purchased, and financed, and
11 bonds may be issued under this Act for such purposes,
12 notwithstanding that any other law or power may provide for
13 the acquisition, purchase, and financing of like home
14 mortgage loans, or the issuance of bonds for like purposes,
15 and without regard to the requirements, restrictions,
16 limitations, or other provisions contained in any law,
17 including any law relating to any requirement of competitive
18 bidding or restriction imposed on the sale or disposition of
19 property or award of contracts. Nothing in this Act shall be
20 deemed or construed to prohibit the exercise of the powers
21 conferred upon Authorities in connection with the financing
22 of federally assisted housing for persons of low and moderate
23 income.
24 Section 65. Construction. This Act is necessary for
25 the health, welfare, and safety of the State, its counties
26 and municipalities, and its inhabitants; therefore, it shall
27 be liberally construed to effect its purposes.".