State of Illinois
91st General Assembly

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SB445 Enrolled                                 LRB9102296JSpc

 1        AN  ACT  to amend the Residential Mortgage License Act of
 2    1987 by changing Sections 2-2, 2-9, and 4-2.

 3        Be it enacted by the People of  the  State  of  Illinois,
 4    represented in the General Assembly:

 5        Section  5.  The Residential Mortgage License Act of 1987
 6    is amended by changing Sections 2-2, 2-9, and 4-2 as follows:

 7        (205 ILCS 635/2-2) (from Ch. 17, par. 2322-2)
 8        Sec. 2-2.  Application process; investigation; fee.
 9        (a)  The  Commissioner  shall  issue   a   license   upon
10    completion of all of the following:
11             (1)  The filing of an application for license.
12             (2)  The  filing  with the Commissioner of a listing
13        of judgments entered against,  and  bankruptcy  petitions
14        by, the license applicant for the preceding 10 years.
15             (3)  The    payment,    in   certified   funds,   of
16        investigation and application fees, the  total  of  which
17        shall  be in an amount equal to $1,800 annually, however,
18        the  Commissioner  may  increase  the  investigation  and
19        application fees by rule as provided in Section 4-11.
20             (4)  Except  for  a  broker  applying  to  renew   a
21        license, the filing of an audited balance sheet including
22        all  footnotes  prepared by a certified public accountant
23        in  accordance   with   generally   accepted   accounting
24        principles  and  generally  accepted  auditing principles
25        which evidences that the applicant meets  the  net  worth
26        requirements of Section 3-5.
27             (5)  The   filing   of  proof  satisfactory  to  the
28        Commissioner that the applicant, the members  thereof  if
29        the  applicant  is  a  partnership  or  association,  the
30        members  or managers thereof that retain any authority or
31        responsibility  under  the  operating  agreement  if  the
SB445 Enrolled             -2-                 LRB9102296JSpc
 1        applicant is a limited liability company, or the officers
 2        thereof if the applicant is a corporation  have  3  years
 3        experience  preceding application in real estate finance.
 4        Instead  of  this  requirement,  the  applicant  and  the
 5        applicant's  officers  or  members,  as  applicable,  may
 6        satisfactorily complete a program of  education  in  real
 7        estate  finance  and  fair  lending,  as  approved by the
 8        Commissioner, prior to within 9 months of  receiving  the
 9        initial license.  The Commissioner shall promulgate rules
10        regarding    proof   of   experience   requirements   and
11        educational requirements and the satisfactory  completion
12        of those requirements.  The Commissioner may establish by
13        rule a list of duly licensed professionals and others who
14        may be exempt from this requirement.
15             (6)  An  investigation  of the averments required by
16        Section  2-4,  which   investigation   must   allow   the
17        Commissioner  to issue positive findings stating that the
18        financial  responsibility,  experience,  character,   and
19        general  fitness  of  the  license  applicant  and of the
20        members thereof if the license applicant is a partnership
21        or association, of the officers and directors thereof  if
22        the  license  applicant  is  a  corporation,  and  of the
23        managers  and  members  that  retain  any  authority   or
24        responsibility  under  the  operating  agreement  if  the
25        license applicant is a limited liability company are such
26        as  to  command  the  confidence  of the community and to
27        warrant  belief  that  the  business  will  be   operated
28        honestly,  fairly  and  efficiently within the purpose of
29        this Act.  If the Commissioner shall not so find,  he  or
30        she  shall  not  issue  such license, and he or she shall
31        notify the license applicant of the denial.
32        (b)  All licenses shall be issued in duplicate  with  one
33    copy  being  transmitted  to  the  license  applicant and the
34    second being retained with the Commissioner.
SB445 Enrolled             -3-                 LRB9102296JSpc
 1        Upon receipt of  such  license,  a  residential  mortgage
 2    licensee  shall  be  authorized  to  engage  in  the business
 3    regulated by this Act.  Such license  shall  remain  in  full
 4    force  and  effect  until  it  expires  without  renewal,  is
 5    surrendered  by  the  licensee  or  revoked  or  suspended as
 6    hereinafter provided.
 7    (Source: P.A. 89-355, eff. 8-17-95; 89-508, eff. 7-3-96.)

 8        (205 ILCS 635/2-9) (from Ch. 17, par. 2322-9)
 9        Sec. 2-9.  Posting of license.  The license of a licensee
10    whose home office is within the State of Illinois  or  of  an
11    out-of-state  licensee shall be conspicuously posted in every
12    office of the licensee  located  in  Illinois.   Out-of-state
13    licensees  without  an  Illinois  office  shall  produce  the
14    license  upon  request.   Licensees  originating loans on the
15    Internet shall post on their Internet web site their  license
16    number   and   the   address  and  telephone  number  of  the
17    Commissioner.  The license shall  state  the  full  name  and
18    address   of   the   licensee.   The  license  shall  not  be
19    transferable or assignable. A separate certificate  shall  be
20    issued for posting in each full service Illinois office.
21    (Source: P.A. 86-137; 87-642.)

22        (205 ILCS 635/4-2) (from Ch. 17, par. 2324-2)
23        Sec. 4-2.  Examination; prohibited activities.
24        (a)  The  business  affairs  of a licensee under this Act
25    shall be examined for compliance with this Act  as  often  as
26    the   Commissioner   deems   necessary   and   proper.    The
27    Commissioner  shall  promulgate  rules  with  respect  to the
28    frequency and manner of examination.   The Commissioner shall
29    appoint a suitable person to perform such  examination.   The
30    Commissioner and his appointees may examine the entire books,
31    records,  documents,  and operations of each licensee and may
32    examine any of the licensee's officers, directors,  employees
SB445 Enrolled             -4-                 LRB9102296JSpc
 1    and agents under oath.
 2        (b)  The  Commissioner  shall prepare a sufficiently full
 3    and detailed report of  each  licensee's  examination,  shall
 4    issue  a  copy  of such report to each licensee's principals,
 5    officers, or directors and shall take  appropriate  steps  to
 6    ensure correction of violations of this Act.
 7        (c)  Affiliates   of  a  licensee  shall  be  subject  to
 8    examination by the Commissioner on  the  same  terms  as  the
 9    licensee,  but  only  when  reports from, or examination of a
10    licensee  provides  for  documented  evidence   of   unlawful
11    activity   between   a  licensee  and  affiliate  benefiting,
12    affecting or deriving from the activities regulated  by  this
13    Act.
14        (d)  The  expenses of any examination of the licensee and
15    affiliates shall be borne by the licensee and assessed by the
16    Commissioner as established by regulation.
17        (e)  Upon completion of the examination, the Commissioner
18    shall issue  a  report  to  the  licensee.   The  examination
19    report, and the work papers of the report shall belong to the
20    Commissioner's  office  and  may  not  be disclosed to anyone
21    other than the licensee, law enforcement officials  or  other
22    regulatory   agencies   that   shall   be  defined  in  rules
23    promulgated by the Commissioner, or to a party  presenting  a
24    lawful  subpoena  to  the Office of the Commissioner. Reports
25    required of licensees by the Commissioner under this Act  and
26    results  of  examinations performed by the Commissioner under
27    this Act shall be the property of only the licensee  and  the
28    Commissioner.  Access under this Act to the books and records
29    of each licensee shall be limited to the Commissioner and his
30    agents  as  provided  in this Act and to the licensee and its
31    authorized agents and designees.  No other person shall  have
32    access to the books and records of a licensee under this Act.
33        (f)  The    Commissioner,   deputy   commissioners,   and
34    employees of the Office of Banks and  Real  Estate  shall  be
SB445 Enrolled             -5-                 LRB9102296JSpc
 1    subject  to  the  restrictions provided in Section 2.5 of the
 2    Office of  Banks  and  Real  Estate  Act  including,  without
 3    limitation, the restrictions on (i) owning shares of stock or
 4    holding  any  other  equity  interest  in an entity regulated
 5    under this Act or in any corporation or company that owns  or
 6    controls  an  entity  regulated under this Act; (ii) being an
 7    officer, director, employee, or agent of an entity  regulated
 8    under  this  Act;  and  (iii) obtaining a loan or accepting a
 9    gratuity from an entity regulated under this Act.
10        (g)  After the initial examination  for  those  licensees
11    whose  only  mortgage  activity is servicing fewer than 1,000
12    Illinois  residential  loans,  the  examination  required  in
13    subsection (a) may be waived upon submission of a letter from
14    the  licensee's  independent  certified  auditor   that   the
15    licensee serviced fewer than 1,000 Illinois residential loans
16    during the year in which the audit was performed.
17    (Source: P.A.  89-355,  eff.  8-17-95;  89-508,  eff. 7-3-96;
18    90-301, eff. 8-1-97.)

19        Section 99.  Effective date.  This Act takes effect  upon
20    becoming law.

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