State of Illinois
92nd General Assembly
Legislation

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[ Introduced ][ Enrolled ][ Senate Amendment 001 ]


92_SB1269eng

SB1269 Engrossed                               LRB9201663TAtm

 1        AN ACT concerning the State Treasurer.

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

 4        Section 5.  The Deposit of State Moneys Act is amended by
 5    changing Section 7 as follows:

 6        (15 ILCS 520/7) (from Ch. 130, par. 26)
 7        Sec. 7. (a) Proposals made  may  either  be  approved  or
 8    rejected  by the State Treasurer.  A bank or savings and loan
 9    association whose proposal is approved shall be  eligible  to
10    become  a  State depositary for the class or classes of funds
11    covered  by  its  proposal.  A  bank  or  savings  and   loan
12    association  whose  proposal  is  rejected  shall  not  be so
13    eligible. The State Treasurer shall seek to have at all times
14    a total of not  less  than  20  banks  or  savings  and  loan
15    associations  which  are  approved  as State depositaries for
16    time deposits.
17        (b)  The State Treasurer may, in his discretion, accept a
18    proposal from an eligible institution which  provides  for  a
19    reduced  rate  of  interest  provided  that  such institution
20    documents  the  use  of   deposited   funds   for   community
21    development projects.
22        (c)  The  State  Treasurer may, in his or her discretion,
23    accept a proposal from an eligible institution that  provides
24    for  interest earnings on deposits of State moneys to be held
25    by the institution in  a  separate  account  that  the  State
26    Treasurer  may  use to secure up to 10% of any (i) home loans
27    to  Illinois  citizens  purchasing  a  home  in  Illinois  in
28    situations  where  the  participating  financial  institution
29    would  not  offer  the  borrower  a  home  loan   under   the
30    institution's   prevailing   credit   standards  without  the
31    incentive of a reduced rate of interest on deposits of  State
 
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 1    moneys, and (ii) existing home loans of Illinois citizens who
 2    have  failed  to make payments on a the home loan as a result
 3    of a financial  hardship  due  to  circumstances  beyond  the
 4    control  of the borrower where there is a reasonable prospect
 5    that the borrower  will  be  able  to  resume  full  mortgage
 6    payments,  and  (iii) loans in amounts that do not exceed the
 7    amount of arrearage on a mortgage and that  are  extended  to
 8    enable  a  borrower  to become current on his or her mortgage
 9    obligation.
10        The  following  factors  shall  be  considered   by   the
11    participating  financial institution to determine whether the
12    financial hardship is due to circumstances beyond the control
13    of the borrower: (i) loss, reduction, or delay in the receipt
14    of income because of the death or disability of a person  who
15    contributed  to  the household income, (ii) expenses actually
16    incurred related to the uninsured damage or costly repairs to
17    the mortgaged  premises  affecting  its  habitability,  (iii)
18    expenses  related  to  the death or illness in the borrower's
19    household or of family members living outside  the  household
20    that  reduce  the  amount  of  household income, (iv) loss of
21    income or a substantial increase in  total  housing  expenses
22    because of divorce, abandonment, separation from a spouse, or
23    failure  to  support  a  spouse or child, (v) unemployment or
24    underemployment,  (vi)  loss,  reduction,  or  delay  in  the
25    receipt of federal, State, or other government benefits,  and
26    (vii)  participation  by  the homeowner in a recognized labor
27    action such as a strike.  In determining whether there  is  a
28    reasonable  prospect that the borrower will be able to resume
29    full   mortgage   payments,   the   participating   financial
30    institution  shall  consider  factors  including,   but   not
31    necessarily  limited  to  the following: (i) a favorable work
32    and credit  history,  (ii)  the  borrower's  ability  to  and
33    history  of paying the mortgage when employed, (iii) the lack
34    of an impediment or disability  that  prevents  reemployment,
 
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 1    (iv)  new  education and training opportunities, (v) non-cash
 2    benefits that may reduce household expenses, and  (vi)  other
 3    debts.  temporary  layoff or disability, but who have resumed
 4    making payments on the home loan and have  made  at  least  2
 5    consecutive payments, when under the institution's prevailing
 6    policies  it would commence or pursue foreclosure proceedings
 7    if it were not  for  the  incentive  of  a  reduced  rate  of
 8    interest on deposits of State moneys.
 9        For  the  purposes  of  this Section, "home loan" means a
10    loan, other  than  an  open-end  credit  plan  or  a  reverse
11    mortgage  transaction,  for which (i) the principal amount of
12    the loan does not exceed 50%  of  the  conforming  loan  size
13    limit  for  a single-family dwelling as established from time
14    to time by the Federal National  Mortgage  Association,  (ii)
15    the  borrower is a natural person, (iii) the debt is incurred
16    by the borrower primarily for personal, family, or  household
17    purposes,  and (iv) the loan is secured by a mortgage or deed
18    of trust on real estate upon which there is located or  there
19    is  to  be  located  a structure designed principally for the
20    occupancy of no more than 4 families one family and  that  is
21    or  will  be  occupied  by  the  borrower  as  the borrower's
22    principal dwelling.
23        (d)  If there is an agreement between the State Treasurer
24    and an eligible institution that details the use of deposited
25    funds, the agreement may  not  require  the  gift  of  money,
26    goods,  or services to a third party; this provision does not
27    restrict the eligible institution from contracting with third
28    parties in order to carry out the intent of the agreement  or
29    restrict  the  State Treasurer from placing requirements upon
30    third-party  contracts   entered   into   by   the   eligible
31    institution.
32    (Source: P.A. 92-482, eff. 8-23-01.)

33        Section  99.  Effective date.  This Act takes effect upon
 
SB1269 Engrossed            -4-                LRB9201663TAtm
 1    becoming law.

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