There Is a Newer Version of the Illinois Compiled Statutes
  1. 2025 Illinois Comp. Stat.
  2. 2024 Illinois Comp. Stat.
  3. 2023 Illinois Comp. Stat.
  4. 2005 Illinois Comp. Stat. (here)
  5. View All Versions
View Our Newest Version Here

2005 Illinois Code - 205 ILCS 635/      Residential Mortgage License Act of 1987. Article II - Licensing Procedure


      (205 ILCS 635/Art. II heading)
ARTICLE II
LICENSING PROCEDURE

    (205 ILCS 635/2‑1) (from Ch. 17, par. 2322‑1)
    Sec. 2‑1. Licensee Name.
    (a) No person, partnership, association, corporation, limited liability company, or other entity engaged in the business regulated by this Act shall operate such business under a name other than the real names of the individuals conducting such business, an assumed corporate name pursuant to the Business Corporation Act of 1983, an assumed limited liability company name pursuant to the Limited Liability Company Act, or an assumed business name pursuant to the Assumed Business Name Act.
    (b) A knowing violation of this Section constitutes an unlawful practice within the meaning of this Act, and in addition to the administrative relief available under this Act, may be prosecuted for the commission of a Class A misdemeanor. A person who is convicted of a second or subsequent violation of this Section is guilty of a Class 4 felony.
(Source: P.A. 89‑355, eff. 8‑17‑95.)

    (205 ILCS 635/2‑2) (from Ch. 17, par. 2322‑2)
    Sec. 2‑2. Application process; investigation; fee.
    (a) The Commissioner shall issue a license upon completion of all of the following:
        (1) The filing of an application for license.
        (2) The filing with the Commissioner of a listing of
    
judgments entered against, and bankruptcy petitions by, the license applicant for the preceding 10 years.
        (3) The payment, in certified funds, of
    
investigation and application fees, the total of which shall be in an amount equal to $2,700 annually, however, the Commissioner may increase the investigation and application fees by rule as provided in Section 4‑11.
        (4) Except for a broker applying to renew a license,
    
the filing of an audited balance sheet including all footnotes prepared by a certified public accountant in accordance with generally accepted accounting principles and generally accepted auditing principles which evidences that the applicant meets the net worth requirements of Section 3‑5.
        (5) The filing of proof satisfactory to the
    
Commissioner that the applicant, the members thereof if the applicant is a partnership or association, the members or managers thereof that retain any authority or responsibility under the operating agreement if the applicant is a limited liability company, or the officers thereof if the applicant is a corporation have 3 years experience preceding application in real estate finance. Instead of this requirement, the applicant and the applicant's officers or members, as applicable, may satisfactorily complete a program of education in real estate finance and fair lending, as approved by the Commissioner, prior to receiving the initial license. The Commissioner shall promulgate rules regarding proof of experience requirements and educational requirements and the satisfactory completion of those requirements. The Commissioner may establish by rule a list of duly licensed professionals and others who may be exempt from this requirement.
        (6) An investigation of the averments required by
    
Section 2‑4, which investigation must allow the Commissioner to issue positive findings stating that the financial responsibility, experience, character, and general fitness of the license applicant and of the members thereof if the license applicant is a partnership or association, of the officers and directors thereof if the license applicant is a corporation, and of the managers and members that retain any authority or responsibility under the operating agreement if the license applicant is a limited liability company are such as to command the confidence of the community and to warrant belief that the business will be operated honestly, fairly and efficiently within the purpose of this Act. If the Commissioner shall not so find, he or she shall not issue such license, and he or she shall notify the license applicant of the denial.
    The Commissioner may impose conditions on a license if
    
the Commissioner determines that the conditions are necessary or appropriate. These conditions shall be imposed in writing and shall continue in effect for the period prescribed by the Commissioner.
    (b) All licenses shall be issued in duplicate with one copy being transmitted to the license applicant and the second being retained with the Commissioner.
    Upon receipt of such license, a residential mortgage licensee shall be authorized to engage in the business regulated by this Act. Such license shall remain in full force and effect until it expires without renewal, is surrendered by the licensee or revoked or suspended as hereinafter provided.
(Source: P.A. 93‑32, eff. 7‑1‑03; 93‑1018, eff. 1‑1‑05.)

    (205 ILCS 635/2‑3) (from Ch. 17, par. 2322‑3)
    Sec. 2‑3. Application form.
    (a) Application for a residential mortgage license must be made in accordance with Section 2‑6. The application shall be in writing, under oath, and on a form obtained from and prescribed by the Commissioner.
    (b) The application shall contain the name and complete business and residential address or addresses of the license applicant. If the license applicant is a partnership, association, corporation or other form of business organization, the application shall contain the names and complete business and residential addresses of each member, director and principal officer thereof. Such application shall also include a description of the activities of the license applicant, in such detail and for such periods, as the Commissioner may require, including all of the following:
        (1) An affirmation of financial solvency noting such
    
capitalization requirements as may be required by the Commissioner, and access to such credit as may be required by the Commissioner.
        (2) An affirmation that the license applicant or its
    
members, directors or principals as may be appropriate, are at least 18 years of age.
        (3) Information as to the character, fitness,
    
financial and business responsibility, background, experience, and criminal record of any (i) person, entity, or ultimate equitable owner that owns or controls, directly or indirectly, 10% or more of any class of stock of the license applicant; (ii) person, entity, or ultimate equitable owner that is not a depository institution, as defined in Section 1007.50 of the Savings Bank Act, that lends, provides, or infuses, directly or indirectly, in any way, funds to or into a license applicant, in an amount equal to or more than 10% of the license applicant's net worth; (iii) person, entity, or ultimate equitable owner that controls, directly or indirectly, the election of 25% or more of the members of the board of directors of a license applicant; or (iv) person, entity, or ultimate equitable owner that the Commissioner finds influences management of the license applicant.
        (4) Upon written request by the licensee and
    
notwithstanding the provisions of paragraphs (1), (2), and (3) of this subsection, the Commissioner may permit the licensee to omit all or part of the information required by those paragraphs if, in lieu of the omitted information, the licensee submits an affidavit stating that the information submitted on the licensee's previous renewal application is still true and accurate. The Commissioner may promulgate rules prescribing the form and content of the affidavit that are necessary to accomplish the purposes of this Section.
        (5) Such other information as required by
    
regulations of the Commissioner.
(Source: P.A. 89‑355, eff. 8‑17‑95.)

    (205 ILCS 635/2‑4) (from Ch. 17, par. 2322‑4)
    Sec. 2‑4. Averments of Licensee. Each application for license or for the renewal of a license shall be accompanied by the following averments stating that the applicant:
    (a) Will maintain at least one full service office within the State of Illinois pursuant to Section 3‑4 of this Act;
    (b) Will maintain staff reasonably adequate to meet the requirements of Section 3‑4 of this Act;
    (c) Will keep and maintain for 36 months the same written records as required by the federal Equal Credit Opportunity Act, and any other information required by regulations of the Commissioner regarding any home mortgage in the course of the conduct of its residential mortgage business;
    (d) Will file with the Commissioner, when due, any report or reports which it is required to file under any of the provisions of this Act;
    (e) Will not engage, whether as principal or agent, in the practice of rejecting residential mortgage applications without reasonable cause, or varying terms or application procedures without reasonable cause, for home mortgages on real estate within any specific geographic area from the terms or procedures generally provided by the licensee within other geographic areas of the State;
    (f) Will not engage in fraudulent home mortgage underwriting practices;
    (g) Will not make payment, whether directly or indirectly, of any kind to any in house or fee appraiser of any government or private money lending agency with which an application for a home mortgage has been filed for the purpose of influencing the independent judgment of the appraiser with respect to the value of any real estate which is to be covered by such home mortgage;
    (h) Has filed tax returns (State and Federal) for the past 3 years or filed with the Commissioner an accountant's or attorney's statement as to why no return was filed;
    (i) Will not engage in any discrimination or redlining activities prohibited by Section 3‑8 of this Act;
    (j) Will not knowingly make any false promises likely to influence or persuade, or pursue a course of misrepresentation and false promises through agents, solicitors, advertising or otherwise;
    (k) Will not knowingly misrepresent, circumvent or conceal, through whatever subterfuge or device, any of the material particulars or the nature thereof, regarding a transaction to which it is a party to the injury of another party thereto;
    (l) Will disburse funds in accordance with its agreements;
    (m) Has not committed a crime against the law of this State, any other state or of the United States, involving moral turpitude, fraudulent or dishonest dealing, and that no final judgment has been entered against it in a civil action upon grounds of fraud, misrepresentation or deceit which has not been previously reported to the Commissioner;
    (n) Will account or deliver to any person any personal property such as money, fund, deposit, check, draft, mortgage, other document or thing of value, which has come into its possession, and which is not its property, or which it is not in law or equity entitled to retain under the circumstances, at the time which has been agreed upon or is required by law, or, in the absence of a fixed time, upon demand of the person entitled to such accounting and delivery;
    (o) Has not engaged in any conduct which would be cause for denial of a license;
    (p) Has not become insolvent;
    (q) Has not submitted an application for a license under this Act which contains a material misstatement;
    (r) Has not demonstrated by course of conduct, negligence or incompetence in performing any act for which it is required to hold a license under this Act;
    (s) Will advise the Commissioner in writing of any changes to the information submitted on the most recent application for license within 30 days of said change. The written notice must be signed in the same form as the application for license being amended;
    (t) Will comply with the provisions of this Act, or with any lawful order, rule or regulation made or issued under the provisions of this Act;
    (u) Will submit to periodic examination by the Commissioner as required by this Act;
    (v) Will advise the Commissioner in writing of judgments entered against, and bankruptcy petitions by, the license applicant within 5 days of occurrence;
    (w) Will advise the Commissioner in writing within 30 days when the license applicant requests a licensee under this Act to repurchase a loan, and the circumstances therefor; and
    (x) Will advise the Commissioner in writing within 30 days when the license applicant is requested by another entity to repurchase a loan, and the circumstances therefor.
    (y) Will at all times act in a manner consistent with subsections (a) and (b) of Section 1‑2 of this Act.
    (x) Will not knowingly hire or employ a loan originator who is not registered with the Commissioner as required under Section 7‑1 of this Act.
    A licensee who fails to fulfill obligations of an averment, to comply with averments made, or otherwise violates any of the averments made under this Section shall be subject to the penalties in Section 4‑5 of this Act.
(Source: P.A. 93‑561, eff. 1‑1‑04.)

    (205 ILCS 635/2‑5) (from Ch. 17, par. 2322‑5)
    Sec. 2‑5. Refusal to Issue License. The Commissioner shall refuse to license or renew a license if:
        (1) it is determined that the applicant is not in
    
compliance with any provisions of the Act; or
        (2) there is substantial continuity between the
    
applicant and any violator of this Act; or
        (3) the Commissioner cannot make the findings
    
specified in Section 2‑2, subsection (a), of this Act.
(Source: P.A. 86‑137; 87‑642.)

    (205 ILCS 635/2‑6) (from Ch. 17, par. 2322‑6)
    Sec. 2‑6. License issuance and renewal; fee.
    (a) Beginning July 1, 2003, licenses shall be renewed every year on the anniversary of the date of issuance of the original license. Properly completed renewal application forms and filing fees must be received by the Commissioner 60 days prior to the renewal date.
    (b) It shall be the responsibility of each licensee to accomplish renewal of its license; failure of the licensee to receive renewal forms absent a request sent by certified mail for such forms will not waive said responsibility. Failure by a licensee to submit a properly completed renewal application form and fees in a timely fashion, absent a written extension from the Commissioner, will result in the assessment of additional fees, as follows:
        (1) A fee of $750 will be assessed to the licensee
    
30 days after the proper renewal date and $1,500 each month thereafter, until the license is either renewed or expires pursuant to Section 2‑6, subsections (c) and (d), of this Act.
        (2) Such fee will be assessed without prior notice
    
to the licensee, but will be assessed only in cases wherein the Commissioner has in his or her possession documentation of the licensee's continuing activity for which the unrenewed license was issued.
    (c) A license which is not renewed by the date required in this Section shall automatically become inactive. No activity regulated by this Act shall be conducted by the licensee when a license becomes inactive. The Commissioner may require the licensee to provide a plan for the disposition of any residential mortgage loans not closed or funded when the license becomes inactive. The Commissioner may allow a licensee with an inactive license to conduct activities regulated by this Act for the sole purpose of assisting borrowers in the closing or funding of loans for which the loan application was taken from a borrower while the license was active. An inactive license may be reactivated by the Commissioner upon payment of the renewal fee, and payment of a reactivation fee equal to the renewal fee.
    (d) A license which is not renewed within one year of becoming inactive shall expire.
    (e) A licensee ceasing an activity or activities regulated by this Act and desiring to no longer be licensed shall so inform the Commissioner in writing and, at the same time, convey the license and all other symbols or indicia of licensure. The licensee shall include a plan for the withdrawal from regulated business, including a timetable for the disposition of the business. Upon receipt of such written notice, the Commissioner shall issue a certified statement canceling the license.
(Source: P.A. 93‑32, eff. 7‑1‑03; 93‑561, eff. 1‑1‑04; 93‑1018, eff. 1‑1‑05.)

    (205 ILCS 635/2‑7) (from Ch. 17, par. 2322‑7)
    Sec. 2‑7. Waiver of licensing fee. The Commissioner may waive the licensing fee upon receipt of:
    (a) an application for a residential mortgage license in Illinois,
    (b) an addendum requesting waiver of the fee stating the grounds in support of such waiver, including but not limited to, not for profit status, bankruptcy or the showing of undue hardship, and
    (c) in case of an out‑of‑state servicer of loans in Illinois, the following documentation is required:
        (1) A verification that the firm services only 100
    
or fewer loans secured by residential real estate situated in Illinois;
        (2) An agreement not to originate, purchase or
    
acquire additional servicing of loans secured by residential real estate situated in Illinois;
        (3) An agreement to maintain a dedicated toll free
    
(800) number for exclusive use by the licensee's Illinois customers;
        (4) An agreement to provide a written notice at
    
least annually to the licensee's Illinois customers advising them of the dedicated toll free (800) number; and to furnish the Commissioner with a copy of such written notice.
    A request for waiver of the filing fee must be submitted each year in conjunction with the license renewal procedure.
(Source: P.A. 90‑301, eff. 8‑1‑97.)

    (205 ILCS 635/2‑8) (from Ch. 17, par. 2322‑8)
    Sec. 2‑8. Additional Full‑service Offices.
    (a) A licensee may apply for authority to open and maintain additional full‑service offices by:
    (1) Giving the Commissioner prior notice of its intention in such form as shall be prescribed by the Commissioner.
    (2) Payment of a fee to be established by regulation.
    (b) Upon receipt of the notice and fee required in subsection (a) above, the Commissioner shall issue a certificate for the additional full‑service office.
    (c) The certificate shall be conspicuously posted in the respective additional full‑service offices.
(Source: P.A. 85‑735.)

    (205 ILCS 635/2‑9) (from Ch. 17, par. 2322‑9)
    Sec. 2‑9. Posting of license. The license of a licensee whose home office is within the State of Illinois or of an out‑of‑state licensee shall be conspicuously posted in every office of the licensee located in Illinois. Out‑of‑state licensees without an Illinois office shall produce the license upon request. Licensees originating loans on the Internet shall post on their Internet web site their license number and the address and telephone number of the Commissioner. The license shall state the full name and address of the licensee. The license shall not be transferable or assignable. A separate certificate shall be issued for posting in each full service Illinois office.
(Source: P.A. 91‑586, eff. 8‑14‑99.)

    (205 ILCS 635/2‑11) (from Ch. 17, par. 2322‑11)
    Sec. 2‑11. Miscellaneous fees. In addition to any license fee collected under this Act, the Commissioner shall by rule and regulation establish a schedule to apply to assessment and collection of necessary contingent and miscellaneous fees.
(Source: P.A. 85‑735.)

Disclaimer: These codes may not be the most recent version. Illinois may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.