2005 Illinois Code - Chapter 765 Property 765 ILCS 910/ Mortgage Escrow Account Act.
(765 ILCS 910/1) (from Ch. 17, par. 4901)
Sec. 1.
This Act shall be known as the "Mortgage Escrow Account Act".
(Source: P.A. 79‑625.)
|
(765 ILCS 910/2)(from Ch. 17, par. 4902)
Sec. 2. As used in this Act, unless the context requires otherwise:
(a) "Escrow Account" means any account established by the mortgage lender
in conjunction with a mortgage loan on a residence, into which the borrower
is required to make regular periodic payments and out of which the lender
pays the taxes on the property covered by the mortgage.
(b) "Borrower" means the person obligated under the mortgage loan.
(c) "Mortgage Lender" means any bank, savings bank, savings and loan association, credit union, mortgage banker, or other institution, association, partnership, corporation
or person who extends the loan of monies for the purpose of enabling another
to purchase a residence or who services the loan, including successors in interest of the foregoing.
(d) "Escrow‑like Arrangement" means any arrangement the intent of which
is to serve the same purposes as an escrow account but which does not require
the formal establishment of an account.
(Source: P.A. 94‑50, eff. 1‑1‑06.)
(765 ILCS 910/3) (from Ch. 17, par. 4903)
Sec. 3.
Escrow Accounts or escrow‑like arrangements established after
the effective date of this Act in conjunction with mortgage agreements for
single‑family owner occupied residential property are hereby declared separate
and distinct transactions from mortgages and, hence, subject to the laws
and regulations of this State.
(Source: P.A. 79‑625.)
|
(765 ILCS 910/4)(from Ch. 17, par. 4904)
Sec. 4. On or after the effective date of this Act, each mortgage lender
in conjunction with the granting or servicing of a mortgage on a single‑family owner
occupied residential property, shall comply with the provisions of this Act.
(Source: P.A. 94‑50, eff. 1‑1‑06.)
(765 ILCS 910/5) (from Ch. 17, par. 4905)
Sec. 5.
When the mortgage is reduced to 65% of its original amount by
payments of the borrower, timely made according to the provisions of the
loan agreement secured by the mortgage, and the borrower is otherwise not
in default on the loan agreement, the mortgage lender must notify the borrower
that he may terminate such escrow account or that he may elect to continue
it until he requests a termination thereof, or until the mortgage is paid
in full, whichever occurs first.
(Source: P.A. 79‑625.)
|
(765 ILCS 910/6) (from Ch. 17, par. 4906)
Sec. 6.
In lieu of the mortgage lender establishing an escrow account
or an escrow‑like arrangement, a borrower may pledge an interest bearing
time deposit with the mortgage lender in an
amount sufficient to secure the payment of anticipated taxes.
(Source: P.A. 84‑232.)
|
(765 ILCS 910/7) (from Ch. 17, par. 4907)
Sec. 7.
The borrower shall not have the right to terminate any such arrangement
under Section 5 in conjunction with mortgages insured, guaranteed, supplemented,
or assisted by the State of Illinois or the federal government that require
an escrow arrangement for their continuation.
(Source: P.A. 79‑625.)
|
(765 ILCS 910/8) (from Ch. 17, par. 4908)
Sec. 8.
If after terminating an escrow arrangement under the conditions
of this Act, the borrower does not furnish to the lender sufficient evidence
of payment of the taxes when due on the residence covered by the mortgage
with respect to which the escrow arrangement was established, the lender,
after taking reasonably good faith steps to verify nonpayment, may, within
thirty days after such payment is due, establish or reestablish an escrow
arrangement notwithstanding the provisions of this Act.
(Source: P.A. 79‑625.)
|
(765 ILCS 910/9) (from Ch. 17, par. 4909)
Sec. 9.
Failure of any mortgage lender operating within this State to
comply with the provisions of this Act shall entitle the borrower to actual
damages in a court action.
(Source: P.A. 79‑625.)
|
(765 ILCS 910/10) (from Ch. 17, par. 4910)
Sec. 10.
The provisions of this Act shall not be applicable to a mortgage
lender using the capitalization method of accounting for receipt of payments
for taxes. The capitalization method shall mean crediting such tax payments
directly to the loan principal upon receipt and increasing the loan balance
when the taxes are paid.
(Source: P.A. 79‑625.)
|
(765 ILCS 910/11) (from Ch. 17, par. 4911)
Sec. 11.
Notice of the requirements of the Act shall be furnished in writing
to the borrower at the date of closing.
(Source: P.A. 79‑625.)
|
(765 ILCS 910/12) (from Ch. 17, par. 4912)
Sec. 12.
This Act takes effect on January 1, 1976.
(Source: P.A. 79‑625.)
|
(765 ILCS 910/15) Sec. 15. Notice of tax payments. (a) When any mortgage
lender pays the property tax from an escrow account, the mortgage lender must give the borrower written notice of the following, within 45 business days after the tax payment: (1) the date the taxes were paid; (2) the amount of taxes paid; and (3) the permanent index number, mortgage account
|
number, address of the property, or other property description that is used for assessment and taxation purposes under the Property Tax Code.
|
|
(b) The notice required in subsection (a) may be included
|
|
on or with other documents, notices, or statements provided to the borrower. If more than one borrower is obligated on the loan, only one borrower who is primarily liable on the loan need be given notice. Notice may be delivered, mailed, or transmitted by any usual means of communication.
|
|
(c) Notwithstanding the requirements in subsection (a), a
|
|
mortgage lender that provides notice at least annually to a borrower in the manner provided in subsection (b) of a means of communication for the borrower to access the information set forth in subsection (a) by telephone, facsimile, e‑mail, Internet access, or other means of communication, is deemed to be in compliance with subsection (a).
|
|
(Source: P.A. 94‑50, eff. 1‑1‑06; 94‑883, eff. 1‑1‑07.)
|
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.
