Public Act 103-0156

HB2325 Enrolled LRB103 26311 BMS 52672 b

AN ACT concerning regulation.

Be it enacted by the People of the State of Illinois,

represented in the General Assembly:

Section 5. The Residential Mortgage License Act of 1987 is

amended by changing Sections 1-3 and 1-4 and by adding Section

3-11 as follows:

(205 ILCS 635/1-3) (from Ch. 17, par. 2321-3)

Sec. 1-3. Necessity for license; scope of Act.

(a) No person, partnership, association, corporation or

other entity shall engage in the business of brokering,

funding, originating, servicing or purchasing of residential

mortgage loans without first obtaining a license from the

Secretary in accordance with the licensing procedure provided

in this Article I and such regulations as may be promulgated by

the Secretary. The licensing provisions of this Section shall

not apply to any entity engaged solely in commercial mortgage

lending or to any person, partnership association, corporation

or other entity exempted pursuant to Section 1-4, subsection

(d), of this Act or in accordance with regulations promulgated

by the Secretary hereunder. No provision of this Act shall

apply to an exempt person or entity as defined in items (1) and

(1.5) of subsection (d) of Section 1-4 of this Act.

Notwithstanding anything to the contrary in the preceding

sentence, an individual acting as a mortgage loan originator

who is not employed by and acting for an entity described in

item (1) of subsection (tt) of Section 1-4 of this Act shall be

subject to the mortgage loan originator licensing requirements

of Article VII of this Act.

Effective January 1, 2011, no provision of this Act shall

apply to an exempt person or entity as defined in item (1.8) of

subsection (d) of Section 1-4 of this Act. Notwithstanding

anything to the contrary in the preceding sentence, an

individual acting as a mortgage loan originator who is not

employed by and acting for an entity described in item (1) of

subsection (tt) of Section 1-4 of this Act shall be subject to

the mortgage loan originator licensing requirements of Article

VII of this Act, and provided that an individual acting as a

mortgage loan originator under item (1.8) of subsection (d) of

Section 1-4 of this Act shall be further subject to a

determination by the U.S. Department of Housing and Urban

Development through final rulemaking or other authorized

agency determination under the federal Secure and Fair

Enforcement for Mortgage Licensing Act of 2008.

(a-1) A person who is exempt from licensure pursuant to

paragraph (ii) of item (1) of subsection (d) of Section 1-4 of

this Act as a federally chartered savings bank that is

registered with the Nationwide Multistate Licensing System and

Registry may apply to the Secretary for an exempt company

registration for the purpose of sponsoring one or more

individuals subject to the mortgage loan originator licensing

requirements of Article VII of this Act. Registration with the

Division of Banking of the Department shall not affect the

exempt status of the applicant.

(1) A mortgage loan originator eligible for licensure

under this subsection shall (A) be covered under an

exclusive written contract with, and originate residential

mortgage loans solely on behalf of, that exempt person;

and (B) hold a current, valid insurance producer license

under Article XXXI of the Illinois Insurance Code.

(2) An exempt person shall: (A) fulfill any reporting

requirements required by the Nationwide Multistate

Licensing System and Registry or the Secretary; (B)

provide a blanket surety bond pursuant to Section 7-12 of

this Act covering the activities of all its sponsored

mortgage loan originators; (C) reasonably supervise the

activities of all its sponsored mortgage loan originators;

(D) comply with all rules and orders (including the

averments contained in Section 2-4 of this Act as

applicable to a non-licensed exempt entity provided for in

this Section) that the Secretary deems necessary to ensure

compliance with the federal SAFE Act; and (E) pay an

annual registration fee established by the Director.

(3) The Secretary may deny an exempt company

registration to an exempt person or fine, suspend, or

revoke an exempt company registration if the Secretary

finds one of the following:

(A) that the exempt person is not a person of

honesty, truthfulness, or good character;

(B) that the exempt person violated any applicable

law, rule, or order;

(C) that the exempt person refused or failed to

furnish, within a reasonable time, any information or

make any report that may be required by the Secretary;

(D) that the exempt person had a final judgment

entered against him or her in a civil action on grounds

of fraud, deceit, or misrepresentation, and the

conduct on which the judgment is based indicates that

it would be contrary to the interest of the public to

permit the exempt person to manage a loan originator;

(E) that the exempt person had an order entered

against him or her involving fraud, deceit, or

misrepresentation by an administrative agency of this

State, the federal government, or any other state or

territory of the United States, and the facts relating

to the order indicate that it would be contrary to the

interest of the public to permit the exempt person to

manage a loan originator;

(F) that the exempt person made a material

misstatement or suppressed or withheld information on

the application for an exempt company registration or

any document required to be filed with the Secretary;

or

(G) that the exempt person violated Section 4-5 of

this Act.

(a-5) An entity that is exempt from licensure pursuant to

item (7) of subsection (d) of Section 1-4 of this Act as an

independent loan processing entity shall annually apply to the

Secretary through the Nationwide Multistate Licensing System

and Registry for an exempt company registration for the

purpose of sponsoring one or more individuals subject to the

mortgage loan originator licensing requirements of Article VII

of this Act. A loan processor who performs clerical or support

duties at the direction of and subject to the supervision and

instruction of a licensed mortgage loan originator sponsored

by an independent loan processing entity shall be exempt from

his or her own licensing as a mortgage loan originator. An

independent loan processing entity shall not be subject to

examination by the Secretary. The Secretary may adopt rules to

implement any provisions necessary for the administration of

this subsection.

(b) No person, partnership, association, corporation, or

other entity except a licensee under this Act or an entity

exempt from licensing pursuant to Section 1-4, subsection (d),

of this Act shall do any business under any name or title, or

circulate or use any advertising or make any representation or

give any information to any person, which indicates or

reasonably implies activity within the scope of this Act.

(c) The Secretary may, through the Attorney General,

request the circuit court of either Cook or Sangamon County to

issue an injunction to restrain any person from violating or

continuing to violate any of the foregoing provisions of this

Section.

(d) When the Secretary has reasonable cause to believe

that any entity which has not submitted an application for

licensure is conducting any of the activities described in

subsection (a) hereof, the Secretary shall have the power to

examine all books and records of the entity and any additional

documentation necessary in order to determine whether such

entity should become licensed under this Act.

(d-1) The Secretary may issue orders against any person if

the Secretary has reasonable cause to believe that an unsafe,

unsound, or unlawful practice has occurred, is occurring, or

is about to occur, if any person has violated, is violating, or

is about to violate any law, rule, or written agreement with

the Secretary, or for the purposes of administering the

provisions of this Act and any rule adopted in accordance with

this Act.

(e) Any person, partnership, association, corporation or

other entity who violates any provision of this Section

commits a business offense and shall be fined an amount not to

exceed $25,000. A mortgage loan brokered, funded, originated,

serviced, or purchased by a party who is not licensed under

this Section shall not be held to be invalid solely on the

basis of a violation under this Section. The changes made to

this Section by Public Act 99-113 are declarative of existing

law.

(f) Each person, partnership, association, corporation or

other entity conducting activities regulated by this Act shall

be issued one license. Each full service office, place of

business or location at which a residential mortgage licensee

conducts any part of his or her business must be recorded with

the Secretary pursuant to Section 2-8 of this Act.

(g) Licensees under this Act shall solicit, broker, fund,

originate, service and purchase residential mortgage loans

only in conformity with the provisions of this Act and such

rules and regulations as may be promulgated by the Secretary.

(h) This Act applies to all entities doing business in

Illinois as residential mortgage bankers, as defined by "An

Act to provide for the regulation of mortgage bankers",

approved September 15, 1977, as amended, regardless of whether

licensed under that or any prior Act. Any existing residential

mortgage lender or residential mortgage broker in Illinois

whether or not previously licensed, must operate in accordance

with this Act.

(i) This Act is a successor Act to and a continuance of the

regulation of residential mortgage bankers provided in "An Act

to provide for the regulation of mortgage bankers", approved

September 15, 1977, as amended.

Entities and persons subject to the predecessor Act shall

be subject to this Act from and after its effective date.

(Source: P.A. 100-851, eff. 8-14-18; 100-1153, eff. 12-19-18;

101-81, eff. 7-12-19.)

(205 ILCS 635/1-4)

Sec. 1-4. Definitions. The following words and phrases

have the meanings given to them in this Section:

(a) "Residential real property" or "residential real

estate" shall mean any real property located in Illinois,

upon which is constructed or intended to be constructed a

dwelling. Those terms include a manufactured home as

defined in subdivision (53) of Section 9-102 of the

Uniform Commercial Code which is real property as defined

in Section 5-35 of the Conveyance and Encumbrance of

Manufactured Homes as Real Property and Severance Act.

(b) "Making a residential mortgage loan" or "funding a

residential mortgage loan" shall mean for compensation or

gain, either directly or indirectly, advancing funds or

making a commitment to advance funds to a loan applicant

for a residential mortgage loan.

(c) "Soliciting, processing, placing, or negotiating a

residential mortgage loan" shall mean for compensation or

gain, either directly or indirectly, accepting or offering

to accept an application for a residential mortgage loan,

assisting or offering to assist in the processing of an

application for a residential mortgage loan on behalf of a

borrower, or negotiating or offering to negotiate the

terms or conditions of a residential mortgage loan with a

lender on behalf of a borrower including, but not limited

to, the submission of credit packages for the approval of

lenders, the preparation of residential mortgage loan

closing documents, including a closing in the name of a

broker.

(d) "Exempt person or entity" shall mean the

following:

(1) (i) Any banking organization or foreign

banking corporation licensed by the Illinois

Commissioner of Banks and Real Estate or the United

States Comptroller of the Currency to transact

business in this State; (ii) any national bank,

federally chartered savings and loan association,

federal savings bank, federal credit union; (iii)

(blank); (iv) any bank, savings and loan association,

savings bank, or credit union organized under the laws

of this or any other state; (v) any Illinois Consumer

Installment Loan Act licensee; (vi) any insurance

company authorized to transact business in this State;

(vii) any entity engaged solely in commercial mortgage

lending; (viii) any service corporation of a savings

and loan association or savings bank organized under

the laws of this State or the service corporation of a

federally chartered savings and loan association or

savings bank having its principal place of business in

this State, other than a service corporation licensed

or entitled to reciprocity under the Real Estate

License Act of 2000; or (ix) any first tier subsidiary

of a bank, the charter of which is issued under the

Illinois Banking Act by the Illinois Commissioner of

Banks and Real Estate, or the first tier subsidiary of

a bank chartered by the United States Comptroller of

the Currency and that has its principal place of

business in this State, provided that the first tier

subsidiary is regularly examined by the Illinois

Commissioner of Banks and Real Estate or the

Comptroller of the Currency, or a consumer compliance

examination is regularly conducted by the Federal

Reserve Board.

(1.5) Any employee of a person or entity mentioned

in item (1) of this subsection, when acting for such

person or entity, or any registered mortgage loan

originator when acting for an entity described in

subsection (tt) of this Section.

(1.8) Any person or entity that does not originate

mortgage loans in the ordinary course of business, but

makes or acquires residential mortgage loans with his

or her own funds for his or her or its own investment

without intent to make, acquire, or resell more than 3

residential mortgage loans in any one calendar year.

(2) (Blank).

(2.1) A bona fide nonprofit organization.

(2.2) An employee of a bona fide nonprofit

organization when acting on behalf of that

organization.

(3) Any person employed by a licensee to assist in

the performance of the residential mortgage licensee's

activities regulated by this Act who is compensated in

any manner by only one licensee.

(4) (Blank).

(5) Any individual, corporation, partnership, or

other entity that originates, services, or brokers

residential mortgage loans, as these activities are

defined in this Act, and who or which receives no

compensation for those activities, subject to the

Commissioner's regulations and the federal Secure and

Fair Enforcement for Mortgage Licensing Act of 2008

and the rules promulgated under that Act with regard

to the nature and amount of compensation.

(6) (Blank).

(7) Any entity engaged solely in providing loan

processing services through the sponsoring of

individuals acting pursuant to subsection (d) of

Section 7-1A of this Act.

(e) "Licensee" or "residential mortgage licensee"

shall mean a person, partnership, association,

corporation, or any other entity who or which is licensed

pursuant to this Act to engage in the activities regulated

by this Act.

(f) "Mortgage loan" "residential mortgage loan" or

"home mortgage loan" shall mean any loan primarily for

personal, family, or household use that is secured by a

mortgage, deed of trust, or other equivalent consensual

security interest on a dwelling as defined in Section

103(v) of the federal Truth in Lending Act, or residential

real estate upon which is constructed or intended to be

constructed a dwelling.

(g) "Lender" shall mean any person, partnership,

association, corporation, or any other entity who either

lends or invests money in residential mortgage loans.

(h) "Ultimate equitable owner" shall mean a person

who, directly or indirectly, owns or controls an ownership

interest in a corporation, foreign corporation, alien

business organization, trust, or any other form of

business organization regardless of whether the person

owns or controls the ownership interest through one or

more persons or one or more proxies, powers of attorney,

nominees, corporations, associations, partnerships,

trusts, joint stock companies, or other entities or

devices, or any combination thereof.

(i) "Residential mortgage financing transaction" shall

mean the negotiation, acquisition, sale, or arrangement

for or the offer to negotiate, acquire, sell, or arrange

for, a residential mortgage loan or residential mortgage

loan commitment.

(j) "Personal residence address" shall mean a street

address and shall not include a post office box number.

(k) "Residential mortgage loan commitment" shall mean

a contract for residential mortgage loan financing.

(l) "Party to a residential mortgage financing

transaction" shall mean a borrower, lender, or loan broker

in a residential mortgage financing transaction.

(m) "Payments" shall mean payment of all or any of the

following: principal, interest and escrow reserves for

taxes, insurance and other related reserves, and

reimbursement for lender advances.

(n) "Commissioner" shall mean the Commissioner of

Banks and Real Estate, except that, beginning on April 6,

2009 (the effective date of Public Act 95-1047), all

references in this Act to the Commissioner of Banks and

Real Estate are deemed, in appropriate contexts, to be

references to the Secretary of Financial and Professional

Regulation, or his or her designee, including the Director

of the Division of Banking of the Department of Financial

and Professional Regulation.

(n-1) "Director" shall mean the Director of the

Division of Banking of the Department of Financial and

Professional Regulation, except that, beginning on July

31, 2009 (the effective date of Public Act 96-112), all

references in this Act to the Director are deemed, in

appropriate contexts, to be the Secretary of Financial and

Professional Regulation, or his or her designee, including

the Director of the Division of Banking of the Department

of Financial and Professional Regulation.

(o) "Loan brokering", "brokering", or "brokerage

service" shall mean the act of helping to obtain from

another entity, for a borrower, a loan secured by

residential real estate situated in Illinois or assisting

a borrower in obtaining a loan secured by residential real

estate situated in Illinois in return for consideration to

be paid by either the borrower or the lender including,

but not limited to, contracting for the delivery of

residential mortgage loans to a third party lender and

soliciting, processing, placing, or negotiating

residential mortgage loans.

(p) "Loan broker" or "broker" shall mean a person,

partnership, association, corporation, or limited

liability company, other than those persons, partnerships,

associations, corporations, or limited liability companies

exempted from licensing pursuant to Section 1-4,

subsection (d), of this Act, who performs the activities

described in subsections (c), (o), and (yy) of this

Section.

(q) "Servicing" shall mean the collection or

remittance for or the right or obligation to collect or

remit for any lender, noteowner, noteholder, or for a

licensee's own account, of payments, interests, principal,

and trust items such as hazard insurance and taxes on a

residential mortgage loan in accordance with the terms of

the residential mortgage loan; and includes loan payment

follow-up, delinquency loan follow-up, loan analysis and

any notifications to the borrower that are necessary to

enable the borrower to keep the loan current and in good

standing. "Servicing" includes management of third-party

entities acting on behalf of a residential mortgage

licensee for the collection of delinquent payments and the

use by such third-party entities of said licensee's

servicing records or information, including their use in

foreclosure.

(r) "Full service office" shall mean an office,

provided by the licensee and not subleased from the

licensee's employees or independent contractors, and staff

in Illinois reasonably adequate to handle efficiently

communications, questions, and other matters relating to

any application for, or an existing home mortgage secured

by residential real estate situated in Illinois with

respect to which the licensee is brokering, funding

originating, purchasing, or servicing. The management and

operation of each full service office must include

observance of good business practices such as proper

signage; adequate, organized, and accurate books and

records; ample phone lines, hours of business, staff

training and supervision, and provision for a mechanism to

resolve consumer inquiries, complaints, and problems. The

Commissioner shall issue regulations with regard to these

requirements and shall include an evaluation of compliance

with this Section in his or her periodic examination of

each licensee. "Full service office" does not include a

remote location.

(s) "Purchasing" shall mean the purchase of

conventional or government-insured mortgage loans secured

by residential real estate situated in Illinois from

either the lender or from the secondary market.

(t) "Borrower" shall mean the person or persons who

seek the services of a loan broker, originator, or lender.

(u) "Originating" shall mean the issuing of

commitments for and funding of residential mortgage loans.

(v) "Loan brokerage agreement" shall mean a written

agreement in which a broker or loan broker agrees to do

either of the following:

(1) obtain a residential mortgage loan for the

borrower or assist the borrower in obtaining a

residential mortgage loan; or

(2) consider making a residential mortgage loan to

the borrower.

(w) "Advertisement" shall mean the attempt by

publication, dissemination, or circulation to induce,

directly or indirectly, any person to enter into a

residential mortgage loan agreement or residential

mortgage loan brokerage agreement relative to a mortgage

secured by residential real estate situated in Illinois.

(x) (Blank).

(y) "Government-insured mortgage loan" shall mean any

mortgage loan made on the security of residential real

estate insured by the Department of Housing and Urban

Development or Farmers Home Loan Administration, or

guaranteed by the Veterans Administration.

(z) "Annual audit" shall mean a certified audit of the

licensee's books and records and systems of internal

control performed by a certified public accountant in

accordance with generally accepted accounting principles

and generally accepted auditing standards.

(aa) "Financial institution" shall mean a savings and

loan association, savings bank, credit union, or a bank

organized under the laws of Illinois or a savings and loan

association, savings bank, credit union or a bank

organized under the laws of the United States and

headquartered in Illinois.

(bb) "Escrow agent" shall mean a third party,

individual or entity charged with the fiduciary obligation

for holding escrow funds on a residential mortgage loan

pending final payout of those funds in accordance with the

terms of the residential mortgage loan.

(cc) "Net worth" shall have the meaning ascribed

thereto in Section 3-5 of this Act.

(dd) "Affiliate" shall mean:

(1) any entity that directly controls or is

controlled by the licensee and any other company that

is directly affecting activities regulated by this Act

that is controlled by the company that controls the

licensee;

(2) any entity:

(A) that is controlled, directly or

indirectly, by a trust or otherwise, by or for the

benefit of shareholders who beneficially or

otherwise control, directly or indirectly, by

trust or otherwise, the licensee or any company

that controls the licensee; or

(B) a majority of the directors or trustees of

which constitute a majority of the persons holding

any such office with the licensee or any company

that controls the licensee;

(3) any company, including a real estate

investment trust, that is sponsored and advised on a

contractual basis by the licensee or any subsidiary or

affiliate of the licensee.

(ee) "First tier subsidiary" shall be defined by

regulation incorporating the comparable definitions used

by the Office of the Comptroller of the Currency and the

Illinois Commissioner of Banks and Real Estate.

(ff) "Gross delinquency rate" means the quotient

determined by dividing (1) the sum of (i) the number of

government-insured residential mortgage loans funded or

purchased by a licensee in the preceding calendar year

that are delinquent and (ii) the number of conventional

residential mortgage loans funded or purchased by the

licensee in the preceding calendar year that are

delinquent by (2) the sum of (i) the number of

government-insured residential mortgage loans funded or

purchased by the licensee in the preceding calendar year

and (ii) the number of conventional residential mortgage

loans funded or purchased by the licensee in the preceding

calendar year.

(gg) "Delinquency rate factor" means the factor set by

rule of the Commissioner that is multiplied by the average

gross delinquency rate of licensees, determined annually

for the immediately preceding calendar year, for the

purpose of determining which licensees shall be examined

by the Commissioner pursuant to subsection (b) of Section

4-8 of this Act.

(hh) (Blank).

(ii) "Confidential supervisory information" means any

report of examination, visitation, or investigation

prepared by the Commissioner under this Act, any report of

examination visitation, or investigation prepared by the

state regulatory authority of another state that examines

a licensee, any document or record prepared or obtained in

connection with or relating to any examination,

visitation, or investigation, and any record prepared or

obtained by the Commissioner to the extent that the record

summarizes or contains information derived from any

report, document, or record described in this subsection.

"Confidential supervisory information" does not include

any information or record routinely prepared by a licensee

and maintained in the ordinary course of business or any

information or record that is required to be made publicly

available pursuant to State or federal law or rule.

(jj) "Mortgage loan originator" means an individual

who for compensation or gain or in the expectation of

compensation or gain:

(i) takes a residential mortgage loan application;

or

(ii) offers or negotiates terms of a residential

mortgage loan.

"Mortgage loan originator" includes an individual

engaged in loan modification activities as defined in

subsection (yy) of this Section. A mortgage loan

originator engaged in loan modification activities shall

report those activities to the Department of Financial and

Professional Regulation in the manner provided by the

Department; however, the Department shall not impose a fee

for reporting, nor require any additional qualifications

to engage in those activities beyond those provided

pursuant to this Act for mortgage loan originators.

"Mortgage loan originator" does not include an

individual engaged solely as a loan processor or

underwriter except as otherwise provided in subsection (d)

of Section 7-1A of this Act.

"Mortgage loan originator" does not include a person

or entity that only performs real estate brokerage

activities and is licensed in accordance with the Real

Estate License Act of 2000, unless the person or entity is

compensated by a lender, a mortgage broker, or other

mortgage loan originator, or by any agent of that lender,

mortgage broker, or other mortgage loan originator.

"Mortgage loan originator" does not include a person

or entity solely involved in extensions of credit relating

to timeshare plans, as that term is defined in Section

101(53D) of Title 11, United States Code.

(kk) "Depository institution" has the same meaning as

in Section 3 of the Federal Deposit Insurance Act, and

includes any credit union.

(ll) "Dwelling" means a residential structure or

mobile home which contains one to 4 family housing units,

or individual units of condominiums or cooperatives.

(mm) "Immediate family member" means a spouse, child,

sibling, parent, grandparent, or grandchild, and includes

step-parents, step-children, step-siblings, or adoptive

relationships.

(nn) "Individual" means a natural person.

(oo) "Loan processor or underwriter" means an

individual who performs clerical or support duties as an

employee at the direction of and subject to the

supervision and instruction of a person licensed, or

exempt from licensing, under this Act. "Clerical or

support duties" includes subsequent to the receipt of an

application:

(i) the receipt, collection, distribution, and

analysis of information common for the processing or

underwriting of a residential mortgage loan; and

(ii) communicating with a consumer to obtain the

information necessary for the processing or

underwriting of a loan, to the extent that the

communication does not include offering or negotiating

loan rates or terms, or counseling consumers about

residential mortgage loan rates or terms. An

individual engaging solely in loan processor or

underwriter activities shall not represent to the

public, through advertising or other means of

communicating or providing information, including the

use of business cards, stationery, brochures, signs,

rate lists, or other promotional items, that the

individual can or will perform any of the activities

of a mortgage loan originator.

(pp) "Nationwide Multistate Licensing System and

Registry" means a mortgage licensing system developed and

maintained by the Conference of State Bank Supervisors and

the American Association of Residential Mortgage

Regulators for the licensing and registration of licensed

mortgage loan originators.

(qq) "Nontraditional mortgage product" means any

mortgage product other than a 30-year fixed rate mortgage.

(rr) "Person" means a natural person, corporation,

company, limited liability company, partnership, or

association.

(ss) "Real estate brokerage activity" means any

activity that involves offering or providing real estate

brokerage services to the public, including:

(1) acting as a real estate agent or real estate

broker for a buyer, seller, lessor, or lessee of real

property;

(2) bringing together parties interested in the

sale, purchase, lease, rental, or exchange of real

property;

(3) negotiating, on behalf of any party, any

portion of a contract relating to the sale, purchase,

lease, rental, or exchange of real property, other

than in connection with providing financing with

respect to any such transaction;

(4) engaging in any activity for which a person

engaged in the activity is required to be registered

or licensed as a real estate agent or real estate

broker under any applicable law; or

(5) offering to engage in any activity, or act in

any capacity, described in this subsection (ss).

(tt) "Registered mortgage loan originator" means any

individual that:

(1) meets the definition of mortgage loan

originator and is an employee of:

(A) a depository institution;

(B) a subsidiary that is:

(i) owned and controlled by a depository

institution; and

(ii) regulated by a federal banking

agency; or

(C) an institution regulated by the Farm

Credit Administration; and

(2) is registered with, and maintains a unique

identifier through, the Nationwide Multistate

Licensing System and Registry.

(uu) "Unique identifier" means a number or other

identifier assigned by protocols established by the

Nationwide Multistate Licensing System and Registry.

(vv) "Residential mortgage license" means a license

issued pursuant to Section 1-3, 2-2, or 2-6 of this Act.

(ww) "Mortgage loan originator license" means a

license issued pursuant to Section 7-1A, 7-3, or 7-6 of

this Act.

(xx) "Secretary" means the Secretary of the Department

of Financial and Professional Regulation, or a person

authorized by the Secretary or by this Act to act in the

Secretary's stead.

(yy) "Loan modification" means, for compensation or

gain, either directly or indirectly offering or

negotiating on behalf of a borrower or homeowner to adjust

the terms of a residential mortgage loan in a manner not

provided for in the original or previously modified

mortgage loan.

(zz) "Short sale facilitation" means, for compensation

or gain, either directly or indirectly offering or

negotiating on behalf of a borrower or homeowner to

facilitate the sale of residential real estate subject to

one or more residential mortgage loans or debts

constituting liens on the property in which the proceeds

from selling the residential real estate will fall short

of the amount owed and the lien holders are contacted to

agree to release their lien on the residential real estate

and accept less than the full amount owed on the debt.

(aaa) "Bona fide nonprofit organization" means an

organization that is described in Section 501(c)(3) of the

Internal Revenue Code, is exempt from federal income tax

under Section 501(a) of the Internal Revenue Code, does

not operate in a commercial context, and does all of the

following:

(1) Promotes affordable housing or provides home

ownership education or similar services.

(2) Conducts its activities in a manner that

serves public or charitable purposes.

(3) Receives funding and revenue and charges fees

in a manner that does not create an incentive for

itself or its employees to act other than in the best

interests of its clients.

(4) Compensates its employees in a manner that

does not create an incentive for its employees to act

other than in the best interests of its clients.

(5) Provides to, or identifies for, the borrower

residential mortgage loans with terms favorable to the

borrower and comparable to residential mortgage loans

and housing assistance provided under government

housing assistance programs.

(bbb) "Remote location" means a location other than a

principal place of business or a full service office at

which a mortgage loan originator of a licensee may conduct

business.

The Commissioner may define by rule and regulation any

terms used in this Act for the efficient and clear

administration of this Act.

(Source: P.A. 100-783, eff. 8-10-18; 100-851, eff. 8-14-18;

100-1153, eff. 12-19-18; 101-81, eff. 7-12-19.)

(205 ILCS 635/3-11 new)

Sec. 3-11. Remote location operations. Licensees may allow

mortgage loan originators to work from a remote location if:

(1) the licensee has written policies and procedures

for the supervision of mortgage loan originators working

from a remote location;

(2) access to company platforms and customer

information is in accordance with the licensee's

comprehensive written information security plan;

(3) no in-person customer interaction occurs at a

mortgage originator's residence unless that residence is a

licensed location;

(4) physical records are not maintained at a remote

location;

(5) customer interactions and conversations about

consumers will be in compliance with federal and State

information security requirements, including applicable

provisions under the federal Gramm-Leach-Bliley Act and

the Safeguards Rule established by the Federal Trade

Commission and set forth in 16 CFR Part 314, as such

requirements may be amended from time to time;

(6) mortgage loan originators working at a remote

location access the company's secure systems, including a

cloud-based system, directly from any out-of-office device

the mortgage loan originator uses, including, but not

limited to, a laptop, phone, desktop computer, or tablet,

via a virtual private network or comparable system that

ensures secure connectivity and requires passwords or

other forms of authentication to access;

(7) the licensee ensures that appropriate security

updates, patches, or other alterations to the security of

all devices used at remote locations are installed and

maintained;

(8) the licensee has an ability to remotely lock or

erase company-related contents of any device or otherwise

remotely limit all access to a company's secure systems;

and

(9) the Nationwide Multistate Licensing System and

Registry record of a loan originator that works from a

remote location designates the principal place of business

as the loan originator's registered location unless the

loan originator elects another licensed branch office as a

registered location.