Some three years after initially adopted, the oft-delayed and subsequently amended Predatory Lending Database Program established within Cook County, Illinois becomes operational on July 1, 2008.  As the name suggests, within ten (10) days after taking a mortgage application brokers and originators must input certain required borrower and loan-related information into a database.  Within seven (7) days after receipt of that information, the Illinois Department of Financial and Professional Regulation (IDFPR) must determine whether to recommend housing counseling by a HUD-approved counselor.  Counseling is required if the borrowers are all first-time homebuyers.  In addition, counseling is required if the borrower is refinancing a primary residence and the loan includes one or more of the following features: (a) interest only payments; (b) negative amortization; (c) total points and fees paid by the borrower exceed 5%; (d) the loan includes a prepayment penalty; or (e) the loan is an ARM.  The borrower may not waive required counseling.  Additional procedures and timeframes are included to accommodate changes in loan or commitment terms.  The borrower then has ten (10) days within which to complete counseling, and the counselor has seven (7) days to input that information into the database.  Reasonable and customary costs of counseling up to $300 must be paid by the broker or originator.  Within ten (10) days after closing a loan, the title company or closing agent must submit required information to the database.  Finally, the title company or closing agent must attach either a certificate of compliance or a certificate of exemption to the mortgage in order to record the mortgage on or after July 1, 2008.

To view a copy of the recent amendments to the Predatory Lending Database Program (Public Act 095-0691), click here. 

The Predatory Lending Database Program website is located here.