Governor Blagojevich announces results of increased crackdown on unlicensed mortgage loan originators

CHICAGO - Building on efforts to protect homebuyers from fraudulent practices, Governor Rod R. Blagojevich announced today the results of the State's increased crackdown on unlicensed mortgage loan originators. The latest inspections conducted by the Governor's Mortgage Fraud Task Force (MFTF), found that six residential mortgage firms in the Chicago and East St. Louis regions used unlicensed loan originators to process more than 700 home loans.  Today's announcement brings the total of companies and individuals slated for discipline by the Illinois Department of Financial and Professional Regulations (IDFPR) to more than 45, since unannounced inspections across the state began last March.

 

"We have worked hard to protect families from fraud and abuse, and through these inspections across the state we've put mortgage companies on notice that we will not tolerate activities that could harm homeowners," said Gov. Blagojevich. 

 

The task force was established by Gov. Blagojevich to ensure that mortgage companies comply with the strict standards of conduct established for loan originators in the 2003 High Risk Home Loan Act. 

 

One of the most important provisions of the law requires people who process mortgages to undergo training and background screening before being entrusted with borrowers' financial and personal information.  Loan originators must also pass a rigorous screening test to make sure they understand loan processing. 

 

During the initial registration of loan originators, 29,000 people applied for registration.  Forty percent of those applicants failed the Loan Originator Exam and almost 800 applicants were denied licenses after background checks were completed.  There are approximately 16,000 registered loan originators in Illinois.

 

The MFTF has cracked down on unregistered loan originators in the State of Illinois.  Most recently its efforts have been focused in the Chicago metropolitan area.  In its summer sweep, the MFTF inspected mortgage licensees in the Metro East area.  IDFPR has the authority to issue fines of $2,500 for the first unlicensed loan originator it finds at any licensed residential mortgage company, and $500 for each additional unregistered loan originator.  Individuals working as loan originators without the proper registration are subject to fines of $950 and a permanent notation on their file should they decide to register in the future. 

 

The MFTF found problems after inspections at the following licensees.  These potential violations may result in disciplinary or other actions including revocation, suspension, fines or surrender of license:

 

Envision Mortgage Solutions, license number 6759105, located at 4731 Midlothian Turnpike, Suite 32, Crestwood, Neil Coleman
4731 Midlothian Turnpike, Suite 32
Crestwood, IL 60445has been licensed since September of 2003.  A MFTF visit to this licensee found 28 Loan Originators who had produced over 500 loans without possessing the proper registration as required in the State of Illinois.

 

AM Mortgage, license number 6411, located at 6518 N. Lincoln Avenue, Lincolnwood, has been licensed since March of 2002.  A MFTF visit found eight Loan Originators who had produced around 100 loans without possessing the proper registration, as required in the State of Illinois.

 

Express Funding, Inc., license number 6759512, located at 937 N. Plum Grove Road #d Schaumburg, has been licensed since February of 2005.  A MFTF visit discovered around 50 loans that had been originated by five Loan Originators, not possessing the proper registration as required in the State of Illinois.

 

Fidelity Mortgage Group, license number 6039, located at 13515 Barrett Parkway Drive, Suite150, Manchester, MO, has been licensed since February of 2001.  A MFTF visit found the licensee had originated over 35 loans without employing a registered Loan Originator, as required in the State of Illinois.

 

Mainline Mortgage Group, license number 6759245, located at 3200 James Terrace, Alton, has been licensed since September of 2004.  A MFTF visit to this licensee revealed over 25 loans originated without a registered Loan Originator with the State of Illinois.  This visit prompted licensee to surrender the Mortgage Broker License.

 

Global Mortgage Company, license number 3209, located at 1857 E. 71st Street, Chicago, has been licensed since September of 1992.  A MFTF visit found the licensee had no actively registered loan originators but originated over 25 loans.

Dennis Wooff
3200 James Terrace
Alton, IL 62002

 

The extra work done by the MFTF complements the regular examinations conducted by IDFPR as part of its regulatory responsibility to ensure that residential mortgage companies provide safe, effective services to the homebuyers and homeowners in Illinois.

 

"Illinois consumers have the right to know that when they do business with companies licensed by our state, they will receive the best possible service by ethical and appropriately trained professionals," said Dean Martinez, Secretary, Financial and Professional Regulation.  "We will use all the tools available to us to discipline companies which violate the laws and regulations designed to protect Illinois homebuyers."

 

Throughout his administration, Gov. Blagojevich taken numerous actions to help homebuyers and protect consumers.

 

Reduced the number of high-risk home loans: In August 2003, the Governor signed the High Risk Home Loan Act to protect consumers from predatory mortgage lending practices.  As a result of the Act, the state has seen both a reduction in the number of high-risk home loans and a change in lenders' business practices so they are no longer offering high-risk loans as defined in the Act.

 

Protect homebuyers in at-risk communities from predatory lenders: In July 2005, Gov. Blagojevich signed into law HB 4050 that provides borrowers with critical information on home loans and helps state regulators and law enforcement track and crack down on dishonest lenders.

 

Give homebuyers easy access to accurate information about their properties: In August 2005, Gov. Blagojevich signed three bills to help homebuyers and homeowners obtain access to accurate and important information about their properties: House Bill 1428, which requires lenders to notify homebuyers of accurate and timely property tax payment from the buyer's escrow account; House Bill 2462, which requires property tax exemption information to be included on the seller's transfer declaration; and House Bill 2594, which requires home repair contracts to increase consumer awareness of contract clauses that waive the homeowner's right to trial by jury for repair disputes.

 

Protect homebuyers from discrimination: In 2005, Gov. Blagojevich announced a Fair Housing program to help protect homebuyers against discrimination in housing.  The Illinois Department of Human Rights and other agencies conduct training seminars around the state to inform homebuyers, tenants, landlords, property owners, advertisers, housing advocates, and community organizations about Illinois' anti-discrimination laws.