CHICAGO – December 31, 2009. Governor Pat Quinn today signed a bill into law to help protect homebuyers across Illinois. Senate Bill 1894 increases the education requirements for real estate agents in Illinois and expands an anti-predatory lending program to three new counties.
“Homeownership is a cornerstone of our economy,” said Governor Quinn. “This important new law helps protect Illinois’ homebuyers from unscrupulous lenders and ensures that our real estate agents have comprehensive, up-to-date training.”
Under the legislation, the education requirement to become a real estate agent in Illinois increases from 45 to 120 hours by eliminating the “salesperson” licensure category and establishing “broker” as the new entry-level license. Additionally, the new law requires real estate brokers to complete 12 hours of continuing education every renewal period (two years). The bill also creates the licensure category of “managing broker,” which requires 165 hours of education and 24 hours of continuing education every renewal period.
Senate Bill 1894’s stringent education requirements help ensure that Illinois’ real estate agents are fully trained and up-to-date on Illinois’ real estate laws and homebuyer protections.
The legislation also expands the state’s anti-predatory lending database program to three counties that have among the state’s highest foreclosure rates - Kane, Will and Peoria. Under current law the program only applies to Cook County. The program requires lenders to provide loan information to the State to determine if the homebuyer should receive loan counseling, prior to approval of the loan. The types of loans that qualify a homebuyer for counseling are those that frequently result in foreclosures.
These include: (1) the loan permits interest-only payments; (2) The loan may result in negative amortization; (3) the total points and fees payable by the borrower at or before closing will exceed five percent; (4) the loan includes a prepayment penalty; or (5) the loan is an adjustable rate mortgage which allows adjustments of the interest rate in the first three years.
Senate Bill 1894 also includes a provision that allows municipalities to place a lien on an abandoned residential property to help cover the cost of clean-up. The legislation was sponsored by Rep. Kevin A. McCarthy (D-Orland Park) and Sen. William R. Haine (D-Alton).
“The signing of Senate Bill 1894 provides significant protections to the citizens of Illinois. Maintaining the professionalism of real estate brokers across the state, instituting programs to stop predatory lending, and assisting municipalities in cleaning up abandoned or foreclosed properties will help all of Illinois rebound from the economic difficulties we have faced,” said Rep. McCarthy.
Also today, Governor Quinn signed Senate Bills 253 and 332.