The March 30 guidance affects mortgage, consumer finance, debt, and money services businesses, among others:
Guidance to mortgage servicers
On March 30, the Illinois Department of Financial Regulation, Division of Banking and Division of Financial Institutions, issued guidance to Illinois-licensed mortgage servicers and exempt mortgage servicers urging support for borrowers impacted by Covid-19. The department urges all servicers of nonconforming and private mortgages to implement policies at least as helpful to borrowers as those offered for conforming loans, including, among others:
- Forbearing mortgage payments for at least 90 days without incurring additional interest or fees
- Refraining from reporting late payments to credit rating agencies and, when payments are deferred or modified, coding those payments as deferred with the applicable disaster order
- Offering loss mitigation options to borrowers
- Waiving late payment fees and online payments fees
- Postponing foreclosures and evictions for at least 90 days
Prudent actions taken during this period will be considered to be consistent with safe and sound banking practices and will not be subject to examiner criticism.
Guidance to Consumer Installment Loan Act, Payday Loan Reform Act, and Sales Finance Agency Act licensees on office closures
On March 30, the Illinois Department of Financial and Professional Regulation issued guidance to licensees under the Consumer Installment Loan Act, Payday Loan Reform Act, and Sales Finance Agency Act regarding office closures due to Covid-19. A licensee may close its offices without notice and approval of the department as otherwise required under applicable law if certain conditions are met. For example, the licensee must provide notice to the department no later than 24 hours after the closure and one business day prior to reopening, and the licensee must provide reasonable methods for consumers to make payments while its offices are closed. Additionally, if any payments are due on any obligations to a licensee on any closed day, then the payment must be considered received on the closed day for all purposes, including the computation of interest or charges, if received at any time before the close of business on the 30th calendar day following the last closed day.
Notice to currency exchange and money transmitter licensees
On March 30, the Illinois Department of Financial and Professional Regulation issued a notice encouraging currency exchange and money transmitter licensees to provide the department with advance notice of any changes to their usual business practices. The department expects all licensees to act responsibly and proactively to address any consumer harm that may arise.
This content originally appeared in the InfoBytes blog, a collection of news and alerts covering legal and regulatory developments for the financial services industry. To read more or have the InfoBytes weekly newsletter delivered to your inbox, please visit infobytesblog.com.