Yes, we believe that Illinois law imposes a twenty-year limitation on the security provided for future advances made under a mortgage securing a HELOC. The Illinois Banking Act provides that mortgages that secure revolving credit loans secure future advances only if “made within twenty years from the date thereof . . . .”

A separate issue is the expiration of the mortgage lien itself. In Illinois, a mortgage will cease to be a lien on the property twenty years after the last payment is due, or if no due date is stated on its face, thirty years after the date of the mortgage instrument. These limitations can be avoided by recording an extension agreement with the borrower.

By contrast, we do not believe that the Illinois Banking Act’s twenty-year limitation for future advances made under mortgages securing revolving loans can be avoided by entering into and recording an extension agreement with the borrower. Consequently, we believe that your bank may need to enter into a new mortgage to secure future advances made twenty or more years after the date of the original mortgage securing a HELOC (or other revolving credit loan).

For resources related to our guidance, please see:

• Illinois Banking Act, 205 ILCS 5/5d (“Any mortgage or deed of trust given to secure a revolving credit loan may, and when so expressed therein shall, secure not only the existing indebtedness, but also such future advances, whether such advances are obligatory or to be made at the option of the lender, or otherwise, as are made within twenty years from the date thereof, to the same extent as if such future advances were made on the date of the execution of such mortgage or deed of trust, although there may be no advance made at the time of execution of such mortgage or other instrument, and although there may be no indebtedness outstanding at the time any advance is made. The lien of such mortgage or deed of trust, as to third persons without actual notice thereof, shall be valid as to all such indebtedness and future advances from the time said mortgage or deed of trust is filed for record in the office of the Recorder of Deeds or the Registrar of Titles of the county where the real property described therein is located.”)

• Code of Civil Procedure, 735 ILCS 5/13-116(a) (“The lien of every mortgage . . . the due date of which is stated upon the face, or ascertainable from the written terms thereof . . . shall cease by limitation after the expiration of 20 years from the time the last payment on such mortgage . . . became or becomes due upon its face and according to its written terms, unless the owner of such mortgage . . . within such 20 year period . . . files or causes to be filed for record . . . an extension agreement executed as hereinafter provided.”)

• Code of Civil Procedure, 735 ILCS 5/13-116(b) (“The lien of every mortgage . . . in which no due date is stated upon the face, or is ascertainable from the written terms thereof, shall cease by limitation after the expiration of 30 years from the date of the instrument creating the lien, unless the owner of such mortgage . . . within such 30 year period . . . files or causes to be filed for record . . . an extension agreement executed as hereinafter provided.”)