IBA Compliance Connection

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Is the Illinois Addendum to Residential Mortgages a required document? This document asks the borrower whether they are a party to a civil union and whether any other parties may claim any interest in the property that will secure repayment of the loan. Is it required if the application is for joint credit and both borrowers are married and applying together? What about a married person applying for individual credit?

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An Illinois Addendum to Residential Mortgages is not required by Illinois law, but we believe using such a form is helpful for identifying individuals who may have relevant property rights and interests because they are a member of a civil union. Also, it is possible that secondary market purchasers may require this form as a condition of purchasing the mortgage loan, and we recommend reviewing any applicable secondary market requirements before discontinuing use of this form.

We believe your bank should determine whether a borrower has entered into a civil union, although there are no specific disclosures that you must provide to members of civil unions. Because Illinois law offers members of a civil union the same protections and benefits as married couples, you should provide members of a civil union the same documents and disclosures that you provide to married spouses. For example, a loan secured by a borrower’s home may be subject to homestead rights of another individual if your borrower has entered into a civil union with that individual. This is true whether the borrower is in a same-sex or opposite-sex marriage or civil union.

For borrowers that are married, asking about their civil union status is unnecessary. However, we believe your bank still may want the borrower to notify your bank about other parties’ interests in the property that will secure the loan. And, as mentioned above, secondary market purchasers may require a completed Illinois Addendum to Residential Mortgages regardless of the borrower’s marital status.

For resources related to our guidance, please see:

  • Illinois Religious Freedom and Marriage Fairness Act, 750 ILCS 80/10(a) (“All laws of this State applicable to marriage, whether they derive from statute, administrative or court rule, policy, common law, or any other source of civil or criminal law, shall apply equally to marriages of same-sex and different-sex couples and their children.”)
  • Illinois Religious Freedom Protection and Civil Union Act, 750 ILCS 75/20 (“A party to a civil union is entitled to the same legal obligations, responsibilities, protections, and benefits as are afforded or recognized by the law of Illinois to spouses, whether they derive from statute, administrative rule, policy, common law, or any other source of civil or criminal law.”)
  • Illinois Religious Freedom Protection and Civil Union Act, 750 ILCS 75/60 (“A civil union, or a substantially similar legal relationship other than common law marriage, legally entered into in another jurisdiction, shall be recognized in Illinois as a civil union. A marriage, whether of the same sex or different sexes and providing that it is not a common law marriage, legally entered into in another jurisdiction, shall be recognized in this State as a marriage in accordance with the provisions of the Illinois Marriage and Dissolution of Marriage Act, except that Section 216 of the Illinois Marriage and Dissolution of Marriage Act shall not apply to marriages of same-sex couples validly entered into in another jurisdiction.”)