IBA Compliance Connection

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We are updating the fields in our Laser Pro system for end-of-year HOEPA triggers. Where can I find the state of Illinois high-cost mortgage interest rate triggers for first and second liens?

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Illinois’ equivalent of the federal HOEPA regulations for “high-cost” mortgage loans is the Illinois High Risk Home Loan Act (Act). Under the Act, the interest rate trigger for a “high risk home loan” is an annual percentage rate that exceeds the average prime offer rate (APOR) by more than six percentage points for first lien mortgages or by more than eight percentage points for junior lien mortgages. The APOR tables for fixed and adjustable rate mortgage loans (updated as of January 6, 2020) are available on the FFIEC’s HMDA website.

For resources related to our guidance, please see:

  • Illinois High Risk Home Loan Act, 815 ILCS 137/10 (“‘High risk home loan’ means a consumer credit transaction, other than a reverse mortgage, that is secured by the consumer's principal dwelling if: (i) at the time of origination, the annual percentage rate exceeds by more than 6 percentage points in the case of a first lien mortgage, or by more than 8 percentage points in the case of a junior mortgage, the average prime offer rate, as defined in Section 129C(b)(2)(B) of the federal Truth in Lending Act, for a comparable transaction as of the date on which the interest rate for the transaction is set . . .”)
  • Truth in Lending Act, 15 USC 1639c(b)(2)(B) (The term ‘average prime offer rate’ means the average prime offer rate for a comparable transaction as of the date on which the interest rate for the transaction is set, as published by the Bureau.”)