The Illinois High Risk Home Loan Act requires us to compare a loan’s interest rate to the yield on U.S. Treasury securities, but Regulation Z requires us to use the average prime offer rate. Should we be running two tests for HOEPA?

The Illinois High Risk Home Loan Act has been amended to adopt the federal standard of the average prime offer rate (APOR). 815 ILCS 137/10 (scroll down to view the section “after P.A. 97-849 takes effect,” since that law took effect on January 10, 2014). However, we do recommend running separate interest rate tests under the Illinois law and federal law — the Illinois interest rate triggers are at 6% and 8%, versus 6.5% and 8.5% under Regulation Z, among other differences. See 815 ILCS 137/1012 CFR 1026.32(a)(1).