Chicago, IL— A new law will give those seeking home loans additional tools to combat mortgage fraud.

House Bill 4011, sponsored by Sen. Kwame Raoul (D-Chicago), will allow Illinois to participate with the Nationwide Mortgage Licensing System and Registry (NMLSR). NMLSR monitors those applying for a mortgage license, provides enhanced reporting and enforcement activities, administers new nationwide education and testing standards and sets new financial responsibility criteria and mortgage standards for the industry. “For far too long predatory lenders have run from state to state to take advantage of the working class,” Senator Raoul said. “With the help of the Nationwide Mortgage Licensing System and Registry our consumers will have the adequate tools necessary to combat these predators.”

The Nationwide Mortgage Licensing System was launched in 2008.  The goals of the system are to increase the amount of information available to state regulators, industry, and consumers. Second, the System will allow the ability to update, amend, renew existing or apply for a new license online over a secure website. Third, the System will create an uniform application form for state-licensed mortgage companies. Fourth, it will create uniform state standards and makes it easier to become licensed in multiple states. Fifth the bill will create greater transparency for the licensing and renewal of mortgage originators. The system also seeks to increase accountability for mortgage companies and professionals. 

“The legislation cracks down on predatory home lending practices and strengthens the rights of those applying for a mortgage,” said Governor Quinn. “We are sending a strong signal to scam artists and predatory lenders: You can’t do business in Illinois.”

The Mortgage Loan Originator licensing program will be phased in to replace the current State Loan Originator registration program. The new program will feature new eligibility limitations regarding revoked licenses and financial felonies, new definitions and exemptions, new education and testing standards, new financial responsibility criteria and standards, mandatory use by mortgage loan originators of unique identifier issued by the Nationwide Mortgage Licensing System and Registry and enhanced reporting and enforcement activities through the Nationwide Mortgage Licensing System and Registry.