Illinois Administrative Code › Title 38 - FINANCIAL INSTITUTIONS › Part 1055 - MORTGAGE COMMUNITY REINVESTMENT › Subpart C - RECORDS, REPORTING, AND DISCLOSURE REQUIREMENTS; EXAMINATIONS › Appendix A - Ratings

Current through Register Vol. 48, No. 28, July 12, 2024
a) Ratings in general.
1) In assigning a rating, the Secretary evaluates
				  a covered mortgage licensee's performance under the applicable performance
				  criteria in this Part, in accordance with Sections 1055.210 and 1055.240, which
				  provide for adjustments on the basis of evidence of discriminatory or other
				  illegal credit practices.
2) A covered mortgage licensee's performance need
				  not fit each aspect of a particular rating profile in order to receive that
				  rating, and exceptionally strong performance with respect to some aspects may
				  compensate for weak performance in others. The covered mortgage licensee's
				  overall performance, however, must be consistent with safe and sound lending
				  practices and generally with the appropriate rating profile as follows.
b) Covered mortgage licensees evaluated under the lending and
				  service tests.
1) Lending performance rating. The Secretary
				  assigns each covered mortgage licensee's lending performance one of the four
				  following ratings.
A) Outstanding. The Secretary rates a covered
				  mortgage licensee's performance "outstanding" if, in general, it
				  demonstrates:
i) An excellent geographic distribution of loans
				  in the State;
ii) An excellent distribution of loans among
				  individuals of different income levels, given the product lines offered by the
				  covered mortgage licensee;
iii) An excellent record of serving the mortgage
				  credit needs of highly economically disadvantaged areas in the State and
				  low-income individuals, including loans to assist existing low- and
				  moderate-income residents to be able to acquire or remain in affordable housing
				  in their neighborhoods at rates and terms that are reasonable considering the
				  covered mortgage licensee's history with similarly situated borrowers,
				  consistent with safe and sound operations;
iv) Extensive use of innovative or flexible
				  lending practices in a safe and sound manner to address the mortgage credit
				  needs of low- and moderate-income individuals or geographies, including loans
				  and other products to assist delinquent home mortgage borrowers to be able to
				  remain in their homes;
v) Mortgage products demonstrate an excellent
				  suitability for low- and moderate-income individuals;
vi) It plays a leadership role in working with
				  delinquent mortgage loan borrowers to facilitate a successful resolution of the
				  delinquency, including a substantial number of loan modifications in a timely
				  manner and which are effective in preventing subsequent defaults or
				  foreclosures;
vii) There is no evidence of loans that show an
				  undue concentration and a systematic pattern of lending, including early
				  payment defaults, resulting in the loss of affordable housing units; and
viii) An excellent record relative to fair lending
				  policies and practices.
B) Satisfactory. The Secretary rates a covered
				  mortgage licensee's performance "satisfactory" if, in general, it
				  demonstrates:
i) An adequate geographic distribution of loans in
				  the State;
ii) An adequate distribution of loans among
				  individuals of different income levels, given the product lines offered by the
				  covered mortgage licensee;
iii) An adequate record of serving the mortgage
				  credit needs of highly economically disadvantaged areas in the State and
				  low-income individuals, including loans to assist existing low- and
				  moderate-income residents to be able to acquire or remain in affordable housing
				  in their neighborhoods at rates and terms that are reasonable considering the
				  covered mortgage licensee's history with similarly situated borrowers
				  consistent with safe and sound operations;
iv) Limited use of innovative or flexible lending
				  practices in a safe and sound manner to address the mortgage credit needs of
				  low- and moderate-income individuals or geographies, including loans and other
				  products to assist delinquent home mortgage borrowers to be able to remain in
				  their homes;
v) Mortgage products demonstrate an adequate
				  suitability for low- and moderate-income individuals;
vi) Its efforts are adequate in working with
				  delinquent mortgage loan borrowers to facilitate a successful resolution of the
				  delinquency, including an adequate number of loan modifications completed in a
				  prompt manner and which are effective in preventing subsequent defaults or
				  foreclosures;
vii) There is no evidence of loans that show an
				  undue concentration and a systematic pattern of lending, including early
				  payment defaults, resulting in the loss of affordable housing units; and
viii) An adequate record relative to fair lending
				  policies and practices.
C) Needs to improve. The Secretary rates a covered
				  mortgage licensee's performance "needs to improve" if, in general, it
				  demonstrates:
i) A poor geographic distribution of loans,
				  particularly to low- and moderate-income geographies, in the State;
ii) A poor distribution of loans among individuals
				  of different income levels, given the product lines offered by the covered
				  mortgage licensee;
iii) A poor record of serving the mortgage credit
				  needs of highly economically disadvantaged areas in the State and low-income
				  individuals, including loans to assist existing low- and moderate-income
				  residents to be able to acquire or remain in affordable housing in their
				  neighborhoods at rates and terms that are reasonable considering the covered
				  mortgage licensee's history with similarly situated borrowers consistent with
				  safe and sound operations;
iv) Little use of innovative or flexible lending
				  practices in a safe and sound manner to address the mortgage credit needs of
				  low- and moderate-income individuals or geographies, including loans and other
				  products to assist delinquent home mortgage borrowers to be able to remain in
				  their homes;
v) Mortgage products demonstrate a poor
				  suitability for low- and moderate-income individuals;
vi) Its efforts are poor in working with
				  delinquent mortgage loan borrowers to facilitate a successful resolution of the
				  delinquency, including slow responses to requests for modification with few
				  loan modifications completed or for which modifications are not effective in
				  preventing subsequent defaults or foreclosures;
vii) There is possible evidence of loans that show
				  an undue concentration and a systematic pattern of lending, including early
				  payment defaults, resulting in the loss of affordable housing units; and
viii) A poor record relative to fair lending
				  policies and practices.
D) Substantial noncompliance. The Secretary rates
				  a covered mortgage licensee's performance as being in "substantial
				  noncompliance" if, in general, it demonstrates:
i) A very poor geographic distribution of loans,
				  particularly to low- and moderate-income geographies, in the State;
ii) A very poor distribution of loans among
				  individuals of different income levels given the product lines offered by the
				  covered mortgage licensee;
iii) A very poor record of serving the mortgage
				  credit needs of highly economically disadvantaged areas in the State and
				  low-income individuals, including loans to assist existing low- and
				  moderate-income residents to be able to acquire or remain in affordable housing
				  in their neighborhoods, at rates and terms that are reasonable considering the
				  covered mortgage licensee's history with similarly situated borrowers
				  consistent with safe and sound operations;
iv) No use of innovative or flexible lending
				  practices in a safe and sound manner to address the mortgage credit needs of
				  low- and moderate-income individuals or geographies, including loans and other
				  products to assist delinquent home mortgage borrowers to be able to remain in
				  their homes;
v) Mortgage products are unsuitable for low- and
				  moderate-income individuals;
vi) It fails to work with delinquent mortgage loan
				  borrowers to facilitate a successful resolution of the delinquency, including
				  no response to requests for loan modifications or modifications which are
				  ineffective in preventing subsequent defaults or foreclosures;
vii) Origination of loans that show an undue
				  concentration and a systematic pattern of lending, including early payment
				  defaults, resulting in the loss of affordable housing units; and
viii) A very poor record relative to fair lending
				  policies and practices.
2) Service performance rating. The Secretary
				  assigns each covered mortgage licensee's service performance one of the four
				  following ratings.
A) Outstanding. The Secretary rates a covered
				  mortgage licensee's service performance "outstanding" if, in general, the
				  covered mortgage licensee demonstrates:
i) It is a leader in providing community
				  development services;
ii) Its service delivery systems are readily
				  accessible to geographies and individuals of different income levels in the
				  State;
iii) To the extent changes have been made, its
				  record of opening and closing additional full-service offices has improved the
				  accessibility of its delivery systems, particularly in low- and moderate-income
				  geographies or to low- and moderate-income individuals; and
iv) Its services (including, where appropriate,
				  business hours) are tailored to the convenience and needs of the State,
				  particularly low- and moderate-income geographies or low- and moderate-income
				  individuals.
B) Satisfactory. The Secretary rates a covered
				  mortgage licensee's service performance "satisfactory" if, in general, the
				  covered mortgage licensee demonstrates:
i) It provides an adequate level of community
				  development services;
ii) Its service delivery systems are reasonably
				  accessible to geographies and individuals of different income levels in the
				  State;
iii) To the extent changes have been made, its
				  record of opening and closing additional full-service offices has generally not
				  adversely affected the accessibility of its delivery systems, particularly in
				  low- and moderate-income geographies and to low- and moderate-income
				  individuals; and
iv) Its services (including, where appropriate,
				  business hours) do not vary in a way that inconveniences geographies or
				  individuals, particularly low- and moderate-income geographies and low- and
				  moderate-income individuals.
C) Needs to improve. The Secretary rates a covered
				  mortgage licensee's service performance "needs to improve" if, in general, the
				  covered mortgage licensee demonstrates:
i) It provides a limited level of community
				  development services;
ii) Its service delivery systems are unreasonably
				  inaccessible to portions of the State, particularly to low- and moderate-income
				  geographies or to low- and moderate-income individuals;
iii) To the extent changes have been made, its
				  record of opening and closing additional full-service offices has adversely
				  affected the accessibility of its delivery systems, particularly in low- and
				  moderate-income geographies or to low- and moderate- income individuals;
				  and
iv) Its services (including, where appropriate,
				  business hours) vary in a way that inconveniences geographies or individuals,
				  particularly low- and moderate-income geographies or low- and moderate-income
				  individuals.
D) Substantial noncompliance. The Secretary rates
				  a covered mortgage licensee's service performance as being in "substantial
				  noncompliance" if, in general, the covered mortgage licensee
				  demonstrates:
i) It provides few, if any, community development
				  services;
ii) Its service delivery systems are unreasonably
				  inaccessible to significant portions of the State, particularly to low- and
				  moderate-income geographies or to low- and moderate-income individuals;
iii) To the extent changes have been made, its
				  record of opening and closing additional full-service offices has significantly
				  adversely affected the accessibility of its delivery systems, particularly in
				  low- and moderate-income geographies or to low- and moderate-income
				  individuals; and
iv) Its services (including, where appropriate,
				  business hours) vary in a way that significantly inconveniences geographies or
				  individuals, particularly low- and moderate-income geographies or low- and
				  moderate-income individuals.
3) Other eligible criteria for an outstanding
				  rating. A covered mortgage licensee that achieves at least a "satisfactory"
				  rating under both the lending and service tests may warrant consideration for
				  an overall rating of "outstanding". In assessing whether a covered mortgage
				  licensee's performance is "outstanding", the Secretary will also consider the
				  covered mortgage licensee's performance in making qualified investments and
				  community development loans to the extent authorized under
				  law.