Illinois Administrative Code › Title 38 - FINANCIAL INSTITUTIONS › Part 190 - ILLINOIS CREDIT UNION ACT › Subpart A - GENERAL PROVISIONS › Section 190.140 - Real Estate Lending

Current through Register Vol. 48, No. 28, July 12, 2024
a) A credit
				union with total assets greater than $1 million may, following a resolution of
				its board, make loans secured by a lien on real estate, including an assignment
				of a beneficial interest in a land trust, subject to the following procedures:
Total Assets of a Credit Union
Maximum Amount of Loans Secured by Real Estate
Aggregate of All First Mortgage Loans Secured by Real
							 Estate
Under $1 million
Lending Limits for Consumer Loans
0% of total assets
$1 - 2.5 million
$165,000*
25% of total assets
$2.5 - 5 million
$250,000*
30% of total assets
$5 - 10 million
$330,000
35% of total assets
$10 - 30 million
$580,000
40% of total assets
$30 - 100 million
$825,000
45% of total assets
Over $100 million
$1,000,000
50% of total assets
* The aggregate loans to one member may not exceed the
				  aggregate limit referenced in subsection (e).
b) Credit unions with assets under $1 million
				may make home equity and second mortgage loans subject to the lending limits
				for consumer loans set forth in Section
				190.160.
				Credit unions with assets under $1 million shall not make first mortgage real
				estate loans.
c) Credit unions
				shall not make first mortgage real estate loans for more than the estimated
				market value or appraised value of the real estate securing the loans. Real
				estate loans, other than first mortgage loans, shall be limited to the value of
				the member-borrower's equity in the real estate securing the loan, provided a
				credit union may consider as equity any outstanding loan amount secured by the
				real estate if the outstanding loan will be repaid with the proceeds of the
				credit union's loan.
d) The maximum
				individual lending limit and the maximum ratio of first mortgage real estate
				loans may be increased by obtaining written approval from the Secretary.
				Approval is to be based upon the need of the members and the credit union's
				real estate lending record.
e) The
				maximum limit on an individual loan by credit unions with assets greater than
				$1 million is in addition to the secured and unsecured lending limits of
				Section 190.160; provided, however, in no event shall all loans to any member
				exceed in the aggregate 10% of the credit union's unimpaired capital and
				surplus as defined in Section
				190.2. Loans subject
				to the requirements for business loans shall be subject to the appraisal
				requirements set forth in subsection (h), but shall not be subject to the other
				provisions of this Section.
f) The
				maximum maturity of a loan secured by a first mortgage shall not exceed 40
				years.
g) Procedures
1) All loans secured by a lien on real estate
				shall be made based upon prudent written lending policies and sound lending
				practices as documented in each member's loan file. Unless waived by the
				Secretary, lending policies shall include, without limitation, acceptable
				debt-to-income and loan-to-value ratios that will be considered the types of
				real estate security that will be accepted and any other prudent data
				considered necessary to determine the appropriateness of a loan request. All
				applicable Illinois and federal statutes shall be observed.
2) All accounting for real estate loan
				transactions shall be in accordance with GAAP.