IL HB2627

Amends the High Risk Home Loan Act to revise the definition of "high risk home loan" to apply to consumer credit transactions secured by a consumer's principal dwelling, other than reverse mortgages.

Changes the interest rate threshold comparison from U.S. Treasury securities to the average prime offer rate as defined in the federal Truth in Lending Act for determining high-risk status.

Expands high-risk loan criteria to include loans with prepayment fees or penalties extending more than 36 months after closing or exceeding 2% of the amount prepaid, and adjusts points and fees thresholds based on loan amount ($20,000 or more versus less than $20,000).

Adds definition of "bona fide discount points" as loan discount points knowingly paid by consumers to reduce the interest rate or time price differential, which may be excluded from points and fees calculations.

Clarifies that seller-financed transactions by natural persons securing a principal residence no more than 3 times in a 12-month period are excluded from high-risk loan regulations, unless the seller constructed or acted as contractor for the residence.