Public Act 099-0288 (SB1942) Summary

• Amends the High Risk Home Loan Act to update the definition of "high risk home loan" to reference the federal average prime offer rate instead of U.S. Treasury securities for determining annual percentage rate thresholds.

• Adds new criteria for classifying loans as high risk, including prepayment fees or penalties that extend more than 36 months after closing or exceed 2% of the amount prepaid.

• Introduces definition of "bona fide discount points" as loan discount points knowingly paid by consumers to reduce interest rates.

• Expands "points and fees" definition to include prepayment fees and penalties, mortgage broker compensation, and various credit insurance premiums financed into loans, with specific exclusions for federal/state insurance and certain mortgage insurance premiums.

• Takes effect upon becoming law.