IL Predatory Lending Program Suspended

Illinois Gov. Rod R. Blagojevich has directed the Illinois Department of Financial and Professional Regulations to immediately suspend the Illinois Predatory Lending Database Pilot Program, also known as H.B. 4050.Gov. Blagojevich said the law, designed to curb predatory lending practices (especially in areas with high residential foreclosure rates), "has created uncertainty for lenders, limiting their interest in offering products to consumers." The governor said he was halting the program "until we can find a system that effectively fights predatory lending and protects homebuyers." A recent report from the University of Illinois Urbana-Champaign showed that housing sales in the housing bill ZIP codes have dropped by nearly half from the level recorded last fall. Comparable ZIP codes in which the pilot program is not being applied have seen a decline of only 20%. The report also said the pilot program does not offer borrowers additional consumer protections.