Illinois
Illinois VA IRRRL: Homestead Signatures and Title Company Closings
The Illinois rules that catch veterans off guard on a VA streamline, from Scott AFB to Great Lakes. Home Loans Inc is not licensed in Illinois and cannot take your application.
Home Loans Inc is not licensed in Illinois and cannot take a Illinois application. We lend in South Carolina, North Carolina, Virginia, West Virginia, Florida, Georgia, Alabama, Mississippi, Iowa and Wyoming.
Not your lender, still your source
Home Loans Inc is not licensed in Illinois
Plain truth: Home Loans Inc cannot take an Illinois application. We are not licensed there. I put this page up because Illinois has a few rules that trip people up, and I would rather you hear them from a veteran-friendly broker than learn them at the closing table.
Who closes it
Title companies, not the Chicago attorney ritual
If you bought in Chicagoland, you probably had an attorney at your purchase. On a refinance that custom typically falls away. Illinois is a title and escrow state, and title companies legally close refinances. Funding is wet, so money is on hand when you sign, and remote online notarization is generally available.
That makes an Illinois streamline closing pretty quick for a big Midwest state. It also means one fewer professional fee in the mix, which helps the 36-month recoup math.
The homestead signature
Why the spouse signs on an Illinois refinance
Illinois protects the homestead under 735 ILCS 5/12-904. On a purchase there is an exception for purchase-money loans. On a refinance that exception does not apply, so if the property is your homestead, your spouse signs. If your spouse was not at your original closing, do not be surprised when the title company asks for them this time. That is the law working as intended, not a lender being difficult. Schedule the signing around both of your calendars. With online notarization generally available, the two of you can often sign together from home, which beats taking a day off for a title office visit.
Illinois consumer rules
Database counties, prepayment rules and a tip for vetting ads
Predatory Lending Database
Cook, Kane, Peoria and Will counties run a database with counseling on certain high-risk loans. Ask your lender whether your loan falls into it.
Prepayment penalties
Illinois makes prepayment penalties unlawful where the APR exceeds 8 percent.
The NMLS ad rule
Illinois requires mortgage ads to include the NMLS Consumer Access URL. If a streamline flyer skips it, that tells you something about the sender.
Foreclosure
Illinois forecloses judicially. Not a factor if you stay current, but it is how the state works.
On taxes, Illinois charges no state tax on a refinance. The transfer tax is deed-based, so it does not apply. You will see county recording fees and that is about it. Compared with some East Coast states, Illinois is cheap on the government side. That leaves lender fees and title charges as the items worth comparing, and comparing them is your job, not mine, since I cannot quote you here.
From Scott AFB to Great Lakes
The VA rules, applied to Illinois veterans
Scott AFB near Belleville is home to US Transportation Command and Air Mobility Command, and the Metro East is full of VA homeowners. Rock Island Arsenal anchors the Quad Cities, and Naval Station Great Lakes, the Navy boot camp in North Chicago, is the largest military installation in Illinois. Springfield and Champaign-Urbana have their share too.
Wherever you are, the IRRRL tests are federal. The current loan must be VA. You need at least 210 days since the first payment due date and six payments made, whichever comes later. Costs must be recouped through monthly savings within 36 months, with a net tangible benefit. The funding fee is 0.5 percent, waived with VA disability compensation. VA usually requires no appraisal and no income verification, though a lender may add overlays. If you rent the place now, you only certify prior occupancy. Take all of that to a lender licensed in Illinois. Ask for the break-even month in writing before you lock.
Illinois VA IRRRL questions
Do I need an attorney for my Chicago-area VA streamline?
Usually not. The Chicago attorney custom typically falls away on a refinance, and Illinois title companies legally close refinances. You can still hire one if you want, but it is not required, and skipping it can help your 36-month recoup.
Why does my spouse have to sign the Belleville refinance when they skipped the purchase?
Illinois protects the homestead under 735 ILCS 5/12-904. Purchase-money loans get an exception, but a refinance does not, so the spouse signs when the property is your homestead. That is why the title company is asking now.
What is the Illinois Predatory Lending Database?
It is a program covering Cook, Kane, Peoria and Will counties that requires counseling on certain high-risk loans. Ask your lender whether your refinance falls under it. A straightforward VA streamline lender should be able to answer immediately.
How can I spot a sketchy IRRRL mailer in Illinois?
Illinois requires mortgage ads to include the NMLS Consumer Access URL. If the flyer leaves it off, be careful. Also check that the offer respects VA seasoning, recoups costs within 36 months, and shows a net tangible benefit.
Can Home Loans Inc help with my Illinois IRRRL application?
No. Home Loans Inc is not licensed in Illinois and cannot take the application. This page is education only, so you can compare lenders licensed in Illinois and ask each of them about seasoning, recoup and the funding fee.