Illinois Compiled Statutes 215 ILCS 155/17 – Independent escrowees
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(a) Every independent escrowee shall be subject to the same certification and deposit requirements to which title insurance companies are subject under Section 4 of this Act.
(b) No person, firm, corporation or other legal entity shall hold itself out to be an independent escrowee unless it has been issued a certificate of authority by the Secretary.
(c) Every applicant for a certificate of authority, except a firm, partnership, association or corporation, must be 18 years or more of age.
(d) Every certificate of authority shall remain in effect one year unless revoked or suspended by the Secretary or voluntarily surrendered by the holder.
(e) An independent escrowee may engage in the escrow, settlement, or closing business, or any combination of such business, and operate as an escrow, settlement, or closing agent, provided that:
(1) Funds deposited in connection with any escrow,
(b) No person, firm, corporation or other legal entity shall hold itself out to be an independent escrowee unless it has been issued a certificate of authority by the Secretary.
Terms Used In Illinois Compiled Statutes 215 ILCS 155/17
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Fiduciary: A trustee, executor, or administrator.
- individual: shall include every infant member of the species homo sapiens who is born alive at any stage of development. See Illinois Compiled Statutes 5 ILCS 70/1.36
- Lien: A claim against real or personal property in satisfaction of a debt.
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
(c) Every applicant for a certificate of authority, except a firm, partnership, association or corporation, must be 18 years or more of age.
(d) Every certificate of authority shall remain in effect one year unless revoked or suspended by the Secretary or voluntarily surrendered by the holder.
(e) An independent escrowee may engage in the escrow, settlement, or closing business, or any combination of such business, and operate as an escrow, settlement, or closing agent, provided that:
(1) Funds deposited in connection with any escrow,
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settlement, or closing shall be deposited in a separate fiduciary trust account or accounts in a bank or other financial institution insured by an agency of the federal government unless the instructions provide otherwise. Such funds shall be the property of the person or persons entitled thereto under the provisions of the escrow, settlement, or closing and shall be segregated by escrow, settlement or closing in the records of the independent escrowee. Such funds shall not be subject to any debts of the escrowee and shall be used only in accordance with the terms of the individual escrow, settlement or closing under which the funds were accepted.
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(2) Interest received on funds deposited with the
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independent escrowee in connection with any escrow, settlement or closing shall be paid to the depositing party unless the instructions provide otherwise.
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(3) The independent escrowee shall maintain separate
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records of all receipt and disbursement of escrow, settlement or closing funds.
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(4) The independent escrowee shall comply with any
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rules or regulations promulgated by the Secretary pertaining to escrow, settlement or closing transactions.
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(f) The Secretary or his authorized representative shall have the power and authority to visit and examine at any time any independent escrowee certified under this Act and to verify and compel compliance with the provisions of this Act.
(g) A title insurance company or title insurance agent, not qualified as an independent escrowee, may act in the capacity of an escrow agent when it is supplying an abstract of title, grantor-grantee search, tract search, lien search, tax assessment search, or other limited purpose search to the parties to the transaction even if it is not issuing a title insurance commitment or title insurance policy. A title insurance agent may act as an escrow agent only when specifically authorized in writing on forms prescribed by the Secretary by a title insurance company that has duly registered the agent with the Secretary and only when notice of the authorization is provided to and receipt thereof is acknowledged by the Secretary. The authority granted to a title insurance agent may be limited or revoked at any time by the title insurance company.
(h) An independent escrowee may, pursuant to Section 17.1 of this Act, issue an insured closing letter if, in addition to complying with the same certification and deposit requirements that title insurance companies are subject to under Section 4 of this Act, the independent escrowee:
(1) Satisfies the Secretary that it has a minimum
(g) A title insurance company or title insurance agent, not qualified as an independent escrowee, may act in the capacity of an escrow agent when it is supplying an abstract of title, grantor-grantee search, tract search, lien search, tax assessment search, or other limited purpose search to the parties to the transaction even if it is not issuing a title insurance commitment or title insurance policy. A title insurance agent may act as an escrow agent only when specifically authorized in writing on forms prescribed by the Secretary by a title insurance company that has duly registered the agent with the Secretary and only when notice of the authorization is provided to and receipt thereof is acknowledged by the Secretary. The authority granted to a title insurance agent may be limited or revoked at any time by the title insurance company.
(h) An independent escrowee may, pursuant to Section 17.1 of this Act, issue an insured closing letter if, in addition to complying with the same certification and deposit requirements that title insurance companies are subject to under Section 4 of this Act, the independent escrowee:
(1) Satisfies the Secretary that it has a minimum
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capital and surplus of $2,000,000. The Secretary may provide the forms and standards for this purpose by rule. This paragraph applies only to independent escrowees licensed under this Act for the first time on or after the effective date of this amendatory Act of the 100th General Assembly.
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(2) Files with and has approved by the Secretary
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proof of a fidelity bond in the minimum amount of $2,000,000 per occurrence.
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(3) Establishes and maintains a statutory closing
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protection letter reserve for the protection of parties named in warranties of services consisting of a sum of 25% of the closing protection letter revenue received by the independent escrowee on or after the effective date of this amendatory Act of the 100th General Assembly. The reserve shall be reported as a liability of the independent escrowee in its financial statements. Amounts placed in the statutory closing protection letter reserve shall be deducted in determining the net profit of the independent escrowee for the year. Except as provided in this subsection, assets in value equal to the statutory closing protection letter reserve are not subject to distribution among creditors, stockholders, or other owners of the independent escrowee until all claims of parties named in warranties of services have been paid in full and discharged.
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(4) Releases from the statutory closing protection
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letter reserve a sum equal to 10% of the amount added to the reserve during a calendar year on July 1 of each of the 5 years following the year in which the sum was added and releases from the statutory closing protection letter reserve a sum equal to 3 1/3% of the amount added to the reserve during that year on each succeeding July 1 until the entire amount for that year has been released.
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The Secretary shall adopt and amend rules as may be required for the proper administration and enforcement of this subsection (h) consistent with the federal Real Estate Settlement and Procedures Act and Section 24 of this Act.