As we described last year, the bankruptcy court in In re Crane held that a bankruptcy trustee could avoid two mortgages because the mortgages did not expressly state the interest rate and the maturity date.   This ruling turned upside down mortgage-industry standard practices and effectively required all Illinois mortgage to contain the maturity date and interest rate.  Then, when loans were extended, the lender would need to modify the mortgage, record the modification and require borrowers to purchase a date down endorsement.

In response to Crane, the Illinois legislature passed S.B.0016 acknowledging that the failure of a mortgage to state the interest rate or the maturity date does not invalidate an Illinois mortgage.  Then, the bankruptcy court reversed its earlier order, allowing all lenders with mortgages without interest rates set forth in them to breath again.