I am in IL, and I am in the middle of securing a home loan. What happens if the bank goes under before the final loan is secured? Do I need to start over with another lender?
The chances are slim that pending loan applications would be further processed if a bank fails. If the failure results in the bank's being acquired by another institution, you can certainly ask if the application will be pursued, and you might even get credit for any up-front fees you have already paid. However, the acquiring bank may have different loan standards and underwriting criteria, so you may have to start over, even if you do so at the same desk with the same loan officer.
If the bank is shuttered by the FDIC and liquidated, there's nothing to discuss. The bank will be gone, and you won't have any option but to try somewhere else. If the FDIC takes a middle ground and creates a conservatorship to operate the bank, as it did with IndyMac Bank, your best course of action would be to contact the new bank to see whether the application process can resume, or will have to start from scratch.
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I am in IL, and I am in the middle of securing a home 
The chances are slim that pending loan applications would be further processed if a bank fails. If the failure results in the bank's being acquired by another institution, you can certainly ask if the application will be pursued, and you might even get credit for any up-front 