By: Harris S.B. No. 1468
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the regulation of certain consumer credit practices;
1-2 providing that certain violations are actionable.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Article 6.05, Title 79, Revised Statutes (Article
1-5 5069-6.05, Vernon's Texas Civil Statutes), is amended to read as
1-6 follows:
1-7 Art. 5069-6.05. Prohibited provisions. No retail installment
1-8 contract or retail charge agreement shall:
1-9 (1) Provide that the holder may accelerate the
1-10 maturity of any part or all of the amount owing thereunder unless
1-11 (a) the buyer is in default in the performance of any of his
1-12 obligations, or (b) the holder in good faith believes that the
1-13 prospect of payment or performance is impaired;
1-14 (2) Contain a power of attorney to confess judgment,
1-15 or an assignment of wages;
1-16 (3) Authorize the seller or holder or other person
1-17 acting on his behalf to enter upon the buyer's premises unlawfully
1-18 or to commit any breach of the peace in the repossession of goods;
1-19 (4) Provide for a waiver of the buyer's rights of
1-20 action against the seller or holder or other person acting therefor
1-21 for any illegal act committed in the collection of payments under
1-22 the contract or agreement or in the repossession of goods;
1-23 (5) Contain any provision by which the buyer executes
2-1 a power of attorney appointing the seller or holder or other person
2-2 acting on his behalf, as the buyer's agent in the repossession of
2-3 goods;
2-4 (6) Provide that the buyer agrees not to assert
2-5 against the seller any claim or defense arising out of the sale;
2-6 (7) Provide for or grant a first lien upon real estate
2-7 to secure such obligation, except (a) such lien as is created by
2-8 law upon the recording of an abstract of judgment, <or> (b) such
2-9 lien as is provided for or granted by a contract or series of
2-10 contracts for the sale or construction and sale of a structure to
2-11 be used as a residence so long as the time price differential does
2-12 not exceed an annual percentage rate permitted under either this
2-13 Chapter or Article 1.04 of this Title, or (c) in the case of
2-14 improvements to an existing structure used or to be used as a
2-15 residence, Notice is given in the following form:
2-16 NOTICE: The Contract you are entering provides for a lien
2-17 against your home. Unless you make payments as provided under the
2-18 Contract, the Contractor or a Lender to whom the Contract is
2-19 assigned will have the right to foreclose and take possession of
2-20 your home. You have three days after the execution of the Contract
2-21 to provide the Contractor with written notice of your decision to
2-22 rescind the Contract. You are encouraged to seek the advice of an
2-23 attorney of your choice to explain your rights and obligations
2-24 under this Contract.
2-25 The notice must be given in the mechanic's lien contract and
3-1 must be conspicuous and printed in ten point bold faced type or
3-2 upper case typewritten letters.
3-3 A violation of this subsection (7) is a false, misleading, or
3-4 deceptive act or practice within the meaning of Section 17.46,
3-5 Business & Commerce Code, and is actionable under the provisions of
3-6 the Deceptive Trade Practices-Consumer Protection Act (Subchapter
3-7 E, Chapter 17, Business & Commerce Code) but does not void the lien
3-8 created.
3-9 SECTION 2. This Act takes effect September 1, 1995.
3-10 SECTION 3. The importance of this legislation and the
3-11 crowded condition of the calendars in both houses create an
3-12 emergency and an imperative public necessity that the
3-13 constitutional rule requiring bills to be read on three several
3-14 days in each house be suspended, and this rule is hereby suspended.