By Thompson, et al. H.B. No. 594
Substitute the following for H.B. No. 594:
By Giddings C.S.H.B. No. 594
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to certain charges for the administration of loans and
1-3 loan applications.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section (8), Article 3.15, Title 79, Revised
1-6 Statutes (Article 5069-3.15, Vernon's Texas Civil Statutes), is
1-7 amended to read as follows:
1-8 (8) In addition to the authorized charges provided in
1-9 this chapter no further or other charge or amount whatsoever shall
1-10 be directly, or indirectly, charged, contracted for, or received.
1-11 This includes (but is not limited by) all charges such as fees,
1-12 compensation, bonuses, commissions, brokerage, discounts, expenses
1-13 and every other charge of any nature whatsoever, whether of the
1-14 types listed herein or not. Without limitation of the foregoing,
1-15 such charges may be any form of costs or compensation whether
1-16 contracted for or not, received by the lender, or any other person,
1-17 in connection with (a) the investigating, arranging, negotiation,
1-18 procuring, guaranteeing, making, servicing, collecting or enforcing
1-19 of a loan; or (b) for the forbearance of money, credit, goods or
1-20 things in action; or (c) for any other service or services
1-21 performed or offered. However, the prohibition set out herein
1-22 shall not apply to amounts actually incurred by an authorized
1-23 lender as court costs; attorney fees assessed by a court; lawful
1-24 fees for filing, recording, or releasing in any public office any
2-1 security for a loan; the reasonable cost actually expended for
2-2 repossessing, storing, preparing for sale, or selling any security;
2-3 or fees for noting a lien on or transferring a certificate of title
2-4 to any motor vehicle offered as security for a loan made under this
2-5 Chapter, or premiums or identifiable charge received in connection
2-6 with the sale of insurance authorized under this Chapter; or, on a
2-7 loan made under this Article, an administrative fee not to exceed
2-8 $25 for a loan of more than $1,000 or $10 for a loan of $1,000 or
2-9 less which is considered earned at the time the loan is made or
2-10 refinanced, which is not subject to refund, which may not be
2-11 contracted for or received by the lender refinancing the loan more
2-12 than once in any 180-day period if the loan is refinanced, and for
2-13 which 50 cents of the fee charged is deposited with the comptroller
2-14 for the purpose of fulfilling the responsibilities of the Finance
2-15 Commission, as required under Section 1.011(f), Texas Banking Act
2-16 (Article 342-1.011, Vernon's Texas Civil Statutes).
2-17 SECTION 2. Section (7), Article 4.01, Title 79, Revised
2-18 Statutes (Article 5069-4.01, Vernon's Texas Civil Statutes), is
2-19 amended to read as follows:
2-20 (7) In addition to the authorized charges provided in
2-21 this Chapter no further or other charge or amount whatsoever shall
2-22 be directly, or indirectly, charged, contracted for, or received.
2-23 This includes (but is not limited by) all charges such as fees,
2-24 compensation, bonuses, commissions, brokerage, discounts, expenses
2-25 and every other charge of any nature whatsoever, whether of the
2-26 types listed herein or not. Without limitation of the foregoing,
2-27 such charges may be any form of costs or compensation whether
3-1 contracted for or not, received by the lender, or any other person,
3-2 in connection with (a) the investigating, arranging, negotiation,
3-3 procuring, guaranteeing, making, servicing, collecting or enforcing
3-4 of a loan; or (b) for the forbearance of money, credit, goods or
3-5 things in action; or (c) for any other service or services
3-6 performed or offered. However, the prohibition set out herein
3-7 shall not apply to amounts actually incurred by a lender as court
3-8 costs, attorney fees assessed by a court, lawful fees for filing,
3-9 recording, or releasing to any public office any instrument
3-10 securing a loan; the reasonable cost actually expended for
3-11 repossessing, storing, preparing for sale, or selling any security;
3-12 or fees for noting a lien on or transferring a certificate of title
3-13 to any motor vehicle offered as security for a loan made under this
3-14 Chapter, or premiums or identifiable charge received in connection
3-15 with the sale of insurance authorized under this Chapter; or an
3-16 administrative fee not to exceed $25 for a loan of more than $1,000
3-17 or $10 for a loan of $1,000 or less which is considered earned at
3-18 the time the loan is made or refinanced, which is not subject to
3-19 refund, which may not be contracted for or received by the lender
3-20 refinancing the loan more than once in any 180-day period if the
3-21 loan is refinanced, and for which 50 cents of the fee charged is
3-22 deposited with the comptroller for the purpose of fulfilling the
3-23 responsibilities of the Finance Commission, as required under
3-24 Section 1.011(f), Texas Banking Act (Article 342-1.011, Vernon's
3-25 Texas Civil Statutes).
3-26 SECTION 3. Section (7), Article 5.02, Title 79, Revised
3-27 Statutes (Article 5069-5.02, Vernon's Texas Civil Statutes), is
4-1 amended to read as follows:
4-2 (7) In addition to the authorized charges provided in
4-3 the Chapter no further or other charge or amount whatsoever shall
4-4 be directly, or indirectly, charged, contracted for, or received.
4-5 This includes (but is not limited by) all charges such as fees,
4-6 compensation, bonuses, commissions, brokerage, discounts, expenses
4-7 and every other charge of any nature whatsoever, whether of the
4-8 types listed herein or not. Without limitation of the foregoing,
4-9 such charges may be any form of costs or compensation whether
4-10 contracted for or not, received by the lender, or any other person,
4-11 in connection with (a) the investigating, arranging, negotiation,
4-12 procuring, guaranteeing, making, servicing, collecting or enforcing
4-13 a loan; or (b) for the forbearance of money, credit, goods or
4-14 things in action; or (c) for any other service or services
4-15 performed or offered. A secondary mortgage loan lender or an
4-16 assignee of a secondary mortgage loan may collect on or before the
4-17 closing of a loan, or include in the principal of the secondary
4-18 mortgage loan, the following:
4-19 (A) reasonable fees for title examination and
4-20 preparation of an abstract of title by an attorney not an employee
4-21 of the lender, or a title company or property search company
4-22 authorized to do business in this State; or premiums or fees for
4-23 title insurance or title search for the benefit of the mortgagee,
4-24 and, at mortgagor's option, title insurance or title search for the
4-25 benefit of the mortgagor;
4-26 (B) reasonable fees charged to the lender by an
4-27 attorney, provided the attorney is not a salaried employee of the
5-1 lender, for preparation of the loan documents in connection with
5-2 the mortgage loan, if the fees are evidenced by a statement for
5-3 services rendered addressed to the lender;
5-4 (C) charges prescribed by law that are or will
5-5 be paid to public officials for determining the existence of and
5-6 for perfecting, releasing, and satisfying a security interest;
5-7 (D) reasonable fees for an appraisal of real
5-8 property offered as security for the loan prepared by a certified
5-9 appraiser who is not an employee of the lender;
5-10 (E) reasonable cost of any credit report;
5-11 (F) reasonable fees for a survey of real
5-12 property offered as security for the loan prepared by a registered
5-13 surveyor who is not a salaried employee of the lender;
5-14 (G) the premiums received in connection with the
5-15 sale of credit life insurance, credit accident and health
5-16 insurance, and insurance which protects the mortgagee in the event
5-17 of default by the mortgagor, the benefits of which go in whole or
5-18 in part to reduce or extinguish the loan balance. Premiums for
5-19 property insurance written in conformity with Section (2) of
5-20 Article 5.03 of this Title may be added to the loan contract; and
5-21 (H) reasonable fees relating to real property
5-22 offered as security for the loan that are incurred to comply with a
5-23 federally mandated program if the collection of the fees or the
5-24 participation in the program is required by a federal agency.
5-25 In addition, the contract for a secondary mortgage loan may
5-26 provide for:
5-27 (A) reasonable fees or charges paid to the
6-1 trustee in connection with a deed of trust or similar instrument
6-2 executed in connection with the secondary mortgage loan, including
6-3 but not limited to fees for enforcing the lien, posting for sale,
6-4 selling, or releasing the property secured by the deed of trust;
6-5 (B) reasonable fees paid to an attorney who is
6-6 not an employee of the creditor in the collection of a delinquent
6-7 secondary mortgage loan and any court costs and fees incurred in
6-8 the collection of, or foreclosure of, any lien created by the loan;
6-9 (C) a fee of Fifteen Dollars or less for the
6-10 return by a depository institution of a dishonored check,
6-11 negotiable order of withdrawal, or share draft offered in full or
6-12 partial payment of a secondary mortgage loan;
6-13 (D) an administrative fee not to exceed $25 for
6-14 a loan of more than $1,000 or $10 for a loan of $1,000 or less
6-15 which is considered earned at the time the loan is made or
6-16 refinanced, which is not subject to refund, which may not be
6-17 contracted for or received by the lender refinancing the loan more
6-18 than once in any 180-day period if the loan is refinanced, and for
6-19 which 50 cents of the fee charged is deposited with the comptroller
6-20 for the purpose of fulfilling the responsibilities of the Finance
6-21 Commission, as required under Section 1.011(f), Texas Banking Act
6-22 (Article 342-1.011, Vernon's Texas Civil Statutes).
6-23 SECTION 4. This Act takes effect September 1, 1997.
6-24 SECTION 5. The importance of this legislation and the
6-25 crowded condition of the calendars in both houses create an
6-26 emergency and an imperative public necessity that the
6-27 constitutional rule requiring bills to be read on three several
7-1 days in each house be suspended, and this rule is hereby suspended.