By Thompson H.B. No. 594
75R3972 BEM-F
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 this
1-9 chapter no further or other charge or amount whatsoever shall be
1-10 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 that is considered earned at the time the loan is made or
2-9 refinanced, is not subject to refund, and, if the loan is
2-10 refinanced, may not be contracted for or received by the lender
2-11 refinancing the loan more than once in any 180-day period.
2-12 SECTION 2. Section (7), Article 4.01, Title 79, Revised
2-13 Statutes (Article 5069-4.01, Vernon's Texas Civil Statutes), is
2-14 amended to read as follows:
2-15 (7) In addition to the authorized charges provided in this
2-16 Chapter no further or other charge or amount whatsoever shall be
2-17 directly, or indirectly, charged, contracted for, or received.
2-18 This includes (but is not limited by) all charges such as fees,
2-19 compensation, bonuses, commissions, brokerage, discounts, expenses
2-20 and every other charge of any nature whatsoever, whether of the
2-21 types listed herein or not. Without limitation of the foregoing,
2-22 such charges may be any form of costs or compensation whether
2-23 contracted for or not, received by the lender, or any other person,
2-24 in connection with (a) the investigating, arranging, negotiation,
2-25 procuring, guaranteeing, making, servicing, collecting or enforcing
2-26 of a loan; or (b) for the forbearance of money, credit, goods or
2-27 things in action; or (c) for any other service or services
3-1 performed or offered. However, the prohibition set out herein
3-2 shall not apply to amounts actually incurred by a lender as court
3-3 costs, attorney fees assessed by a court, lawful fees for filing,
3-4 recording, or releasing to any public office any instrument
3-5 securing a loan; the reasonable cost actually expended for
3-6 repossessing, storing, preparing for sale, or selling any security;
3-7 or fees for noting a lien on or transferring a certificate of title
3-8 to any motor vehicle offered as security for a loan made under this
3-9 Chapter, or premiums or identifiable charge received in connection
3-10 with the sale of insurance authorized under this Chapter; or an
3-11 administrative fee not to exceed $25 that is considered earned at
3-12 the time the loan is made or refinanced, is not subject to refund,
3-13 and, if the loan is refinanced, may not be contracted for or
3-14 received by the lender refinancing the loan more than once in any
3-15 180-day period.
3-16 SECTION 3. Section (7), Article 5.02, Title 79, Revised
3-17 Statutes (Article 5069-5.02, Vernon's Texas Civil Statutes), is
3-18 amended to read as follows:
3-19 (7) In addition to the authorized charges provided in the
3-20 Chapter no further or other charge or amount whatsoever shall be
3-21 directly, or indirectly, charged, contracted for, or received.
3-22 This includes (but is not limited by) all charges such as fees,
3-23 compensation, bonuses, commissions, brokerage, discounts, expenses
3-24 and every other charge of any nature whatsoever, whether of the
3-25 types listed herein or not. Without limitation of the foregoing,
3-26 such charges may be any form of costs or compensation whether
3-27 contracted for or not, received by the lender, or any other person,
4-1 in connection with (a) the investigating, arranging, negotiation,
4-2 procuring, guaranteeing, making, servicing, collecting or enforcing
4-3 a loan; or (b) for the forbearance of money, credit, goods or
4-4 things in action; or (c) for any other service or services
4-5 performed or offered. A secondary mortgage loan lender or an
4-6 assignee of a secondary mortgage loan may collect on or before the
4-7 closing of a loan, or include in the principal of the secondary
4-8 mortgage loan, the following:
4-9 (A) reasonable fees for title examination and
4-10 preparation of an abstract of title by an attorney not an employee
4-11 of the lender, or a title company or property search company
4-12 authorized to do business in this State; or premiums or fees for
4-13 title insurance or title search for the benefit of the mortgagee,
4-14 and, at mortgagor's option, title insurance or title search for the
4-15 benefit of the mortgagor;
4-16 (B) reasonable fees charged to the lender by an
4-17 attorney, provided the attorney is not a salaried employee of the
4-18 lender, for preparation of the loan documents in connection with
4-19 the mortgage loan, if the fees are evidenced by a statement for
4-20 services rendered addressed to the lender;
4-21 (C) charges prescribed by law that are or will be paid
4-22 to public officials for determining the existence of and for
4-23 perfecting, releasing, and satisfying a security interest;
4-24 (D) reasonable fees for an appraisal of real property
4-25 offered as security for the loan prepared by a certified appraiser
4-26 who is not an employee of the lender;
4-27 (E) reasonable cost of any credit report;
5-1 (F) reasonable fees for a survey of real property
5-2 offered as security for the loan prepared by a registered surveyor
5-3 who is not a salaried employee of the lender;
5-4 (G) the premiums received in connection with the sale
5-5 of credit life insurance, credit accident and health insurance, and
5-6 insurance which protects the mortgagee in the event of default by
5-7 the mortgagor, the benefits of which go in whole or in part to
5-8 reduce or extinguish the loan balance. Premiums for property
5-9 insurance written in conformity with Section (2) of Article 5.03 of
5-10 this Title may be added to the loan contract; and
5-11 (H) reasonable fees relating to real property offered
5-12 as security for the loan that are incurred to comply with a
5-13 federally mandated program if the collection of the fees or the
5-14 participation in the program is required by a federal agency.
5-15 In addition, the contract for a secondary mortgage loan may
5-16 provide for:
5-17 (A) reasonable fees or charges paid to the trustee in
5-18 connection with a deed of trust or similar instrument executed in
5-19 connection with the secondary mortgage loan, including but not
5-20 limited to fees for enforcing the lien, posting for sale, selling,
5-21 or releasing the property secured by the deed of trust;
5-22 (B) reasonable fees paid to an attorney who is not an
5-23 employee of the creditor in the collection of a delinquent
5-24 secondary mortgage loan and any court costs and fees incurred in
5-25 the collection of, or foreclosure of, any lien created by the loan;
5-26 (C) a fee of $25 [Fifteen Dollars] or less for the
5-27 return by a depository institution of a dishonored check,
6-1 negotiable order of withdrawal, or share draft offered in full or
6-2 partial payment of a secondary mortgage loan;
6-3 (D) an administrative fee not to exceed $25 that is
6-4 considered earned at the time the loan is made or refinanced, is
6-5 not subject to refund, and, if the loan is refinanced, may not be
6-6 contracted for or received by the lender refinancing the loan more
6-7 than once in any 180-day period.
6-8 SECTION 4. This Act takes effect September 1, 1997.
6-9 SECTION 5. The importance of this legislation and the
6-10 crowded condition of the calendars in both houses create an
6-11 emergency and an imperative public necessity that the
6-12 constitutional rule requiring bills to be read on three several
6-13 days in each house be suspended, and this rule is hereby suspended.