1-1     By:  Burnam (Senate Sponsor - Moncrief)               H.B. No. 1755

 1-2           (In the Senate - Received from the House May 9, 1997;

 1-3     May 12, 1997, read first time and referred to Committee on Economic

 1-4     Development; May 18, 1997, reported favorably, as amended, by the

 1-5     following vote:  Yeas 10, Nays 0; May 18, 1997, sent to printer.)

 1-6     COMMITTEE AMENDMENT NO. 1                               By:  Duncan

 1-7           Amend H.B. No. 1755 in SECTION 1 of the bill, in Subsection

 1-8     (c) of added Section 1B, Article 21.50, Insurance Code (engrossed

 1-9     version, page 1, line 44), between "(c)" and "In", by inserting the

1-10     following:

1-11     If federal law requires a lender to provide a borrower with a

1-12     written notice containing substantially the same information

1-13     required by Subsection (a) of this section, a lender who provides

1-14     the notice required by federal law within the period prescribed by

1-15     federal law satisfies the notice requirement of Subsection (a) of

1-16     this section.

1-17           (d)

1-18                            A BILL TO BE ENTITLED

1-19                                   AN ACT

1-20     relating to a mortgage guaranty insurance policy.

1-21           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

1-22           SECTION 1.  Article 21.50, Insurance Code, is amended by

1-23     adding Section 1B to read as follows:

1-24           Sec. 1B.  NOTICE TO BORROWER.  (a)  A lender that requires a

1-25     borrower to purchase mortgage guaranty insurance shall provide

1-26     annually to the borrower a copy of the following written notice

1-27     printed in at least 10-point bold-faced type:

1-28           "NOTICE OF RIGHT TO CANCEL PRIVATE MORTGAGE INSURANCE:  If

1-29     you currently pay private mortgage insurance premiums, you may have

1-30     the right to cancel the insurance and cease paying premiums.  This

1-31     would permit you to make a lower total monthly mortgage payment and

1-32     to possibly receive a refund of any unearned premiums on the

1-33     policy.  In most cases, you have the right to cancel private

1-34     mortgage insurance if the principal balance of your loan is 80

1-35     percent or less of the current fair market appraised value of your

1-36     home.  If you want to learn whether you are eligible to cancel this

1-37     insurance, please contact us at (address and telephone number of

1-38     lender) or the Texas Department of Insurance consumer help line at

1-39     (the appropriate toll-free telephone number)."

1-40           (b)  If a lender receives a refund of an unearned mortgage

1-41     guaranty insurance premium paid by a borrower, the lender shall

1-42     remit the refund to the borrower not later than the 10th business

1-43     day after the date on which the lender receives the refund.

1-44           (c)  In this section, "lender" has the meaning assigned by

1-45     Section 1(1), Article 21.48A, of this code.

1-46           SECTION 2.  This Act takes effect January 1, 1998.

1-47           SECTION 3.  The importance of this legislation and the

1-48     crowded condition of the calendars in both houses create an

1-49     emergency and an imperative public necessity that the

1-50     constitutional rule requiring bills to be read on three several

1-51     days in each house be suspended, and this rule is hereby suspended.

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