SRC-PNG, SLL H.B. 3072 76(R)   BILL ANALYSIS


Senate Research Center   H.B. 3072
By: Averitt (Brown)
State Affairs
5/13/1999
Engrossed


DIGEST 

Under current law, the only situation in which the seller of a motor
vehicle is allowed to pay off the outstanding debt against a vehicle owned
by the buyer is when the vehicle being paid off is to be used as a trade-in
on the vehicle being purchased.  When the vehicle a buyer intends to use as
a trade-in vehicle has been rendered a total loss, the law does not allow
the seller to pay off the amount owed against the total-loss vehicle and
incorporate that amount into the retail installment agreement in the sale.
This is because a total-loss vehicle cannot be used as a trade-in.  H.B.
3072 removes the phrase "used as a trade-in" and replaces the phrase with
"owned by the buyer."  This allows a seller to pay off the outstanding debt
against  a vehicle owned by the buyer whether or not the vehicle is
technically to be used as a trade-in.  

PURPOSE

As proposed, H.B. 3072 sets forth provisions regarding certain payments by
a retail seller in a retail installment transaction involving a motor
vehicle.  

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 348.404, Finance Code, as follows:

Sec.  348.404.  New heading: SELLER'S ACTION FOR INCENTIVE PROGRAM OR TO
PAY FOR BUYER'S MOTOR VEHICLE.  Authorizes a retail seller, in connection
with a retail instrument transaction, to advance money to retire an amount
owed by the buyer that has been declared a total loss by the buyer's
insurer.  Authorizes a retail seller to pay in cash to the retail buyer any
portion of the net cash value of a motor vehicle owned by the buyer and
used as a trade-in in a transaction involving the sale of another m  otor
vehicle.  Defines "net cash value." 

SECTION 2.  Amends Section 152.002(b), Tax Code, to redefine "total
consideration." 

SECTION 3.  Emergency clause.
            Effective date: upon passage.