1-1 AN ACT
1-2 relating to additional interest for default on a loan contract
1-3 including simple interest.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 ARTICLE 1. AMENDMENTS TO TITLE 79, REVISED STATUTES
1-6 SECTION 1.01. Article 3A.303, Title 79, Revised Statutes
1-7 (Article 5069-3A.303, Vernon's Texas Civil Statutes), is amended to
1-8 read as follows:
1-9 Art. 3A.303. ADDITIONAL INTEREST FOR DEFAULT: REGULAR
1-10 TRANSACTION. (a) A loan contract that includes precomputed
1-11 interest and that is a regular transaction may provide for
1-12 additional interest for default if any part of an installment
1-13 remains unpaid after the 10th day after the date on which the
1-14 installment is due, including Sundays and holidays.
1-15 (b) A loan contract that uses the scheduled installment
1-16 earnings method and that is a regular transaction may provide for
1-17 additional interest for default if any part of an installment
1-18 remains unpaid after the 10th day after the date on which the
1-19 installment is due, including Sundays and holidays.
1-20 (c) A loan contract that includes simple interest and that
1-21 is a regular transaction may provide for additional interest for
1-22 default if any part of an installment remains unpaid after the 10th
1-23 day after the date on which the installment is due, including
1-24 Sundays and holidays.
2-1 (d) The additional interest may not exceed five cents for
2-2 each $1 of a scheduled installment.
2-3 (e) [(d)] Interest under this article may not be collected
2-4 more than once on the same installment.
2-5 SECTION 1.02. Article 3A.306, Title 79, Revised Statutes
2-6 (Article 5069-3A.306, Vernon's Texas Civil Statutes), is amended to
2-7 read as follows:
2-8 Art. 3A.306. ADDITIONAL INTEREST FOR DEFAULT: IRREGULAR
2-9 TRANSACTION. (a) A loan contract that includes precomputed
2-10 interest and that is an irregular transaction may provide for
2-11 additional interest for default using the true daily earnings
2-12 method for the period from the maturity date of an installment
2-13 until the date the installment is paid. The rate of the additional
2-14 interest may not exceed the maximum contract interest rate.
2-15 (b) A loan contract that includes simple interest and that
2-16 is an irregular transaction may provide for additional interest for
2-17 default if any part of an installment remains unpaid after the
2-18 10th day after the date on which the installment is due, including
2-19 Sundays and holidays. The additional interest may not exceed five
2-20 cents for each $1 of a scheduled installment. Interest under this
2-21 subsection may not be collected more than once on the same
2-22 installment.
2-23 ARTICLE 2. AMENDMENTS TO FINANCE CODE
2-24 SECTION 2.01. Section 342.203, Finance Code, is amended to
2-25 read as follows:
2-26 Sec. 342.203. ADDITIONAL INTEREST FOR DEFAULT: REGULAR
2-27 TRANSACTION. (a) A loan contract that includes precomputed
3-1 interest and that is a regular transaction may provide for
3-2 additional interest for default if any part of an installment
3-3 remains unpaid after the 10th day after the date on which the
3-4 installment is due, including Sundays and holidays.
3-5 (b) A loan contract that uses the scheduled installment
3-6 earnings method and that is a regular transaction may provide for
3-7 additional interest for default if any part of an installment
3-8 remains unpaid after the 10th day after the date on which the
3-9 installment is due, including Sundays and holidays.
3-10 (c) A loan contract that includes simple interest and that
3-11 is a regular transaction may provide for additional interest for
3-12 default if any part of an installment remains unpaid after the 10th
3-13 day after the date on which the installment is due, including
3-14 Sundays and holidays.
3-15 (d) The additional interest may not exceed five cents for
3-16 each $1 of a scheduled installment.
3-17 (e) [(d)] Interest under this section may not be collected
3-18 more than once on the same installment.
3-19 SECTION 2.02. Section 342.206, Finance Code, is amended to
3-20 read as follows:
3-21 Sec. 342.206. ADDITIONAL INTEREST FOR DEFAULT: IRREGULAR
3-22 TRANSACTION. (a) A loan contract that includes precomputed
3-23 interest and that is an irregular transaction may provide for
3-24 additional interest for default using the true daily earnings
3-25 method for the period from the maturity date of an installment
3-26 until the date the installment is paid. The rate of the additional
3-27 interest may not exceed the maximum contract interest rate.
4-1 (b) A loan contract that includes simple interest and that
4-2 is an irregular transaction may provide for additional interest for
4-3 default if any part of an installment remains unpaid after the 10th
4-4 day after the date on which the installment is due, including
4-5 Sundays and holidays. The additional interest may not exceed five
4-6 cents for each $1 of a scheduled installment. Interest under this
4-7 subsection may not be collected more than once on the same
4-8 installment.
4-9 ARTICLE 3. EFFECTIVE DATE; EMERGENCY
4-10 SECTION 3.01. (a) Except as provided by Subsections (b) and
4-11 (c) of this section, this Act takes effect September 1, 1999.
4-12 (b) Article 1 of this Act takes effect only if the Act of
4-13 the 76th Legislature, Regular Session, 1999, relating to
4-14 nonsubstantive additions to and corrections in enacted codes does
4-15 not take effect.
4-16 (c) Article 2 of this Act takes effect only if the Act of
4-17 the 76th Legislature, Regular Session, 1999, relating to
4-18 nonsubstantive additions to and corrections in enacted codes takes
4-19 effect.
4-20 SECTION 3.02. The importance of this legislation and the
4-21 crowded condition of the calendars in both houses create an
4-22 emergency and an imperative public necessity that the
4-23 constitutional rule requiring bills to be read on three several
4-24 days in each house be suspended, and this rule is hereby suspended.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 2337 was passed by the House on May
8, 1999, by a non-record vote.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 2337 was passed by the Senate on May
26, 1999, by the following vote: Yeas 30, Nays 0.
_______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor