By Wise                                               H.B. No. 2743
         76R7993 CLG-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the disclosure of certain information by a lender;
 1-3     providing a criminal penalty.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.   Title 5, Finance Code, is amended by adding
 1-6     Chapter 396 to read as follows:
 1-7             CHAPTER 396.  RESIDENTIAL MORTGAGE LOAN DISCLOSURES
 1-8           Sec. 396.001.  DEFINITIONS.  In this chapter:
 1-9                 (1)  "Borrower" means the person who seeks the services
1-10     of a lender.
1-11                 (2)  "Closing costs" include discount points,
1-12     origination fees, private mortgage insurance premiums, property or
1-13     casualty insurance premiums, title insurance premiums, lender
1-14     escrow account impound deposits, fees for reviewing credit reports,
1-15     appraisal review fees, inspection fees, recording fees, courier and
1-16     express mail delivery fees, underwriting fees, attorney's fees for
1-17     preparation of loan documents or loan disclosures, title company
1-18     imposed escrow fees, survey fees, and other settlement charges.
1-19                 (3)  "Lender" means any person who lends money for or
1-20     invests money in residential mortgage loans.
1-21                 (4)  "Residential mortgage loan" means a loan to or for
1-22     the benefit of one or more individuals made primarily for personal,
1-23     family, or household use, primarily secured by a mortgage on
1-24     residential real property.
 2-1           Sec. 396.002.  DISCLOSURE OF CLOSING COSTS REQUIRED.  Not
 2-2     later than the third business day after the date on which a
 2-3     borrower signs a completed residential mortgage loan application,
 2-4     the lender shall provide to the borrower a good faith, written
 2-5     estimate of all closing costs required to be paid by the borrower
 2-6     in connection with the loan.  The disclosure must:
 2-7                 (1)  contain a complete description of the closing
 2-8     costs; and
 2-9                 (2)  state the total amount of each of the closing
2-10     costs listed in Subdivision (1).
2-11           Sec. 396.003.  CRIMINAL PENALTY.  (a)  A lender commits an
2-12     offense if the lender violates Section 396.002.
2-13           (b)  An offense under this section is a Class C misdemeanor.
2-14           SECTION 2.  This Act takes effect September 1, 1999, and
2-15     applies only to a loan application that is completed on or after
2-16     that date.
2-17           SECTION 3.  The importance of this legislation and the
2-18     crowded condition of the calendars in both houses create an
2-19     emergency and an imperative public necessity that the
2-20     constitutional rule requiring bills to be read on three several
2-21     days in each house be suspended, and this rule is hereby suspended.