1-1 By: Marchant (Senate Sponsor - Carona) H.B. No. 1994
1-2 (In the Senate - Received from the House April 25, 2001;
1-3 April 26, 2001, read first time and referred to Committee on
1-4 Business and Commerce; May 7, 2001, reported favorably by the
1-5 following vote: Yeas 5, Nays 0; May 7, 2001, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to certain charges included in a retail installment
1-9 agreement.
1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11 SECTION 1. Sections 345.251(b) and (c), Finance Code, are
1-12 amended to read as follows:
1-13 (b) If a documentary fee is charged under this section the
1-14 fee:
1-15 (1) must be charged to cash buyers and credit buyers;
1-16 (2) may not exceed $75 [$50]; and
1-17 (3) must be disclosed on the retail installment
1-18 contract as a separate itemized charge.
1-19 (c) A preliminary work sheet on which a sale price is
1-20 computed and that is shown to the retail buyer, an order from the
1-21 buyer, or a retail installment contract must include in reasonable
1-22 proximity to the place on the document where the documentary fee is
1-23 disclosed:
1-24 (1) the amount of the fee; and
1-25 (2) the following notice in type that is bold-faced,
1-26 capitalized, or underlined or otherwise conspicuously set out from
1-27 the surrounding written material:
1-28 "A DOCUMENTARY FEE IS NOT AN OFFICIAL FEE. A DOCUMENTARY FEE IS
1-29 NOT REQUIRED BY LAW, BUT MAY BE CHARGED TO BUYERS FOR HANDLING
1-30 DOCUMENTS AND PERFORMING SERVICES RELATING TO THE CLOSING OF A
1-31 SALE. A DOCUMENTARY FEE MAY NOT EXCEED $75 [$50]. THIS NOTICE IS
1-32 REQUIRED BY LAW."
1-33 SECTION 2. Section 348.006(c), Finance Code, is amended to
1-34 read as follows:
1-35 (c) For a documentary fee to be included in the principal
1-36 balance of a retail installment contract:
1-37 (1) the retail seller must charge the documentary fee
1-38 to cash buyers and credit buyers;
1-39 (2) the documentary fee may not exceed $75 [$50] for a
1-40 motor vehicle retail installment contract or a reasonable amount
1-41 agreed to by the retail seller and retail buyer for a heavy
1-42 commercial vehicle retail installment contract; and
1-43 (3) the buyer's order and the retail installment
1-44 contract must include:
1-45 (A) a statement of the amount of the documentary
1-46 fee; and
1-47 (B) in reasonable proximity to the place in each
1-48 where the amount of the documentary fee is disclosed, the following
1-49 notice in type that is bold-faced, capitalized, underlined, or
1-50 otherwise conspicuously set out from surrounding written material:
1-51 "A DOCUMENTARY FEE IS NOT AN OFFICIAL FEE. A DOCUMENTARY FEE IS
1-52 NOT REQUIRED BY LAW, BUT MAY BE CHARGED TO BUYERS FOR HANDLING
1-53 DOCUMENTS AND PERFORMING SERVICES RELATING TO THE CLOSING OF A
1-54 SALE. A DOCUMENTARY FEE MAY NOT EXCEED $75 [$50] FOR A MOTOR
1-55 VEHICLE CONTRACT OR A REASONABLE AMOUNT AGREED TO BY THE PARTIES
1-56 FOR A HEAVY COMMERCIAL VEHICLE CONTRACT. THIS NOTICE IS REQUIRED
1-57 BY LAW."
1-58 SECTION 3. This Act takes effect immediately if it receives
1-59 a vote of two-thirds of all the members elected to each house, as
1-60 provided by Section 39, Article III, Texas Constitution. If this
1-61 Act does not receive the vote necessary for immediate effect, this
1-62 Act takes effect September 1, 2001.
1-63 * * * * *