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78R4512 ATP-D

By:  Mercer                                                       H.B. No. 824



A BILL TO BE ENTITLED

AN ACT

relating to the automatic withdrawal of payments on a home loan from 
a borrower's account.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter B, Chapter 343, Finance Code, is 
amended by adding Section 343.105 to read as follows:
	Sec. 343.105.  AUTOMATIC PAYMENT OF HOME LOAN.  (a)  A lender 
shall provide a borrower of a home loan with the option of making 
the payments on the loan through the automatic withdrawal of each 
payment by an electronic funds transfer from the borrower's account 
at a financial institution.
	(b)  A lender shall provide a borrower who chooses to make 
payments on a home loan under Subsection (a) with the option of 
having the funds automatically withdrawn monthly or semimonthly, on 
payment dates selected by the lender.
	(c)  A lender shall inform a prospective borrower of a home 
loan of the payment options prescribed by this section in writing on 
or before the closing of the home loan.
	SECTION 2.  On or before January 1, 2004, a lender shall 
inform, in writing, each borrower of a home loan that is outstanding 
and owed to the lender on January 1, 2004, of the borrower's payment 
options under Section 343.105, Finance Code, as added by this Act.
	SECTION 3.  This Act takes effect January 1, 2004.