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78R3866 DWS-D

By:  West                                                         S.B. No. 1003



A BILL TO BE ENTITLED

AN ACT

relating to certain practices in connection with financing of a 
home.       
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 343.001(2), Finance Code, is amended to 
read as follows: 
		(2)  "Home loan" means a loan or retail installment 
sales transaction that is:
			(A)  made to or entered into with one or more 
individuals for personal, family, or household purposes;  and
			(B)  secured in whole or part by:                                            
				(i)  a manufactured home, as defined by 
Section 347.002, used or to be used as the borrower's principal 
residence; or
				(ii)  real property improved by a dwelling 
designed for occupancy by four or fewer families and used or to be 
used as the borrower's principal residence.
	SECTION 2.  Subchapter B, Chapter 343, Finance Code, is 
amended by adding Sections 343.105 and 343.106 to read as follows:
	Sec. 343.105.  FEE FOR BALANCE.  (a)  A lender may not charge 
a fee for informing or transmitting to any person the balance due to 
pay off a home loan or to provide a release on prepayment.
	(b)  The lender shall provide payoff balances within a 
reasonable time, not more than seven business days after the 
request.
	Sec. 343.106.  FEE FOR APPRAISAL AFTER DEFAULT.  A lender 
may not charge the borrower a fee for an appraisal conducted after 
default on the home loan by the borrower unless:
		(1)  the appraisal is conducted by a state licensed or 
certified real estate appraiser or a state licensed real estate 
broker or salesperson who is not a salaried employee of the lender;
		(2)  the amount of the fee does not exceed the amount 
actually paid by the lender for the appraisal; and
		(3)  either:                                                           
			(A)  the appraisal is conducted after foreclosure 
has been initiated; or
			(B)  not more than one similar appraisal has been 
conducted during the preceding 12-month period.
	SECTION 3.  Sections 343.102(b) and 343.103(b), Finance 
Code, are repealed.  
	SECTION 4.  The change in law made by this Act applies only 
to a loan closed on or after the effective date of this Act.  A loan 
closed before the effective date of this Act is governed by the law 
in effect when the loan was closed, and the former law is continued 
in effect for that purpose.
	SECTION 5.  This Act takes effect September 1, 2003.