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By: Pickett, et al. (Senate Sponsor - Van de Putte) H.B. No. 1547
(In the Senate - Received from the House May 11, 2005;
May 13, 2005, read first time and referred to Committee on Business
and Commerce; May 21, 2005, reported favorably by the following
vote: Yeas 6, Nays 0; May 21, 2005, sent to printer.)
A BILL TO BE ENTITLED
AN ACT
relating to the form of the loan contract and related documents for
a consumer loan.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The heading to Section 341.502, Finance Code, is
amended to read as follows:
Sec. 341.502. FORM OF LOAN CONTRACT AND RELATED DOCUMENTS.
SECTION 2. Section 341.502, Finance Code, is amended by
amending Subsection (a) and adding Subsection (a-1) to read as
follows:
(a) A contract for a loan under Chapter 342, a retail
installment transaction under Chapter 348, or a home equity loan
regulated by the Office of Consumer Credit Commissioner[, whether
in English or Spanish,] must be:
(1) written in plain language designed to be easily
understood by the average consumer; and
(2) [. The contract must be] printed in an easily
readable font and type size.
(a-1) If the terms of the agreement for a loan under
Subsection (a) were negotiated in Spanish, a copy of a summary of
those terms and other pertinent information shall be provided to
the debtor in Spanish in a form identical to disclosures required
for a closed-end transaction under 12 C.F.R. Section 226.18.
SECTION 3. This Act takes effect September 1, 2005.
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