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A BILL TO BE ENTITLED
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AN ACT
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relating to the calculation of certain fees collected to defray |
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certain expenses incurred in conjunction with the sale of a motor |
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vehicle. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 348.006, Finance Code, is amended by |
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amending Subsections (a) and (c) and adding Subsection (e) to read |
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as follows: |
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(a) The principal balance under a retail installment |
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contract is computed by: |
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(1) adding: |
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(A) the cash price of the motor vehicle; |
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(B) each amount included in the retail |
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installment contract for an itemized charge; and |
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(C) subject to Subsection (c), a documentary fee |
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for services rendered for or on behalf of the retail buyer in |
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preparing, handling, and processing documents and complying with |
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federal and state statutes and regulations, including those |
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regarding security safeguards and reporting requirements, relating |
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to the motor vehicle and to the closing of the retail installment |
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transaction; and |
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(2) subtracting from the results under Subdivision (1) |
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the amount of the retail buyer's down payment in money, goods, or |
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both. |
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(c) For a documentary fee to be included in the principal |
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balance of a retail installment contract: |
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(1) the retail seller must charge the documentary fee |
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to cash buyers and credit buyers; |
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(2) except as provided by Subsection (e), the |
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documentary fee may not exceed $75 [$50] for a motor vehicle retail |
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installment contract or a reasonable amount agreed to by the retail |
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seller and retail buyer for a heavy commercial vehicle retail |
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installment contract; and |
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(3) the buyer's order and the retail installment |
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contract must include: |
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(A) a statement of the amount of the documentary |
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fee; and |
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(B) in reasonable proximity to the place in each |
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where the amount of the documentary fee is disclosed, the following |
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notice in type that is bold-faced, capitalized, underlined, or |
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otherwise conspicuously set out from surrounding written material: |
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"A DOCUMENTARY FEE IS NOT AN OFFICIAL FEE. A DOCUMENTARY FEE |
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IS NOT REQUIRED BY LAW, BUT MAY BE CHARGED TO BUYERS FOR HANDLING |
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DOCUMENTS AND PERFORMING SERVICES RELATING TO THE CLOSING OF A |
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SALE. THE MAXIMUM AMOUNT THAT MAY BE CHARGED FOR A DOCUMENTARY FEE |
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IS DETERMINED ACCORDING TO SECTION 348.006, FINANCE CODE. [A
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DOCUMENTARY FEE MAY NOT EXCEED $50 FOR A MOTOR VEHICLE CONTRACT OR A
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REASONABLE AMOUNT AGREED TO BY THE PARTIES FOR A HEAVY COMMERCIAL
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VEHICLE CONTRACT.] THIS NOTICE IS REQUIRED BY LAW." |
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(e) Effective January 1 of each year, the Office of Consumer |
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Credit Commissioner shall adjust the maximum documentary fee, |
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rounded to the nearest $5 increment, to reflect the cumulative |
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percentage change in the consumer price index for the preceding |
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calendar year as compiled by the United States Department of Labor, |
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Bureau of Labor Statistics. |
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SECTION 2. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2007. |