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A BILL TO BE ENTITLED
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AN ACT
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relating to certain charges included in a motor vehicle installment |
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agreement. |
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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 to read |
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as follows: |
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Sec. 348.006. PRINCIPAL BALANCE; INCLUSION OF DOCUMENTARY |
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FEE. (a) The principal balance under a retail installment contract |
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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 relating to the |
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motor vehicle sale [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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(b) The computation of the principal balance may include an |
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amount authorized under Section 348.404(b). |
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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) the documentary fee may not exceed [$50 for a motor
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vehicle retail installment contract or] a reasonable amount for the |
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documentary services agreed to by the retail seller and retail |
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buyer [for a heavy commercial vehicle retail installment contract]; |
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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. A DOCUMENTARY FEE MAY NOT EXCEED [$50 FOR A MOTOR VEHICLE
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CONTRACT OR] A REASONABLE AMOUNT AGREED TO BY THE PARTIES [FOR A
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HEAVY COMMERCIAL VEHICLE CONTRACT]. THIS NOTICE IS REQUIRED BY |
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LAW." |
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(d) A retail seller shall post the documentary fee notice |
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prescribed in Subsection (c) so that it is clearly visible in each |
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place where a vehicle sale is finalized. If the language primarily |
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used in an oral sales presentation is not the same as the language |
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in which the retail installment contract is written, the retail |
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seller shall furnish to the retail buyer a written statement |
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containing the notice set out in Subsection (c)(3)(B) in the |
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language primarily used in the oral sales presentation. |
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(e) The commissioner may review the amount of a documentary |
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fee for reasonableness. If the commissioner determines that a |
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documentary fee charged is not reasonable, then the commissioner |
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may require that the documentary fee charged be reduced or |
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suspended. |
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(f) The Finance Commission may adopt rules, including rules |
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relating to the standards for a reasonableness determination or |
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disclosures, to enforce this section. |
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SECTION 2. This Act takes effect September 1, 2009. |