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A BILL TO BE ENTITLED
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AN ACT
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relating to payoff statements provided in connection with certain |
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home loans. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter B, Chapter 343, Finance Code, is |
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amended by adding Section 343.106 to read as follows: |
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Sec. 343.106. PAYOFF STATEMENTS. (a) In this section: |
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(1) "Mortgagee," "mortgage servicer," "mortgagor," |
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and "security instrument" have the meanings assigned by Section |
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51.0001, Property Code. |
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(2) "Material error" means an error in the payoff |
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amount contained in a payoff statement in which the correct payoff |
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amount minus the amount included in the payoff statement is greater |
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than one-half of one percent of the original amount of the home loan |
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and the amount of any other debts owed by the mortgagor to the |
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mortgagee that are secured by the real property securing the home |
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loan. |
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(b) Not later than the fifth business day after the date a |
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mortgage servicer receives a request for a payoff statement with |
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respect to a home loan from a mortgagor or a person acting on behalf |
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of the mortgagor, the mortgage servicer shall deliver to the |
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requestor the requested payoff statement as prescribed by this |
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section. |
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(c) A request for a payoff statement must be addressed to |
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the mortgagee at the address provided in the most recent applicable |
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security instrument recorded with the county clerk of the county in |
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which the real property subject to the security instrument is |
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located. |
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(d) The finance commission by rule shall adopt a standard |
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form that must be used by a mortgage servicer in providing a payoff |
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statement requested under this section. In adopting rules under |
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this subsection, the commission shall require that a completed |
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form: |
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(1) include: |
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(A) the legal description of the real property |
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securing the home loan as the description appears in the applicable |
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security instrument; |
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(B) the names of each mortgagor, trustee, and |
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mortgagee named in the applicable security instrument; and |
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(C) a statement of the original amount of the |
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home loan; |
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(2) state the amount of: |
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(A) the unpaid balance of the original home loan |
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and any other debts owed by the mortgagor to the mortgagee that are |
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secured by the real property securing the home loan, including |
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principal, interest, and other charges properly assessed under the |
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documentation for the home loan and other debts; |
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(B) the interest on a per diem basis for the |
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unpaid balance of the home loan from the date the payoff statement |
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is prepared until the closing date specified in Subdivision (3); |
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and |
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(C) if applicable, the unpaid balance and the |
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interest on a per diem basis for the unpaid balance of any other |
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debts owed by the mortgagor to the mortgagee with respect to the |
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real property that is security for the home loan for the period |
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prescribed by Paragraph (B); |
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(3) state the proposed closing date for the sale and |
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purchase of the real property securing the home loan or for any |
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other transaction that would involve the payoff of the home loan and |
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any other debts described by Subsection (d)(2)(A); |
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(4) be signed by an authorized officer or agent of the |
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mortgagee; and |
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(5) include any additional information the finance |
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commission determines necessary. |
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(e) Except as provided by Subsection (f) or (g), if the |
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mortgage servicer provides a completed payoff statement form that |
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meets the requirements of this section in response to a request for |
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a payoff statement made in accordance with this section, the |
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mortgage servicer or mortgagee may not demand that a mortgagor pay |
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an amount in excess of the payoff amount specified in the payoff |
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statement. |
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(f) If a mortgage servicer or mortgagee notices that a |
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material error has been made in a payoff statement, the mortgage |
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servicer or mortgagee may correct and deliver the statement on or |
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before the second business day before the specified closing date. |
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The corrected payoff statement must be delivered to the requestor |
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by: |
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(1) certified mail with return receipt requested; and |
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(2) electronic means, if the requestor provides the |
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mortgage servicer with a means to deliver the corrected statement |
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electronically. |
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(g) If a mortgage servicer makes an error in a payoff amount |
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contained in a payoff statement that results in the mortgage |
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servicer requesting an amount that is less than the correct payoff |
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amount and the transaction referenced in the payoff statement is |
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closed, the difference in the amount included in the payoff |
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statement and the correct payoff amount becomes an unsecured |
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liability of the former mortgagor owed to the mortgagee. |
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(h) If a mortgagor pays the unpaid balance and the interest |
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on a per diem amount calculated through the proposed closing date |
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specified in the payoff statement received under this section, |
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including any corrected statement provided in accordance with |
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Subsection (f): |
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(1) the home loan and other obligations are considered |
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paid in full; and |
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(2) the mortgagee shall execute and deliver to the |
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mortgagor, within a reasonable time after payment, a release of the |
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lien on the real property securing the home loan and any other |
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obligations, or a copy of an endorsement and assignment of the lien |
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to a lender that is refinancing the home loan. |
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(i) A mortgage servicer who violates Subsection (b) is |
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liable to the mortgagor for: |
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(1) any actual damages suffered by the mortgagor as a |
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result of the violation; |
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(2) reasonable attorney's fees; and |
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(3) court costs. |
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SECTION 2. (a) As soon as practicable after the effective |
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date of this Act, the Finance Commission of Texas shall adopt the |
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form required by Section 343.106, Finance Code, as added by this |
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Act. |
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(b) Notwithstanding Section 343.106, Finance Code, as added |
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by this Act, a mortgage servicer is not required to comply with that |
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section until the Finance Commission of Texas adopts the form |
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required by that section. |
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SECTION 3. This Act takes effect September 1, 2009. |