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A BILL TO BE ENTITLED
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AN ACT
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Relating to capping interest rates in executory contracts. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Sec. 5.073(a), Property Code, is amended to read |
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as follows: |
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(a) A seller may not include as a term of the executory |
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contract a provision that: |
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(1) imposes an additional late-payment fee that |
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exceeds the lesser of: |
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(A) eight percent of the monthly payment under |
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the contract; or |
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(B) the actual administrative cost of processing |
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the late payment; |
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(2) prohibits the purchaser from pledging the |
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purchaser's interest in the property as security to obtain a loan to |
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place improvements, including utility improvements or fire |
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protection improvements, on the property; |
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(3) imposes a prepayment penalty or any similar fee if |
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the purchaser elects to pay the entire amount due under the contract |
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before the scheduled payment date under the contract; |
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(4) forfeits an option fee or other option payment |
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paid under the contract for a late payment; or
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(5) increases the purchase price, imposes a fee or |
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charge of any type, or otherwise penalizes a purchaser leasing |
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property with an option to buy the property for requesting repairs |
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or exercising any other right under Chapter 92; or |
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(6) imposes an interest rate that exceeds twelve |
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percent. |
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(b) A provision of the executory contract that purports to |
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waive a right or exempt a party from a liability or duty under this |
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subchapter is void. |
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SECTION 2. This Act takes effect September 1, 2013. |