BILL ANALYSIS |
C.S.H.B. 3367 |
By: Burrows |
Investments & Financial Services |
Committee Report (Substituted) |
BACKGROUND AND PURPOSE
Interested parties assert that the law governing the entities under the regulatory jurisdiction of the Department of Savings and Mortgage Lending and the savings and mortgage lending commissioner needs to be updated, clarified, and made uniform, and the parties further assert that there is a need for changes that will strengthen enforcement of the Residential Mortgage Loan Servicer Registration Act. C.S.H.B. 3367 seeks to implement such changes.
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CRIMINAL JUSTICE IMPACT
It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.
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RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.
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ANALYSIS
C.S.H.B. 3367 amends the Finance Code to replace references to "articles of incorporation" with references to "certificate of formation" and to update references to the "Texas Business Corporation Act" with references to the "Business Organizations Code" in specified provisions of the Texas Savings and Loan Act and the Texas Savings Bank Act. The bill removes the requirement for the directors of a federal savings and loan association or a state or national bank to execute two copies of the application to convert to a state savings and loan association, includes the entity's managing officer as an alternative executor and signer of such an application, and removes references to the capacity as a subscriber and as an incorporator in which such individuals sign and acknowledge the application and the proposed bylaws. The bill replaces a requirement for the directors or president and secretary of a newly converted savings bank to execute two copies of an application for a certificate of incorporation with a requirement for the directors or managing officer of an applicable financial institution to execute an application to convert to a savings bank and replaces a requirement for each director or president and secretary of a newly converted savings bank to sign and acknowledge an application for a certificate of incorporation in certain capacities with a requirement for each director or managing officer of an applicable financial institution to sign and acknowledge an application to convert to a savings bank and the proposed bylaws. The bill removes the authorization for the Finance Commission of Texas to adopt rules relating to the form, contents, and time of publication of statements of condition under the Texas Savings and Loan Act and under the Texas Savings Bank Act.
C.S.H.B. 3367, effective January 1, 2018, for purposes of the Residential Mortgage Loan Company Licensing and Registration Act, revises the required contents of the disclosure form provided to an applicant for a residential mortgage loan by a residential mortgage loan originator sponsored by and conducting business for a licensed or registered residential mortgage loan company to require such form to include the name, address, and toll-free telephone number for the Department of Savings and Mortgage Lending and contain information on how to file a complaint or recovery fund claim and to remove the requirement that the form specify the nature of the relationship between the applicant and the originator, the originator's duties to the applicant, and how the originator will be compensated. The bill requires the finance commission to adopt rules to implement such disclosure requirements not later than January 1, 2018, and establishes that such disclosure requirements apply only to an application for a residential mortgage loan that is submitted on or after January 1, 2018.
C.S.H.B. 3367 specifies that the residential mortgage loans for which the applicable borrowers must be provided certain notice regarding mortgage-servicing complaints by a mortgage banker under the Mortgage Banker Registration and Residential Mortgage Loan Originator License Act that indicates in its registration that it acts as a residential mortgage loan servicer and by a registered mortgage loan servicer under the Residential Mortgage Loan Servicer Registration Act are residential mortgage loans secured by a lien on residential real estate located in Texas.
C.S.H.B. 3367 authorizes the savings and mortgage lending commissioner to investigate a registered mortgage loan servicer for reasonable cause at any time to determine whether the servicer is complying with the Residential Mortgage Loan Servicer Registration Act and applicable rules but limits the commissioner's authority to conduct an undercover or covert investigation to an investigation the commissioner, after due consideration of the circumstances, determines is necessary to prevent immediate harm and to carry out the purposes of the act.
C.S.H.B. 3367 authorizes a cease and desist order issued by the savings and mortgage lending commissioner as a result of the commissioner's reasonable-cause belief that a person who is not registered or exempt under the Residential Mortgage Loan Servicer Registration Act has engaged, or is about to engage, in an act or practice for which registration is required under the act to assess an administrative penalty capped at $1,000 per day for each violation.
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EFFECTIVE DATE
Except as otherwise provided, September 1, 2017.
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COMPARISON OF ORIGINAL AND SUBSTITUTE
While C.S.H.B. 3367 may differ from the original in minor or nonsubstantive ways, the following comparison is organized and formatted in a manner that indicates the substantial differences between the introduced and committee substitute versions of the bill.
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