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A BILL TO BE ENTITLED
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AN ACT
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relating to exemptions for certain residential property owners from |
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the applicability of certain regulations of residential mortgage |
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loan companies and residential mortgage loan originators. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 156.202, Finance Code, is amended by |
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amending Subsection (a-1) and adding Subsection (b) to read as |
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follows: |
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(a-1) The following entities are exempt from this chapter: |
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(1) a nonprofit organization: |
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(A) providing self-help housing that originates |
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zero interest residential mortgage loans for borrowers who have |
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provided part of the labor to construct the dwelling securing the |
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loan; or |
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(B) that has designation as a Section 501(c)(3) |
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organization by the Internal Revenue Service and originates |
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residential mortgage loans for borrowers who, through a self-help |
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program, have provided at least 200 labor hours or 65 percent of the |
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labor to construct the dwelling securing the loan; |
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(2) a mortgage banker registered under Chapter 157; |
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(3) subject to Subsection (b), any owner of |
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residential real estate who in any 12-consecutive-month period |
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makes no more than five residential mortgage loans to purchasers of |
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the property for all or part of the purchase price of the |
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residential real estate against which the mortgage is secured; and |
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(4) an entity that is: |
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(A) a depository institution; |
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(B) a subsidiary of a depository institution that |
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is: |
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(i) owned and controlled by the depository |
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institution; and |
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(ii) regulated by a federal banking agency; |
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or |
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(C) an institution regulated by the Farm Credit |
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Administration. |
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(b) In determining eligibility for an exemption under |
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Subsection (a-1)(3), two or more owners of residential real estate |
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are considered a single owner for the purpose of computing the |
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number of mortgage loans made within the period specified by that |
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subdivision if any of the owners are affiliates, as defined by |
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Section 1.002(1), Business Organizations Code, or if any of the |
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owners have substantially common ownership, as determined by the |
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commissioner. In this subsection, "owners of residential real |
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estate" include corporations, limited partnerships, limited |
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liability companies, professional associations, cooperatives, and |
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real estate investment trusts. |
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SECTION 2. Section 157.0121, Finance Code, is amended by |
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amending Subsection (c) and adding Subsection (f) to read as |
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follows: |
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(c) Employees of the following entities, when acting for the |
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benefit of those entities, are exempt from the licensing and other |
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requirements of this chapter applicable to residential mortgage |
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loan originators: |
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(1) a nonprofit organization: |
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(A) providing self-help housing that originates |
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zero interest residential mortgage loans for borrowers who have |
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|
provided part of the labor to construct the dwelling securing the |
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loan; or |
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(B) that has designation as a Section 501(c)(3) |
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organization by the Internal Revenue Service and originates |
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residential mortgage loans for borrowers who, through a self-help |
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program, have provided at least 200 labor hours or 65 percent of the |
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labor to construct the dwelling securing the loan; |
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(2) subject to Subsection (f), any owner of |
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residential real estate who in any 12-consecutive-month period |
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makes no more than five residential mortgage loans to purchasers of |
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the property for all or part of the purchase price of the |
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residential real estate against which the mortgage is secured; and |
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(3) an entity that is: |
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(A) a depository institution; |
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(B) a subsidiary of a depository institution that |
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is: |
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(i) owned and controlled by the depository |
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institution; and |
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(ii) regulated by a federal banking agency; |
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or |
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(C) an institution regulated by the Farm Credit |
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Administration. |
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(f) In determining eligibility for an exemption under |
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Subsection (c)(2), two or more owners of residential real estate |
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are considered a single owner for the purpose of computing the |
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number of mortgage loans made within the period specified by that |
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subdivision if any of the owners are affiliates, as defined by |
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Section 1.002(1), Business Organizations Code, or if any of the |
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owners have substantially common ownership, as determined by the |
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commissioner. In this subsection, "owners of residential real |
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estate" include corporations, limited partnerships, limited |
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liability companies, professional associations, cooperatives, and |
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real estate investment trusts. |
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SECTION 3. Section 180.003, Finance Code, is amended by |
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amending Subsection (a) and adding Subsection (d) to read as |
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follows: |
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(a) The following persons are exempt from this chapter: |
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(1) a registered mortgage loan originator when acting |
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for an entity described by Section 180.002(16)(A)(i), (ii), or |
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(iii); |
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(2) an individual who offers or negotiates terms of a |
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residential mortgage loan with or on behalf of an immediate family |
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member of the individual; |
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(3) a licensed attorney who negotiates the terms of a |
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residential mortgage loan on behalf of a client as an ancillary |
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matter to the attorney's representation of the client, unless the |
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attorney: |
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(A) takes a residential mortgage loan |
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application; and |
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(B) offers or negotiates the terms of a |
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residential mortgage loan; |
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(4) an individual who offers or negotiates terms of a |
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residential mortgage loan secured by a dwelling that serves as the |
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individual's residence; |
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(5) subject to Subsection (d), an owner of residential |
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real estate who in any 12-consecutive-month period makes no more |
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than five residential mortgage loans to purchasers of the property |
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for all or part of the purchase price of the residential real estate |
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against which the mortgage is secured; and |
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(6) subject to Subsection (d), an owner of a dwelling |
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who in any 12-consecutive-month period makes no more than five |
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residential mortgage loans to purchasers of the property for all or |
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part of the purchase price of the dwelling against which the |
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mortgage or security interest is secured. |
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(d) In determining eligibility for an exemption under |
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Subsection (a)(5) or (6), two or more owners of residential real |
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estate or a dwelling, as applicable, are considered a single owner |
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for the purpose of computing the number of mortgage loans made |
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within the period specified by those subdivisions if any of the |
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owners are affiliates, as defined by Section 1.002(1), Business |
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Organizations Code, or if any of the owners have substantially |
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common ownership, as determined by the savings and mortgage lending |
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commissioner. |
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SECTION 4. This Act takes effect September 1, 2017. |