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A BILL TO BE ENTITLED
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AN ACT
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relating to deferred payments under motor vehicle retail |
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installment contracts. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 348.114, Finance Code, is amended by |
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amending Subsection (a) and adding Subsection (c) to read as |
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follows: |
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(a) If a retail installment contract that provides for a |
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time price differential that is computed using the add-on method or |
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the scheduled installment earnings method is amended to defer all |
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or a part of one or more installments for not longer than three |
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months, the holder may collect from the retail buyer: |
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(1) a deferment charge in an amount computed on the |
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amount deferred for the period of deferment at a rate that does not |
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exceed the effective return for time price differential permitted |
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for a monthly payment retail installment contract; and |
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(2) the amount of the additional cost to the holder |
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for: |
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(A) premiums for continuing in force any |
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insurance coverages provided for by the contract; and |
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(B) any additional necessary official fees. |
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(c) A holder of a retail installment contract that provides |
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for a time price differential that is computed using the true daily |
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earnings method may defer all or a part of one or more installments |
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and continue to accrue time price differential on the unpaid |
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balance of the contract at the rate agreed to in the contract. A |
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holder does not collect a deferment charge by the accrual of time |
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price differential on the unpaid balance of the contract. |
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SECTION 2. This Act takes effect September 1, 2017. |