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A BILL TO BE ENTITLED
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AN ACT
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relating to the provision of accounting statements by mortgage |
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servicers for certain loans secured by a lien on residential real |
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property. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Title 5, Finance Code, is amended by adding |
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Chapter 397 to read as follows: |
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CHAPTER 397. ACCOUNTING STATEMENTS FOR CERTAIN HOME LOANS REQUIRED |
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Sec. 397.001. DEFINITION. In this chapter, "mortgage |
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servicer" has the meaning assigned by Section 51.0001, Property |
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Code. |
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Sec. 397.002. APPLICABILITY OF CHAPTER. This chapter |
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applies only to a loan secured by a first or subordinate lien on |
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residential real property that is not: |
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(1) a federally related mortgage loan, as defined by |
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12 U.S.C. Section 2602; |
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(2) a loan that is made by a credit union regulated by |
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the Credit Union Department; |
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(3) a loan that is primarily for business, commercial, |
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or agricultural purposes, or for temporary financing, such as a |
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construction loan, as referred to under 12 U.S.C. Section 2602; or |
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(4) a loan that is directly financed and serviced by a |
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relative within the second degree of consanguinity or affinity of |
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the borrower. |
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Sec. 397.003. ANNUAL ACCOUNTING STATEMENT. (a) A mortgage |
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servicer shall provide to the borrower an annual statement in |
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January of each year for the term of the loan. The statement must be |
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provided by mail, postmarked on or before January 31, and sent to |
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the borrower at the borrower's last known address. |
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(b) The statement required by Subsection (a) must clearly |
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and conspicuously state the following information: |
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(1) the amount of each payment that was received by the |
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mortgage servicer as payment toward the loan during the preceding |
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calendar year; |
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(2) how each payment described by Subdivision (1) was |
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applied to the borrower's account, including information showing |
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the amount of each payment that was applied to: |
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(A) the borrower's principal obligation under |
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the loan; |
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(B) the interest charged on the loan; |
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(C) any escrow account associated with the loan; |
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and |
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(D) any fee or other charge assessed against the |
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borrower during the preceding calendar year; and |
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(3) the outstanding balance of the borrower's |
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principal obligation under the loan. |
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Sec. 397.004. RECOURSE OF BORROWER FOR MORTGAGE SERVICER'S |
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FAILURE TO TIMELY PROVIDE STATEMENT; LIABILITY OF MORTGAGE |
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SERVICER. (a) If a borrower does not receive an annual statement |
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within the time prescribed by Section 397.003(a), the borrower may |
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request the statement from the mortgage servicer by sending a |
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request to that effect to the mortgage servicer by certified mail, |
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return receipt requested. |
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(b) Except as provided by Subsection (c), if, after |
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receiving a request under Subsection (a), the mortgage servicer |
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fails to provide the statement to the borrower on or before the 25th |
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day after the date the mortgage servicer receives the request: |
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(1) the borrower is not liable for any payment, fees, |
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or other charges not made during the year to which the annual |
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statement relates and is considered to have paid all payments, |
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fees, or other charges owed under the loan relating to that year, on |
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time, and in accordance with the terms of the loan agreement; and |
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(2) if the mortgagee is not the mortgage servicer, the |
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mortgage servicer is liable for paying the mortgagee: |
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(A) any amount for which the borrower is no |
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longer liable under Subdivision (1); and |
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(B) any fee or other charge assessed against the |
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borrower by the mortgagee as a result of, or consequential damages |
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arising out of, the mortgage servicer's failure to comply with this |
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section. |
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(c) Subsection (b) does not apply if, before the borrower |
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requests an annual statement under this section, the mortgage |
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servicer sends a default notice to the borrower at the borrower's |
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last known address by certified mail, return receipt requested. |
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SECTION 2. This Act takes effect September 1, 2017. |