Texas House Bill HB2284

Texas 2021 - 87th Regular

Caption

Relating to the physical presence of a borrower at the closing of a home equity loan.

Impact

If enacted, HB 2284 modifies the current requirements under Texas Finance Code by allowing borrowers to close on home equity loans using remote methods, which could significantly increase access to financing for those facing mobility challenges. It also introduces an amendment to how durable powers of attorney can be utilized in such transactions, ensuring that agents can act on behalf of borrowers effectively. This change aims to modernize the lending process and make it more inclusive for borrowers whose circumstances previously restricted their ability to participate in loan closings.

Summary

House Bill 2284 addresses the closing process of home equity loans in Texas by allowing certain borrowers who are unable to be physically present to close their loans remotely. This legislation is particularly beneficial for active duty military personnel, their spouses, and civilians working with the armed forces, enabling them to close loans from outside the state or in situations where travel is not possible due to health conditions or incarceration. By introducing remote online notarization and the use of an agent with a durable power of attorney, the bill seeks to streamline the loan closing process and accommodate the needs of those unable to attend in person.

Contention

The legislation may face contention regarding the security and validity of remote online notarization processes. Concerns may be raised about the potential for fraud or misrepresentation in loans closed remotely, as traditional methods typically require in-person verification to ensure the identity and consent of the borrower. Additionally, stakeholders might debate the adequacy of protections in place for vulnerable borrowers, such as those with disabilities or elderly individuals who may not be familiar with modern technology used for remote transactions. As this bill advances, it will be essential to consider safeguards that balance convenience with the need for secure lending practices.