Relating to certain qualifications and requirements for residential mortgage loan companies, the investment and use of excess residential mortgage loan originator recovery fund fees, and the creation of the mortgage grant fund; changing a fee.
Impact
If enacted, HB 3617 would be significant in reinforcing the regulatory framework governing mortgage loan companies. It mandates that penalties collected under certain finance code sections be allocated toward consumer education programs. Additionally, the bill expands the conditions under which residential mortgage loan applicants can seek recovery for damages from this new mortgage grant fund, particularly in cases of fraud by individuals without the required licensing. This suggests an intention to protect consumers more effectively and to bolster the financial literacy of the public regarding mortgage loans.
Summary
House Bill 3617 aims to address specific qualifications and requirements for residential mortgage loan companies, focusing on enhancing consumer protection against fraudulent activities by unlicensed individuals acting as loan originators. The bill seeks to establish a mortgage grant fund funded by penalties collected by the commissioner and by excess amounts from the residential mortgage loan originator recovery fund. This fund will support financial education initiatives and reimburse damages incurred by consumers due to fraudulent activities.
Sentiment
The sentiment surrounding HB 3617 appears generally positive among consumer advocacy groups and legislators focused on financial regulation. Supporters argue that the bill strengthens protections for consumers against fraudulent practices in the mortgage industry. However, there may be dissent from groups or individuals concerned about the potential burden on small residential mortgage companies, indicating ongoing discussions about finding a balance between regulatory oversight and economic viability within the mortgage sector.
Contention
A potential point of contention surrounding the bill is the impact of increased regulations on small and medium-sized mortgage companies which might struggle with compliance costs. Additionally, there may be debates regarding the extent of the commissioner's authority in managing the mortgage grant fund and the effectiveness of the educational programs funded by it. Questions about how effectively the funds will be allocated for consumer protection versus administrative costs could also arise as the bill is assessed in practice.
Relating to small business recovery funds and insurance tax credits for certain investments in those funds; imposing a monetary penalty; authorizing fees.
Relating to the regulation of money services businesses; creating a criminal offense; creating administrative penalties; authorizing the imposition of a fee.
Relating to licensing and regulation of certain persons involved in residential mortgage lending pursuant to the Texas Secure and Fair Enforcement for Mortgage Licensing Act of 2009; providing penalties.
Relating to licensing and regulation of certain persons involved in residential mortgage lending pursuant to the Texas Secure and Fair Enforcement for Mortgage Licensing Act of 2009; providing penalties.
An act relating to civil commitment procedures at a secure residential recovery facility and a psychiatric residential treatment facility for youth and civil commitment procedures for individuals with an intellectual disability
Relating to the investment and use of excess residential mortgage loan originator recovery fund fees and to the creation of the mortgage grant fund; changing a fee.