Texas Senate Bill SB1791

Texas 2021 - 87th Regular

Caption

Relating to the investment and use of excess residential mortgage loan originator recovery fund fees; changing a fee.

Impact

If implemented, SB1791 will have a significant impact on the management of residential mortgage loan origination fees in Texas. Up to $20 will be charged as a recovery fund fee for both original and renewal license applications, with an excess balance beyond $3.5 million being redirected to the Texas Financial Education Endowment account. This redirection illustrates a proactive approach to consumer education and support in the mortgage domain, encouraging financial literacy among residents and potentially improving their financial stability through informed decision-making.

Summary

SB1791 aims to amend several provisions related to the Residential Mortgage Loan Originator Recovery Fund within Texas finance law. The bill facilitates the use and investment of excess fees collected from residential mortgage loan originator applications, aiming to enhance financial education initiatives and consumer protections. It sets out clear guidelines on how the funds in the recovery account can be used, ensuring that they support financial education and assistance related to mortgage loans, thereby benefiting consumers directly affected by mortgage-related issues.

Contention

The bill has sparked debates regarding the effectiveness and allocation of resources in financial education. Critics may argue that while the intention is noble, there are concerns about ensuring that the funds are used efficiently. Opponents could raise questions about the oversight and accountability of how the funds are managed, particularly in ensuring that educational programs genuinely reach and benefit those in need. Additionally, some legislators might express that the fee structure should include tighter regulations or alternative funding sources to mitigate any potential financial burden on applicants during the licensing process.