Texas Senate Bill SB354

Texas 2009 - 81st Regular

• Filed: 12/10/08

Caption

Relating to transactions involving residential mortgage foreclosures; providing a penalty.

Impact

This legislation introduces significant consumer protections to ensure that homeowners are informed of their rights during foreclosure proceedings. The law mandates stringent requirements for foreclosure consultants, including prohibitions against charging excessive fees or making false representations about the effectiveness of their services. Additionally, it establishes penalties for violations, which underscores the seriousness of protecting vulnerable homeowners from predatory practices prevalent in foreclosure situations.

Summary

SB354 addresses residential mortgage foreclosures in Texas by establishing regulations that protect homeowners from exploitative practices associated with foreclosure consulting services and equity purchase contracts. The bill aims to legislate standards for contracts related to foreclosure consulting, requiring them to be in writing, clearly define services, and include disclosures about the homeowner's rights. This is particularly important for homeowners facing the stress of foreclosure, aimed at preventing unintended loss of their property due to deceptive practices.

Contention

Despite the protective measures included in SB354, there may be opposition from those within the real estate and finance sectors who argue that increased regulations could restrict their ability to operate flexibly in a competitive market. Proponents emphasize that the bill is necessary to safeguard homeowners, particularly in economically challenging times when foreclosures may rise. The debate centers around balancing consumer protection with the rights of businesses in the mortgage sector.