Texas House Bill HJR128

Texas 2015 - 84th Regular

Caption

Proposing a constitutional amendment relating to the limitation of fees that may be charged for a home equity loan.

Impact

The passage of HJR128 would significantly impact home equity loan transactions and the rights of homeowners in Texas. By capping fees, the bill intends to protect consumers from potentially exorbitant lending costs that can arise in the real estate market. This amendment could lead to an increase in home equity loan applications as homeowners may find loans more accessible and affordable under the new fee structure. Moreover, it could set a precedent for similar regulations in other areas of consumer lending, promoting greater transparency and fairness in loan agreements.

Summary

HJR128 is a joint resolution proposing an amendment to the Texas Constitution that addresses the limitation of fees that can be charged for home equity loans. The proposed amendment seeks to establish that the aggregate fees for such loans should not exceed three percent of the original principal amount. This change aims to facilitate access to home equity loans by reducing the financial burden on borrowers, allowing them to utilize their home equity more flexibly and affordably. The resolution reflects a broader trend of legislative efforts to reform lending practices and enhance consumer protections in the housing market.

Contention

Debates surrounding HJR128 point to notable issues regarding lender profits and consumer rights. Proponents argue that the limitation on fees is necessary to protect borrowers, especially low and moderate-income families who may be disproportionately affected by high fees. However, critics of the amendment warn that imposing such a cap could lead to reduced competition among lenders, potentially increasing costs or limiting access to credit. This contention raises pertinent questions about balancing the interests of consumers against those of financial institutions, making the resolution a focal point for ongoing discussions about housing finance reform in Texas.