85R26115 CLG-D
By: Ortega, Thompson of Harris, Kuempel, H.B. No. 3088
Giddings
Substitute the following for H.B. No. 3088:
By: Dean C.S.H.B. No. 3088
A BILL TO BE ENTITLED
AN ACT
relating to exemptions for certain residential property owners from
the applicability of certain regulations of residential mortgage
loan companies and residential mortgage loan originators.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 156.202, Finance Code, is amended by
amending Subsection (a-1) and adding Subsection (b) to read as
follows:
(a-1) The following entities are exempt from this chapter:
(1) a nonprofit organization:
(A) providing self-help housing that originates
zero interest residential mortgage loans for borrowers who have
provided part of the labor to construct the dwelling securing the
loan; or
(B) that has designation as a Section 501(c)(3)
organization by the Internal Revenue Service and originates
residential mortgage loans for borrowers who, through a self-help
program, have provided at least 200 labor hours or 65 percent of the
labor to construct the dwelling securing the loan;
(2) a mortgage banker registered under Chapter 157;
(3) subject to Subsection (b), any owner of
residential real estate who in any 12-consecutive-month period
makes no more than five residential mortgage loans to purchasers of
the property for all or part of the purchase price of the
residential real estate against which the mortgage is secured; and
(4) an entity that is:
(A) a depository institution;
(B) a subsidiary of a depository institution that
is:
(i) owned and controlled by the depository
institution; and
(ii) regulated by a federal banking agency;
or
(C) an institution regulated by the Farm Credit
Administration.
(b) In determining eligibility for an exemption under
Subsection (a-1)(3), two or more owners of residential real estate
are considered a single owner for the purpose of computing the
number of mortgage loans made within the period specified by that
subdivision if any of the owners are affiliates, as defined by
Section 1.002(1), Business Organizations Code, or if any of the
owners have substantially common ownership, as determined by the
commissioner. In this subsection, "owners of residential real
estate" include corporations, limited partnerships, limited
liability companies, professional associations, cooperatives, and
real estate investment trusts.
SECTION 2. Section 157.0121, Finance Code, is amended by
amending Subsection (c) and adding Subsection (f) to read as
follows:
(c) Employees of the following entities, when acting for the
benefit of those entities, are exempt from the licensing and other
requirements of this chapter applicable to residential mortgage
loan originators:
(1) a nonprofit organization:
(A) providing self-help housing that originates
zero interest residential mortgage loans for borrowers who have
provided part of the labor to construct the dwelling securing the
loan; or
(B) that has designation as a Section 501(c)(3)
organization by the Internal Revenue Service and originates
residential mortgage loans for borrowers who, through a self-help
program, have provided at least 200 labor hours or 65 percent of the
labor to construct the dwelling securing the loan;
(2) subject to Subsection (f), any owner of
residential real estate who in any 12-consecutive-month period
makes no more than five residential mortgage loans to purchasers of
the property for all or part of the purchase price of the
residential real estate against which the mortgage is secured; and
(3) an entity that is:
(A) a depository institution;
(B) a subsidiary of a depository institution that
is:
(i) owned and controlled by the depository
institution; and
(ii) regulated by a federal banking agency;
or
(C) an institution regulated by the Farm Credit
Administration.
(f) In determining eligibility for an exemption under
Subsection (c)(2), two or more owners of residential real estate
are considered a single owner for the purpose of computing the
number of mortgage loans made within the period specified by that
subdivision if any of the owners are affiliates, as defined by
Section 1.002(1), Business Organizations Code, or if any of the
owners have substantially common ownership, as determined by the
commissioner. In this subsection, "owners of residential real
estate" include corporations, limited partnerships, limited
liability companies, professional associations, cooperatives, and
real estate investment trusts.
SECTION 3. Section 180.003, Finance Code, is amended by
amending Subsection (a) and adding Subsection (d) to read as
follows:
(a) The following persons are exempt from this chapter:
(1) a registered mortgage loan originator when acting
for an entity described by Section 180.002(16)(A)(i), (ii), or
(iii);
(2) an individual who offers or negotiates terms of a
residential mortgage loan with or on behalf of an immediate family
member of the individual;
(3) a licensed attorney who negotiates the terms of a
residential mortgage loan on behalf of a client as an ancillary
matter to the attorney's representation of the client, unless the
attorney:
(A) takes a residential mortgage loan
application; and
(B) offers or negotiates the terms of a
residential mortgage loan;
(4) an individual who offers or negotiates terms of a
residential mortgage loan secured by a dwelling that serves as the
individual's residence;
(5) subject to Subsection (d), an owner of residential
real estate who in any 12-consecutive-month period makes no more
than five residential mortgage loans to purchasers of the property
for all or part of the purchase price of the residential real estate
against which the mortgage is secured; and
(6) subject to Subsection (d), an owner of a dwelling
who in any 12-consecutive-month period makes no more than five
residential mortgage loans to purchasers of the property for all or
part of the purchase price of the dwelling against which the
mortgage or security interest is secured.
(d) In determining eligibility for an exemption under
Subsection (a)(5) or (6), two or more owners of residential real
estate or a dwelling, as applicable, are considered a single owner
for the purpose of computing the number of mortgage loans made
within the period specified by those subdivisions if any of the
owners are affiliates, as defined by Section 1.002(1), Business
Organizations Code, or if any of the owners have substantially
common ownership, as determined by the savings and mortgage lending
commissioner.
SECTION 4. This Act takes effect September 1, 2017.