Texas 2017 - 85th Regular

Texas Senate Bill SJR60 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	S.J.R. No. 60
	1	+	By: Hancock S.J.R. No. 60
	2	+	(Parker, Raymond, Lambert, Longoria, Guerra)
2	3
3	4
4	5		proposing a constitutional amendment establishing a lower amount
5	6		for expenses that can be charged to a borrower and removing certain
6	7		financing expense limitations for a home equity loan, establishing
7	8		certain authorized lenders to make a home equity loan, changing
8	9		certain options for the refinancing of home equity loans, changing
9	10		the threshold for an advance of a home equity line of credit, and
10	11		allowing home equity loans on agricultural homesteads.
11	12		BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	13		SECTION 1. Section 50, Article XVI, Texas Constitution, is
13	14		amended by amending Subsections (a), (f), (g), and (t) and adding
14	15		Subsection (f-1) to read as follows:
15	16		(a) The homestead of a family, or of a single adult person,
16	17		shall be, and is hereby protected from forced sale, for the payment
17	18		of all debts except for:
18	19		(1) the purchase money thereof, or a part of such
19	20		purchase money;
20	21		(2) the taxes due thereon;
21	22		(3) an owelty of partition imposed against the
22	23		entirety of the property by a court order or by a written agreement
23	24		of the parties to the partition, including a debt of one spouse in
24	25		favor of the other spouse resulting from a division or an award of a
25	26		family homestead in a divorce proceeding;
26	27		(4) the refinance of a lien against a homestead,
27	28		including a federal tax lien resulting from the tax debt of both
28	29		spouses, if the homestead is a family homestead, or from the tax
29	30		debt of the owner;
30	31		(5) work and material used in constructing new
31	32		improvements thereon, if contracted for in writing, or work and
32	33		material used to repair or renovate existing improvements thereon
33	34		if:
34	35		(A) the work and material are contracted for in
35	36		writing, with the consent of both spouses, in the case of a family
36	37		homestead, given in the same manner as is required in making a sale
37	38		and conveyance of the homestead;
38	39		(B) the contract for the work and material is not
39	40		executed by the owner or the owner's spouse before the fifth day
40	41		after the owner makes written application for any extension of
41	42		credit for the work and material, unless the work and material are
42	43		necessary to complete immediate repairs to conditions on the
43	44		homestead property that materially affect the health or safety of
44	45		the owner or person residing in the homestead and the owner of the
45	46		homestead acknowledges such in writing;
46	47		(C) the contract for the work and material
47	48		expressly provides that the owner may rescind the contract without
48	49		penalty or charge within three days after the execution of the
49	50		contract by all parties, unless the work and material are necessary
50	51		to complete immediate repairs to conditions on the homestead
51	52		property that materially affect the health or safety of the owner or
52	53		person residing in the homestead and the owner of the homestead
53	54		acknowledges such in writing; and
54	55		(D) the contract for the work and material is
55	56		executed by the owner and the owner's spouse only at the office of a
56	57		third-party lender making an extension of credit for the work and
57	58		material, an attorney at law, or a title company;
58	59		(6) an extension of credit that:
59	60		(A) is secured by a voluntary lien on the
60	61		homestead created under a written agreement with the consent of
61	62		each owner and each owner's spouse;
62	63		(B) is of a principal amount that when added to
63	64		the aggregate total of the outstanding principal balances of all
64	65		other indebtedness secured by valid encumbrances of record against
65	66		the homestead does not exceed 80 percent of the fair market value of
66	67		the homestead on the date the extension of credit is made;
67	68		(C) is without recourse for personal liability
68	69		against each owner and the spouse of each owner, unless the owner or
69	70		spouse obtained the extension of credit by actual fraud;
70	71		(D) is secured by a lien that may be foreclosed
71	72		upon only by a court order;
72	73		(E) does not require the owner or the owner's
73	74		spouse to pay, in addition to any interest or any bona fide discount
74	75		points used to buy down the interest rate, any fees to any person
75	76		that are necessary to originate, evaluate, maintain, record,
76	77		insure, or service the extension of credit that exceed, in the
77	78		aggregate, two [three] percent of the original principal amount of
78	79		the extension of credit, excluding fees for:
79	80		(i) an appraisal performed by a third party
80	81		appraiser;
81	82		(ii) a property survey performed by a state
82	83		registered or licensed surveyor;
83	84		(iii) a state base premium for a mortgagee
84	85		policy of title insurance with endorsements established in
85	86		accordance with state law; or
86	87		(iv) a title examination report if its cost
87	88		is less than the state base premium for a mortgagee policy of title
88	89		insurance without endorsements established in accordance with
89	90		state law;
90	91		(F) is not a form of open-end account that may be
91	92		debited from time to time or under which credit may be extended from
92	93		time to time unless the open-end account is a home equity line of
93	94		credit;
94	95		(G) is payable in advance without penalty or
95	96		other charge;
96	97		(H) is not secured by any additional real or
97	98		personal property other than the homestead;
98	99		(I) (repealed) [is not secured by homestead
99	100		property that on the date of closing is designated for agricultural
100	101		use as provided by statutes governing property tax, unless such
101	102		homestead property is used primarily for the production of milk];
102	103		(J) may not be accelerated because of a decrease
103	104		in the market value of the homestead or because of the owner's
104	105		default under other indebtedness not secured by a prior valid
105	106		encumbrance against the homestead;
106	107		(K) is the only debt secured by the homestead at
107	108		the time the extension of credit is made unless the other debt was
108	109		made for a purpose described by Subsections (a)(1)-(a)(5) or
109	110		Subsection (a)(8) of this section;
110	111		(L) is scheduled to be repaid:
111	112		(i) in substantially equal successive
112	113		periodic installments, not more often than every 14 days and not
113	114		less often than monthly, beginning no later than two months from the
114	115		date the extension of credit is made, each of which equals or
115	116		exceeds the amount of accrued interest as of the date of the
116	117		scheduled installment; or
117	118		(ii) if the extension of credit is a home
118	119		equity line of credit, in periodic payments described under
119	120		Subsection (t)(8) of this section;
120	121		(M) is closed not before:
121	122		(i) the 12th day after the later of the date
122	123		that the owner of the homestead submits a loan application to the
123	124		lender for the extension of credit or the date that the lender
124	125		provides the owner a copy of the notice prescribed by Subsection (g)
125	126		of this section;
126	127		(ii) one business day after the date that
127	128		the owner of the homestead receives a copy of the loan application
128	129		if not previously provided and a final itemized disclosure of the
129	130		actual fees, points, interest, costs, and charges that will be
130	131		charged at closing. If a bona fide emergency or another good cause
131	132		exists and the lender obtains the written consent of the owner, the
132	133		lender may provide the documentation to the owner or the lender may
133	134		modify previously provided documentation on the date of closing;
134	135		and
135	136		(iii) the first anniversary of the closing
136	137		date of any other extension of credit described by Subsection
137	138		(a)(6) of this section secured by the same homestead property,
138	139		except a refinance described by Paragraph (Q)(x)(f) of this
139	140		subdivision, unless the owner on oath requests an earlier closing
140	141		due to a state of emergency that:
141	142		(a) has been declared by the president
142	143		of the United States or the governor as provided by law; and
143	144		(b) applies to the area where the
144	145		homestead is located;
145	146		(N) is closed only at the office of the lender, an
146	147		attorney at law, or a title company;
147	148		(O) permits a lender to contract for and receive
148	149		any fixed or variable rate of interest authorized under statute;
149	150		(P) is made by one of the following that has not
150	151		been found by a federal regulatory agency to have engaged in the
151	152		practice of refusing to make loans because the applicants for the
152	153		loans reside or the property proposed to secure the loans is located
153	154		in a certain area:
154	155		(i) a bank, savings and loan association,
155	156		savings bank, or credit union doing business under the laws of this
156	157		state or the United States, including a subsidiary of a bank,
157	158		savings and loan association, savings bank, or credit union
158	159		described by this subparagraph;
159	160		(ii) a federally chartered lending
160	161		instrumentality or a person approved as a mortgagee by the United
161	162		States government to make federally insured loans;
162	163		(iii) a person licensed to make regulated
163	164		loans, as provided by statute of this state;
164	165		(iv) a person who sold the homestead
165	166		property to the current owner and who provided all or part of the
166	167		financing for the purchase;
167	168		(v) a person who is related to the homestead
168	169		property owner within the second degree of affinity or
169	170		consanguinity; or
170	171		(vi) a person regulated by this state as a
171	172		mortgage banker or mortgage company [broker]; and
172	173		(Q) is made on the condition that:
173	174		(i) the owner of the homestead is not
174	175		required to apply the proceeds of the extension of credit to repay
175	176		another debt except debt secured by the homestead or debt to another
176	177		lender;
177	178		(ii) the owner of the homestead not assign
178	179		wages as security for the extension of credit;
179	180		(iii) the owner of the homestead not sign
180	181		any instrument in which blanks relating to substantive terms of
181	182		agreement are left to be filled in;
182	183		(iv) the owner of the homestead not sign a
183	184		confession of judgment or power of attorney to the lender or to a
184	185		third person to confess judgment or to appear for the owner in a
185	186		judicial proceeding;
186	187		(v) at the time the extension of credit is
187	188		made, the owner of the homestead shall receive a copy of the final
188	189		loan application and all executed documents signed by the owner at
189	190		closing related to the extension of credit;
190	191		(vi) the security instruments securing the
191	192		extension of credit contain a disclosure that the extension of
192	193		credit is the type of credit defined by Subsection (a)(6) of this
193	194		section [Section 50(a)(6), Article XVI, Texas Constitution];
194	195		(vii) within a reasonable time after
195	196		termination and full payment of the extension of credit, the lender
196	197		cancel and return the promissory note to the owner of the homestead
197	198		and give the owner, in recordable form, a release of the lien
198	199		securing the extension of credit or a copy of an endorsement and
199	200		assignment of the lien to a lender that is refinancing the extension
200	201		of credit;
201	202		(viii) the owner of the homestead and any
202	203		spouse of the owner may, within three days after the extension of
203	204		credit is made, rescind the extension of credit without penalty or
204	205		charge;
205	206		(ix) the owner of the homestead and the
206	207		lender sign a written acknowledgment as to the fair market value of
207	208		the homestead property on the date the extension of credit is made;
208	209		(x) except as provided by Subparagraph (xi)
209	210		of this paragraph, the lender or any holder of the note for the
210	211		extension of credit shall forfeit all principal and interest of the
211	212		extension of credit if the lender or holder fails to comply with the
212	213		lender's or holder's obligations under the extension of credit and
213	214		fails to correct the failure to comply not later than the 60th day
214	215		after the date the lender or holder is notified by the borrower of
215	216		the lender's failure to comply by:
216	217		(a) paying to the owner an amount
217	218		equal to any overcharge paid by the owner under or related to the
218	219		extension of credit if the owner has paid an amount that exceeds an
219	220		amount stated in the applicable Paragraph (E), (G), or (O) of this
220	221		subdivision;
221	222		(b) sending the owner a written
222	223		acknowledgement that the lien is valid only in the amount that the
223	224		extension of credit does not exceed the percentage described by
224	225		Paragraph (B) of this subdivision, if applicable, or is not secured
225	226		by property described under Paragraph (H) [or (I)] of this
226	227		subdivision, if applicable;
227	228		(c) sending the owner a written notice
228	229		modifying any other amount, percentage, term, or other provision
229	230		prohibited by this section to a permitted amount, percentage, term,
230	231		or other provision and adjusting the account of the borrower to
231	232		ensure that the borrower is not required to pay more than an amount
232	233		permitted by this section and is not subject to any other term or
233	234		provision prohibited by this section;
234	235		(d) delivering the required documents
235	236		to the borrower if the lender fails to comply with Subparagraph (v)
236	237		of this paragraph or obtaining the appropriate signatures if the
237	238		lender fails to comply with Subparagraph (ix) of this paragraph;
238	239		(e) sending the owner a written
239	240		acknowledgement, if the failure to comply is prohibited by
240	241		Paragraph (K) of this subdivision, that the accrual of interest and
241	242		all of the owner's obligations under the extension of credit are
242	243		abated while any prior lien prohibited under Paragraph (K) remains
243	244		secured by the homestead; or
244	245		(f) if the failure to comply cannot be
245	246		cured under Subparagraphs (x)(a)-(e) of this paragraph, curing the
246	247		failure to comply by a refund or credit to the owner of $1,000 and
247	248		offering the owner the right to refinance the extension of credit
248	249		with the lender or holder for the remaining term of the loan at no
249	250		cost to the owner on the same terms, including interest, as the
250	251		original extension of credit with any modifications necessary to
251	252		comply with this section or on terms on which the owner and the
252	253		lender or holder otherwise agree that comply with this section; and
253	254		(xi) the lender or any holder of the note
254	255		for the extension of credit shall forfeit all principal and
255	256		interest of the extension of credit if the extension of credit is
256	257		made by a person other than a person described under Paragraph (P)
257	258		of this subdivision or if the lien was not created under a written
258	259		agreement with the consent of each owner and each owner's spouse,
259	260		unless each owner and each owner's spouse who did not initially
260	261		consent subsequently consents;
261	262		(7) a reverse mortgage; or
262	263		(8) the conversion and refinance of a personal
263	264		property lien secured by a manufactured home to a lien on real
264	265		property, including the refinance of the purchase price of the
265	266		manufactured home, the cost of installing the manufactured home on
266	267		the real property, and the refinance of the purchase price of the
267	268		real property.
268	269		(f) A refinance of debt secured by the homestead, any
269	270		portion of which is an extension of credit described by Subsection
270	271		(a)(6) of this section, may not be secured by a valid lien against
271	272		the homestead unless either:
272	273		(1) the refinance of the debt is an extension of credit
273	274		described by Subsection (a)(6) or (a)(7) of this section; or
274	275		(2) all of the following conditions are met:
275	276		(A) the refinance is not closed before the first
276	277		anniversary of the date the extension of credit was closed;
277	278		(B) the refinanced extension of credit does not
278	279		include the advance of any additional funds other than:
279	280		(i) funds advanced to refinance a debt
280	281		described by Subsections (a)(1) through (a)(7) of this section; or
281	282		(ii) actual costs and reserves required by
282	283		the lender to refinance the debt;
283	284		(C) the refinance of the extension of credit is
284	285		of a principal amount that when added to the aggregate total of the
285	286		outstanding principal balances of all other indebtedness secured by
286	287		valid encumbrances of record against the homestead does not exceed
287	288		80 percent of the fair market value of the homestead on the date the
288	289		refinance of the extension of credit is made; and
289	290		(D) the lender provides the owner the following
290	291		written notice on a separate document not later than the third
291	292		business day after the date the owner submits the loan application
292	293		to the lender and at least 12 days before the date the refinance of
293	294		the extension of credit is closed:
294	295		"YOUR EXISTING LOAN THAT YOU DESIRE TO REFINANCE IS A HOME
295	296		EQUITY LOAN. YOU MAY HAVE THE OPTION TO REFINANCE YOUR HOME EQUITY
296	297		LOAN AS EITHER A HOME EQUITY LOAN OR AS A NON-HOME EQUITY LOAN, IF
297	298		OFFERED BY YOUR LENDER.
298	299		"HOME EQUITY LOANS HAVE IMPORTANT CONSUMER PROTECTIONS. A
299	300		LENDER MAY ONLY FORECLOSE A HOME EQUITY LOAN BASED ON A COURT ORDER.
300	301		A HOME EQUITY LOAN MUST BE WITHOUT RECOURSE FOR PERSONAL LIABILITY
301	302		AGAINST YOU AND YOUR SPOUSE.
302	303		"IF YOU HAVE APPLIED TO REFINANCE YOUR EXISTING HOME EQUITY
303	304		LOAN AS A NON-HOME EQUITY LOAN, YOU WILL LOSE CERTAIN CONSUMER
304	305		PROTECTIONS. A NON-HOME EQUITY REFINANCED LOAN:
305	306		"(1) WILL PERMIT THE LENDER TO FORECLOSE WITHOUT A
306	307		COURT ORDER;
307	308		"(2) WILL BE WITH RECOURSE FOR PERSONAL LIABILITY
308	309		AGAINST YOU AND YOUR SPOUSE; AND
309	310		"(3) MAY ALSO CONTAIN OTHER TERMS OR CONDITIONS THAT
310	311		MAY NOT BE PERMITTED IN A TRADITIONAL HOME EQUITY LOAN.
311	312		"BEFORE YOU REFINANCE YOUR EXISTING HOME EQUITY LOAN TO MAKE
312	313		IT A NON-HOME EQUITY LOAN, YOU SHOULD MAKE SURE YOU UNDERSTAND THAT
313	314		YOU ARE WAIVING IMPORTANT PROTECTIONS THAT HOME EQUITY LOANS
314	315		PROVIDE UNDER THE LAW AND SHOULD CONSIDER CONSULTING WITH AN
315	316		ATTORNEY OF YOUR CHOOSING REGARDING THESE PROTECTIONS.
316	317		"YOU MAY WISH TO ASK YOUR LENDER TO REFINANCE YOUR LOAN AS A
317	318		HOME EQUITY LOAN. HOWEVER, A HOME EQUITY LOAN MAY HAVE A HIGHER
318	319		INTEREST RATE AND CLOSING COSTS THAN A NON-HOME EQUITY LOAN."
319	320		(f-1) A lien securing a refinance of debt under Subsection
320	321		(f)(2) of this section is deemed to be a lien described by
321	322		Subsection (a)(4) of this section. An affidavit executed by the
322	323		owner or the owner's spouse acknowledging that the requirements of
323	324		Subsection (f)(2) of this section have been met conclusively
324	325		establishes that the requirements of Subsection (a)(4) of this
325	326		section have been met.
326	327		(g) An extension of credit described by Subsection (a)(6) of
327	328		this section may be secured by a valid lien against homestead
328	329		property if the extension of credit is not closed before the 12th
329	330		day after the lender provides the owner with the following written
330	331		notice on a separate instrument:
331	332		"NOTICE CONCERNING EXTENSIONS OF CREDIT DEFINED BY SECTION
332	333		50(a)(6), ARTICLE XVI, TEXAS CONSTITUTION:
333	334		"SECTION 50(a)(6), ARTICLE XVI, OF THE TEXAS CONSTITUTION
334	335		ALLOWS CERTAIN LOANS TO BE SECURED AGAINST THE EQUITY IN YOUR HOME.
335	336		SUCH LOANS ARE COMMONLY KNOWN AS EQUITY LOANS. IF YOU DO NOT REPAY
336	337		THE LOAN OR IF YOU FAIL TO MEET THE TERMS OF THE LOAN, THE LENDER MAY
337	338		FORECLOSE AND SELL YOUR HOME. THE CONSTITUTION PROVIDES THAT:
338	339		"(A) THE LOAN MUST BE VOLUNTARILY CREATED WITH THE CONSENT OF
339	340		EACH OWNER OF YOUR HOME AND EACH OWNER'S SPOUSE;
340	341		"(B) THE PRINCIPAL LOAN AMOUNT AT THE TIME THE LOAN IS MADE
341	342		MUST NOT EXCEED AN AMOUNT THAT, WHEN ADDED TO THE PRINCIPAL BALANCES
342	343		OF ALL OTHER LIENS AGAINST YOUR HOME, IS MORE THAN 80 PERCENT OF THE
343	344		FAIR MARKET VALUE OF YOUR HOME;
344	345		"(C) THE LOAN MUST BE WITHOUT RECOURSE FOR PERSONAL LIABILITY
345	346		AGAINST YOU AND YOUR SPOUSE UNLESS YOU OR YOUR SPOUSE OBTAINED THIS
346	347		EXTENSION OF CREDIT BY ACTUAL FRAUD;
347	348		"(D) THE LIEN SECURING THE LOAN MAY BE FORECLOSED UPON ONLY
348	349		WITH A COURT ORDER;
349	350		"(E) FEES AND CHARGES TO MAKE THE LOAN MAY NOT EXCEED 2 [3]
350	351		PERCENT OF THE LOAN AMOUNT, EXCEPT FOR A FEE OR CHARGE FOR AN
351	352		APPRAISAL PERFORMED BY A THIRD PARTY APPRAISER, A PROPERTY SURVEY
352	353		PERFORMED BY A STATE REGISTERED OR LICENSED SURVEYOR, A STATE BASE
353	354		PREMIUM FOR A MORTGAGEE POLICY OF TITLE INSURANCE WITH
354	355		ENDORSEMENTS, OR A TITLE EXAMINATION REPORT;
355	356		"(F) THE LOAN MAY NOT BE AN OPEN-END ACCOUNT THAT MAY BE
356	357		DEBITED FROM TIME TO TIME OR UNDER WHICH CREDIT MAY BE EXTENDED FROM
357	358		TIME TO TIME UNLESS IT IS A HOME EQUITY LINE OF CREDIT;
358	359		"(G) YOU MAY PREPAY THE LOAN WITHOUT PENALTY OR CHARGE;
359	360		"(H) NO ADDITIONAL COLLATERAL MAY BE SECURITY FOR THE LOAN;
360	361		"(I) (repealed) [THE LOAN MAY NOT BE SECURED BY HOMESTEAD
361	362		PROPERTY THAT IS DESIGNATED FOR AGRICULTURAL USE AS OF THE DATE OF
362	363		CLOSING, UNLESS THE AGRICULTURAL HOMESTEAD PROPERTY IS USED
363	364		PRIMARILY FOR THE PRODUCTION OF MILK];
364	365		"(J) YOU ARE NOT REQUIRED TO REPAY THE LOAN EARLIER THAN
365	366		AGREED SOLELY BECAUSE THE FAIR MARKET VALUE OF YOUR HOME DECREASES
366	367		OR BECAUSE YOU DEFAULT ON ANOTHER LOAN THAT IS NOT SECURED BY YOUR
367	368		HOME;
368	369		"(K) ONLY ONE LOAN DESCRIBED BY SECTION 50(a)(6), ARTICLE
369	370		XVI, OF THE TEXAS CONSTITUTION MAY BE SECURED WITH YOUR HOME AT ANY
370	371		GIVEN TIME;
371	372		"(L) THE LOAN MUST BE SCHEDULED TO BE REPAID IN PAYMENTS THAT
372	373		EQUAL OR EXCEED THE AMOUNT OF ACCRUED INTEREST FOR EACH PAYMENT
373	374		PERIOD;
374	375		"(M) THE LOAN MAY NOT CLOSE BEFORE 12 DAYS AFTER YOU SUBMIT A
375	376		LOAN APPLICATION TO THE LENDER OR BEFORE 12 DAYS AFTER YOU RECEIVE
376	377		THIS NOTICE, WHICHEVER DATE IS LATER; AND MAY NOT WITHOUT YOUR
377	378		CONSENT CLOSE BEFORE ONE BUSINESS DAY AFTER THE DATE ON WHICH YOU
378	379		RECEIVE A COPY OF YOUR LOAN APPLICATION IF NOT PREVIOUSLY PROVIDED
379	380		AND A FINAL ITEMIZED DISCLOSURE OF THE ACTUAL FEES, POINTS,
380	381		INTEREST, COSTS, AND CHARGES THAT WILL BE CHARGED AT CLOSING; AND IF
381	382		YOUR HOME WAS SECURITY FOR THE SAME TYPE OF LOAN WITHIN THE PAST
382	383		YEAR, A NEW LOAN SECURED BY THE SAME PROPERTY MAY NOT CLOSE BEFORE
383	384		ONE YEAR HAS PASSED FROM THE CLOSING DATE OF THE OTHER LOAN, UNLESS
384	385		ON OATH YOU REQUEST AN EARLIER CLOSING DUE TO A DECLARED STATE OF
385	386		EMERGENCY;
386	387		"(N) THE LOAN MAY CLOSE ONLY AT THE OFFICE OF THE LENDER,
387	388		TITLE COMPANY, OR AN ATTORNEY AT LAW;
388	389		"(O) THE LENDER MAY CHARGE ANY FIXED OR VARIABLE RATE OF
389	390		INTEREST AUTHORIZED BY STATUTE;
390	391		"(P) ONLY A LAWFULLY AUTHORIZED LENDER MAY MAKE LOANS
391	392		DESCRIBED BY SECTION 50(a)(6), ARTICLE XVI, OF THE TEXAS
392	393		CONSTITUTION;
393	394		"(Q) LOANS DESCRIBED BY SECTION 50(a)(6), ARTICLE XVI, OF THE
394	395		TEXAS CONSTITUTION MUST:
395	396		"(1) NOT REQUIRE YOU TO APPLY THE PROCEEDS TO ANOTHER DEBT
396	397		EXCEPT A DEBT THAT IS SECURED BY YOUR HOME OR OWED TO ANOTHER
397	398		LENDER;
398	399		"(2) NOT REQUIRE THAT YOU ASSIGN WAGES AS SECURITY;
399	400		"(3) NOT REQUIRE THAT YOU EXECUTE INSTRUMENTS WHICH HAVE
400	401		BLANKS FOR SUBSTANTIVE TERMS OF AGREEMENT LEFT TO BE FILLED IN;
401	402		"(4) NOT REQUIRE THAT YOU SIGN A CONFESSION OF JUDGMENT OR
402	403		POWER OF ATTORNEY TO ANOTHER PERSON TO CONFESS JUDGMENT OR APPEAR IN
403	404		A LEGAL PROCEEDING ON YOUR BEHALF;
404	405		"(5) PROVIDE THAT YOU RECEIVE A COPY OF YOUR FINAL LOAN
405	406		APPLICATION AND ALL EXECUTED DOCUMENTS YOU SIGN AT CLOSING;
406	407		"(6) PROVIDE THAT THE SECURITY INSTRUMENTS CONTAIN A
407	408		DISCLOSURE THAT THIS LOAN IS A LOAN DEFINED BY SECTION 50(a)(6),
408	409		ARTICLE XVI, OF THE TEXAS CONSTITUTION;
409	410		"(7) PROVIDE THAT WHEN THE LOAN IS PAID IN FULL, THE LENDER
410	411		WILL SIGN AND GIVE YOU A RELEASE OF LIEN OR AN ASSIGNMENT OF THE
411	412		LIEN, WHICHEVER IS APPROPRIATE;
412	413		"(8) PROVIDE THAT YOU MAY, WITHIN 3 DAYS AFTER CLOSING,
413	414		RESCIND THE LOAN WITHOUT PENALTY OR CHARGE;
414	415		"(9) PROVIDE THAT YOU AND THE LENDER ACKNOWLEDGE THE FAIR
415	416		MARKET VALUE OF YOUR HOME ON THE DATE THE LOAN CLOSES; AND
416	417		"(10) PROVIDE THAT THE LENDER WILL FORFEIT ALL PRINCIPAL AND
417	418		INTEREST IF THE LENDER FAILS TO COMPLY WITH THE LENDER'S
418	419		OBLIGATIONS UNLESS THE LENDER CURES THE FAILURE TO COMPLY AS
419	420		PROVIDED BY SECTION 50(a)(6)(Q)(x), ARTICLE XVI, OF THE TEXAS
420	421		CONSTITUTION; AND
421	422		"(R) IF THE LOAN IS A HOME EQUITY LINE OF CREDIT:
422	423		"(1) YOU MAY REQUEST ADVANCES, REPAY MONEY, AND REBORROW
423	424		MONEY UNDER THE LINE OF CREDIT;
424	425		"(2) EACH ADVANCE UNDER THE LINE OF CREDIT MUST BE IN AN
425	426		AMOUNT OF AT LEAST $4,000;
426	427		"(3) YOU MAY NOT USE A CREDIT CARD, DEBIT CARD, OR SIMILAR
427	428		DEVICE, OR PREPRINTED CHECK THAT YOU DID NOT SOLICIT, TO OBTAIN
428	429		ADVANCES UNDER THE LINE OF CREDIT;
429	430		"(4) ANY FEES THE LENDER CHARGES MAY BE CHARGED AND COLLECTED
430	431		ONLY AT THE TIME THE LINE OF CREDIT IS ESTABLISHED AND THE LENDER
431	432		MAY NOT CHARGE A FEE IN CONNECTION WITH ANY ADVANCE;
432	433		"(5) THE MAXIMUM PRINCIPAL AMOUNT THAT MAY BE EXTENDED, WHEN
433	434		ADDED TO ALL OTHER DEBTS SECURED BY YOUR HOME, MAY NOT EXCEED 80
434	435		PERCENT OF THE FAIR MARKET VALUE OF YOUR HOME ON THE DATE THE LINE OF
435	436		CREDIT IS ESTABLISHED;
436	437		"(6) IF THE PRINCIPAL BALANCE UNDER THE LINE OF CREDIT AT ANY
437	438		TIME EXCEEDS 80 [50] PERCENT OF THE FAIR MARKET VALUE OF YOUR HOME,
438	439		AS DETERMINED ON THE DATE THE LINE OF CREDIT IS ESTABLISHED, YOU MAY
439	440		NOT CONTINUE TO REQUEST ADVANCES UNDER THE LINE OF CREDIT UNTIL THE
440	441		BALANCE IS LESS THAN 80 [50] PERCENT OF THE FAIR MARKET VALUE; AND
441	442		"(7) THE LENDER MAY NOT UNILATERALLY AMEND THE TERMS OF THE
442	443		LINE OF CREDIT.
443	444		"THIS NOTICE IS ONLY A SUMMARY OF YOUR RIGHTS UNDER THE TEXAS
444	445		CONSTITUTION. YOUR RIGHTS ARE GOVERNED BY SECTION 50, ARTICLE XVI,
445	446		OF THE TEXAS CONSTITUTION, AND NOT BY THIS NOTICE."
446	447		If the discussions with the borrower are conducted primarily
447	448		in a language other than English, the lender shall, before closing,
448	449		provide an additional copy of the notice translated into the
449	450		written language in which the discussions were conducted.
450	451		(t) A home equity line of credit is a form of an open-end
451	452		account that may be debited from time to time, under which credit
452	453		may be extended from time to time and under which:
453	454		(1) the owner requests advances, repays money, and
454	455		reborrows money;
455	456		(2) any single debit or advance is not less than
456	457		$4,000;
457	458		(3) the owner does not use a credit card, debit card,
458	459		or similar device, or preprinted check unsolicited by the borrower,
459	460		to obtain an advance;
460	461		(4) any fees described by Subsection (a)(6)(E) of this
461	462		section are charged and collected only at the time the extension of
462	463		credit is established and no fee is charged or collected in
463	464		connection with any debit or advance;
464	465		(5) the maximum principal amount that may be extended
465	466		under the account, when added to the aggregate total of the
466	467		outstanding principal balances of all indebtedness secured by the
467	468		homestead on the date the extension of credit is established, does
468	469		not exceed an amount described under Subsection (a)(6)(B) of this
469	470		section;
470	471		(6) (repealed) [no additional debits or advances are
471	472		made if the total principal amount outstanding exceeds an amount
472	473		equal to 50 percent of the fair market value of the homestead as
473	474		determined on the date the account is established];
474	475		(7) the lender or holder may not unilaterally amend
475	476		the extension of credit; and
476	477		(8) repayment is to be made in regular periodic
477	478		installments, not more often than every 14 days and not less often
478	479		than monthly, beginning not later than two months from the date the
479	480		extension of credit is established, and:
480	481		(A) during the period during which the owner may
481	482		request advances, each installment equals or exceeds the amount of
482	483		accrued interest; and
483	484		(B) after the period during which the owner may
484	485		request advances, installments are substantially equal.
485	486		SECTION 2. The following temporary provision is added to
486	487		the Texas Constitution:
487	488		TEMPORARY PROVISION. (a) This temporary provision applies
488	489		to the constitutional amendment proposed by the 85th Legislature,
489	490		Regular Session, 2017, to establish a lower amount for expenses
490	491		that can be charged to a borrower and removing certain financing
491	492		expense limitations for a home equity loan, establishing certain
492	493		authorized lenders to make a home equity loan, changing certain
493	494		options for the refinancing of home equity loans, changing the
494	495		threshold for an advance of a home equity line of credit, and
495	496		allowing home equity loans on agricultural homesteads.
496	497		(b) The constitutional amendment takes effect January 1,
497	498		2018.
498	499		(c) The changes in law made by the constitutional amendment
499	500		apply only to a home equity loan made on or after the effective date
500	501		of the constitutional amendment and to an existing home equity loan
501	502		that is refinanced on or after the effective date of the
502	503		constitutional amendment.
503	504		(d) This temporary provision takes effect on the adoption of
504	505		the constitutional amendment by the voters and expires January 1,
505	506		2019.
506	507		SECTION 3. This proposed constitutional amendment shall be
507	508		submitted to the voters at an election to be held November 7, 2017.
508	509		The ballot shall be printed to provide for voting for or against the
509	510		proposition: "The constitutional amendment to establish a lower
510	511		amount for expenses that can be charged to a borrower and removing
511	512		certain financing expense limitations for a home equity loan,
512	513		establishing certain authorized lenders to make a home equity loan,
513	514		changing certain options for the refinancing of home equity loans,
514	515		changing the threshold for an advance of a home equity line of
515	516		credit, and allowing home equity loans on agricultural homesteads."
516		-	______________________________ ______________________________
517		-	President of the Senate Speaker of the House
518		-	I hereby certify that S.J.R. No. 60 was adopted by the Senate
519		-	on April 20, 2017, by the following vote: Yeas 30, Nays 0.
520		-	______________________________
521		-	Secretary of the Senate
522		-	I hereby certify that S.J.R. No. 60 was adopted by the House
523		-	on May 6, 2017, by the following vote: Yeas 143, Nays 0, two
524		-	present not voting.
525		-	______________________________
526		-	Chief Clerk of the House