| 1 | 1 | | By: Menéndez S.B. No. 110 |
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| 2 | 2 | | |
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| 3 | 3 | | |
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| 4 | 4 | | A BILL TO BE ENTITLED |
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| 5 | 5 | | AN ACT |
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| 6 | 6 | | relating to fees paid to certain credit services organizations in |
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| 7 | 7 | | connection with certain extensions of consumer credit. |
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| 8 | 8 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 9 | 9 | | SECTION 1. Subchapter A, Chapter 302, Finance Code, is |
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| 10 | 10 | | amended by adding Section 302.003 to read as follows: |
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| 11 | 11 | | Sec. 302.003. RESTRICTION ON CERTAIN THIRD-PARTY FEES TO |
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| 12 | 12 | | OBTAIN, ARRANGE, OR GUARANTEE CERTAIN EXTENSIONS OF CONSUMER |
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| 13 | 13 | | CREDIT. The amount of a fee paid or to be paid to a credit services |
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| 14 | 14 | | organization subject to Chapter 393 to assist a consumer in |
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| 15 | 15 | | transacting, arranging, guaranteeing, or negotiating an extension |
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| 16 | 16 | | of credit or to obtain for a consumer an extension of credit is |
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| 17 | 17 | | considered interest for usury purposes under state law if: |
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| 18 | 18 | | (1) the extension of credit is secured by a |
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| 19 | 19 | | non-purchase money security interest in personal property or is |
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| 20 | 20 | | unsecured; and |
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| 21 | 21 | | (2) the proceeds of the extension of credit are used |
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| 22 | 22 | | for personal, family, or household purposes. |
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| 23 | 23 | | SECTION 2. The changes in law made by this Act apply only to |
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| 24 | 24 | | an extension of consumer credit made on or after the effective date |
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| 25 | 25 | | of this Act. An extension of consumer credit made before the |
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| 26 | 26 | | effective date of this Act is governed by the law in effect on the |
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| 27 | 27 | | date the extension of consumer credit was made, and the former law |
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| 28 | 28 | | is continued in effect for that purpose. For purposes of this |
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| 29 | 29 | | section, a refinance or renewal of an extension of consumer credit |
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| 30 | 30 | | is considered made on the date the extension of consumer credit |
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| 31 | 31 | | being refinanced or renewed was made. |
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| 32 | 32 | | SECTION 3. This Act takes effect September 1, 2017. |
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