Texas Register, Volume 40, Number 10, Pages 983-1152, March 6, 2015 Page: 1,076
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outlined in the previous discussion, the property tax lenders that
currently rely exclusively on closing costs and discount points
should be able to recover their costs and effectively receive the
same stream of payments by charging higher interest rates. So
it is unclear why secondary-market participants would refuse to
purchase the loans on terms that allow the lenders to recover
substantially the same costs that they recover today.
While the adopted rules may have an impact on certain small
property tax lenders, the commission believes that this impact
will be minimal. For the reasons discussed earlier, small property
tax lenders should be able to amend their pricing practices in a
manner that enables them to comply with the rule and recoup
their actual costs.
V. Conclusion
The amended provisions in this adoption, including the amended
recordkeeping requirements, the disclosure of affiliated busi-
nesses, the amended limitation on closing costs, and the
prohibition on discount points, will only apply to loans made on
or after the effective date of these rules, which is anticipated to
be March 15, 2015.
SUBCHAPTER A. GENERAL PROVISIONS
7 TAC 89.102
All of the amendments are adopted under Texas Finance Code,
351.007, which authorizes the commission to adopt rules to
ensure compliance with Texas Finance Code, Chapter 351 and
Texas Tax Code, 32.06. Additionally, the amendments are
adopted under Texas Finance Code, 11.304, which authorizes
the Finance Commission to adopt rules to enforce Title 4 of the
Texas Finance Code.
The amendments related to affiliated businesses contained in
89.102, 89.207, and 89.504 are adopted under Texas Finance
Code, 351.0021(e), which authorizes the commission to adopt
rules implementing and interpreting authorized charges that a
property tax lender may impose after closing.
The Texas Tax Code also contains specific authority for the
amendments to certain rules. In particular, the amendments
to 89.504 are adopted under 32.06(a-4)(1) of the Tax Code,
which authorizes the commission to prescribe the form and
content of an appropriate disclosure statement to be provided to
a property owner before the execution of a tax lien transfer. The
amendments to 89.601 are adopted under 32.06(a-4)(2) of
the Tax Code, which authorizes the commission to adopt rules
relating to the reasonableness of closing costs, fees, and other
charges permitted under 32.06.
The statutory provisions affected by the adopted amendments
are contained in Texas Finance Code, Chapter 351, and Texas
Tax Code, 32.06 and 32.065.
The agency certifies that legal counsel has reviewed the adop-
tion and found it to be a valid exercise of the agency's legal au-
thority.
Filed with the Office of the Secretary of State on February 23,
2015.
TRD-201500613Leslie L. Pettijohn
Commissioner
Office of Consumer Credit Commissioner
Effective date: March 15, 2015
Proposal publication date: December 26, 2014
For further information, please call: (512) 936-7621
SUBCHAPTER B. AUTHORIZED ACTIVITIES
7 TAC 89.207
The amendments are adopted under Texas Finance Code,
351.007, which authorizes the commission to adopt rules to
ensure compliance with Texas Finance Code, Chapter 351 and
Texas Tax Code, 32.06. Additionally, the amendments are
adopted under Texas Finance Code, 11.304, which authorizes
the Finance Commission to adopt rules to enforce Title 4 of the
Texas Finance Code.
The amendments related to affiliated businesses contained in
89.207 are adopted under Texas Finance Code, 351.0021(e),
which authorizes the commission to adopt rules implementing
and interpreting authorized charges that a property tax lender
may impose after closing.
The statutory provisions affected by the adopted amendments
are contained in Texas Finance Code, Chapter 351, and Texas
Tax Code, 32.06 and 32.065.
89.207. Files and Records Required.
Each licensee must maintain records with respect to each property tax
loan made under Texas Finance Code, Chapter 351 and Texas Tax
Code, 32.06 and 32.065, and make those records available for ex-
amination under Texas Finance Code, 351.008. The records required
by this section may be maintained by using either a paper or manual
recordkeeping system, electronic recordkeeping system, optically im-
aged recordkeeping system, or a combination of the preceding types of
systems, unless otherwise specified by statute or regulation. If federal
law requirements for record retention are different from the provisions
contained in this section, the federal law requirements prevail only to
the extent of the conflict with the provisions of this section.
(1) Required records. A licensee must maintain the follow-
ing items:
(A) A loan register, containing the date of the property
tax loan, the last name of the borrower, the "total tax lien payment
amount" as defined in 89.601 of this title (relating to Fees for Closing
Costs), and the loan number;
(B) General business and accounting records, including
receipts, documents, canceled checks, or other records for each dis-
bursement made at the borrower's direction or request, or made on his
behalf or for his benefit, including foreclosure or legal fees applied to
the borrower's account;
(C) Advertising and solicitation records, including ex-
amples of all written and electronic communications soliciting loans
(including scripts of radio and television broadcasts, and reproductions
of billboards and signs not at the licensed place of business) for a period
of not less than one year from the date of use or until the next exami-
nation by OCCC staff, whichever is later, in order to show compliance
with Texas Finance Code, 341.403 and 351.0023;
(D) Adverse action records regarding all applications
relating to Texas Finance Code, Chapter 351 property tax loans main-40 TexReg 1076 March 6, 2015 Texas Register
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Texas. Secretary of State. Texas Register, Volume 40, Number 10, Pages 983-1152, March 6, 2015, periodical, March 6, 2015; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth606207/m1/94/?q=32+TexReg+3206: accessed July 16, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.