Texas Register, Volume 40, Number 10, Pages 983-1152, March 6, 2015 Page: 1,080
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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 partic-
ular, the amendments to 89.504 are adopted under 32.06(a-
4)(1) of the Tax Code, which authorizes the commission to pre-
scribe the form and content of an appropriate disclosure state-
ment to be provided to a property owner before the execution of
a tax lien transfer.
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-201500618
Leslie 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 F. COSTS AND FEES
7 TAC 89.601
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 Texas Tax Code also contains specific authority for the
amendments to certain rules. 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.
89.601. Fees for Closing Costs.
(a) Applicability. The fee limitations contained in this section
are applicable to property tax loans secured by property designated as
"Category A (Real Property: Single-Family Residential)," and home-
steads designated as "Category E (Real Property: Farm and Ranch Im-
provements)" by the Property Classification Guide published by the
Texas Comptroller of Public Accounts.
(b) Closing costs for which fees may be charged, contracted
for, or received.
(1) Scope of closing costs. For purposes of this section, the
term "closing costs" includes costs incurred by a property tax lender
from the time of application through the time of closing.
(2) Examples of closing costs. The following is a non-com-
prehensive list of examples of closing costs for which a property taxlender may charge, contract for, or receive fees in connection with a
property tax loan. Other law may limit the ability to charge these and
other fees. Examples of some allowable fees for closing costs include
the following:
(A) an application fee;
(B) an appraisal or inspection fee;
(C) a title examination fee;
(D) a property survey fee;
(E) a fee for flood and plat determinations;
(F) a document preparation fee;
(G) a closing or escrow fee;
(H) a fee for a tax certificate or tax payoff determina-
tion;
(I) a loan processing fee;
(J) an underwriting fee;
(K) a fee for obtaining credit reports;
(L) a fee for courier and delivery services.
(c) Total maximum fees for closing costs.
(1) Maximum fees include funds received by third parties
or retained by property tax lender. The maximum fees provided for
by this section encompass fees related to closing costs, whether the
charge is paid by a property owner directly to a third party, paid to a
third party through a property tax lender, or paid by a property owner
directly to and retained by a property tax lender. A property tax lender
may absorb any closing costs and may pay third parties out of the total
compensation paid to it by a property owner.
(2) Maximum fee limits for closing costs. A property
owner may not be charged, directly or indirectly, by a property tax
lender an amount related to closing costs in excess of the amounts
authorized by this section. A property tax lender may not directly or
indirectly charge, contract for, or receive any amount related to closing
costs from a property owner in excess of the amounts authorized by
this section.
(3) General maximum fee limit. The general maximum fee
for closing costs is $900.
(4) Cost for additional parcels of real property. If a prop-
erty tax loan includes the payment of taxes for more than one parcel of
real property, then the property tax lender may charge up to $100 for
each additional parcel of residential property described by subsection
(a), in addition to the general maximum fee limit described in para-
graph (3) of this subsection.
(5) Cost for preparing documents to address title defect. If
one or more documents must be prepared in order to address a defect in
title on the real property subject to the property tax loan, then the prop-
erty tax lender may charge a reasonable fee for costs directly incurred
in preparing, executing, and recording any necessary documents, in ad-
dition to the general maximum fee limit described in paragraph (3) of
this subsection. The fee for preparing documents is limited to record-
ing costs paid to a governmental entity (or a private entity designated
by a governmental entity for electronic recording) and reasonable attor-
ney's fees paid to a person who is not an employee of the property tax
lender. In order for the fee for these documents to be authorized, any
documents must comply with all applicable laws, including recording
requirements. In particular, any affidavit of heirship must comply with
the substantive and procedural requirements of Texas Estates Code,40 TexReg 1080 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/m1/98/: accessed July 16, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.