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Memos

Client Memo-Sunset Review for the Texas Department of Savings & Mortgage Lending : Update from the Hearing held May 24, 2018
MEMO: 5-29-18

As you may be aware, the Texas Department of Savings and Mortgage Lending (“SML”) is the subject of Sunset Review this year. The Texas Sunset Commission conducted their first hearing last Thursday, May 24th. Doug Foster, the former Commissioner of the SML and the Director of Regulatory Affairs for Polunsky Beitel Green, among others, testified before the Commission. This memo outlines the details of that hearing.

Please let us know if you have any questions regarding this information.

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Client Memo-Sunset Review for the Texas Department of Savings & Mortgage Lending
MEMO: 5-22-18

This is a Memo in regard to the Sunset Review of the Texas Department of Savings & Mortgage Lending. The Texas Sunset Commission has recently released its report, which recommends abolishing the Texas Department of Savings and Mortgage Lending (SML) and transferring its regulatory duties to the Texas Banking Department. The Sunset Commission has scheduled hearings for the Finance Commission of Texas and its agencies at 9:00am Thursday, May 24, 2018, in Room E2.030, Capital Extension, in Austin. This memo outlines the details of the process and the potential implications of eliminating this department.

Please let us know if you have any questions regarding this information.

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Client Memo-The CFPB Final Rule Addressing the Black Hole
MEMO: 5-2-18

Please be advised that the publication date in the Federal Register for the new TRID Final Rule addressing the “black hole” is May 2, 2018. The Black Hole refers to the inability, under the original TRID rule, for a Lender to reset tolerances with a Closing Disclosure, except during the four business days prior to closing.

Please let us know if you have any questions regarding this information.

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Client Memo-Texas Attorney General Opinion and Texas Home Equity Loans
MEMO: 3-14-18

This memo concerns the most recent Texas Attorney General Opinion issued on February 26, 2018 stating that the Texas Constitution, article XVI, subsection 50(a)(6)(H) prohibits a U.S. Department of Veterans Affairs cash-out refinance loan. The complete Attorney General Opinion and explanation has been included at the end of the Client Memo.

Please let us know if you have any questions regarding this information.

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Client Memo-Recent Proposed Interpretations Regarding Texas Home Equity Lending
MEMO: 3-9-18

We wish to advise you that the Texas Finance Commission has APPROVED adoption of certain interpretative guidance regarding home equity lending in Texas. This proposed guidance was also considered and approved for adoption when the Texas Credit Union Commission which met on March 9, 2018. The new interpretations should assist Texas mortgage lenders in more easily implementing the recently enacted changes to home equity lending in Texas.

Please let us know if you have any questions regarding this information.

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Lender Tool Box - Texas Home Equity
MEMO: 11-29-17

The Home Equity Constitutional Amendment has now passed and takes effect January 1, 2018. We hope you will find the following information useful in your implementation for both a timeline and all in one place tool for your Texas Home Equity questions. Also, attached are the constitutional changes from the official Senate bill.

Please let us know if you have any questions regarding this information.

View Lender Tool Box


SJR - Home Equity Changes

Texas Finance Commission adopts Norwood Amendments
MEMO: 01-05-15

As you are probably aware, on January 31, 2014, the Texas Supreme Court issued its supplemental decision in The Finance Commission of Texas, et al v. Valerie Norwood, et al, and held that, in the context of a transaction originated under Article XVI, Section 50a6 of the Texas Constitution (a “Texas Home Equity Loan”) both pre-paid per diem interest and bona fide discount points are “interest” and are NOT fees “necessary to originate, evaluate, maintain, record, insure, or service” the loan and are therefore NOT subject to the 3% fee cap applicable to a Texas Home Equity Loan.

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Memo Regarding Finance Commission Meeting (Norwood Amendments)
MEMO: 06-19-14

As you are probably aware, on January 31, 2014, the Texas Supreme Court issued its supplemental decision in The Finance Commission of Texas, et al v. Valerie Norwood, et al, and held that, in the context of a transaction originated under Article XVI, Section 50a6 of the Texas Constitution (a “Texas Home Equity Loan”) both pre-paid per diem interest and bona fide discount points are “interest” and are NOT fees “necessary to originate, evaluate, maintain, record, insure, or service” the loan and are therefore NOT subject to the 3% fee cap applicable to a Texas Home Equity Loan.

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Texas Supreme Court Decision - Sims v. Carrington Mortgage Services
MEMO: 05-16-14

Today the Texas Supreme Court rendered its Opinion in Sims v. Carrington Mortgage Services. In this case, the United States Court of Appeals for the Fifth Circuit certified the four questions to the Texas Supreme Court regarding whether a particular transaction of a Texas home equity loan is a modification or a refinance for home equity purposes.

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New TDSML Commissioner Announced
MEMO: 04-23-14

Bill White, Chair of the Texas Finance Commission, announced on Tuesday, April 22nd that Caroline Jones has been selected as the new Commissioner of the Texas Department of Savings & Mortgage Lending. Ms. Jones appointment will be effective as of June 1st

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Memo Regarding Dallas Court of Appeals decision (Wells Fargo v Leath)
MEMO: 02-12-14

We wanted to take a minute to advise you of a recent decision of the Dallas Court of Appeals relating to a Texas home equity loan. In Wells Fargo Bank, N.A., as Trustee for Option One Mortgage Loan Trust 2006-1 Asset-Backed Certificates, Series 2006-1 v. Lonzie Leath, the borrower, Mr. Leath, had sought to invalidate a home equity loan on the grounds that the loan exceeded 80% of the fair market value of the property, which as you probably know is the limit imposed by Article XVI, Section 50(a)(6)(B) of the Texas Constitution.

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TX Home Equity - Norwood case follow up
MEMO: 01-31-14

The case challenged the promulgated interpretative rules of the Finance Commission dealing with certain provisions of the Texas home equity lending requirements of Texas Constitution, Article XVI, Section 50, Subsections (a)(6)(E) and (a)(6)(N).

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