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Memos

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.

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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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