Bill Text: TX SB1431 | 2017-2018 | 85th Legislature | Introduced
Bill Title: Relating to escrow payments for a loan secured by a new dwelling.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2017-04-18 - Left pending in committee [SB1431 Detail]
Download: Texas-2017-SB1431-Introduced.html
By: Zaffirini | S.B. No. 1431 | |
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relating to escrow payments for a loan secured by a new dwelling. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subchapter B, Chapter 343, Finance Code, is | ||
amended by adding Section 343.107 to read as follows: | ||
Sec. 343.107. DETERMINATION OF INITIAL AMOUNT OF ESCROW | ||
PAYMENTS ON LOAN SECURED BY NEW DWELLING. (a) In this section, | ||
"mortgage servicer" has the meaning assigned by Section 51.0001, | ||
Property Code. | ||
(b) This section applies only to a home loan secured by real | ||
property on which a dwelling has been constructed that is not | ||
included on the appraisal roll of the appraisal district that | ||
appraises the property for ad valorem tax purposes because the | ||
dwelling is a new improvement. | ||
(c) Subject to 12 C.F.R. Section 1024.17, if an escrow | ||
account is created for the home loan, the lender or mortgage | ||
servicer, as applicable, shall make a good-faith effort to ensure | ||
that the amount the borrower is initially required to pay into the | ||
escrow account for purposes of payment of the ad valorem taxes | ||
imposed on the property is reasonably likely to be sufficient to pay | ||
the taxes based on all available evidence, including the probable | ||
effect of the newly constructed dwelling on the appraised value, | ||
and the market value of comparable improved residential properties | ||
in the market area as determined by the appraisal districts that | ||
appraise those properties for ad valorem tax purposes as | ||
applicable. | ||
(d) A lender or mortgage servicer's failure to ensure that | ||
the amount paid into escrow is sufficient to pay the taxes as | ||
described by Subsection (c) does not affect the lender or mortgage | ||
servicer's security interest in the real property that secures the | ||
home loan. | ||
(e) This section does not create a cause of action. | ||
SECTION 2. The change in law made by this Act applies to a | ||
loan closed on or after the effective date of this Act. A loan | ||
closed before the effective date of this Act is governed by the law | ||
in effect when the loan was closed, and the former law is continued | ||
in effect for that purpose. | ||
SECTION 3. This Act takes effect September 1, 2017. |