Texas Finance Code 342.308 – Amounts Authorized to Be Collected or Added to Loan
(a) A lender or a person who is assigned a secondary mortgage loan may collect on or before the closing of the loan, or include in the principal of the loan:
(1) reasonable fees for:
(A) title examination and preparation of an abstract of title by:
(i) an attorney who is not an employee of the lender; or
(ii) a title company or property search company authorized to do business in this state; or
(B) premiums or fees for title insurance or title search for the benefit of the mortgagee and, at the mortgagor‘s option, for title insurance or title search for the benefit of the mortgagor;
(2) reasonable fees charged to the lender by an attorney who is not a salaried employee of the lender for preparation of the loan documents in connection with the mortgage loan if the fees are evidenced by a statement for services rendered;
(3) charges prescribed by law that are paid to public officials for determining the existence of a security interest or for perfecting, releasing, or satisfying a security interest;
(4) reasonable fees for an appraisal of real property offered as security for the loan prepared by an appraiser who is not a salaried employee of the lender;
(5) the reasonable cost of a credit report;
(6) reasonable fees for a survey of real property offered as security for the loan prepared by a registered surveyor who is not a salaried employee of the lender;
(7) the premiums received in connection with the sale of credit life insurance, credit accident and health insurance, or other insurance that protects the mortgagee against default by the mortgagor, the benefits of which are applied in whole or in part to reduce or extinguish the loan balance; or
(8) reasonable fees relating to real property offered as security for the loan that are incurred to comply with a federally mandated program if the collection of the fees or the participation in the program is required by a federal agency; and
(9) an administrative fee, subject to Subsection (c), in an amount not to exceed $25 for a loan of more than $1,000 or $20 for a loan of $1,000 or less.
(b) Premiums for property insurance that conform with § 342.401 may be added to the loan contract.
Terms Used In Texas Finance Code 342.308
- Appraisal: A determination of property value.
- Comptroller: means the state comptroller of public accounts. See Texas Government Code 312.011
- Contract: A legal written agreement that becomes binding when signed.
- Credit report: A detailed report of an individual's credit history prepared by a credit bureau and used by a lender in determining a loan applicant's creditworthiness. Source: OCC
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
- Mortgagee: The person to whom property is mortgaged and who has loaned the money.
- Mortgagor: The person who pledges property to a creditor as collateral for a loan and who receives the money.
- Person: includes corporation, organization, government or governmental subdivision or agency, business trust, estate, trust, partnership, association, and any other legal entity. See Texas Government Code 311.005
- Property: means real and personal property. See Texas Government Code 311.005
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
(c) An administrative fee under Subsection (a)(9) is considered earned when the loan is made or refinanced and is not subject to refund. A lender refinancing the loan may not contract for or receive an administrative fee for the loan more than once in any 180-day period. Fifty cents of each administrative fee may be deposited with the comptroller for use in carrying out the finance commission’s responsibilities under § 11.3055.
(d) Costs that conform to § 342.4021(a) may be added to the loan contract.