(a) Except as provided by Subsection (c), a creditor shall require a consumer to pay ad valorem taxes on the manufactured home through the creditor.
(b) The creditor may:
(1) include in the credit transaction an amount equal to a reasonable estimate of the tax for the first year; or
(2) require that the consumer pay on each installment due date an amount equal to one-twelfth of the reasonable estimate of the tax for the first year.

Terms Used In Texas Finance Code 347.254

  • Consumer: means a person to whom credit is extended in a credit transaction. See Texas Finance Code 347.002
  • Credit transaction: means :
    (A) any sale, loan, or other transaction involving a retail purchase of a manufactured home and under which a person in a written agreement, including a credit sales contract or loan instrument, grants to another person a purchase money lien on the manufactured home to secure an extension of credit that is:
    (i) subject to a finance charge; or
    (ii) payable in more than four installments, not including a down payment; and
    (B) a lease or bailment described by § 347. See Texas Finance Code 347.002
  • Creditor: means a:
    (A) person who extends credit or arranges for the extension of credit in a credit transaction; or
    (B) retailer or broker, as defined by § 1201. See Texas Finance Code 347.002
  • Escrow: Money given to a third party to be held for payment until certain conditions are met.
  • Manufactured home: has the meaning assigned by § 1201. See Texas Finance Code 347.002
  • Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
  • Year: means 12 consecutive months. See Texas Government Code 311.005

(c) The escrow requirement of Subsection (a) does not apply to a transaction involving a manufactured home if the creditor is a federally insured financial institution and does not otherwise require the escrow of taxes, insurance premiums, fees, or other charges in connection with loans secured by residential real property.