Texas SJR60 – Potential Changes for Texas Home Equity Lending

Texas Senate Joint Resolution 60 – Potential Changes for Texas Home Equity Lending

Texas Senate Joint Resolution 60 (SJR60) in the 2017 Texas legislative session was passed and will appear on the ballot in Texas as a legislatively referred constitutional amendment on November 7, 2017.  SJR60 proposes a constitutional amendment to Section 50(a)(6) of the TX Constitution.  These changes would ease restrictions on Texas home equity loans. The enrolled version can be found by clicking here.

This is a proposed constitutional amendment and needs both the support of the Legislature (which the bill has) and a majority of Texas voters.  This amendment will be voted on this November and if it passes, it will become effective January 1, 2018.   A summary of the resolution is presented below for your information.  We encourage support of this amendment, so let’s get the vote out come November.

On the Ballot:  “The constitutional amendment to establish a lower amount for expenses that can be charged to a borrower and removing certain financing expense limitations for a home equity loan, establishing certain authorized lenders to make a home equity loan, changing certain options for the refinancing for home equity loans, changing the threshold for an advance of a home equity line of credit, and allowing home equity loans on agricultural homesteads.”

Key Provisions: 

• Removing the “once a home equity loan, always a home equity loan” provision currently in place
• Providing consumers an option to refinance a seasoned home equity loan into a non-home equity product
• Lowering the cap on fees from 3% to 2%, but excluding certain fees (title premium, appraisal and survey expenses) from the fee cap
• Allowing farm and ranch property owners the ability to obtain a home equity loan while maintaining their agricultural valuation (exemption) on their properties

As always, please let us know if you have any questions.