An equity loan may not be closed before one business day after
the date that the owner of the homestead receives a copy of the loan
application, if not previously provided, and a final itemized disclosure
of the actual fees, points, interest, costs, and charges that will
be charged at closing. If a bona fide emergency or another good cause
exists and the lender obtains the written consent of the owner, the
lender may provide the preclosing disclosure to the owner or the lender
may modify the previously provided preclosing disclosure on the date
of closing.
(1) For purposes of this section, the "preclosing disclosure"
consists of a copy of the loan application, if not previously provided,
and a final itemized disclosure of the actual fees, points, interest,
costs, and charges that will be charged at closing.
(2) The copy of the loan application submitted to the
owner in satisfaction of the preclosing disclosure requirement must
be the most current version at the time the document is delivered.
The lender is not obligated to provide another copy of the loan application
if the only difference from the version previously provided to the
owner is formatting. The lender is not obligated to give another copy
of the loan application if the information contained on the more recent
application is the same as that contained on the application of which
the owner has a copy.
(3) The lender must deliver to the owner a final itemized
disclosure of the actual fees, points, interest, costs, and charges
that will be charged at closing.
(A) For a closed-end equity loan, the lender may satisfy
this requirement by delivering a properly completed closing disclosure
under Regulation Z, 12 C.F.R. §1026.19(f) and §1026.38.
(B) For a home equity line of credit, the lender may
satisfy this requirement by delivering properly completed account-opening
disclosures under Regulation Z, 12 C.F.R. §1026.6(a).
(4) The lender may provide the preclosing disclosure
electronically in accordance with state and federal law governing
electronic signatures and delivery of electronic documents. The UETA
and the E-Sign Act include requirements for electronic signatures
and delivery.
(5) Bona fide emergency.
(A) An owner may consent to receive the preclosing
disclosure or a modification of the preclosing disclosure on the date
of closing in the case of a bona fide emergency occurring before the
date of the extension of credit. An equity loan secured by a homestead
in an area designated by Federal Emergency Management Agency (FEMA)
as a disaster area is an example of a bona fide emergency if the homestead
was damaged during FEMA's declared incident period.
(B) To document a bona fide emergency modification,
the lender should obtain a written statement from the owner that:
(i) describes the emergency;
(ii) specifically states that the owner consents to
receive the preclosing disclosure or a modification of the preclosing
disclosure on the date of closing;
(iii) bears the signature of all of the owners entitled
to receive the preclosing disclosure; and
(iv) affirms the owner has received notice of the owner's
right to receive a final itemized disclosure containing all actual
fees, points, costs, and charges one day prior to closing.
(6) Good cause. An owner may consent to receive the
preclosing disclosure or a modification of the preclosing disclosure
on the date of closing if another good cause exists.
(A) Good cause to modify the preclosing disclosure
or to receive a subsequent disclosure modifying the preclosing disclosure
on the date of closing may only be established by the owner.
(i) The term "good cause" as used in this section means
a legitimate or justifiable reason, such as financial impact or an
adverse consequence.
(ii) At the owner's election, a good cause to modify
the preclosing disclosure may be established if:
(I) the modification does not create a material adverse
financial consequence to the owner; or
(II) a delay in the closing would create an adverse
consequence to the owner.
(iii) The term "de minimis" as used in this section
means a very small or insignificant amount.
(B) At the owner's election, a de minimis good cause
standard may be presumed if:
(i) the total actual disclosed fees, costs, points,
and charges on the date of closing do not exceed in the aggregate
more than the greater of $100 or 0.125 percent of the principal amount
of the loan (e.g. 0.125 percent on a $80,000 principal loan amount
equals $100) from the initial preclosing disclosure; and
(ii) no itemized fee, cost, point, or charge exceeds
more than the greater of $100 or 0.125 percent of the principal amount
of the loan than the amount disclosed in the initial preclosing disclosure.
(C) To document a good cause modification of the disclosure,
the lender should obtain a written statement from the owner that:
(i) describes the good cause;
(ii) specifically states that the owner consents to
receive the preclosing disclosure on the date of closing;
(iii) bears the signature of all of the owners entitled
to receive the preclosing disclosure; and
(iv) affirms the owner has received notice of the owner's
right to receive a final itemized disclosure containing all fees,
costs, points, or charges one day prior to closing.
(7) An equity loan may be closed at any time during
normal business hours on the next business day following the calendar
day on which the owner receives the preclosing disclosure or any calendar
day thereafter.
(8) The owner maintains the right of rescission under
Section 50(a)(6)(Q)(viii) even if the owner exercises an emergency
or good cause modification of the preclosing disclosure.
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| Source Note: The provisions of this §153.13 adopted to be effective June 29, 2006, 31 TexReg 5080; amended to be effective November 9, 2006, 31 TexReg 9022; amended to be effective November 13, 2008, 33 TexReg 9074; amended to be effective November 24, 2016, 41 TexReg 9106; amended to be effective January 6, 2022, 46 TexReg 9240 |
