Texas Finance Commission Increases Allowable Administrative Fees, Acquisition Charges; Sets Maximum Allowable Documentary Fees

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On August 27, the Texas Finance Commission, Office of Consumer Credit Commissioner, issued a bulletin on recently adopted rules to increase certain allowable fees and charges on consumer loans and cash advances. The Commission exercised authority recently granted by the state legislature to set maximum amounts for administrative fees charged on consumer loans and acquisition charges on cash advances. The rules allow, respectively, authorized lenders to (i) collect on consumer loans an administrative fee that does not exceed $100 and (ii) collect on cash advances an acquisition charge that does not exceed the lesser of 10% of the cash advance of the loan or $100. The Commission also issued a second bulletin on a new rule setting the maximum documentary fees chargeable by Chapter 345 retail creditors in retail installment transactions, including a maximum fee of $125 on transactions for the purchase of covered land vehicles or watercrafts.  For transactions involving both the purchase of a land vehicle and a watercraft, the maximum amount chargeable is $175. All of the changes take effect on September 5, 2013.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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