HB 3088

85(R) - 2017
House Investments & Financial Services
House Investments & Financial Services
Occupational Licensing
Property Rights

Vote Recommendation

  • Neutral
  • Neutral
  • Neutral
  • Neutral
  • Neutral


Evelina Ortega

Bill Caption

Relating to the licensing and other regulation of wrap lenders.

Fiscal Notes

No significant fiscal implication to the State is anticipated.

Bill Analysis

HB 3088 is one of a number of bills targeting scams associated with wraparound mortgages which are a legal but very risky (both for the buyer and seller) form of mortgage financing. Sellers who agree to this type of financing are usually desperate to sell their house and unable to do so under traditional finance arrangements. Buyers who use this type of financing are usually unable to obtain less risky traditional mortgage financing. While there are legitimate lenders who serve the unique needs of these buyers and sellers, others skirt the intent of the law to perpetrate wraparound lending scams in a way that is technically legal but clearly outside of the intent of the law. This bill would make it more difficult for predatory lenders to successfully run these scams. 

Vote Recommendation Notes

This legislation infringes on personal responsibility to some extent because buyers and sellers have a responsibility to do their own research and due diligence to ensure that they understand their mortgage financing and that it works they way they expect it to. On the other hand this bill does enhance property rights by making it more difficult for people to run scams that deprive people of their property. For these reasons we withdraw our original objection to HB 3088.