An out-of-state lender closes a 2026 loan for a borrower who is in Texas when the loan is made. Assuming the loan otherwise falls within Chapter 343, does the lender’s out-of-state location defeat applicability?
Correct Answer
A) The chapter applies: the borrower was located in Texas at that time
The chapter applies to a loan extended to a person who is located in this state at the time the loan is made, which is a test about the borrower rather than about the lender. Other choices: where the lender sits is not the test; the section speaks to the person rather than to the property; and no residency period of 12 months is required. Source: Tex. Fin. Code sec. 343.002(a)
Why This Is the Correct Answer
The chapter applies to a loan extended to a person who is located in this state at the time the loan is made, which is a test about the borrower rather than about the lender. Other choices: where the lender sits is not the test; the section speaks to the person rather than to the property; and no residency period of 12 months is required. Source: Tex. Fin. Code sec. 343.002(a)
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