Frank and Carmen own a homestead in Fort Worth, Texas. They want to use a home equity loan to pay off credit card debt. Under Texas law, how many home equity loans can be outstanding against their homestead at any one time?
Correct Answer
D) Only one home equity loan can be outstanding against a Texas homestead at any time
Under Texas Constitution Article XVI, Section 50(a)(6)(K), only one home equity loan may be outstanding against a Texas homestead at any given time. Borrowers must pay off an existing home equity loan before obtaining a new one.
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Predatory lending refers to unfair, deceptive, or abusive lending practices that impose unjustified terms on borrowers, often targeting vulnerable populations. It includes practices like excessive fees, inflated appraisals, and unnecessary refinancing.
RESPA is a federal law that requires lenders to provide borrowers with information about settlement costs, prohibits kickbacks and referral fees, and limits escrow account deposits. It applies to federally related mortgage loans.
The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
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- → A Texas property owner defaults on both a first mortgage and a second-lien home equity loan. The first mortgage lender forecloses and sells the property at the trustee's sale. Under Texas law, what happens to the second-lien home equity loan?
- → Under Texas foreclosure law, a property is sold at a trustee's sale on the first Tuesday of the month. The winning bidder pays the full purchase price. Under Texas Property Code, when does the bidder receive a trustee's deed?
- → In Texas, the standard security instrument for real estate loans is a deed of trust rather than a mortgage. Which parties are involved in a Texas deed of trust?
- → Under Texas Constitution Article XVI, Section 50(a)(6), a home equity loan on a Texas homestead must comply with numerous constitutional requirements. All of the following are required provisions of a Texas home equity loan EXCEPT:
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- → A Texas homeowner closes on a home equity loan on January 15. The loan proceeds are not actually disbursed until January 18, three days after closing. The borrower exercises the right of rescission on January 26. Under Texas Constitution Article XVI, Section 50(a)(6), is this rescission timely?
- → A Texas lender fails to cure a constitutional defect in a home equity loan within the required timeframe. The borrower files a lawsuit. Under Texas Constitution Article XVI, Section 50(a)(6)(Q)(x), what is the potential penalty for the lender's failure to cure?
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Previous Question
Angela, a Texas homeowner, receives a home equity loan that was disbursed in four separate installments over three months. Under Texas Constitution Article XVI, Section 50(a)(6), was this disbursement method proper?
Next Question
A lender in Texas charges fees and costs totaling 5% of the loan amount on a home equity loan secured by the borrower's homestead. Under Texas Constitution Article XVI, Section 50(a)(6), is this fee structure compliant?