CHAPTER 303. OPTIONAL RATE CEILINGS - Texas Statutes

FINANCE CODE

TITLE 4. REGULATION OF INTEREST, LOANS, AND FINANCED TRANSACTIONS

SUBTITLE A. INTEREST

CHAPTER 303. OPTIONAL RATE CEILINGS

SUBCHAPTER A. RATE CEILINGS: APPLICABILITY, COMPUTATION, AND

PUBLICATION

Sec. 303.001. USE OF CEILINGS. (a) Except as provided by

Subchapter B, a person may contract for, charge, or receive a

rate or amount that does not exceed the applicable interest rate

ceiling provided by this chapter. The use of a ceiling provided

by this chapter for any contract is optional, and a contract may

provide for a rate or amount allowed by other applicable law.

(b) A contract that is subject to Chapter 342, 345, 347, or 348,

including a contract for an open-end account, may, as an

alternative to an interest rate or amount of time price

differential allowed under that chapter, provide for a simple or

precomputed rate or amount of time price differential that does

not exceed the applicable ceiling provided by this chapter or by

the equivalent yield authorized by Chapter 342, 345, 347, or 348.

(c) Except as inconsistent with this chapter, a party to a

contract that is subject to Chapter 342, 345, 347, or 348, or the

party's assignee, has all rights, duties, and obligations under

the applicable chapter, including those relating to refund

credits on prepayment or acceleration.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.002. WEEKLY CEILING. The parties to a written

agreement may agree to an interest rate, or in an agreement

described by Chapter 345, 347, or 348, an amount of time price

differential producing a rate, that does not exceed the

applicable weekly ceiling.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.003. COMPUTATION OF WEEKLY CEILING. (a) The weekly

ceiling is computed by:

(1) multiplying the auction rate by two; and

(2) rounding the result obtained under Subdivision (1) to the

nearest one-quarter of one percent.

(b) The weekly rate ceiling becomes effective on Monday of each

week and remains in effect through the following Sunday.

(c) In this subchapter, "auction rate" means the auction average

rate quoted on a bank discount basis for 26-week treasury bills

issued by the United States government, as published by the

Federal Reserve Board, for the week preceding the week in which

the weekly rate ceiling is to take effect.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999; Acts 1999, 76th Leg., ch. 909, Sec. 2.03, eff. Sept. 1,

1999.

Sec. 303.004. MONTHLY CEILING. (a) The monthly ceiling may be

used as an alternative to the weekly ceiling only for a contract

that:

(1) provides for a variable rate, including a contract for an

open-end account; and

(2) is not made for personal, family, or household use.

(b) A contract that provides for the use of the monthly ceiling

may not provide for the use of another rate ceiling provided

under this subchapter.

(c) If the parties agree that the rate may be adjusted monthly,

they may agree that the rate from time to time in effect may not

exceed the monthly ceiling from time to time in effect, and the

monthly ceiling is the ceiling on those contracts.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.005. COMPUTATION OF MONTHLY CEILING. (a) The consumer

credit commissioner shall compute the monthly ceiling on the

first business day of the calendar month in which the rate

applies. The monthly ceiling is effective for one month beginning

on the first calendar day of each month.

(b) The monthly ceiling is computed by averaging all of the

weekly ceilings computed using rates from auctions held during

the calendar month preceding the computation date of the monthly

ceiling.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.006. QUARTERLY CEILING. (a) A written contract,

including a contract that involves an open-end account, may, as

an alternative to the weekly ceiling, provide for an interest

rate or an amount of time price differential producing a rate

that does not exceed the applicable quarterly ceiling.

(b) A variable rate contract authorized under Section 303.015

may not provide for use of both the weekly ceiling and the

quarterly ceiling.

(c) Notwithstanding other provisions of this subchapter, the

rate of interest on an open-end account authorized under Section

342.455 or 346.003, or an amount owed for a credit card

transaction under another type of credit card agreement, in

connection with which a merchant discount is imposed or received

by the creditor may not exceed the applicable quarterly ceiling.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.007. ANNUALIZED CEILING. The annualized ceiling may be

used as an alternative to the weekly ceiling only for a written

contract that involves an open-end account.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.008. COMPUTATION OF QUARTERLY AND ANNUALIZED CEILING.

(a) On December 1, March 1, June 1, and September 1 of each

year, the consumer credit commissioner shall compute the

quarterly ceiling and annualized ceiling for the calendar quarter

effective the following January 1, April 1, July 1, and October

1, respectively. The quarterly ceiling becomes effective for

three-month periods beginning on the effective dates set out in

this subsection and is subject to adjustment after each

three-month period. The annualized ceiling becomes effective on

each of the effective dates set out in this subsection and

remains in effect for a period of 12 months, after which it is

subject to adjustment.

(b) The quarterly ceiling and annualized ceiling are computed by

averaging all of the weekly ceilings computed using average

auction rates during the three calendar months preceding the

computation date of the ceiling.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.009. MAXIMUM AND MINIMUM WEEKLY, MONTHLY, QUARTERLY, OR

ANNUALIZED CEILING. (a) If the rate computed for the weekly,

monthly, quarterly, or annualized ceiling is less than 18 percent

a year, the ceiling is 18 percent a year.

(b) Except as provided by Subsection (c), if the rate computed

for the weekly, monthly, quarterly, or annualized ceiling is more

than 24 percent a year, the ceiling is 24 percent a year.

(c) For a contract made, extended, or renewed under which credit

is extended for a business, commercial, investment, or similar

purpose, the limitation on the ceilings determined by those

computations is 28 percent a year.

(d) For an open-end account credit agreement that provides for

credit card transactions on which a merchant discount is not

imposed or received by the creditor, the ceiling is 21 percent a

year.

(e) Repealed by Acts 1999, 76th Leg., ch. 1348, Sec. 5, eff.

Sept. 1, 1999.

(f) In this chapter, "weekly ceiling," "monthly ceiling,"

"quarterly ceiling," or "annualized ceiling" refers to that

ceiling as determined after the application of this section.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999. Amended by Acts 1999, 76th Leg., ch. 1348, Sec. 5, eff.

Sept. 1, 1999.

Amended by:

Acts 2005, 79th Leg., Ch.

1018, Sec. 2.02, eff. September 1, 2005.

Sec. 303.010. COMPUTATION OF CEILING IF INFORMATION UNAVAILABLE.

If any of the information required to compute a ceiling is

discontinued or is otherwise not available to the consumer credit

commissioner from the Federal Reserve Board in the time required

for the computation, the ceiling last computed remains in effect

until the information becomes available and a new ceiling is

computed from the obtained information.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.011. PUBLICATION OF RATE CEILINGS. (a) The consumer

credit commissioner shall send the rate ceilings computed under

this subchapter to the secretary of state for publication in the

Texas Register.

(b) The monthly, quarterly, or annualized ceiling shall be

published before the 11th day after the date on which the ceiling

is computed.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.012. JUDICIAL NOTICE. A court may take judicial notice

of interpretations issued by the consumer credit commissioner or

information published in the Texas Register under Section

303.011.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.013. DETERMINATION OF CEILING FOR CONTRACT TO RENEW OR

EXTEND DEBT PAYMENT. The rate ceiling for a contract to renew or

extend the terms of payment of a debt is the ceiling in effect

under this chapter when the contract for renewal or extension is

made, regardless of when the debt is incurred.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.014. RATE FOR LENDER CREDIT CARD AGREEMENT WITH

MERCHANT DISCOUNT. On an amount owed for a credit card

transaction under a lender credit card agreement that imposes or

allows the creditor to receive a merchant discount, the creditor

may not contract for, charge, or receive:

(1) a rate that exceeds the ceiling provided under Section

303.006(c); or

(2) a fee or charge that:

(A) is not allowed under Chapter 346; or

(B) exceeds the amount allowed under Chapter 346.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.015. VARIABLE RATE. (a) The parties to a contract,

including a contract for an open-end account, may agree to any

index, formula, or provision of law by which the interest rate or

amount of time price differential will be determined, but the

agreed rate of interest or yield from an amount of time price

differential may not exceed the amount that would be produced by

the rate ceiling applicable to the contract.

(b) A variable contract rate described by this section may not

be used in a contract in which the interest or time price

differential is precomputed and added into the amount of the

contract at the time the contract is made.

(c) A variable rate agreement for credit extended primarily for

personal, family, or household use must include the disclosures

identified for variable rate contracts required by regulations

issued by the Federal Reserve Board under the Truth in Lending

Act (15 U.S.C. Section 1601 et seq.), as amended, except that if

that Act does not apply because of the amount of the transaction,

the following disclosure must be included in a size equal to at

least 10-point type that is boldface, capitalized, underlined, or

otherwise set out from surrounding material so as to be

conspicuous:

"NOTICE TO CONSUMER: UNDER TEXAS LAW, IF YOU CONSENT TO THIS

AGREEMENT, YOU MAY BE SUBJECT TO A FUTURE RATE AS HIGH AS 24

PERCENT PER YEAR."

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.016. CHARGING OF RATE LOWER THAN AGREED RATE. A

creditor may charge an interest rate or amount of time price

differential that is lower than the rate or amount agreed to in

the contract.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.017. VARIOUS CHARGES ON CONSUMER LOANS MADE BY

PARTICULAR LENDERS. Notwithstanding Section 342.005, a bank,

savings association, savings bank, or credit union making a loan

primarily for personal, family, or household use under authority

of this chapter may charge all reasonable expenses and fees

incurred in connection with making, closing, disbursing,

extending, readjusting, or renewing a loan not secured by real

property, whether or not those expenses or fees are paid to third

parties. Those reasonable expenses and fees paid to third

parties are not interest.

Added by Acts 2005, 79th Leg., Ch.

1018, Sec. 2.03, eff. September 1, 2005.

SUBCHAPTER B. OPEN-END ACCOUNTS

Sec. 303.101. OPEN-END ACCOUNT: CEILINGS. (a) To use the

quarterly or annualized ceiling for setting the interest rate on

current and future open-end account balances, the agreement must

provide for use of the ceiling, and the creditor must give notice

of the interest rate after the date on which the quarterly or

annualized ceiling is computed but before the last day of the

next succeeding calendar quarter.

(b) If the annualized ceiling is used, the rate is effective for

the 12-month period beginning on the date on which the rate takes

effect for the account.

(c) If the quarterly ceiling is used, the rate is effective for

the three-month period beginning on the date on which the rate

takes effect for the account. For an open-end account authorized

under Section 342.455 or 346.003, in connection with which credit

card transactions are authorized or a merchant discount is

imposed or received by the creditor, the quarterly ceiling shall

be adjusted, at the option of the creditor, on:

(1) the effective dates provided by Section 303.008; or

(2) the first day of the first billing cycle of the account

beginning after those dates.

(d) If a quarterly or annualized ceiling is being used for an

account and if the rate for the applicable period is less than or

equal to the ceiling to be in effect for the succeeding period of

equal length, the creditor may leave that rate in effect for the

succeeding period.

(e) A creditor who has disclosed to an obligor that an election

may be renewed under Subsection (d) is not required to give

additional notice of a renewal under that subsection.

(f) To increase a previously agreed rate, a creditor shall

comply with Section 303.103 before the end of the last calendar

quarter of the period in which the rate previously agreed to is

in effect. The ceiling in effect for that period remains the

ceiling until the parties to the agreement agree to a new rate.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.102. VARIABLE RATE OPEN-END ACCOUNT: CEILINGS. The

applicable rate ceiling for an open-end account agreement that

provides for a variable rate or amount according to an index,

formula, or provision of law disclosed to the obligor, other than

a variable rate commercial contract that is subject to Section

303.004, is the annualized, quarterly, or weekly ceiling as

disclosed to the obligor. The annualized ceiling shall be

adjusted after each 12-month period, the quarterly ceiling shall

be adjusted after each three-month period, and the weekly ceiling

shall be adjusted weekly.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.103. OPEN-END ACCOUNT: CHANGE OF AGREEMENT TERM. (a)

An agreement covering an open-end account may provide that the

creditor may change the terms of the agreement for current and

future balances of that account by giving notice of the change to

the obligor.

(b) A notice under this section to change a provision of an

account, including the rate, or the index or formula used to

compute the rate, must include:

(1) the new provision, the new rate, or the index or formula to

be used to compute the rate;

(2) the date on which the change is to take effect;

(3) the period for which the change is to be effective or after

which the rate will be adjusted;

(4) a statement of whether the change is to affect current and

future balances; and

(5) the obligor's rights under this section and the procedures

for the obligor to exercise those rights.

(c) A creditor who increases a rate shall include with a notice

required by this section a form that may be returned at the

expense of the creditor and on which the obligor may indicate by

checking or marking an appropriate box or by a similar

arrangement the obligor's decision not to continue the account.

The form may be included on a part of the account statement that

is to be returned to the creditor or on a separate sheet. In

addition to the requirements of Subsection (b), the notice must

include:

(1) the address to which the obligor may send notice of the

obligor's election not to continue the open-end account; and

(2) the following statement printed in not less than 10-point

type or computer equivalent:

"YOU MAY TERMINATE THIS AGREEMENT IF YOU DO NOT WISH TO PAY THE

NEW RATE."

(d) An obligor is considered to have agreed to a change under

this section if the creditor mails a notice required by this

section to the obligor's most recent address shown in the

creditor's records and:

(1) the obligor chooses to retain the privilege of using the

open-end account;

(2) the obligor or a person authorized by the obligor accepts or

uses an extension of credit after the fifth day after the date on

which the notice is mailed; or

(3) the obligor does not notify the creditor in writing before

the 21st day after the date on which the notice is mailed that

the obligor does not wish to continue to use the open-end

account.

(e) An obligor who rejects a rate change in accordance with this

section is entitled to pay the balance on the open-end account at

the rate and over the period in effect immediately before the

date of the proposed change and under the same minimum payment

terms provided by the agreement. Rejection of a new rate does not

accelerate payment of the balance due.

(f) The procedure provided by this section for changing the

terms of an agreement is in addition to other means of amending

the agreement provided by law.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.104. DISCLOSURE OF DECREASE IN INTEREST RATE NOT

REQUIRED ON OPEN-END ACCOUNTS INVOLVING CREDIT CARD TRANSACTION

OR MERCHANT DISCOUNT. On an open-end account authorized under

Section 342.455 or 346.003, in connection with which credit card

transactions are authorized or a merchant discount is imposed or

received by the creditor and on which interest is charged under

this chapter, the creditor is not required to disclose a decrease

in the applicable interest rate.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.105. OPEN-END ACCOUNT: DISCLOSURE OF CERTAIN RATE

VARIATIONS. (a) Except as provided by Subsection (b), a

variation in an interest rate on an account resulting from

operation of the previously disclosed index, formula, or

provision of law is not required to be disclosed under Section

303.101 or 303.103.

(b) Except as inconsistent with federal law, the creditor on an

open-end account agreement that provides for a variable interest

rate according to an index, formula, or provision of law, that is

primarily for personal, family, or household use, and that is

subject to this chapter shall give to the obligor notice of a

change in the rate resulting from operation of the index,

formula, or provision of law. The notice must be given:

(1) by a document mailed on or before the beginning of the first

cycle for which the change becomes effective; or

(2) on or with:

(A) the billing statement for a billing cycle that precedes the

cycle for which the change becomes effective, if the account is

covered by Section 303.006(c); or

(B) any billing statement, if the account is not covered by

Section 303.006(c).

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.106. OPEN-END ACCOUNT: CEILING FOR PLAN OR ARRANGEMENT.

If a creditor implements a quarterly or annualized ceiling for a

majority of the creditor's open-end accounts that are under a

particular plan or arrangement and that are for obligors in this

state, that ceiling is also the ceiling for all open-end accounts

that are opened or activated under that plan for obligors in this

state during the period that the election is in effect.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

SUBCHAPTER C. PROVISIONS APPLICABLE TO CERTAIN CONSUMER LOANS AND

SECONDARY MORTGAGE LOANS

Sec. 303.201. LICENSE REQUIRED. A person engaged in the

business of making loans for personal, family, or household use

for which the rate is authorized under this chapter must obtain a

license under Chapter 342 unless the person is not required to

obtain a license under Section 342.051.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Amended by:

Acts 2005, 79th Leg., Ch.

1018, Sec. 2.04, eff. September 1, 2005.

Sec. 303.202. APPLICABILITY OF SUBTITLE B. Except as

inconsistent with this chapter:

(1) a person engaged in the business of extending open-end

credit primarily for personal, family, or household use and who

charges on an open-end account a rate or amount under authority

of this chapter is subject to the applicable chapter in Subtitle

B; and

(2) a party to an account described by Subdivision (1) or the

party's assignees have all the rights, duties, and obligations

under that applicable chapter.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.203. AUTOMOBILE CLUB MEMBERSHIP OFFERED IN CONNECTION

WITH A LOAN. (a) A lender may, at the time or after a loan is

made, offer to sell to the borrower and finance in the loan

contract a charge for an automobile club membership.

(b) The lender may not require the purchase of the membership

authorized under Subsection (a) as a condition for approval of

the loan.

(c) The borrower shall provide the lender with written

acknowledgment of the borrower's intent to purchase the

membership.

(d) The amount charged for a membership as authorized by

Subsection (a) must be reasonable.

Added by Acts 2005, 79th Leg., Ch.

252, Sec. 1, eff. September 1, 2005.

SUBCHAPTER D. LIMITATIONS ON APPLICABILITY OF CHAPTER

Sec. 303.301. AGREEMENT TO WHICH CHAPTER DOES NOT APPLY. The

rate ceilings provided by this chapter do not apply to an

agreement:

(1) under which credit is extended by the seller, or an owner,

subsidiary, or corporate affiliate of the seller, for a

transaction governed by Chapter 601, Business & Commerce

Code; and

(2) that is secured by a lien on the obligor's homestead.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.16, eff. April 1, 2009.

Sec. 303.302. REQUIREMENTS INCONSISTENT WITH FEDERAL LAW. (a)

A person is not required to comply with a disclosure or notice

requirement of this chapter that is inconsistent with federal

statute or regulation.

(b) A creditor may modify a disclosure or notice requirement of

this chapter to conform to federal law.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

SUBCHAPTER E. ENFORCEMENT

Sec. 303.401. WHEN ACT OR OMISSION NOT VIOLATION. An act or

omission does not violate this title if the act or omission

conforms to an interpretation of this title that is in effect at

the time of the act or omission and that was made by:

(1) the consumer credit commissioner under Section 14.108; or

(2) an appellate court of this state or the United States.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.402. PENALTY FOR VIOLATION OF CHAPTER FOR CERTAIN

CONTRACTS SUBJECT TO SUBTITLE B. (a) A person who contracts

for, charges, or receives under a contract subject to Chapter

342, 345, 346, 347, or 348, including a contract for an open-end

account, a rate or amount of time price differential that exceeds

the maximum applicable rate or amount authorized by the

applicable chapter or this chapter is subject to a penalty for

that violation determined under Chapter 349.

(b) For a contract described by Subsection (a) that contains a

rate or amount authorized under this chapter, the failure to

perform a duty or comply with a prohibition provided by this

chapter is subject to Chapter 349 as if this chapter were in

Subtitle B.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.403. PENALTY FOR VIOLATION OF CEILING IN CERTAIN

CONTRACTS. A written contract, other than a contract to which

Section 303.402 applies, that directly or indirectly provides for

a rate that exceeds the rate authorized by this chapter and that

is not otherwise authorized by law, is subject to the penalty

prescribed by Chapter 305.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.404. ENFORCEMENT BY CONSUMER CREDIT COMMISSIONER.

Subject to Subchapter B, Chapter 341, the consumer credit

commissioner shall enforce Subtitles B and C as they apply to

contracts subject to those chapters.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.405. EXAMINATION OF RECORDS; INSPECTIONS; RULES. (a)

Section 342.552 applies to a transaction:

(1) that is made by a person who holds a license under Chapter

342;

(2) that is subject to Chapter 342 or 346; and

(3) the rate of which is authorized by this chapter.

(b) Subchapter L, Chapter 342, applies to a loan:

(1) that is subject to Chapter 342; and

(2) the rate of which is authorized by this chapter.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.406. ENFORCEMENT BY CREDIT UNION COMMISSIONER. The

credit union commissioner shall enforce this chapter as it

applies to contracts subject to Subtitle D, Title 3.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.407. ENFORCEMENT BY TEXAS DEPARTMENT OF INSURANCE. The

Texas Department of Insurance shall enforce this chapter as it

applies to contracts subject to Chapter 651, Insurance Code.

Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Amended by:

Acts 2005, 79th Leg., Ch.

728, Sec. 11.113, eff. September 1, 2005.

SUBCHAPTER F. EFFECT ON OTHER STATUTES OF USING OPTIONAL RATE

Sec. 303.501. APPLICABILITY OF CREDIT UNION ACT. Except as

inconsistent with this chapter:

(1) a person subject to Subtitle D, Title 3, who contracts for,

charges, or receives a rate or amount authorized by this chapter

remains subject to that subtitle; and

(2) a party to a transaction described by Subdivision (1) has

all the rights provided by that subtitle.

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Sec. 303.502. APPLICABILITY OF CHAPTER 24, INSURANCE CODE. (a)

Except as inconsistent with this chapter:

(1) a person subject to Chapter 651, Insurance Code, who

contracts for, charges, or receives an interest rate authorized

by this chapter remains subject to that chapter; and

(2) a party to an insurance premium finance agreement, including

an agreement for an open-end account, has all the rights provided

by Chapter 651, Insurance Code.

(b) The licensing requirements of Chapter 342 do not apply to a

transaction described by Subsection (a)(1). The penalty

provisions of this title do not apply to a transaction described

by Subsection (a)(1).

Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.

1, 1999.

Amended by:

Acts 2005, 79th Leg., Ch.

728, Sec. 11.114, eff. September 1, 2005.