| |
| |
|
|
A BILL TO BE ENTITLED
|
|
|
AN ACT
|
|
|
relating to interest on commercial loans. |
|
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
|
SECTION 1. Section 306.002, Finance Code, is amended by |
|
|
adding Subsection (c) to read as follows: |
|
|
(c) The provisions of this chapter do not affect |
|
|
transactions that are not subject to this chapter nor affect or |
|
|
negatively impact any rule of law applicable to transactions not |
|
|
subject to this chapter. |
|
|
SECTION 2. Section 306.003, Finance Code, is amended to |
|
|
read as follows: |
|
|
Sec. 306.003. COMPUTATION OF LOAN TERMS [TERM]. (a) In |
|
|
addition to any other method otherwise permitted under this title, |
|
|
a creditor and an obligor may agree to compute an annual interest |
|
|
rate on a commercial loan on a 365/360 basis, determined by applying |
|
|
the ratio of the percentage annual interest rate agreed to by the |
|
|
parties over a year of 360 days, multiplied by the outstanding |
|
|
principal balance, multiplied by the actual number of days the |
|
|
principal balance is outstanding. A creditor and an obligor may |
|
|
also agree to compute the term and rate of a commercial loan based |
|
|
on a 360-day year consisting of 12 30-day months. Each [For
|
|
|
purposes of this chapter, each] rate ceiling under Chapters 302 and |
|
|
303 expressed as a rate per year may mean a rate per year computed in |
|
|
accordance with this section [consisting of 360 days and of 12
|
|
|
30-day months]. |
|
|
(b) A creditor and an obligor may agree that one or more |
|
|
payments of interest due or that are scheduled to be due with |
|
|
respect to a commercial loan may be paid on a periodic basis, but |
|
|
not more often than monthly, wholly or partly by adding to the |
|
|
principal balance of the loan the amount of unpaid interest due or |
|
|
scheduled to be due. On and after the date an amount of interest is |
|
|
added to the principal balance under this subsection, that amount |
|
|
no longer constitutes interest, but instead constitutes part of the |
|
|
principal for purposes of calculating the maximum lawful rate or |
|
|
amount of interest on the loan. |
|
|
SECTION 3. The changes in law made by this Act apply only to |
|
|
a loan agreement entered into on or after the effective date of this |
|
|
Act. A loan agreement entered into before the effective date of |
|
|
this Act is governed by the law in effect on the date the agreement |
|
|
was entered into, and the former law is continued in effect for that |
|
|
purpose. |
|
|
SECTION 4. This Act takes effect September 1, 2013. |