Change Address

VOTE411 Voter Guide

Proposition 2 (SJR 60) (Propuesta 2)

Official Ballot Language: The constitutional amendment to establish a lower amount for expenses that can be charged to a borrower and removing certain financing expense limitations for a home equity loan, establishing certain authorized lenders to make a home equity loan, changing certain options for the refinancing of home equity loans, changing the threshold for an advance of a home equity line of credit, and allowing home equity loans on agricultural homesteads.Lenguaje oficial en la boleta electoral:Enmienda constitucional para establecer una cantidad menor para los gastos que se pueden cobrar a un prestatario y eliminar ciertas limitaciones de gastos de financiación para un préstamo con garantía hipotecaria, establecer ciertos prestamistas autorizados para hacer un préstamo con garantía hipotecaria, cambiar ciertas opciones para la refinanciación de los préstamos de segunda hipoteca, cambiar del umbral para un anticipo de una línea de crédito con respaldo hipotecario y otorgar préstamos con garantía hipotecaria sobre las granjas agrícolas.Explanation:Proposition 2 would amend Article 16, Section 50(a)(6) of the Texas Constitution that governs home equity loans - money borrowed against the value of a homestead by it's owner using the property as a guarantee to repay the loan. This amendment proposes changes to the following terms:Fee cap. Lower the maximum limit on fees that can be charged to borrowers from 3% to 2% of the loan principal and exclude the cost of appraisals, property surveys, title insurance premiums, title insurance, and title examination reports from calculation of the maximum limit on fees.Refinancing. Allow a home equity loan to be refinanced as a non-home equity loan secured with a lien against the property if certain conditions are met. This is currently prohibited.Home equity lines of credit. Repeal a provision that prevents additional advances on a home equity line of credit if the unpaid principal exceeds 50% of the fair market value of the homestead.Agricultural homesteads. Allow a home equity loan for a homestead designated for agricultural use. This is currently prohibited.Approved lenders. Expand the list of approved home equity lenders by adding subsidiaries of banks, savings and loan associations, savings banks, and credit unions; and replace mortgage brokers with mortgage bankers and mortgage companies. Explicación: La Proposición 2 enmendaría el Artículo 16, Sección 50(a)(6) de la Constitución de Texas que gobierna el dinero de los préstamos hipotecarios contra el valor de la casa por su propietario utilizando la propiedad como garantía para pagar el préstamo. Esta enmienda propone cambios a los siguientes términos:Tasa límite. Disminuir el límite máximo en tarifas que le pueden cobrar a los prestatarios del 3% al 2% del principal del préstamo y excluir el costo de avalúos, medidas de la propiedad, el título de las primas de seguro, título de seguro e informes del título del examen de cálculo del límite máximo sobre las tarifas.Refinanciamiento. Permitir que un préstamo hipotecario sea refinanciado como un préstamo sin garantía hipotecaria con un gravamen contra la propiedad si se cumplen ciertas condiciones. Esto actualmente está prohibido.Línea de Crédito con Respaldo Hipotecario. Derogar la disposición que impide avances adicionales sobre una línea de crédito con respaldo hipotecario si el saldo del principal excede del 50% del valor real de la casa.Fincas agrícolas. Permitir un préstamo hipotecario para una finca designada para uso agrícola. Esto actualmente está prohibido.Prestamistas aprobados. Ampliar la lista de prestamistas hipotecarios aprobados al añadir a subsidiarias de bancos, asociaciones de ahorro y préstamo, bancos de ahorro y uniones de crédito; y reemplazar a corredores hipotecarios con banqueros de hipoteca y compañías hipotecarias.
CHOOSE TWO CANDIDATES FROM BELOW TO COMPARE
  • For (A Favor)

  • Against (En Contra)

Change Candidates

Information

Arguments

The proposed amendment will make home equity loans more accessible, lower costs for borrowers, and provide consumers more choice.

Fee Cap. Lenders will be able to male loans under $100,000 more easily; the feecap will not include fees by third parties, and consumers will still be protected against extreme fees from lenders.

Refinancing. Allowing a home equity loan to be refinanced into a non-home equity loan within a restrictions would increase consumer choice. The borrower could combine a home equity loan with another loan to have one payment to to get a lower interest rate.

Home equity lines of credit. The change would allow the borrower to initially take out a smaller loan and pay less interest before the borrowing more against the line of credit.

Agricultural homesteads. Owners of large and small agricultural homesteads should have the same choice as other Texans to borrow against their property under the consumer protections of a home equity loan.
The proposed amendment will raise costs for borrowers and remove several important consumer protections that have worked for borrowers and lenders.

Fee cap. Adding the costs for appraisals, survey, and title insurance and reports on top of a maximum fee limit of 2% of the loan principal would likely be higher than the current 3% cap on all fees.

Refinancing. Home equity loans have important protections related to judicial foreclosure and protection against loss of non-home assets. A new home equity loan with the consumer protections is a better option than a non-home equity loan without those protections.

Home equity lines of credit. Current limits require the borrower to budget carefully for projected expenses and their repayment.

Agricultural homesteads. Home equity loans and lines of credit for agricultural properties are costlier than farm operating loans and lines of credit due to the added large costs for appraisals, surveys, and title insurance reports.

VOTE411.org logo

Disclaimer:

All statements and videos are posted directly by the candidate, unedited by the League of Women Voters and do not express the views of the League. The League never supports or opposes candidates or political parties.