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Re: Sect 35 Home Equity (Closed end) balloon

Home Forums Truth in Lending/ Regulation Z Sect 35 Home Equity (Closed end) balloon Re: Sect 35 Home Equity (Closed end) balloon

#2815
BDyess
Member

It is my understanding that the Texas Constitution specifically prohibits balloon payments on home equity – see https://www.statutes.legis.state.tx.us/Docs/CN/htm/CN.16.htm#16.50 – Article 16, Section 50(a)(6)(L)(i) where it states that the home equity loan must be scheduled to be repaid

in substantially equal successive periodic installments, not more often than every 14 days and not less often than monthly, beginning no later than two months from the date the extension of credit is made, each of which equals or exceeds the amount of accrued interest as of the date of the scheduled installment…

BUT you REALLY need to seek legal advice when doing TX home equity.