News & Analysis as of

Texas Lenders

Orrick, Herrington & Sutcliffe LLP

Texas enacts new disclosure and registration requirements for commercial financing transactions

Recently, the governor of Texas signed HB 700 into law, amending Title 5 of the Texas Finance Code to establish new disclosure and registration requirements for certain commercial sales-based financing transactions. Under the...more

Eversheds Sutherland (US) LLP

Texas Supreme Court announces new method of calculating maximum interest for commercial transactions

On May 23, 2025, the Texas Supreme Court redetermined the method for calculating the maximum allowable interest for commercial loans under Chapter 306 of the Texas Finance Code. The decision is a radical change in how...more

Sheppard Mullin Richter & Hampton LLP

Texas Passes Legislation to Regulate Sales-Based Financing

On June 20, Texas Governor Greg Abbot signed into law HB 700, adding Chapter 398 to the Texas Finance Code. Effective September 1, the statute establishes a regulatory framework for commercial sales-based financing and...more

Mayer Brown

Texas Commercial Financing Disclosure and Registration Law Threatens Sales-Based Financing Industry

Mayer Brown on

Texas has enacted a law that has the potential to place substantial impediments on sales-based financing providers, including merchant cash advance companies, seeking to operate in Texas. The new Texas law prohibits...more

Troutman Pepper Locke

Texas Enacts New Commercial Sales-Based Financing Bill Severely Restricting Automatic Debits

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On June 20, the Texas Legislature passed H.B. 700, which introduces several new regulatory requirements for providers and brokers of commercial sales-based financing operating within the state. The law applies to merchant...more

Sheppard Mullin Richter & Hampton LLP

Texas Supreme Court Issues New Interpretation of Texas Usury Law

On May 23, the Texas Supreme Court issued an opinion holding that in determining whether a commercial loan is usurious under Texas state law, the “actuarial method” must be employed. This requires the applicable amount of...more

Orrick, Herrington & Sutcliffe LLP

Texas Supreme Court answers Fifth Circuit’s question on loans in ruling

On May 23, the Supreme Court of Texas ruled that the maximum permissible interest on a loan must be calculated using the declining principal balance rather than the initial total principal amount. This decision was in...more

Katten Muchin Rosenman LLP

Maximum Interest Must Be Calculated Using the Actuarial Method Resulting in Lower Interest Charges as Principal Balance Declines

Commercial lenders in Texas should be made aware of the Texas Supreme Court’s new decision in American Pearl Group, LLC v. National Payment Systems, LLC, No. 24-0758. In that case, the Court clarified the “actuarial method”...more

Sheppard Mullin Richter & Hampton LLP

Texas Legislature Proposes Disclosure Rules for Commercial Financing 

The Texas House and Senate introduced House Bill 700 and Senate Bill 2677 to regulate commercial sales-based financing transactions. The proposed legislation would impose standardized disclosure requirements, require broker...more

Troutman Pepper Locke

Texas Introduces Legislation to Regulate Sales-Based Commercial Financing

Troutman Pepper Locke on

Last month, the Texas legislature introduced two companion bills, S.B. No. 2677 and H.B. No. 700, to regulate sales-based commercial financing. For purposes of the proposed legislation, sales-based financing is a transaction...more

Proskauer Rose LLP

The End of Non-Pro Rata Uptiers? Fifth Circuit Rules that Serta Exchange was Not an “Open Market Purchase”

Proskauer Rose LLP on

The United States Court of Appeals for the Fifth Circuit (the “Fifth Circuit”) ruled on December 31, 2024 that Serta Simmons Bedding’s (“SSB”) 2020 uptier exchange included a transaction that, contrary to the assertions of...more

Sheppard Mullin Richter & Hampton LLP

Texas Passes Law Expanding Mortgage Borrower Protections

Effective November 23, 2024, the Texas Department of Savings and Mortgage Lending (the “DSML”) adopted new rules affecting mortgage loan companies, mortgage bankers, individual residential mortgage loan originators, and...more

McGlinchey Stafford

Lender FAQs: Understanding Texas Home Equity Loan Modifications

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As interest rates decline in 2024, lenders who make home loans to Texas residents are seeing an uptick in loan modification requests. Although a “mod” for a conventional loan is straightforward, there are – as always – unique...more

King & Spalding

Texas Bankruptcy Court Awards Majority Stake in Reorganized Debtor to Unsecured Creditors After Avoiding the Value of the...

King & Spalding on

On August 3, 2023, the U.S. Bankruptcy Court for the Southern District of Texas found that the majority of the shares of stock of a reorganized debtor should be allocated to unsecured creditors, and not the secured creditors,...more

McGlinchey Stafford

Texas Home Equity Lenders: Understanding New Legislative Changes

McGlinchey Stafford on

Release of Liens- One statute specifically affects mortgage servicers and mortgagees. The statute (House Bill 219) adds Section 343.108 to the Texas Finance Code, which requires a mortgage servicer or mortgagee to deliver a...more

King & Spalding

The Texas Court of Appeals Reverses Lender/Investor’s Damages Award Against Lender

King & Spalding on

On February 14, 2023, the Texas Court of Appeals reversed awards totaling $63 million entered against Credit Suisse after a jury trial and bench trial for Claymore Holdings, LLC, the assignee of a lender-investor. The case...more

King & Spalding

"Trust the Force"

King & Spalding on

Fifth Circuit Concludes That Forced Change of Control Was Not The Product of Duress - The U.S. Court of Appeals for the Fifth Circuit affirmed a lower court’s rejection of a guarantor’s duress defense in the face of a $58...more

McGlinchey Stafford

State COVID-related Foreclosure and Eviction Moratorium Updates

McGlinchey Stafford on

Alert October 23, 2020 Due to the economic impacts of COVID-19, many states have issued moratoriums on foreclosures and evictions. Some of those moratoriums have expired. However, even if a lender is now able to obtain a...more

McGlinchey Stafford

Florida and Texas Extend Borrower Protections Through September

McGlinchey Stafford on

Florida’s Governor Desantis has extended Executive Order Number 20-180 to 12:01 a.m. on October 1, 2020. The Executive Order, titled “Limited Extension of Mortgage Foreclosure and Eviction Relief” provides, in relevant part: ...more

Pillsbury Winthrop Shaw Pittman LLP

Texas: State and Local COVID-19 Social Distancing Measures

Aiming to protect public health within a large and diverse geography and an independent-minded culture, Texas responds to the COVID-19 pandemic with an evolving patchwork of state and local social distancing orders. To date,...more

Foley & Lardner LLP

Reducing Employee Hours v. Layoffs: A Texas Alternative

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Like most employers worldwide facing economic difficulties, Texas employers are struggling with the issue of how to avoid massive layoffs. The Texas Workforce Commission Shared Work Program is one example of a solution that...more

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