TX home equity loans on the ballot in Nov

 Owner-occupied, Regulations, Residential Mortgage  Comments Off on TX home equity loans on the ballot in Nov
Jun 142017

For more information, please contact me at (512) 261-1542 or steve@LoneStarLending.com.

By G. Steven Bray

Texans will have a chance to vote this fall on important changes to lending rules for home equity loans. The changes will allow those with lower-valued homes and rural homes to gain access to their home equity.

Texas has strong homestead protections that are written into the state constitution. Thus, changes to rules governing home equity require voter approval.

Currently, fees associated with a home equity loan are capped at 3% of the loan amount. While a cap on fees sounds great, it doesn’t take into account that certain fees, such as the appraisal and survey fees, don’t vary by loan size. This has prevented many homeowners of lower-valued homes from accessing their equity because the fees would exceed the cap. The new rules cap the fees at 2% but exclude fees associated with the appraisal, survey, and title policy.

The new rules also will allow owners of homes on agricultural land to apply for home equity loans. While this is a favorable development, it will be interesting to see which lenders will be interested in these loans. I suspect conventional lenders will shy away because the loans will be difficult to package with other home equity loans.

A final change will particularly benefit homeowners who used higher-rate, home equity second mortgages for things like remodeling their homes. Previously, a home equity loan only could be refinanced with another home equity loan. The change allows the homeowner to refinance their first and second mortgages into a new conventional loan that is free from the home equity restrictions.

Click here for more information about the amendment.

Applying for Homestead Exemptions in Texas

 Owner-occupied  Comments Off on Applying for Homestead Exemptions in Texas
Jan 272012

Homestead exemptions reduce your property taxes by lowering the property value the county appraisal district uses to calculate your tax bill. You may apply for a homestead exemption for a home you own and treat as your principal residence. That home can be a separate structure, condominium, or a manufactured home located on owned or leased land of up to 20 acres.

To qualify, the home must be your principal residence on January 1st of the year in which you want the exemption. If you are age 65 and older or disabled, you may qualify for an additional homestead exemption for which the January 1st requirement does not apply.

You apply for the exemption by filing an>Application for Residential Homestead Exemption with your county appraisal district. You may apply up to one year after the taxes are due (generally January 31st of each year). Once you receive the exemption, you do not need to reapply unless the appraisal district sends you a new application.

There is NO fee for applying for a homestead exemption, and the process is very simple. Beware of companies offering to process your application for a fee. Their offers may come in official-looking envelopes, but they are scams. Again, filing for a homestead exemption is FREE.

For more information, please visit the state’s Frequenty Asked Questions Web page.