Texas Allowable Charges and 2% Home Equity Fees






















Fees and Charges First Lien Second Lien*

(if Chapter 342 of the Texas Finance code does not apply)

Second Lien*

(if Chapter 342 of the Texas Finance Code does apply)

 Texas 50(a)(6) Home Equity Included in 2% Cap
Administrative Fee Not regulated. Loans with interest rates of 10% or less may charge “loan fees” under 303.017 (or 34.203) and effectively obtain the same fees as with an administrative fee. Texas Finance Code, 342.301(a)(9), allows a lender to collect an administrative fee in an amount not to exceed $25 for a loan of more than $1,000 or $20 for a loan of $1,000 or less, which is considered earned when the loan is made or refinanced. It is not subject to refund and may not be contracted for or received for a loan more often than once in any 180-day period. Yes
Application Fee No limit on the amount or type of fee.

Maximum Fee: None.

Customary Fee: A combination of the appraisal fee and the credit report fee represents the application fee 		No limit on the amount or type of fee.

Maximum Fee: None.

Customary Fee: A combination of the appraisal fee and the credit report fee represents the application fee 		Not allowed Yes
Appraisal Fee Not regulated.

Maximum Fee: None.

Customer Fee: The actual fee charged 		Not regulated.

Maximum Fee: None.

Customer Fee: The actual fee charged 		Texas Finance Code Section 342.308(a)(4) allows "reasonable fees for an appraisal of real property offered as security for the loan prepared by a certified appraiser who is not a salaried employee of the lender."

Maximum Fee: "a reasonable fee."

Customary Fee: The actual fee charged 		No. As long as appraisal is performed by a third-party appraiser
Appraisal Review or AVM See Above See Above See Above Yes
Assignment Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary

Not regulated.

Maximum Fee: None.

Customary Fee: Not customary

Not allowed Yes
Assumption Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary 		Not allowed Yes
Attorney's Fee Texas Gov't Code Ann. Sec. 83.001 states:

"'83.001. Prohibited Acts

(a) A person, other than a person designated in Subsection (b), may not charge or receive, either directly or indirectly, any compensation for all or part of the preparation of a legal instrument affecting title to real property, including a deed, deed of trust, note, mortgage, and transfer of release of lien.

(b) This section does not apply to:

(1) an attorney licensed in this state;
(2) a licensed real estate broker or salesman performing the acts of a real estate broker pursuant to The Real Estate License Act (Article 6573a, Vernon's Texas Civil Statues); or

(3) a person performing acts relating to a transaction for the lease, sale, or transfer of any mineral or mining interest in real property.

(c) This section does not prevent a person from seeking reimbursement for costs incurred by the person to retain a licensed attorney to prepare an instrument."

Maximum Fee: None.

Customary Fee: $200.00 to $500.00 		Texas Gov't Code Ann. Sec. 83.001 states:

"'83.001. Prohibited Acts

(a) A person, other than a person designated in Subsection (b), may not charge or receive, either directly or indirectly, any compensation for all or part of the preparation of a legal instrument affecting title to real property, including a deed, deed of trust, note, mortgage, and transfer of release of lien.

(b) This section does not apply to:

(1) an attorney licensed in this state;
(2) a licensed real estate broker or salesman performing the acts of a real estate broker pursuant to The Real Estate License Act (Article 6573a, Vernon's Texas Civil Statues); or

(3) a person performing acts relating to a transaction for the lease, sale, or transfer of any mineral or mining interest in real property.

(c) This section does not prevent a person from seeking reimbursement for costs incurred by the person to retain a licensed attorney to prepare an instrument."

Maximum Fee: None.

Customary Fee: $200.00 to $500.00 		Texas Finance Code Section 342.308(a)(2) allows "reasonable fees charged to the lender by an attorney who is not a salaried employee of the lender for preparation of the loan documents in connection with the mortgage loan if the fees are evidenced by a statement for services rendered."

See also "Document Preparation Fee."

Maximum Fee: "a reasonable fee."

Customary Fee: $200.00 to $500.00

Texas Finance Code Section 342.307(2) allows "reasonable fees paid to an attorney who is not an employee of the creditor in the collection of a delinquent secondary mortgage loan."

This fee must be expressly provided for in the loan contract.

********************
and Texas Finance Code Section 342.307(3) allows court costs and fees incurred in the collection of the loan or foreclosure of a lien created by the loan."
********************

Maximum Fee: "a reasonable fee." 		Yes
Broker Fee Not regulated. Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not chargeable to the borrower.

Office of Consumer Credit Commissioner in a letter to Secondary Mortgage Lenders dated December 31, 1981, expressly states "Brokerage fees are not authorized."

Office of Consumer Credit Commissioner Interpretive Letter 88-1, dated January 18, 1988, explains that brokers must be licensed under Article 5069-3 (Texas Credit Title Chapter 3A) if they are in the business of making, negotiating, or arranging secondary mortgage loans. If the funding lender absorbs the expense of the referral fee paid to the originating lender and the borrower pays the same basic interest rate and the same amount of prepaid interest regardless of which authorized lender makes the loan, the lender may pay a licensed lender (broker) a fee."

Maximum Fee: None.

Customary Fee: Determined by market conditions.
  		Yes
Broker Points Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not chargeable to the borrower.

Office of Consumer Credit Commissioner in a letter to Secondary Mortgage Lenders dated December 31, 1981, expressly states "Brokerage fees are not authorized."

Office of Consumer Credit Commissioner Interpretive Letter 88-1, dated January 18, 1988, explains that brokers must be licensed under Article Chapter 3A) if they are in the business of making, negotiating, or arranging secondary mortgage loans. If the funding lender absorbs the expense of the referral fee paid to the originating lender and the borrower pays the same basic interest rate and the same amount of prepaid interest regardless of which authorized lender makes the loan, then the lender may pay a licensed lender (broker) a fee."

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Yes
Closing Agent Fee
(Escrow Fee) 		Not regulated.



Maximum Fee: None.



Customary Fee: Not customary because the Title Companies, typically selected by the seller or the real estate agent, normally conduct residential loan closings. 		Not regulated.



Maximum Fee: None.



Customary Fee: Not customary because the Title Companies, typically selected by the seller or the real estate agent, normally conduct residential loan closings. 		Not allowed if interest rate on loan is above 10%. Otherwise fee is permissible. TFC 342.308. Yes
Commitment Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed. Office of Consumer Credit Commissioner in a letter to Secondary Mortgage Lenders dated December 31, 1981, expressly states "Commitment fees are not authorized." Yes
Copy Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed. Yes
Courier Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed if interest rate on loan is above 10%. Otherwise fee is permissible. TFC 342.308. Yes
Credit Investigation Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed. Yes
Credit Life Allowed. Allowed. Texas Finance Code Section 342.308(a)(7) allows Yes
Credit Report Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Texas Finance Code Section 342.308(a)(5) allows the "reasonable cost of any credit report."

Maximum Fee: "reasonable cost."

Customary Fee: The actual fee charged. 		Yes
Disbursement Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary because the Title Companies, typically selected by the seller or the real estate agent, normally conduct residential loan closings. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary because the Title Companies, typically selected by the seller or the real estate agent, normally conduct residential loan closings. 		Not allowed. Yes
Discount Points Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Office of Consumer Credit Commissioner Interpretive letter 81-9 dated July 14, 1981. According to an unpublished letter from the Office of Consumer Credit Commissioner dated December 1, 1981, points, origination fees and discounts may be charged as interest provided that, when added to the other interest and amortized over the term of the loan, the yield to the lender does not exceed the allowable interest rate at the time the loan was made."

Now Texas Finance Code.

Maximum Fee: Limited by Texas usury.

Customary Fee: Determined by market conditions. 		No, if bona fide and documented (updated 1/24/2014)
Document Preparation Fee Allowed, but the documents must be drawn by a licensed attorney. See "Attorney's Fee" above.

Maximum Fee: None

Customary Fee: $200.00 to $500.00 		Allowed, but the documents must be drawn by a licensed attorney. See "Attorney's Fee" above.

Maximum Fee: None

Customary Fee: $200.00 to $500.00 		Allowed, but the documents must be drawn by a licensed attorney not a salaried employee of the lender and if the fees are evidenced by a statement for services rendered." See "Attorney's Fee" above.

Maximum Fee: "a reasonable fee."

Customary Fee: $200.00 to $500.00. 		Yes
Document Redraw Fee Not regulated.

Maximum Fee: None.

Customary Fee: Determined by contract and reason for redraw. 		Not regulated.

Maximum Fee: None.

Customary Fee: Determined by contract and reason for redraw. 		Not allowed. Yes
Escrow Waiver Not regulated. Not regulated. Not regulated. Yes
Fax Fee Not regulated.

Maximum Fee: None.

Customary Fee: Actual Cost. 		Not regulated.

Maximum Fee: None.

Customary Fee: Actual Cost. 		Not allowed. Yes
Federal Express Fee Not regulated.

Maximum Fee: None.

Customary Fee: Actual Fee charged. 		Not regulated.

Maximum Fee: None.

Customary Fee: Actual Fee charged. 		Not allowed. Yes
Federally Mandated Program Fees Allowed. Allowed. Texas Finance Code Section 342.308(a)(8) allows "reasonable fees relating to real property offered as security for the loan that are incurred to comply with a federally mandated program if the collection of the fees or the participation in the program is required by a federal agency."

Maximum Fee: "a reasonable fee."

Customary Fee: The required fees. 		Yes
Fee for providing Amortization Schedule Not regulated.

Maximum Fee: None.

Customary Fee: The actual cost of providing schedule. 		Not regulated.

Maximum Fee: None.

Customary Fee: The actual cost of providing schedule. 		Not allowed. Yes
Flood Certification Fee Not regulated.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Not regulated.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Allowed fees: Texas Finance Code Section 342.308(a)(8) if "incurred to comply with a federally mandated program." Yes
Funding Fee Not regulated.

Maximum Fee: None.

Customary Fee: Determined by investor. 		Not regulated.

Maximum Fee: None.

Customary Fee: Determined by investor. 		Not allowed. Yes
Guarantee Fee See Title Fees See Title Fees See Title Fees Yes
Hazard/Homeowner’s Insurance Not Regulated. Not Regulated. Not Regulated. No.
Late Charges There are no restrictions on late fees.

Maximum Fee: None.

Customary Fee: The Fannie Mae standard of 5% after 15 days. 		Various provisions of the Texas Finance Code have rules and restrictions governing late charges depending on the type of loan and collateral associated. Summarizing all scenarios for the purposes of this chart is not possible.


Customary Fee: The Fannie Mae standard of 5% after 15 days. 		Late charges may not exceed 5% of any installment not paid for 10 days or more following the date the payment is due. Late charges shall not be collected more than once on the same installment. Texas Finance Code Section 342.302. No.
Lender Inspection Fee Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Borrower may pay only if interest rate is 10% or less. Yes.
Lock in Fee Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not allowed. Yes.
Mortgage Protection Insurance Not regulated.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Not regulated.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Texas Finance Code Section 342.308(a)(7) allows premiums for "other insurance that protects the mortgagee against default by the mortgagor, the benefits of which are applied in whole or in part to reduce or extinguish the loan balance." Yes.
Notary Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary because title companies normally conduct residential closings. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary because title companies normally conduct residential closings. 		Not allowed. Yes.
NSF Fee Allowed under Section 3.506 of the Texas Business and Commerce Code. “Processing fee by holder of dishonored check” provides as follows:

"(a) For purposes of this section, "payment device" means any check, item, paper or electronic payment, or other payment device used as a medium for payment.

"(b) On return of a payment device to the holder following dishonor of the payment device by a payor, the holder, the holder's assignee, agent, or representative, or any other person retained by the holder to seek collection of the face value of the dishonored payment device may charge the drawer or indorser a maximum processing fee of $30.
Maximum Fee: $30.00.

Customary Fee: $30.00 		Allowed under Section 3.506 of the Texas Business and Commerce Code. “Processing fee by holder of dishonored check” provides as follows:

"(a) For purposes of this section, "payment device" means any check, item, paper or electronic payment, or other payment device used as a medium for payment.

(b) On return of a payment device to the holder following dishonor of the payment device by a payor, the holder, the holder's assignee, agent, or representative, or any other person retained by the holder to seek collection of the face value of the dishonored payment device may charge the drawer or indorser a maximum processing fee of $30. Maximum Fee: $30.00.

Customary Fee: $30.00 		Section 342.502(d) of the Texas Finance Code allows same fee as allowed by Section 3.506 of the Texas Business and Commerce Code.

Maximum Fee: $30.00

Customary Fee: $30.00 		No.
Origination Fee or Points Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		According to a letter from the Office of Consumer Credit Commission dated July 14, 1981, points, origination fees and discounts may be charged as interest provided that, when added to the other interest and amortized over the term of the loan, the yield to the lender does not exceed the allowable interest rate at the time the loan was made.

Maximum Fee: Limited by the states usury law.

Customary Fee: Determined by market conditions. 		Yes.
Per Diem Interest Not regulated. Not regulated. Not regulated. No.
Pest Inspection Not regulated. Not regulated. Not regulated. Yes.
Points Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Not regulated.

Maximum Fee: None.

Customary Fee: Determined by market conditions. 		Office of Consumer Credit Commissioner Interpretive letter 81-9 dated July 14, 1981. According to an unpublished letter from the Office of Consumer Credit Commissioner dated December 31, 1981, points, origination fees and discounts may be charged as interest provided that, when added to the other interest and amortized over the term of the loan, the yield to the lender does not exceed the allowable interest rate at the time the loan was made."
Maximum Fee: Limited by Texas usury law.

Customary Fee: Determined by market conditions. 		Yes, if origination

No, if discount and bona fide are documented

No, if included in the rate
Property Taxes Not regulated. Not regulated. Not regulated. No.
Prepayment Penalty State Maximum Texas Finance Code Section 302.102 prohibits prepayment penalties on residential mortgage loans secured by the homestead of the borrower if the interest rate on the loan is greater than 12% unless the charge or penalty is required by an agency created by federal law.
Maximum Fee: None.

Customary Fee: Not customary. 		Texas Finance Code Section 302.102 prohibits prepayment penalties on residential mortgage loans secured by the homestead of the borrower if the interest rate on the loan is greater than 12% unless the charge or penalty is required by an agency created by federal law.
Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed. No.
Processing Fee Not regulated.

Maximum Fee: None.

Customary Fee: $150.00 to $300.00. 		Not regulated.

Maximum Fee: None.

Customary Fee: $150.00 to $300.00. 		Not allowed. Office of Consumer Credit Commissioner Interpretive Letter 87-5, dated December 9, 1987.* Yes.
Recording Fee Allowed.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Allowed.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Texas Finance Code Section 342.308(a)(3) allows "charges prescribed by law that are paid to public officials for determining the existence of a security interest or for perfecting, releasing, or satisfying a security interest."
  		Yes.
Release Fees Allowed.

Maximum Fee: None.

Customary Fee: The actual fee paid to a government entity for recording the release. 		Allowed.

Maximum Fee: None.

Customary Fee: The actual fee paid to a government entity for recording the release. 		Texas Finance Code Section 342.308 (a)(3) allows "charges prescribed by law that are paid to public officials for determining the existence of a security interest or for perfecting, releasing, or satisfying a security interest."
  		Yes.
Review Appraisal Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed. See "Appraisal Fee." Yes.
Satisfaction Fee Not regulated.

Maximum Fee: None.

Customary Fee: The actual cost incurred in preparing and recording the release. 		Not regulated.

Maximum Fee: None.

Customary Fee: The actual cost incurred in preparing and recording the release. 		Texas Finance Code Section 342.308(a)(3) allows "charges prescribed by law that are paid to public officials for determining the existence of a security interest or for perfecting, releasing, or satisfying a security interest."
See "Release fee." 		Yes.
Seller Points Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		If a lender is to receive seller points, such compensation must be considered as part of the interest received on the loan. Since seller points are received at the time of the loan they should be considered as prepaid interest in calculating the interest rate on the contract for the purpose of determining whether the rate charged is within the lawful interest rate ceiling. Office of Consumer Credit Commissioner Interpretive Letter 82-14 dated July 20, 1982* Maximum Fee.

Customary Fee: Not customary. 		No.
Servicing Release Premium Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed. Yes.
State Specific Tax Fees on Mortgage Transactions None.  None. None. Yes.
Survey Fees Not regulated.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Not regulated.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Texas Finance Code Section 342.308(a)(6) allows "reasonable fees for a survey of real property offered as security for the loan prepared by a registered surveyor who is not a salaried employee of the lender."

Maximum Fee: "a reasonable fee."

Customary Fee: The actual fee charged.
 No, as long as survey is performed by a Texas-licensed or registered surveyor
Tax Service Fee Allowed.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Allowed.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Not allowed Yes.
Title Examination, Title Insurance and Title Search Fees Not regulated.

Maximum Fee: None.

Customary Fee: The actual fees charged. 		Not regulated.

Maximum Fee: None.

Customary Fee: The actual fees charged. 		Texas Finance Code Section 342.308(1)(A) and (B) allow "reasonable fees for title examination and preparation of an abstract of title by an attorney who is not an employee of the lender; or a title company or property search company authorized to do business in this state; or premiums or fees for title insurance or title search for the benefit of the mortgagee, and, at the mortgagee's option, for title insurance or title search for the benefit of the mortgagor."
Maximum Fee: "a reasonable fee." 		No, if mortgage title premium does not exceed state basic rate with applicable endorsements; or,
No if there is not a title policy and the title search fee costs less than the comparable base lender's title policy amount.
Title Endorsements See above. See above. See above. No.
Transfer Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed. Yes.
Trustee Fees or Post-Default Attorney fee Not regulated.

Maximum Fee: None.

Not regulated.

Maximum Fee: None.

Texas Finance Code Section 342.307 allows "reasonable fees or charges paid to the trustee in connection with a deed of trust or similar instrument executed in connection with the secondary mortgage loan, including fees for enforcing the lien against or posting for sale, selling, or releasing the property secured by the deed of trust." This fee must be expressly provided for in the loan contract.

Maximum Fee: a "reasonable fee." 		No.
Underwriting Fee Not regulated.

Maximum Fee: None.

Customary Fee: $100.00 to $300.00. 		Not regulated.

Maximum Fee: None.

Customary Fee: $100.00 to $300.00. 		Not allowed. Yes.
Warehouse Fee Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not regulated.

Maximum Fee: None.

Customary Fee: Not customary. 		Not allowed. Yes.
Wire Fee Not regulated.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Not regulated.

Maximum Fee: None.

Customary Fee: The actual fee charged. 		Not allowed. Yes.
*Sec. 342.005. APPLICABILITY OF CHAPTER. Except as provided by Sections302.001(d) and 342.004(c), a loan is subject to this chapter if the loan: (1) provides for interest in excess of 10 percent a year;
(2) is extended primarily for personal, family, or household use;
(3) is made by a person engaged in the business of making, arranging, or negotiating those types of loans; and
(4) either:
(A) is not secured by a lien on real property; or
(B) is described by Section 342.001(4), 342.301, or 342.456 and is predominantly payable in monthly installments.
Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.19(a), eff. Sept. 1, 1999. Amended by Acts 2001, 77th Leg., ch. 916, Sec. 11, eff. Sept. 1, 2001; Acts 2001, 77th Leg., ch. 1235, Sec. 12, eff. Sept. 1, 2001.