Consumer Advocacy Groups File Suit over HELC
Several consumer advocacy groups filed suit against the Texas CU Commission and the Texas Finance Commission, claiming new rules implementing the state's recently passed allowance for home equity loans, implementing the state's 1998 law, are tilted unfairly toward lenders and create exceptions that go beyond the intent of the law. The suit, filed in state court, claims the commission violated the law's 3% cap on fees by ruling that discount points purchased to lower interest are interest, so do not fall under the cap. Other provisions being challenged are exceptions to the waiting period and a requirement to provide actual loan costs before the closing. The suit was filed by the Association of Community Organizations for Reform Now, known as ACORN, The American Association of Retired Persons Foundation Litigation, and Texas Rio Grande Legal Aid.