CHAPTER 1201. MANUFACTURED HOUSING
OCCUPATIONS CODE
TITLE 7. PRACTICES AND PROFESSIONS RELATED TO REAL PROPERTY AND
HOUSING
SUBTITLE C. REGULATION OF CERTAIN TYPES OF HOUSING AND BUILDINGS
CHAPTER 1201. MANUFACTURED HOUSING
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 1201.001. SHORT TITLE. This chapter may be cited as the
Texas Manufactured Housing Standards Act.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.002. LEGISLATIVE FINDINGS AND PURPOSES; LIBERAL
CONSTRUCTION. (a) The legislature finds that:
(1) there is a growing need to provide state residents with
safe, affordable, and well-constructed housing;
(2) manufactured housing has become a primary housing source for
many state residents;
(3) statutes and rules in effect before September 1, 1969, were
inadequate to:
(A) fully protect the consumer; and
(B) prevent certain discrimination in this state regarding
manufactured housing;
(4) the state is responsible for:
(A) protecting state residents who want to purchase manufactured
housing by regulating the construction and installation of
manufactured housing;
(B) providing economic stability to manufactured housing
manufacturers, retailers, installers, and brokers; and
(C) providing fair and effective consumer remedies; and
(5) the expansion of certain regulatory powers is:
(A) necessary to address the problems described by Subdivisions
(1)-(4); and
(B) the most economical and efficient means to address those
problems and serve the public interest.
(b) The purposes of this chapter are to:
(1) encourage the construction of housing for state residents;
and
(2) improve the general welfare and safety of purchasers of
manufactured housing in this state.
(c) This chapter shall be liberally construed to promote its
policies and accomplish its purposes.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.003. DEFINITIONS. In this chapter:
(1) "Advertisement" means a commercial message that promotes the
sale, exchange, or lease-purchase of a manufactured home and that
is presented on radio, television, a public-address system, or
electronic media or appears in a newspaper, a magazine, a flyer,
a catalog, direct mail literature, an inside or outside sign or
window display, point-of-sale literature, a price tag, or other
printed material. The term does not include educational material
or material required by law.
(2) "Affiliate" means a person who is under common control.
(3) "Alteration" means the replacement, addition, modification,
or removal of equipment in a new manufactured home after sale by
a manufacturer to a retailer but before sale and installation by
a retailer to a purchaser in a manner that may affect the home's
construction, fire safety, occupancy, or plumbing, heating, or
electrical system. The term includes the modification of a
manufactured home in a manner that may affect the home's
compliance with the appropriate standards but does not include:
(A) the repair or replacement of a component or appliance that
requires plug-in to an electrical receptacle, if the replaced
item is of the same configuration and rating as the replacement;
or
(B) the addition of an appliance that requires plug-in to an
electrical receptacle and that was not provided with the
manufactured home by the manufacturer, if the rating of the
appliance does not exceed the rating of the receptacle to which
the appliance is connected.
(4) "Attached" in reference to a manufactured home means that
the home has been:
(A) installed in compliance with the rules of the department;
and
(B) connected to a utility, including a utility providing water,
electric, natural gas, propane or butane gas, or wastewater
service.
(5) "Board" means the Manufactured Housing Board within the
Texas Department of Housing and Community Affairs.
(6) "Broker" means a person engaged by one or more other persons
to negotiate or offer to negotiate a bargain or contract for the
sale, exchange, or lease-purchase of a manufactured home for
which a certificate or other document of title has been issued
and is outstanding. The term does not include a person who
maintains a location for the display of manufactured homes.
(7) "Business use" means the use of a manufactured home for a
purpose other than as a permanent or temporary dwelling.
(8) "Consumer" means a person, other than a person licensed
under this chapter, who seeks to acquire or acquires by purchase,
exchange, or lease-purchase a manufactured home.
(9) "Control" means, with respect to another person, the
possession of the power, directly or indirectly, to vote an
interest of 25 percent or more.
(10) "Department" means the Texas Department of Housing and
Community Affairs operating through its manufactured housing
division.
(11) "Director" means the executive director of the manufactured
housing division of the Texas Department of Housing and Community
Affairs.
(12) "HUD-code manufactured home":
(A) means a structure:
(i) constructed on or after June 15, 1976, according to the
rules of the United States Department of Housing and Urban
Development;
(ii) built on a permanent chassis;
(iii) designed for use as a dwelling with or without a permanent
foundation when the structure is connected to the required
utilities;
(iv) transportable in one or more sections; and
(v) in the traveling mode, at least eight body feet in width or
at least 40 body feet in length or, when erected on site, at
least 320 square feet;
(B) includes the plumbing, heating, air conditioning, and
electrical systems of the home; and
(C) does not include a recreational vehicle as defined by 24
C.F.R. Section 3282.8(g).
(13) "Installation" means the temporary or permanent
construction of the foundation system and the placement of a
manufactured home or manufactured home component on the
foundation. The term includes supporting, blocking, leveling,
securing, anchoring, and properly connecting multiple or
expandable sections or components and making minor adjustments.
(14) "Installer" means a person, including a retailer or
manufacturer, who contracts to perform or performs an
installation function on manufactured housing.
(15) "Label" means a device or insignia that is:
(A) issued by the director to indicate compliance with the
standards, rules, and regulations established by the United
States Department of Housing and Urban Development; and
(B) permanently attached to each transportable section of each
HUD-code manufactured home constructed after June 15, 1976, for
sale to a consumer.
(16) "Lease-purchase" means entering into a lease contract for a
manufactured home, in which the lessor retains title, containing
a provision or, in another agreement, conferring on the lessee an
option to purchase a manufactured home.
(17) "License holder" or "licensee" means a person who holds a
department-issued license as a manufacturer, retailer, broker,
rebuilder, salesperson, or installer.
(18) "Manufactured home" or "manufactured housing" means a
HUD-code manufactured home or a mobile home.
(19) "Manufacturer" means a person who constructs or assembles
manufactured housing for sale, exchange, or lease-purchase in
this state.
(20) "Mobile home":
(A) means a structure:
(i) constructed before June 15, 1976;
(ii) built on a permanent chassis;
(iii) designed for use as a dwelling with or without a permanent
foundation when the structure is connected to the required
utilities;
(iv) transportable in one or more sections; and
(v) in the traveling mode, at least eight body feet in width or
at least 40 body feet in length or, when erected on site, at
least 320 square feet; and
(B) includes the plumbing, heating, air conditioning, and
electrical systems of the home.
(21) "New manufactured home" means a manufactured home that is
not a used manufactured home, regardless of its age.
(22) "Person" means an individual or a partnership, company,
corporation, association, or other group, however organized.
(23) "Related person" means a person who directly or indirectly
participates in management or policy decisions.
(24) "Retailer" means a person who:
(A) is engaged in the business of buying for resale, selling, or
exchanging manufactured homes or offering manufactured homes for
sale, exchange, or lease-purchase to consumers, including a
person who maintains a location for the display of manufactured
homes; and
(B) sells, exchanges, or lease-purchases at least two
manufactured homes to consumers in a 12-month period.
(25) "Rules" means the rules of the department.
(26) "Salesperson" means a person who, as an employee or agent
of a retailer or broker, sells or lease-purchases or offers to
sell or lease-purchase manufactured housing to a consumer.
(27) "Salvaged manufactured home" means a manufactured home
determined to be salvaged under Section 1201.461.
(28) "Seal" means a device or insignia issued by the director
that, for title purposes, is to be attached to a used
manufactured home as required by the director.
(29) "Standards code" means the Texas Manufactured Housing
Standards Code.
(30) "Statement of ownership and location" means a statement
issued by the department and setting forth:
(A) the ownership and location of a manufactured home in this
state as provided by Section 1201.205; and
(B) other information required by this chapter.
(31) "Trust fund" means the manufactured homeowners' recovery
trust fund.
(32) "Used manufactured home" means a manufactured home which
has been occupied for any use or for which a statement of
ownership and location has been issued. The term does not
include:
(A) a manufactured home that was used as a sales model at a
licensed retail location; or
(B) a manufactured home that:
(i) was sold as a new manufactured home and installed but never
occupied;
(ii) had a statement of ownership and location; and
(iii) was taken back from the consumer or transferee because of
a first payment default or agreement to rescind or unwind the
transaction.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003. Amended by Acts 2003, 78th Leg., ch. 338, Sec. 1, eff. June
18, 2003; Acts 2003, 78th Leg., ch. 1276, Sec. 14A.251(a), eff.
Sept. 1, 2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 1, eff. January 1, 2008.
Sec. 1201.004. DEFINITIONS BINDING. The definitions of "mobile
home," "HUD-code manufactured home," and "manufactured housing"
provided by Section 1201.003 are binding as a matter of law on
each person and agency in this state, including a home-rule
municipality or other political subdivision. A mobile home is not
a HUD-code manufactured home and a HUD-code manufactured home is
not a mobile home for any purpose under state law. Those terms
may not be defined in a manner that is not identical to the
definitions provided by Section 1201.003.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.005. CONSUMER WAIVER VOID. A waiver by a consumer of
this chapter is contrary to public policy and void.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.006. APPLICABILITY OF BUSINESS & COMMERCE CODE.
The Business & Commerce Code applies to transactions relating
to manufactured housing except to the extent that it conflicts
with this chapter.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.007. EXCEPTION FOR REAL ESTATE BROKERS AND
SALESPERSONS. This chapter does not:
(1) modify or amend Chapter 1101 or 1102; or
(2) apply to a person who is licensed as a real estate broker or
salesperson under Chapter 1101 and who, as agent of a buyer or
seller, negotiates the sale or lease of a manufactured home and
the real property to which the home is attached if:
(A) the same person is the record owner of both the manufactured
home and the real property; and
(B) the sale or lease occurs in a single real estate
transaction.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.008. REGULATION BY MUNICIPALITY. (a) A municipality
may prohibit the installation of a mobile home for use as a
dwelling in the municipality. The prohibition must be prospective
and may not apply to a mobile home previously legally permitted
by and used as a dwelling in the municipality. If a mobile home
is replaced by a HUD-code manufactured home in the municipality,
the municipality shall grant a permit for use of the manufactured
home as a dwelling in the municipality.
(b) On application, the municipality shall permit the
installation of a HUD-code manufactured home for use as a
dwelling in any area determined appropriate by the municipality,
including a subdivision, planned unit development, single lot,
and rental community or park. An application to install a new
HUD-code manufactured home for use as a dwelling is considered to
be granted unless the municipality in writing denies the
application and states the reason for the denial not later than
the 45th day after the date the application is received.
(c) Subsections (a) and (b) do not affect the validity of an
otherwise valid deed restriction.
(d) Except as approved by the department, a local governmental
unit may not require a permit, a fee, a bond, or insurance for
the transportation and installation of manufactured housing by a
licensed retailer or installer. This subsection does not prohibit
the collection of actual costs incurred by a local governmental
unit that result from the transportation of a manufactured home.
(e) Notwithstanding any zoning or other law, in the event that a
manufactured home occupies a lot in a municipality, the owner of
the manufactured home may remove the manufactured home from its
location and place another manufactured home on the same
property, provided that the replacement is a newer manufactured
home and is at least as large in living space as the prior
manufactured home.
(f) An owner's ability to replace the home as a result of a fire
or natural disaster cannot be restricted. Other than in the case
of a fire or natural disaster, a general-rule or home-rule
municipality by an ordinance or charter may limit the ability of
the owner to replace his home to a single replacement.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 2, eff. January 1, 2008.
Sec. 1201.009. ELECTRONIC MEANS AUTHORIZED. If feasible, any
action required under this chapter may be accomplished by
electronic means.
Added by Acts 2009, 81st Leg., R.S., Ch.
77, Sec. 1, eff. September 1, 2009.
SUBCHAPTER B. DEPARTMENT POWERS AND DUTIES
Sec. 1201.051. ADMINISTRATION AND ENFORCEMENT OF CHAPTER. The
director shall administer and enforce this chapter.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.052. GENERAL RULEMAKING AUTHORITY. (a) The director
shall adopt rules, issue orders, and otherwise act as necessary
to ensure compliance with the purposes of this chapter to
implement and provide for uniform enforcement of this chapter and
the standards code.
(b) To protect the public health, safety, and welfare and to
ensure the availability of low cost manufactured housing for all
consumers, the director shall adopt rules to:
(1) protect the interests of consumers who occupy or want to
purchase or install manufactured housing; and
(2) govern the business conduct of license holders.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.053. RULES RELATING TO COMPLIANCE WITH NATIONAL
STANDARDS FOR MANUFACTURED HOUSING CONSTRUCTION AND SAFETY; STATE
PLAN. (a) The board shall adopt rules and otherwise act as
necessary to:
(1) comply with the National Manufactured Housing Construction
and Safety Standards Act of 1974 (42 U.S.C. Section 5401 et
seq.), including adopting and enforcing rules reasonably required
to implement the notification and correction procedures provided
by 42 U.S.C. Section 5414; and
(2) provide for the effective enforcement of all HUD-code
manufactured housing construction and safety standards in order
to have the state plan authorized by the National Manufactured
Housing Construction and Safety Standards Act of 1974 (42 U.S.C.
Section 5401 et seq.) approved by the secretary of housing and
urban development.
(b) The state plan described by Subsection (a)(2) must provide
for a third-party inspection agency approved by the United States
Department of Housing and Urban Development to act as an in-plant
inspection agency.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 3, eff. January 1, 2008.
Sec. 1201.054. PROCEDURE FOR ADOPTING RULES. (a) Rules must be
adopted in accordance with Chapter 2001, Government Code, and
with this section.
(b) If requested, the board shall, after at least 10 days'
notice, hold a hearing on any rule that it proposes to adopt,
other than a rule that is to be adopted under emergency
rulemaking, in which case only the requirements of Chapter 2001,
Government Code, shall apply.
(c) A rule takes effect on the 30th day after the date of
publication of notice that the rule has been adopted, except that
a rule relating to installation standards may not take effect
earlier than the 60th day after the date of publication of notice
unless the board has determined that an earlier effective date is
required to meet an emergency and the standard was adopted under
the emergency rulemaking provisions of Chapter 2001, Government
Code.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 4, eff. January 1, 2008.
Sec. 1201.055. INSPECTION, REVIEW, AND RELATED FEES. (a) With
guidance from the federal Housing and Community Development Act
of 1974 (42 U.S.C. Section 5301 et seq.) and from the rules and
regulations adopted under the National Manufactured Housing
Construction and Safety Standards Act of 1974 (42 U.S.C. Section
5401 et seq.), the board shall establish fees as follows:
(1) if the department acts as a design approval primary
inspection agency, a schedule of fees for the review of HUD-code
manufactured home blueprints and supporting information, to be
paid by the manufacturer seeking approval of the blueprints and
supporting information;
(2) except as provided by Subsection (e), a fee for the
inspection of each HUD-code manufactured home manufactured or
assembled in this state, to be paid by the manufacturer of the
home;
(3) a fee for the inspection of an alteration made to the
structure or plumbing, heating, or electrical system of a
HUD-code manufactured home, to be charged on an hourly basis and
to be paid by the person making the alteration;
(4) a fee for the inspection of the rebuilding of a salvaged
manufactured home, to be paid by the rebuilder;
(5) a fee for the inspection of a used manufactured home to
determine whether the home is habitable for the issuance of a new
statement of ownership and location; and
(6) a fee for the issuance of a seal for a used mobile or
HUD-code manufactured home.
(b) In addition to the fees imposed under Subsections (a)(2),
(3), and (4), a manufacturer, a person making an alteration, or a
rebuilder, as appropriate, shall be charged for the actual cost
of travel of a department representative to and from:
(1) the manufacturing facility, for an inspection described by
Subsection (a)(2); or
(2) the place of inspection, for an inspection described by
Subsection (a)(3) or (4).
(c) The board shall establish a fee for the inspection of the
installation of a mobile or HUD-code manufactured home, to be
paid by the installer of the home.
(c-1) The department may permit the use of any device or
procedure that has been reviewed and approved by a licensed
engineer provided that such use or procedure complies with any
instructions, conditions, or other requirements specified by that
engineer.
(d) The board shall charge a fee for a consumer complaint home
inspection requested by a manufacturer or retailer under Section
1201.355(b), to be paid by the manufacturer or retailer.
(e) The fee described by Subsection (a)(2) does not apply if an
inspection agency authorized by the United States Department of
Housing and Urban Development, other than the department, acts as
the in-plant inspection agency.
(f) The fee described by Subsection (c) must accompany notice to
the department of the exact location of the mobile or HUD-code
manufactured home. The department shall make an appropriate fee
distribution to a local governmental unit that performs an
inspection under a contract or other official designation if that
unit does not collect a local inspection fee.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003. Amended by Acts 2003, 78th Leg., ch. 338, Sec. 2, eff. June
18, 2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 5, eff. January 1, 2008.
Sec. 1201.056. LICENSE FEES. The board shall establish fees for
the issuance and renewal of licenses for:
(1) manufacturers;
(2) retailers;
(3) brokers;
(4) salespersons;
(5) rebuilders; and
(6) installers.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.057. INSTRUCTION FEE. The board shall charge a fee to
each person attending a course of instruction described by
Section 1201.104.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.058. AMOUNT OF FEES. (a) The board shall establish
reasonable fees for all matters under this chapter providing for
fees. If the department's rules provide an option to file a
document electronically, the department may charge a discounted
fee for the electronic filing.
(b) Ten dollars of the fee for each purchase, exchange, or
lease-purchase of a manufactured home shall be deposited to the
credit of the trust fund and used for the protection programs
described by Subchapter I.
(c) All fees established by this chapter or the rules are deemed
to be earned and not subject to refund after receipt by the
department.
(d) Notwithstanding Subsection (c), the director may, in limited
and appropriate circumstances and in accordance with rules
adopted by the board, approve the refund of fees.
(e) If the governor by executive order or proclamation declares
a state of disaster under Chapter 418, Government Code, the
director, in accordance with rules adopted by the board, may
waive the imposition of any fee under this chapter in the
affected area.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 6, eff. January 1, 2008.
Acts 2009, 81st Leg., R.S., Ch.
77, Sec. 2, eff. September 1, 2009.
Sec. 1201.060. VENUE FOR HEARING. A hearing under this chapter
shall be held in Travis County unless all parties agree to
another location.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.061. COOPERATION WITH LOCAL GOVERNMENTAL UNITS. The
department shall cooperate with all local governmental units in
this state.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.062. SEAL PROPERTY OF DEPARTMENT. A seal is the
property of the department.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
SUBCHAPTER C. LICENSING
Sec. 1201.101. LICENSE REQUIRED. (a) A person may not
construct or assemble in this state or ship into this state a new
HUD-code manufactured home unless the person holds, at the time
the home is constructed or assembled, a manufacturer's license.
(b) Except as otherwise provided by this chapter, a person may
not sell, exchange, or lease-purchase or offer to sell, exchange,
or lease-purchase two or more manufactured homes to consumers in
this state in a 12-month period unless the person holds a
retailer's license.
(c) A person may not offer to negotiate or negotiate for others
a bargain or contract for the sale, exchange, or lease-purchase
of two or more manufactured homes to consumers in this state in a
12-month period unless the person holds a broker's license.
(d) A person may not act as an installer in this state unless
the person holds an installer's license.
(e) A person may not repair, rebuild, or otherwise alter a
salvaged manufactured home unless the person holds a rebuilder's
or retailer's license.
(f) A person may not act as a salesperson of manufactured
housing unless the person holds a salesperson's license. A
retailer or broker may not employ or otherwise use the services
of a salesperson who is not licensed. A licensed salesperson may
not participate in a sale of a manufactured home unless the sale
is through the retailer or broker who sponsored the salesperson's
application as required by Section 1201.103(d).
(f-1) A retailer may be licensed to operate at a principal
location and one or more branch locations under a single license;
provided, however, that a separate application must be made for
each branch, and each branch must be separately bonded.
(g) A person may not make an announcement concerning the sale,
exchange, or lease-purchase of, or offer to sell, exchange, or
lease-purchase, a manufactured home to a consumer in this state
through an advertisement unless the person holds a
manufacturer's, retailer's, or broker's license. This subsection
does not apply to:
(1) a person exempt from licensing; or
(2) an advertisement concerning real property on which there is
a manufactured home that has been converted to real property in
accordance with Section 1201.2055.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003. Amended by Acts 2003, 78th Leg., ch. 338, Sec. 4, eff. June
18, 2003.
Amended by:
Acts 2005, 79th Leg., Ch.
1284, Sec. 1, eff. June 18, 2005.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 7, eff. January 1, 2008.
Sec. 1201.102. EXCEPTIONS TO LICENSE REQUIREMENT. (a) A
licensed installer may employ unlicensed persons to assist in
performing installation functions provided that the licensed
installer maintains a list of the persons so employed. The
director may issue an order to prohibit a person who is not
licensed as an installer from performing installation functions
under the oversight of a licensed installer.
(b) A licensee may engage another person who is not licensed
under this chapter but possesses another license issued by the
State of Texas to provide goods and services subject to that
other license. Without limiting the generality of the foregoing,
this includes engaging others to install, connect, or otherwise
work on air conditioning, plumbing, and electrical systems.
(c) An individual who holds a retailer's license or broker's
license or who is a related person of such a licensee is not
required to apply for a salesperson's license.
(d) A person who holds a real estate broker's or salesperson's
license under Chapter 1101 may act as a broker or salesperson
under this chapter without holding a license or filing a bond or
other security as required by this chapter if negotiations for
the sale, exchange, or lease-purchase of a manufactured home are
conducted for a consumer for whom the person is also acting as a
real estate broker or salesperson under Chapter 1101 consistent
with Section 1201.007.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.252(a),
eff. Sept. 1, 2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 8, eff. January 1, 2008.
Sec. 1201.103. LICENSE APPLICATION. (a) An applicant for a
license as a manufacturer, retailer, broker, rebuilder, or
installer must file with the director a license application
containing:
(1) the legal name, address, and telephone number of the
applicant and each person who will be a related person at the
time the requested license is issued;
(2) all trade names, and the names of all other business
organizations, under which the applicant does business subject to
this chapter, the name of each such business organization
registered with the secretary of state, and the address of such
business organization;
(3) the dates on which the applicant became the owner and
operator of the business; and
(4) the location to which the license will apply.
(a-1) All required records of a licensee under Subsection (a)
are to be maintained at the licensee's principal office or such
other location within this state as the licensee may designate.
(b) A license application must be accompanied by:
(1) proof of the security required by this subchapter; and
(2) payment of the fee required for issuance of the license.
(c) If a change occurs in the information filed with the
director under Subsection (a), the applicant shall amend the
application to state the correct information.
(d) An applicant for a salesperson's license must:
(1) file with the director an application that provides any
information the director considers necessary and that is
sponsored by a currently licensed retailer or broker; and
(2) pay the required fee.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2005, 79th Leg., Ch.
1284, Sec. 2, eff. June 18, 2005.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 9, eff. January 1, 2008.
Sec. 1201.104. QUALIFICATIONS FOR LICENSE. (a) Except as
provided by Subsection (e), as a requirement for a
manufacturer's, retailer's, broker's, installer's, salvage
rebuilder's, or salesperson's license, a person who was not
licensed or registered with the department or a predecessor
agency on September 1, 1987, must, not more than 12 months before
applying for the person's first license under this chapter,
attend and successfully complete 20 hours of instruction in the
law, including instruction in consumer protection regulations.
If the applicant is not an individual, the applicant must have at
least one related person who meets this requirement.
(b) Except in the case of an applicant for a salesperson's
license, successful completion of the course of instruction is a
prerequisite to obtaining the license.
(c) An applicant for a salesperson's license may apply for a
license without having completed the course of instruction if the
person successfully completes the course not later than the 90th
day after the date of the person's licensure. If the person
fails to complete such course successfully and in a timely
manner, the person's license is automatically suspended until the
person successfully completes the course.
(d) The course of instruction must be offered at least
quarterly.
(e) The board shall adopt rules relating to course content and
approval.
(f) An applicant for an initial installer's license shall
receive a license on a provisional basis. The person's
provisional status remains in effect until a sufficient number of
installations completed by the person have been inspected by the
department and found not to have any identified material
violations of the department's rules. The board, with the advice
of the advisory committee to be established under Section
1201.251, shall adopt rules to establish what constitutes a
sufficient number of installations under this subsection.
(g) Subsection (a) does not apply to a license holder who
applies:
(1) for a license for an additional business location; or
(2) to renew or reinstate a license.
(h) An examination must be a requirement of successful
completion of any initial required course of instruction under
this section.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 10, eff. January 1, 2008.
Acts 2009, 81st Leg., R.S., Ch.
77, Sec. 3, eff. September 1, 2009.
Sec. 1201.105. SECURITY REQUIRED. (a) The department may not
issue or renew a license unless a bond or other security in a
form prescribed by the director is filed with the department as
provided by this subchapter. The bond or other security is
payable to the trust fund.
(b) If a bond is filed, the bond must be issued by a company
authorized to do business in this state and must conform to
applicable provisions of the Insurance Code. If other security
is filed, that security must be maintained in or by a federally
insured depository institution located in this state.
(c) If the department experiences significant problems in
obtaining timely reimbursements from a surety or the surety has
experienced a deterioration in its financial condition, the board
may direct the director to stop accepting bonds issued by the
surety.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 10, eff. January 1, 2008.
Sec. 1201.106. SECURITY: AMOUNT. (a) An applicant for a
license or a license holder shall file a bond or other security
under Section 1201.105 for the issuance or renewal of a license
in the following amount:
(1) $100,000 for a manufacturer;
(2) $50,000 for a retailer's principal location;
(3) $50,000 for each retailer's branch location;
(4) $50,000 for a rebuilder;
(5) $50,000 for a broker; or
(6) $25,000 for an installer.
(a-1) Notwithstanding the provisions of Subsection (a), the
director may require additional security for the licensing,
renewal, or relicensing of a person who, either directly, as a
related person, or through a related person, has been the subject
of a license revocation, has caused the trust fund to incur
unreimbursed costs or liabilities in excess of available surety
bond coverage, or has failed to pay an administrative penalty
that has been assessed by final order.
(b) To ensure the availability of prompt and satisfactory
warranty service, a manufacturer that does not have a licensed
manufacturing plant or other facility in this state from which
warranty service and repairs can be provided shall file a bond or
other security in the additional amount of $100,000.
(c) The bond or other security is open to successive claims up
to the face value of the bond or other security. The surety is
not liable for successive claims in excess of the face value of
the bond, regardless of the number of years the bond remains in
force.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2005, 79th Leg., Ch.
1284, Sec. 3, eff. June 18, 2005.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 11, eff. January 1, 2008.
Sec. 1201.107. SECURITY: LOCATION. (a) A manufacturer,
retailer, broker, or installer who maintains a place of business
at one or more locations shall file with the department a
separate bond or other security for each location.
(b) Property used for the business that is not contiguous to, or
located within 300 feet of, a bonded location requires a separate
bond. A location at which a manufactured home is shown to the
public or at which the home is offered for sale, exchange, or
lease-purchase by a retailer to consumers requires a bond.
(c) A manufactured home installed on a permanent foundation
system and offered for sale as real property does not require a
bond. A temporary location for a bona fide trade show sponsored
by a nonprofit corporation that qualifies for an exemption from
federal income taxation under Section 501(a), Internal Revenue
Code of 1986, by being listed as an exempt organization under
Section 501(c) of that code does not require a bond.
(d) If a retailer or broker offers for sale or participates in
any way in the sale of a manufactured home at a location other
than an undivided parcel of real property where more than one
manufactured home is located and offered for sale, exchange, or
lease-purchase by a retailer or broker to the public, the
retailer or broker must:
(1) identify the bond on file with the department in conjunction
with that person's license; and
(2) provide contractually in the sales transaction that the
identified bond applies to the sale.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2005, 79th Leg., Ch.
1284, Sec. 4, eff. June 18, 2005.
Sec. 1201.108. SECURITY: CHANGE IN OWNERSHIP OR LOCATION. (a)
A new bond is not required for a change in:
(1) ownership of a licensee or a business entity under which a
license holder conducts business; or
(2) location.
(b) A licensee shall notify the department of a change described
by Subsection (a) not later than the 10th day before the date the
change occurs.
(c) After a change described by Subsection (a), the licensee
shall provide to the department a proper endorsement to the
original bond showing that the bond continues to apply to the
license without interruption.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 12, eff. January 1, 2008.
Sec. 1201.109. SECURITY: CANCELLATION OR OTHER IMPAIRMENT. (a)
If a bond required by this subchapter is canceled, the license
for which the security is filed is suspended on the effective
date of cancellation. The surety shall provide written notice to
the director before the 60th day preceding the effective date of
cancellation.
(b) If a surety files for liquidation or reorganization in
bankruptcy or is placed in receivership, the license holder shall
obtain other security not later than the 60th day after the date
that notice of the filing or receivership is received.
(c) If the required face amount of a security is impaired by the
payment of a claim, the license holder shall restore the security
to the required face amount not later than the 60th day after the
date of impairment.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.110. SECURITY: DURATION. The department shall
maintain on file a security other than a bond canceled as
provided by Section 1201.109(a) until the later of:
(1) the second anniversary of the date the manufacturer,
retailer, broker, installer, or rebuilder ceases doing business;
or
(2) the date the director determines that a claim does not exist
against the security.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.111. EXCEPTIONS TO SECURITY AND INSTRUCTION
REQUIREMENTS. (a) Notwithstanding any other provision of this
chapter, a state or national bank, state or federal savings and
loan association, federal savings bank, or state or federal
credit union engaged in the business of selling, exchanging, or
lease-purchasing or offering for sale, exchange, or
lease-purchase manufactured homes that the institution has
acquired through repossession of collateral is not required to
attend a course of instruction or file a bond or other security
to be licensed as a retailer.
(b) A licensed retailer is not required to file a bond or other
security to be licensed as a broker or installer.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.113. CERTIFICATION AND CONTINUING EDUCATION PROGRAMS.
(a) The board shall approve or administer continuing education
programs for licensees under this chapter. A continuing
education program must be at least eight hours long and must
include the current rules of the department and such other
matters as the board may deem relevant.
(b) Completion of an approved or administered continuing
education course described by Subsection (a) is a prerequisite to
renewal of a license.
Text of subsection as amended by Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 13
Without reference to the amendment of this subsection, this
subsection was repealed by Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 73(a)(3), eff. January 1, 2008.
(c) No test shall be given in relation to any continuing
education program.
(d) Repealed by Acts 2007, 80th Leg., R.S., Ch. 863, Sec.
73(a)(3), eff. January 1, 2008.
(e) Repealed by Acts 2007, 80th Leg., R.S., Ch. 863, Sec.
73(a)(3), eff. January 1, 2008.
(f) Repealed by Acts 2007, 80th Leg., R.S., Ch. 863, Sec.
73(a)(3), eff. January 1, 2008.
(g) Repealed by Acts 2007, 80th Leg., R.S., Ch. 863, Sec.
73(a)(3), eff. January 1, 2008.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003. Amended by Acts 2003, 78th Leg., ch. 338, Sec. 5, eff. Jan.
1, 2004.
Amended by:
Acts 2005, 79th Leg., Ch.
1284, Sec. 5, eff. June 18, 2005.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 13, eff. January 1, 2008.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 73(a)(3), eff. January 1, 2008.
Acts 2009, 81st Leg., R.S., Ch.
77, Sec. 4, eff. September 1, 2009.
Sec. 1201.114. LICENSE EXPIRATION. Any license under this
chapter is valid for two years. A license may be renewed as
provided by the director. A person whose license has been
suspended or revoked or whose license has expired may not engage
in activities that require a license until the license has been
reinstated or renewed.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.254(a),
eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch.
1284, Sec. 6, eff. June 18, 2005.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 14, eff. January 1, 2008.
Acts 2009, 81st Leg., R.S., Ch.
77, Sec. 5, eff. September 1, 2009.
Sec. 1201.115. NOTICE OF LICENSE EXPIRATION. Not later than the
30th day before the date a person's license is scheduled to
expire, the department shall send written notice of the impending
expiration to the person at the person's last known address
according to the records of the department.
Added by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.254(a), eff.
Sept. 1, 2003.
Sec. 1201.116. PROCEDURE FOR LICENSE RENEWAL. (a) The
department shall renew a license if the department receives the
renewal application and payment of the required fee before the
expiration date of the license.
(b) If the department needs additional information for the
renewal application or verification of continuing insurance or
bond coverage, the license holder must provide the requested
information or verification not later than the 20th day after the
date of receipt of notice from the department.
(c) The renewal license expires on the second anniversary of the
date the license was renewed.
(d) A person whose license has been expired for 90 days or less
may renew the license by paying to the department a renewal fee
that is equal to 1-1/2 times the normally required renewal fee.
(e) A person whose license has been expired for more than 90
days but less than one year may renew the license by paying to
the department a renewal fee that is equal to two times the
normally required renewal fee.
(f) A person whose license has been expired for one year or more
may not renew the license. The person may obtain a new license by
complying with the requirements and procedures for obtaining an
original license.
Added by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.254(a), eff.
Sept. 1, 2003.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
77, Sec. 6, eff. September 1, 2009.
Sec. 1201.117. RENEWAL OF EXPIRED LICENSE BY OUT-OF-STATE
PRACTITIONER. (a) A person who was licensed in this state,
moved to another state, and is currently licensed and has been in
practice in the other state for the two years preceding the date
of application may obtain a new license without fulfilling the
instruction requirements of Section 1201.104(a).
(b) The person must pay to the department a fee that is equal to
two times the normally required renewal fee for the license.
Added by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.254(a), eff.
Sept. 1, 2003.
Sec. 1201.118. RULES RELATING TO CERTAIN PERSONS. The board
shall adopt rules providing for additional review and scrutiny of
any application for an initial or renewal license that involves a
person who has previously:
(1) been found in a final order to have participated in one or
more violations of this chapter that served as grounds for the
suspension or revocation of a license;
(2) been found to have engaged in activity subject to this
chapter without possessing the required license;
(3) caused the trust fund to incur unreimbursed payments or
claims; or
(4) failed to abide by the terms of a final order, including the
payment of any assessed administrative penalties.
Added by Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 15, eff. January 1, 2008.
SUBCHAPTER D. PRACTICE
Sec. 1201.1505. DEPOSIT ON SPECIALLY ORDERED MANUFACTURED HOMES.
A retailer may require a deposit on a specially ordered
manufactured home.
Added by Acts 2003, 78th Leg., ch. 338, Sec. 10, eff. June 18,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 16, eff. January 1, 2008.
Sec. 1201.151. REFUNDS. (a) Except as otherwise provided by
this section, a retailer must refund a consumer's deposit not
later than the 15th day after the date that a written request for
the refund is received from the consumer.
(b) The deposit may be retained only if:
(1) the consumer specially orders from the manufacturer a
manufactured home that is not in the retailer's inventory;
(2) the home conforms to the specifications of the special order
and any representations made to the consumer;
(3) the consumer fails or refuses to accept delivery and
installation of the home by the retailer; and
(4) the consumer was given conspicuous written notice of the
requirements for retaining the deposit.
(c) The retailer may not retain more than five percent of the
estimated cash price of the specially ordered home and must
refund any amount that exceeds five percent.
(d) This section does not apply to:
(1) a deposit held in escrow in a real estate transaction; or
(2) money stated to be a down payment in an executed retail
sales contract.
(e) A deposit becomes a down payment upon execution of a binding
written agreement. Thereafter, if the consumer exercises a right
of rescission, the retailer shall, not later than the 15th day
after the date of the rescission, refund to the consumer all
money and other consideration received from the consumer, without
offset or deduction.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2005, 79th Leg., Ch.
1284, Sec. 7, eff. June 18, 2005.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 17, eff. January 1, 2008.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 18, eff. January 1, 2008.
Sec. 1201.152. VOIDABLE CONTRACT. (a) If a retailer purchases
a new manufactured home from an unlicensed manufacturer in
violation of Section 1201.505, a consumer's contract with the
retailer for the purchase, exchange, or lease-purchase of the
home is voidable until the second anniversary of the date of
purchase, exchange, or lease-purchase of the home.
(b) If an unlicensed retailer, broker, or installer enters into
a contract with a consumer concerning a manufactured home, the
consumer may void the contract until the second anniversary of
the date of purchase of the home.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.1521. RESCISSION OF CONTRACT FOR SALE, EXCHANGE, OR
LEASE-PURCHASE OF HOME. (a) A person who acquires a
manufactured home from or through a licensee by purchase,
exchange, or lease-purchase may, not later than the third day
after the date the applicable contract is signed, rescind the
contract without penalty or charge.
(b) Subject to rules adopted by the board, a consumer may waive
a right of rescission in the event of a bona fide emergency.
Such rules shall, to the extent practical, be modeled on the
federal rules for the waiver of a right of rescission under 12
C.F.R. Part 226.
Added by Acts 2003, 78th Leg., ch. 338, Sec. 10, eff. June 18,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 19, eff. January 1, 2008.
Sec. 1201.153. FORMALDEHYDE HEALTH NOTICE. (a) A retailer or
manufacturer may not transfer ownership of a HUD-code
manufactured home or otherwise sell, assign, or convey a HUD-code
manufactured home to a consumer unless the retailer or
manufacturer delivers to the consumer a formaldehyde health
notice, subject to the director's rules concerning the notice.
(b) The notice must be delivered before the execution of a
mutually binding sales agreement or retail installment sales
contract.
(c) The notice must:
(1) contain the information required by the United States
Department of Housing and Urban Development; and
(2) be of the type, size, and format required by the director.
(d) A retailer or manufacturer may not vary the content or form
of the notice.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003. Amended by Acts 2003, 78th Leg., ch. 338, Sec. 6, eff. June
18, 2003.
Sec. 1201.154. SUFFICIENCY OF FORMALDEHYDE HEALTH NOTICE;
RETAILER AND MANUFACTURER COMPLIANCE. (a) The formaldehyde
health notice required by Section 1201.153 is sufficient, as a
matter of law, to advise a consumer of the risks of occupying a
HUD-code manufactured home.
(b) The consumer's written acknowledgement of the receipt of the
notice is conclusive proof of the delivery of the notice and the
posting of the notice in compliance with federal regulations.
(c) A retailer's or manufacturer's compliance with United States
Department of Housing and Urban Development regulations and the
director's rules concerning the notice is conclusive proof that:
(1) the consumer received sufficient notice of the risks of
occupying the home; and
(2) the home is habitable with respect to formaldehyde
emissions.
(d) A retailer's or manufacturer's compliance, from September 1,
1981, to September 1, 1985, with Section 1201.153 and the revised
formaldehyde warning as adopted by the department is conclusive
proof that:
(1) the consumer received sufficient notice of the risks of
occupying the home; and
(2) the home is habitable with respect to formaldehyde
emissions.
(e) A retailer's or manufacturer's knowing and wilful failure to
comply with the regulations and rules described by Subsection (c)
is conclusive proof that:
(1) the retailer or manufacturer breached the duty to notify the
consumer about formaldehyde; and
(2) the home is not habitable.
(f) A retailer's or manufacturer's knowing and wilful failure,
from September 1, 1981, to September 1, 1985, to comply with
Section 1201.153 and the revised formaldehyde warning as adopted
by the department is conclusive proof that:
(1) the retailer or manufacturer breached the duty to notify the
consumer about formaldehyde; and
(2) the home is not habitable.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.155. DISCLAIMER OF IMPLIED WARRANTY. The seller's
proper provision of the warranties and notices as required by
Subchapter H or J is a valid disclaimer of an implied warranty of
fitness for a particular purpose or of merchantability as
described by Chapter 2, Business & Commerce Code.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.156. ADVERTISEMENT AS OFFER. An advertisement
relating to manufactured housing is an offer to sell, exchange,
or lease-purchase manufactured housing to consumers.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.157. RETAILER AS WAREHOUSEMAN. (a) A licensed
retailer is a "warehouseman" as defined by Section 7.102,
Business & Commerce Code, for the storage of manufactured
homes for hire.
(b) The provisions of the Business & Commerce Code relating
to the storage of goods for hire apply to a licensed retailer
acting as a warehouseman.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Sec. 1201.158. SALESPERSON. A licensed salesperson may work
only for the salesperson's sponsoring retailer or broker.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 20, eff. January 1, 2008.
Sec. 1201.159. BROKER. (a) Except as provided by Section
1201.456, a broker shall ensure that the seller gives the buyer
the applicable disclosures and warranties that the buyer would
have received if the buyer had purchased the manufactured home
through a licensed retailer.
(b) A person is not required to be a broker licensed under this
chapter but may be required to be a real estate broker or
salesperson licensed under Chapter 1101 if:
(1) the manufactured home is attached; and
(2) the home is offered as real property.
(c) A broker shall provide any person who engages the broker's
services with a written disclosure of which interests in the
transaction, if any, the broker represents.
(d) If the seller is required to possess a license by this
chapter, a broker may assist in the sale of a manufactured home
only if that seller has a current license.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003. Amended by Acts 2003, 78th Leg., ch. 338, Sec. 7, eff. June
18, 2003.
Amended by:
Acts 2005, 79th Leg., Ch.
1284, Sec. 8, eff. June 18, 2005.
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 21, eff. January 1, 2008.
Sec. 1201.161. TRANSPORTATION OF MANUFACTURED HOUSING. (a)
Notwithstanding any other statute or rule or ordinance, a
licensed retailer or licensed installer is not required to obtain
a permit, certificate, or license or pay a fee to transport
manufactured housing to the place of installation except as
required by the Texas Department of Transportation under
Subchapter E, Chapter 623, Transportation Code.
(b) The department shall cooperate with the Texas Department of
Transportation by providing current lists of licensed
manufacturers, retailers, and installers.
(c) The Texas Department of Transportation shall send the
department monthly:
(1) a copy of each permit issued in the preceding month for the
movement of manufactured housing on the highways; or
(2) a list of the permits issued in the preceding month and the
information on the permits.
(d) Unless the information provided for in Subsection (c) is
provided electronically, the department shall pay the reasonable
cost of providing the copies or the list and information under
Subsection (c).
(e) The copies and lists to be provided under this section may
be provided electronically.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 2, eff. June 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 22, eff. January 1, 2008.
Sec. 1201.162. DISCLOSURE BY RETAILER AND LENDER. (a) Before
the completion of a credit application or more than one day
before entering into any agreement for a sale, exchange, or the
exercise of the lease purchase option that will not be financed,
the retailer must provide to the consumer a written disclosure in
the form promulgated by the board. The disclosure shall be in at
least 12-point type and must address matters of concern relating
to costs and obligations that may be associated with home
ownership, matters to be considered in making financing
decisions, related costs that may arise when purchasing a
manufactured home, and such other matters as the board may deem
appropriate to promote informed purchase, financing, and related
decisions regarding the acquisition and ownership of a
manufactured home. The form shall also conspicuously disclose
the consumer's right of rescission.
(b) A federally insured financial institution or lender
approved or authorized by the United States Department of Housing
and Urban Development as a mortgagee with direct endorsement
underwriting authority that fully complies with federal Truth in
Lending disclosures concerning the terms of a manufactured
housing transaction is exempt from the disclosure provisions of
this section.
(c) The right of rescission described in Subsection (a) shall
apply only to the sale transaction between the retailer and the
consumer. Failure by the retailer to comply with the disclosure
provisions of this section does not affect the validity of a
subsequent conveyance or transfer of title of a manufactured home
or otherwise impair a title or lien position of a person other
than the retailer. The consumer shall continue to have the right
of rescission with regard to the retailer until the end of the
third day after the retailer delivers a copy of the disclosure
required by Subsection (a). The consumer's execution of a signed
receipt of a copy of the disclosure required by Subsection (a)
shall constitute conclusive proof of the delivery of the
disclosure. If the consumer grants a person other than the
retailer a lien on the manufactured home, the right of rescission
shall immediately cease on the filing of the lien with the
department.
Added by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.255(a), eff.
Sept. 1, 2003. Amended by Acts 2003, 78th Leg., ch. 338, Sec. 8,
51, eff. June 18, 2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
863, Sec. 23, eff. January 1, 2008.
Sec. 1201.164. ADVANCE COPY OF CONTRACT AND DISCLOSURE
STATEMENTS; OFFER BY RETAILER. (a) In a transaction that is to
be financed and that will not be subject to the federal Real
Estate Settlement Procedures Act of 1974 (Pub. L. No. 93-533) and
its implementing regulations, a retailer shall deliver to a
consumer at least 24 hours before the contract is fully executed
the contract, with all required information included, signed by
the retailer. The delivery of the contract, with all required
information included, signed by the retailer constitutes a firm
offer by the retailer. Except as provided for in Subsection (b),
the consumer may accept the offer not earlier than 24 hours after
the delivery of the contract. If the consumer has not accepted
the offer within 72 hours after the delivery of the contract, the
retailer may withdraw the offer.
(b) The consumer may modify or waive the right to rescind and
the deadlines for disclosures before the execution of the
contract that are provided by Subsection (a) if the consumer
determines that the purchase of the manufactured home is needed
to meet a bona fide personal emergency. If the consumer has a
bona fide personal emergency that necessitates the immediate
purchase of the manufactured home, the consumer shall give the
retailer a dated written statement that describes the emergency,
specifically modifies or waives the notice periods and any right
of rescission, and bears the signature of all of the consumers
entitled to the disclosures and right of rescission. In such
event the retailer shall immediately give the consumer all of the
disclosures required by this code and sell the manufactured home
without the required waiting periods or the right of rescission.
Printed forms for this purpose are prohibited except in a county
that has been declared by the governor to be a major disaster
area. If the governor dec