Sec. 306.005. PREPAYMENT PREMIUMS AND SIMILAR AMOUNTS. With respect to a loan subject to this chapter, a creditor and an obligor may agree to a prepayment premium, make-whole premium, or similar fee or charge, whether payable in the event of voluntary prepayment, involuntary prepayment, acceleration of maturity, or other cause that involves premature termination of the loan, and those amounts do not constitute interest.
Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 1018 (H.B. 955), Sec. 2.12, eff. September 1, 2005.
Structure Texas Statutes
Title 4 - Regulation of Interest, Loans, and Financed Transactions
Chapter 306 - Commercial Transactions
Subchapter A. General Provisions
Section 306.002. Interest; Application of Other Provisions of Subtitle
Section 306.003. Computation of Loan Terms
Section 306.004. Determining Rates of Interest by Spreading
Section 306.005. Prepayment Premiums and Similar Amounts
Section 306.006. Certain Authorized Charges on Commercial Loans
Section 306.007. Guaranty, Assumption, Payment, or Other Agreement