Texas Statutes
Subchapter BB. Access to Capital Programs
Section 481.407. Provisions Relating to Capital Access Loan Under Original Capital Access Program

Sec. 481.407. PROVISIONS RELATING TO CAPITAL ACCESS LOAN UNDER ORIGINAL CAPITAL ACCESS PROGRAM. (a) Except as otherwise provided by this subchapter, the bank may not determine the recipient, amount, or interest rate of a capital access loan under the original capital access program or the fees or other requirements related to the loan.
(b) A loan under the original capital access program is not eligible to be enrolled under this subchapter if the loan is for:
(1) construction or purchase of residential housing;
(2) simple real estate investments, excluding the development or improvement of commercial real estate occupied by the borrower's business or organization; or
(3) inside bank transactions, as defined by the policy board.
(c) The borrower of a capital access loan under the original capital access program must apply the loan to working capital or to the purchase, construction, or lease of capital assets, including buildings and equipment used by the business or nonprofit organization. Working capital uses include the cost of exporting, accounts receivable, payroll, inventory, and other financing needs of the business or organization.
(d) A capital access loan under the original capital access program may be sold on the secondary market with no recourse to the bank or to the loan loss reserve correspondent to the loan and under conditions as may be determined by the bank.
(e) When enrolling a loan in the original capital access program, a participating financial institution may specify an amount to be covered under the original capital access program that is less than the total amount of the loan.
Added by Acts 1997, 75th Leg., ch. 1163, Sec. 1, eff. Sept. 1, 1997. Amended by Acts 2003, 78th Leg., ch. 814, Sec. 1.56, eff. Sept. 1, 2003.
Amended by:
Acts 2021, 87th Leg., R.S., Ch. 1004 (H.B. 3271), Sec. 9, eff. June 18, 2021.

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