1. (a) Purpose. Finance Code §156.555(b) adopts by reference the eligibility and procedural requirements for making a claim on the recovery fund in accordance with Finance Code Chapter 156, Subchapter F. This section clarifies how certain requirements apply to a claim made against the Mortgage Grant Fund in accordance with Finance Code §156.555.
2. (b) Actions by an Unlicensed Individual Acting as an Originator. For a claimant to recover damages from the Mortgage Grant Fund, the respondent must have been acting or attempting to act in the capacity of a residential mortgage loan originator - actions for which a license under Finance Code Chapter 157 is required as provided by Finance Code §157.012 and §55.100 of this title (relating to Licensing Requirements).
3. (c) Fraudulent Acts. Recovery under Finance Code §156.555 is limited to acts of fraud committed by an individual who acted as a residential mortgage loan originator but did not hold the license required by Finance Code Chapter 157. Finance Code §156.501(b), applicable to claims made on the recovery fund, provides that recovery is limited to acts by a licensed residential mortgage loan originator that constitute a violation of specific, enumerated provisions of Finance Code §§157.024(a) and 156.304(b). As a result, to recover under Finance Code §156.555, a claimant must establish that the acts of the unlicensed individual would have constituted fraudulent dealings for purposes of Finance Code §157.024(a)(3), had he or she been licensed as a residential mortgage loan originator at the time of such acts.

Source Note:The provisions of this §53.11 adopted to be effective July 10, 2025, 50 TexReg 3870.