This legislative update covers constitutional amendments SJR 7 and SJR 21, submitted for voter approval on November 8, 2005, and Sections 2.09, 2.10 and 2.11 of HB 955, and revises our November 4, 2005 legislative update on these issues. SJR 7 was approved and becomes effective when the secretary of state canvasses [authenticates] the votes for that amendment. SJR 21 was not approved and neither SJR 21 nor its implementing legislation in Sections 2.09, 2.10 and 2.11 of HB 955 will become law. This update summaries SJR 7 and SJR 21 with redactions from the Bill Analysis. This update also quotes the full text of SJR 7 with its additions underlined and its deletions in brackets with strikethroughs. 1. Reverse Mortgage Line-of-Credit Advances (SJR 7): Currently, Section 50, Article XVI, of the Texas Constitution permits advances under a reverse mortgage to be made only in a lump sum after settlement or in regular periodic, predetermined equal amounts over a term of years or the lifetimes of homeowners. SJR 7 amends Section 50 by amending subsection (p) and adding subsection (v) to allow senior homeowners to draw advances under a reverse mortgage at unscheduled intervals if and when needed, and only in amounts needed, during the loan term. The legislation includes other safeguards regarding how advances are obtained, fees, and amendment of the credit terms.

Complete Memorandum