LegalTips.ORG - Texas BUSINESS & COMMERCE CODE

§ 26.01. PROMISE OR AGREEMENT MUST BE IN
WRITING. (a) A promise or agreement described in Subsection (b)
of this section is not enforceable unless the promise or agreement,
or a memorandum of it, is
(1) in writing; and
(2) signed by the person to be charged with the promise
or agreement or by someone lawfully authorized to sign for him.
(b) Subsection (a) of this section applies to:
(1) a promise by an executor or administrator to
answer out of his own estate for any debt or damage due from his
testator or intestate;
(2) a promise by one person to answer for the debt,
default, or miscarriage of another person;
(3) an agreement made on consideration of marriage or
on consideration of nonmarital conjugal cohabitation;
(4) a contract for the sale of real estate;
(5) a lease of real estate for a term longer than one
year;
(6) an agreement which is not to be performed within
one year from the date of making the agreement;
(7) a promise or agreement to pay a commission for the
sale or purchase of:
(A) an oil or gas mining lease;
(B) an oil or gas royalty;
(C) minerals; or
(D) a mineral interest; and
(8) an agreement, promise, contract, or warranty of
cure relating to medical care or results thereof made by a physician
or health care provider as defined in Section 1.03, Medical
Liability and Insurance Improvement Act of Texas. This section
shall not apply to pharmacists.

Acts 1967, 60th Leg., vol. 2, p. 2343, ch. 785, § 1. Amended by
Acts 1977, 65th Leg., p. 2053, ch. 817, § 21.01, eff. Aug. 29,
1977; Acts 1987, 70th Leg., ch. 551, § 1, eff. Aug. 31, 1987.

§ 26.02. LOAN AGREEMENT MUST BE IN WRITING. (a) In
this section:
(1) "Financial institution" means a state or federally
chartered bank, savings bank, savings and loan association, or
credit union, a holding company, subsidiary, or affiliate of such
an institution, or a lender approved by the United States Secretary
of Housing and Urban Development for participation in a mortgage
insurance program under the National Housing Act (12 U.S.C. Section
1701 et seq.).
(2) "Loan agreement" means one or more promises,
promissory notes, agreements, undertakings, security agreements,
deeds of trust or other documents, or commitments, or any
combination of those actions or documents, pursuant to which a
financial institution loans or delays repayment of or agrees to
loan or delay repayment of money, goods, or another thing of value
or to otherwise extend credit or make a financial accommodation.
The term does not include a promise, promissory note, agreement,
undertaking, document, or commitment relating to:
(A) a credit card or charge card; or
(B) an open-end account, as that term is defined
by Section 301.002, Finance Code, intended or used primarily for
personal, family, or household use.
(b) A loan agreement in which the amount involved in the
loan agreement exceeds $50,000 in value is not enforceable unless
the agreement is in writing and signed by the party to be bound or by
that party's authorized representative.
(c) The rights and obligations of the parties to an
agreement subject to Subsection (b) of this section shall be
determined solely from the written loan agreement, and any prior
oral agreements between the parties are superseded by and merged
into the loan agreement.
(d) An agreement subject to Subsection (b) of this section
may not be varied by any oral agreements or discussions that occur
before or contemporaneously with the execution of the agreement.
(e) In a loan agreement subject to Subsection (b) of this
section, the financial institution shall give notice to the debtor
or obligor of the provisions of Subsections (b) and (c) of this
section. The notice must be in a separate document signed by the
debtor or obligor or incorporated into one or more of the documents
constituting the loan agreement. The notice must be in type that is
boldface, capitalized, underlined, or otherwise set out from
surrounding written material so as to be conspicuous. The notice
must state substantially the following:
"This written loan agreement represents the final
agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous, or
subsequent oral agreements of the parties.

"There are no unwritten oral agreements between the
parties. _________________ ______________________
"Debtor or Obligor Financial Institution"

(f) If the notice required by Subsection (e) of this section
is not given on or before execution of the loan agreement or is not
conspicuous, this section does not apply to the loan agreement, but
the validity and enforceability of the loan agreement and the
rights and obligations of the parties are not impaired or affected.
(g) All financial institutions shall conspicuously post
notices that inform borrowers of the provisions of this section.
The notices shall be located in such a manner and in places in the
institutions so as to fully inform borrowers of the provisions of
this section. The Finance Commission of Texas shall prescribe the
language of the notice.

Added by Acts 1989, 71st Leg., ch. 831, § 1, eff. Sept. 1, 1989.
Amended by Acts 1997, 75th Leg., ch. 1396, § 34, eff. Sept. 1,
1997; Acts 1999, 76th Leg., ch. 62, § 7.47, eff. Sept. 1, 1999.