# 7 Tex. Admin. Code § 91.805: 7 TAC § 91.805. Loan Participation Investments

> Texas · Regulations · In force

URL: https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_805

## Section

- **Citation:** 7 Tex. Admin. Code § 91.805
- **Heading:** 7 TAC § 91.805. Loan Participation Investments
- **Jurisdiction:** Texas
- **Kind:** Regulations
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Texas Administrative Code / Title 7 BANKING AND SECURITIES / Part 6 CREDIT UNION DEPARTMENT / Chapter 91 CHARTERING, OPERATIONS, MERGERS, LIQUIDATIONS / 7 TAC § 91.805

## Text

(a) A credit union may purchase a participation interest
 in a loan, where the borrower is neither a member of the credit union
 or a member of another participating credit union, as permitted by §124.351(a)(8)
 of the Texas Finance Code, provided the following conditions are satisfied:
(1) the purchase complies with all regulatory requirements
 to the same extent as if the credit union had originated the loan;
(2) the originating lender retains at least 10 percent
 of the outstanding balance of the loan through the life of the loan;
(3) the purchase complies with the credit union's investment
 policy, which, at a minimum, must:
(A) establish the same degree of independent credit
 and collateral analysis as if the credit union was the originator;
 and
(B) establish commitment limits for aggregate purchased
 participations, out-of-area participations, and loans originated by
 individual lead institutions.
(4) the written loan participation agreement fully
 describes the lead institution's responsibilities, establishes requirements
 for obtaining timely borrower credit information, addresses remedies
 upon default, and outlines dispute resolution procedures.
(b) Financial Reporting. A participation interest in
 a non-credit union member loan purchased under this section shall
 be reported in accordance with generally accepted accounting principles.
(c) Other Requirements. A credit union purchasing a
 loan participation investment must also comply with applicable requirements
 contained within Part 741 of the National Credit Union Administration
 Rules and Regulations.

## Nearby sections

- [7 Tex. Admin. Code § 91.801 7 TAC § 91.801. Investments in Credit Union Service Organizations](https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_801.md)
- [7 Tex. Admin. Code § 91.802 7 TAC § 91.802. Other Investments](https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_802.md)
- [7 Tex. Admin. Code § 91.803 7 TAC § 91.803. Investment Limits and Prohibitions](https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_803.md)
- [7 Tex. Admin. Code § 91.804 7 TAC § 91.804. Custody And Safekeeping](https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_804.md)
- [7 Tex. Admin. Code § 91.805 7 TAC § 91.805. Loan Participation Investments](https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_805.md)
- [7 Tex. Admin. Code § 91.808 7 TAC § 91.808. Reporting Investment Activities to the Board of Directors](https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_808.md)
- [7 Tex. Admin. Code § 91.809 7 TAC § 91.809. Purchase of Assets and Assumption of Liabilities](https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_809.md)

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/STATE_TX_TAC_T7_P6_C91_S91_805. Check the current official text before relying on it. Not legal advice.