Texas OCCC rules implementing HB 700 took effect July 9, 2026. Providers and brokers must register by December 31. Recurring automatic debits are barred without a first-priority interest in all accounts receivable.
Who Has to Register
Texas House Bill 700 covers merchant cash advance providers and their brokers. Manatt's final-rules summary says providers and brokers must register by December 31, 2026.
Applications go through the Nationwide Multistate Licensing System. Applicants file for each key individual. That means anyone directing management or policies, plus any direct owner of 10% or more.
The Rules Are Already Live
The Office of Consumer Credit Commissioner's rules took effect July 9, 2026. Most HB 700 provisions have applied since September 2025.
The statute was signed June 20, 2025. The Alliance for Fair Financing's summary says it took effect September 1, 2025. The registration deadline is the last piece to land.
What the Offer Must Disclose
For financing under $1 million, providers must disclose key terms on a specific offer. A specific offer does not include nonbinding estimates.
The list covers the total financing amount and the net amount disbursed after fees. It also covers the finance charge, total repayment and expected repayment time. Payment amounts, possible fees, payoff amount, broker compensation and collateral round it out.
If new money pays off old financing, the provider must show the split. That means two numbers. How much pays off old debt, and how much the owner receives.
The Auto-Debit Rule
A provider generally cannot set up automatic debits without a valid, perfected, first-priority security interest. Under the rules, that interest must cover all accounts receivable of the recipient. It does not run to the deposit account itself.
The definition matters more than the rule. Manatt quotes it directly:
debits are automatic if they are authorized in advance to occur more than one time or on a recurring basis.
A single debit the owner approves by hand does not count. A daily or weekly pull set up at signing does.
Quick Check
Know what an advance costs before a debit starts.
Revenue-based capital repays as a share of sales and is priced as a stated multiple. Compare it against any MCA offer in your inbox.
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Can This Texas MCA Debit Your Account Automatically?
Follow the contract top to bottom. Based on HB 700 and the OCCC rules as summarized above.
Sources: Manatt (Texas OCCC final rules) and Alliance for Fair Financing (HB 700). Not legal advice.
Confession of Judgment Is Void
A contract with a confession-of-judgment provision is unenforceable and void under HB 700. That removes the clause letting a provider win a judgment without the owner appearing.
Who Enforces It
The Consumer Credit Commissioner enforces the law. The office can bring enforcement actions, assess civil money penalties, and suspend or terminate registrations.
The rules also prohibit unlawful, unfair, deceptive or abusive acts in a sales-based financing transaction. For the wider cost picture, see our true-cost data and the MCA guide.
Interactive Tool
Check a Texas MCA Offer Against the New Rules
Seven items drawn from the disclosure and contract rules above. Nothing is saved or sent. This is a review aid, not legal advice.
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Next Move
After December 31, ask every Texas provider for its registration status before you sign. Then run the offer through the checklist above. Price it with the capital cost multiple calculator.
Watch whether the OCCC publishes its first enforcement actions in 2027. Those will show which parts of the rules it intends to police hardest.
Frequently Asked Questions
HB 700 requires providers and brokers to register by December 31, 2026. Registration runs through the Nationwide Multistate Licensing System, and registrants renew annually.
Only with a valid, perfected, first-priority interest in all the recipient's accounts receivable. Debits count as automatic if authorized to recur or occur more than once.
No. Under HB 700, a contract with a confession-of-judgment provision is unenforceable and void.
External Resource
Manatt: Texas OCCC Finalizes Rules Implementing Sales-Based Financing Law - Manatt, Phelps and Phillips
External Resource
Alliance for Fair Financing: Major Win for Small Businesses in Texas - HB 700 summary
Skip the debit-first structure.
Rev Boost Funding connects owners with partners offering revenue-based capital with stated terms. Not a lender.
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