110 HR 5830 RH: FHA Housing Stabilization and Homeownership
U.S. House of Representatives
2008-04-17
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
1.Short title and table of
contents
(a)This Act may be cited
as the FHA Housing Stabilization and
Homeownership Retention Act of 2008
.
(b)The table of contents for this Act is as follows:
Sec. 1. Short title and table of
contents.
Title I—Homeownership retention
Sec. 101. Purposes.
Sec. 102. Insurance of
homeownership retention mortgages.
Sec. 103. Study of Auction or Bulk Refinance
Program.
Sec. 104. Temporary increase in maximum loan
guaranty amount for certain housing loans guaranteed by Secretary of Veterans
Affairs.
Sec. 105. Study of possible accounting
revisions relating to property at risk of foreclosure and the availability of
credit for refinancing home mortgages at risk of foreclosure.
Sec. 106. GAO study of the
effect of tightening credit markets in communities affected by the subprime
mortgage foreclosure crises and predatory lending on prospective first-time
homebuyers seeking mortgages.
Title II—Office of Housing
Counseling
Sec. 201. Short title.
Sec. 202. Establishment of Office of Housing
Counseling.
Sec. 203. Counseling procedures.
Sec. 204. Grants for housing counseling
assistance.
Sec. 205. Requirements to use
HUD-certified counselors under HUD programs.
Sec. 206. Study of defaults and
foreclosures.
Sec. 207. Definitions for
counseling-related programs.
Sec. 208. Updating and simplification of
mortgage information booklet.
Title III—Combating mortgage fraud
Sec. 301. Authorization of appropriations to
combat mortgage fraud.
<enum>I</enum><header>Homeownership
retention</header>
<section id="H15C45E579B5E42EA8506EC4953142682"><enum>101.</enum><header>Purposes</header><text display-inline="no-display-inline">The purposes of this title are—</text>
<paragraph id="H76F6775EE86F4180A5A51F29DBC3C01B"><enum>(1)</enum><text>to create an FHA program,
which is voluntary on the part of borrowers and existing mortgage loan holders,
to insure refinance loans for substantial numbers of borrowers at risk of
foreclosure, at levels which are reasonably likely to be sustainable through
enhanced affordability of debt service;</text>
</paragraph><paragraph id="H5A1CDA19BB424C280000D9BB7C48E03E"><enum>(2)</enum><text>to provide flexible
underwriting for FHA-insured loans under such a program to provide refinancing
opportunities under fiscally responsible terms, including higher fees
commensurate with higher risk levels, a seasoning requirement for higher debt
to income loans, and additional program controls to limit and control
risk;</text>
</paragraph><paragraph id="H25684CD330C442D6A7E0BEA8C8CA289"><enum>(3)</enum><text>to bar speculators and
second home owners from participation in such program;</text>
</paragraph><paragraph id="H5A4A7664EAEF414AAF7DB3C9EE1EC4D1"><enum>(4)</enum><text>to require existing
mortgage loan holders to take substantial loan writedowns in exchange for
having the Federal Government and the borrower assume the ongoing risk of the
refinanced loan;</text>
</paragraph><paragraph id="H65988AF16A5C43F5AABB5E08B4B860D2"><enum>(5)</enum><text>to set a loan-to-value
limit on such loans that provides the FHA with an equity buffer against
potential loan losses, provides protections against the risk of future home
price declines, and creates incentives for borrowers to maintain payments on
the loan;</text>
</paragraph><paragraph id="H14D2ED75E610442ABB3F8FEF072E5435"><enum>(6)</enum><text>to protect the FHA
against losses which may exceed normal FHA loss levels by establishing higher
fee levels, including an exit fee and profit sharing during the first five
years of the loan, with such higher fee levels effectively being funded through
the required lender writedown;</text>
</paragraph><paragraph id="H37BCB6AD01DF481B84BDC7D8134C3B24"><enum>(7)</enum><text>to provide a fair level
of incentives for junior lien holders to provide the necessary releases of
their lien interests, in order to meet program requirements that all
outstanding liens must be extinguished, and thereby permit the refinancing to
be completed;</text>
</paragraph><paragraph id="H08F2083245524C2FB4A23CCAA19836C1"><enum>(8)</enum><text>to enhance the
administrative capacity of the FHA to carry out its expanded role under the
program through establishment of an Oversight Board which adds expertise from
the Federal Reserve and the Department of the Treasury, through additional
funding to contract out for the provision of any needed expertise in designing
program requirements and oversight, and through additional funding to increase
FHA personnel resources as needed to handle the increased loan volume resulting
from the program;</text>
</paragraph><paragraph id="HF570A5F111FD4CBAAE22474FE6988ED9"><enum>(9)</enum><text>to sunset the program
when it is no longer needed; and</text>
</paragraph><paragraph id="HA30E12E783C64514B9805500281FEB63"><enum>(10)</enum><text>to study the need for
and efficacy of an auction or bulk refinancing mechanism to facilitate more
expeditious refinancing of larger volumes of existing mortgages that are at
risk for foreclosure into FHA-insured mortgages.</text>
</paragraph></section><section id="H8412190A2A59450295516FE15E039AC"><enum>102.</enum><header>Insurance of
homeownership retention mortgages</header>
<subsection id="H056E2DA7919D4D35B697D44B13029B88"><enum>(a)</enum><header>Mortgage insurance
program</header><text display-inline="yes-display-inline">Title II of the
National Housing Act (<external-xref legal-doc="usc" parsable-cite="usc/12/1707">12 U.S.C. 1707 et seq.</external-xref>) is amended by adding at the end
the following new section:</text>
<quoted-block changed="added" committee-id="HBA00" display-inline="no-display-inline" id="HC4F2AFA829E146C49DAB5956D2B5CFC" reported-display-style="italic" style="OLC">
<section id="H10AD18E29AF94C7D8217ABAB70FD15AE"><enum>257.</enum><header>Insurance of
homeownership retention mortgages</header>
<subsection id="HA8AA9ED6A8784E13B475E50307F8C738"><enum>(a)</enum><header>Oversight
Board</header>
<paragraph id="H796D430D0EC3486D83FFBE51E9EBD64B"><enum>(1)</enum><header>Establishment</header><text display-inline="yes-display-inline">There is hereby established the Refinance
Program Oversight Board (in this section referred to as the <quote>Oversight
Board</quote>).</text>
</paragraph><paragraph id="H6773CC5BCF9842AEB83F11A20086BDFC"><enum>(2)</enum><header>Membership</header><text>The
Oversight Board shall consist of the following members or their
designees:</text>
<subparagraph id="H5534510A3FF74B288911CA8D3417C9C2"><enum>(A)</enum><text>The Secretary of the
Treasury.</text>
</subparagraph><subparagraph id="H186081CAFED044FC849BA98754CA73E2"><enum>(B)</enum><text>The Secretary of Housing
and Urban Development.</text>
</subparagraph><subparagraph id="HF5DA8C09CE034A9C87DFF63548F4164B"><enum>(C)</enum><text>The Chairman of the Board
of Governors of the Federal Reserve System.</text>
</subparagraph></paragraph><paragraph id="H21174794B8E642D5AF08C5EF6479A555"><enum>(3)</enum><header>No additional
compensation</header><text>Members of the Oversight Board shall receive no
additional pay by reason of service on the Oversight Board.</text>
</paragraph><paragraph id="H3FA1FB49BAD04700ABAC9700055B06B9"><enum>(4)</enum><header>Responsibilities</header><text>The
Oversight Board shall be responsible for establishing program and oversight
requirements for the program under this section, which shall include—</text>
<subparagraph id="H1EC244E61DF7469EAC11878F90EFD81C"><enum>(A)</enum><text>detailed program
requirements under subsection (c);</text>
</subparagraph><subparagraph id="H5AB428CD23C6492A88CC8C902FCCA916"><enum>(B)</enum><text>flexible underwriting
criteria under subsection (d);</text>
</subparagraph><subparagraph id="H182D0855850445D2AF9F78AFC1B57CC5"><enum>(C)</enum><text>a mortgage premium
structure under subsection (e);</text>
</subparagraph><subparagraph id="H7D8A9A3A31574DACA257F3138D8C5FA"><enum>(D)</enum><text>a reasonable fee and rate
limitation under subsection (f);</text>
</subparagraph><subparagraph id="H4731E7E0670B486EBBA7204F8D74F090"><enum>(E)</enum><text display-inline="yes-display-inline">enhancement of FHA capacity under
subsection (i), including oversight of such activities and personnel as may be
contracted for as provided therein;</text>
</subparagraph><subparagraph id="HAB2D27B0B2FD47EFB84FC613BEFF6D9"><enum>(F)</enum><text>monitoring of
underwriting risk under subsection (j); and</text>
</subparagraph><subparagraph id="H8AB553E25AF841488F32214D92DB2B7"><enum>(G)</enum><text display-inline="yes-display-inline">such additional requirements as may be
necessary and appropriate to oversee and implement the program.</text>
</subparagraph></paragraph><paragraph id="HCEB69BB29BA14CAEB9C1ED08A9F92A5"><enum>(5)</enum><header>Use of
resources</header><text>In carrying out its functions under this section, the
Oversight Board may utilize, with their consent and to the extent practical,
the personnel, services, and facilities of the Department of the Treasury, the
Department of Housing and Urban Development, the Board of Governors of the
Federal Reserve System, the Federal Reserve Banks, and other Federal agencies,
with or without reimbursement therefore.</text>
</paragraph></subsection><subsection id="H3C79EE11C1554165BF89C3A12B9E861E"><enum>(b)</enum><header>Authority</header>
<paragraph id="H360BC9D88C584A149193FA4D43CCC00"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The Secretary shall,
subject only to the absence of qualified requests for insurance under this
section and to the limitations under subsection (h) of this section and section
531(a), make commitments to insure and insure any mortgage covering a 1- to
4-family residence that is made for the purpose of paying or prepaying
outstanding obligations under an existing mortgage or mortgages on the
residence if the mortgage being insured under this section meets the
requirements of this section, as established by the Oversight Board, and of
section 203, except as modified by this section.</text>
</paragraph><paragraph id="HBDBA83ACA8ED4D44B6B0A7F033BE794C"><enum>(2)</enum><header>Establishment and
implementation of program requirements</header><text display-inline="yes-display-inline">The Oversight Board shall establish program
requirements and standards under this section and the Secretary shall implement
such requirements and standards. The Oversight Board and the Secretary may
establish and implement any requirements or standards through interim guidance
and mortgagee letters.</text>
</paragraph></subsection><subsection id="H5B2E59F78D524ED4A4512D3E6BDAADB0"><enum>(c)</enum><header>Requirements</header><text>To
be eligible for insurance under this section, a mortgage shall comply with all
of the following requirements:</text>
<paragraph id="HAC581DD2002C4E0FAED28CBDA273A8FC"><enum>(1)</enum><header>Owner-occupied
principal residence requirement</header><text display-inline="yes-display-inline">The residence to be covered by the mortgage
insured under this section shall be occupied by the mortgagor as the principal
residence of the mortgagor and the mortgagor shall provide a certification to
the originator of the mortgage that such residence to be covered by the
mortgage insured under this section is the only residence in which the
mortgagor has any present ownership interest.</text>
</paragraph><paragraph id="HC436F98FECF041B1ADA65BCB6C6800C8"><enum>(2)</enum><header>Lack of capacity to pay
existing mortgage or mortgages</header>
<subparagraph id="HE2C5403806FC44CAACF5FEC5E1E3F115"><enum>(A)</enum><header>Borrower
certification</header>
<clause id="HE11FA0AC24E641BABA42AAB4763874E5"><enum>(i)</enum><text display-inline="yes-display-inline">The mortgagor shall provide a certification
to the originator of the mortgage that the mortgagor—</text>
<subclause id="H649F7DB5244445269B413E6BE0947DED"><enum>(I)</enum><text>has not intentionally
defaulted on the existing mortgage or mortgages; and</text>
</subclause><subclause id="H934E5447D9D7432093E16ED27971E388"><enum>(II)</enum><text>has not knowingly, or
willfully and with actual knowledge furnished material information known to be
false for the purpose of obtaining the existing mortgage or mortgages.</text>
</subclause></clause><clause id="HF3A4C24E2B2C4D2683CA34DCBC037774"><enum>(ii)</enum><text>The mortgagor shall
agree in writing that the mortgagor shall be liable to repay the FHA any direct
financial benefit achieved from the reduction of indebtedness on the existing
mortgage or mortgages on the residence refinanced under this section derived
from misrepresentations made in the certifications and documentation required
under this subparagraph, subject to the discretion of the Oversight
Board.</text>
</clause></subparagraph><subparagraph id="HEA90617CD4544B1E93D31C557152383"><enum>(B)</enum><header>Current borrower
debt-to-income ratio</header><text display-inline="yes-display-inline">As of
March 1, 2008, the mortgagor shall have had a ratio of mortgage debt to income,
taking into consideration all existing mortgages at such time, greater than 35
percent.</text>
</subparagraph><subparagraph commented="no" id="HC97CA0EAD25B4DEDA17F00F90000CAD6"><enum>(C)</enum><header>Loss mitigation
responsibilities</header><text display-inline="yes-display-inline">This section
may not be construed to alter or in any way affect the responsibilities of any
party (including the mortgage servicer) to engage in any or all loan
modification or other loss mitigation strategies to maximize value to investors
as established by any applicable contract.</text>
</subparagraph></paragraph><paragraph id="HD286DAA114754ECE008D16E57DDC748C"><enum>(3)</enum><header>Eligibility of
mortgages by date of origination</header><text>The existing senior mortgage
shall have been originated on or before December 31, 2007.</text>
</paragraph><paragraph id="H610BB23CA7FC476290C4336768B6E3D3"><enum>(4)</enum><header>Maximum loan-to-value
ratio for new loans</header><text display-inline="yes-display-inline">The
mortgage being insured under this section shall involve a principal obligation
(including such initial service charges, appraisal, inspection, and other fees
as the Secretary shall approve and including the mortgage insurance premium
paid pursuant to subsection (e)(1)) in an amount not to exceed 90 percent of
the current appraised value of the property. Section 203(d) shall not apply to
mortgages insured under this section.</text>
</paragraph><paragraph id="H69442623544B46AE8B39A085219FA200"><enum>(5)</enum><header>Required waiver of
prepayment penalties and fees</header><text>All penalties for prepayment of the
existing mortgage or mortgages, and all fees and penalties related to default
or delinquency on all existing mortgages or mortgages, shall be waived or
forgiven.</text>
</paragraph><paragraph id="H5F252CE371AB4860A4757BE6AC704D00"><enum>(6)</enum><header>Required loan
reduction</header>
<subparagraph id="H153E82BDC2EC4796A5DBACA727D39277"><enum>(A)</enum><header>Reduction of
indebtedness under existing senior mortgage</header><text display-inline="yes-display-inline">The amount of indebtedness on the existing
mortgage or mortgages on the residence shall have been substantially reduced by
such percentage as the Oversight Board or Secretary may require, and such
reduction shall be at least sufficient to—</text>
<clause id="H748F063002884B978CBABC04866F0089"><enum>(i)</enum><text>provide for the
refinancing of such existing mortgage or mortgages in an amount not greater
than 90 percent of the current appraised value of the property involved;</text>
</clause><clause id="HA98231F7C8D24EF1001C12BDCDAD5EE9"><enum>(ii)</enum><text>pay the full amount of
the single premium to be collected pursuant to subsection (e)(1) (which shall
be an amount equal to 3.0 percent of the amount of the original insured
principal obligation of the mortgage insured under this section and which shall
serve as an additional reserve to cover possible loan losses); and</text>
</clause><clause id="H657C12FA03AC46159B9628067FADE089"><enum>(iii)</enum><text display-inline="yes-display-inline">pay the full amount of the loan origination
fee and any other closing costs, not to exceed 2.0 percent of the amount of the
original insured principal obligation of the mortgage insured under this
section.</text>
</clause></subparagraph><subparagraph id="HC83F2BDB97FC44D2AD82661C009D28F5"><enum>(B)</enum><header>Extinguishment of debt
by refinancing</header>
<clause id="HF7493B3B26054D468E1D6F5B72DAE8C0"><enum>(i)</enum><header>Required
agreement</header><text display-inline="yes-display-inline">All existing
holders of mortgage liens on the property involved shall agree to accept the
proceeds of the insured loan as payment in full of all indebtedness under all
existing mortgages, and all encumbrances related to such mortgages shall be
removed. The Oversight Board may take such actions as the Oversight Board
considers necessary or appropriate to facilitate coordination and agreement
between the holders of the existing senior mortgage and any existing
subordinate mortgages, taking into consideration the subordinate lien status of
such subordinate mortgages, to comply with the requirement under this
subparagraph.</text>
</clause><clause id="HA232ABD357A245A7B42F398DA686C0F5"><enum>(ii)</enum><header>Treatment of multiple
mortgage liens</header><text display-inline="yes-display-inline">In addition to
clause (i), the Oversight Board shall adopt one of the following approaches for
all mortgages or such classes of mortgages as the Oversight Board may determine
and may, from time to time, reconsider:</text>
<subclause id="H9F336A24A7C84B7E9476C4C44F3F61F9"><enum>(I)</enum><header>Fixed
price</header><text display-inline="yes-display-inline">As a requirement for
participating in this program, all existing lien holders will agree to not
provide any payment to subordinate lien holders other than such payment in
accordance with a formula established by the Oversight Board as set forth in
clause (iii); except that the Oversight Board may establish a short period
within which first and subordinate lien holders may negotiate to extinguish all
subordinate liens for compensation that may be different from the amount
determined under such formula set forth in clause (iii).</text>
</subclause><subclause id="HB50FDDB5210B4E9CB639974DDF908DF4"><enum>(II)</enum><header>Shared
equity</header><text display-inline="yes-display-inline">The Oversight Board
may require the mortgagor under a mortgage insured under this section to agree
to share a portion of any future equity in the mortgaged property with holders
of existing subordinate mortgages, in accordance with a formula for such shared
equity established by the Oversight Board as set forth in clause (iii), except
that payments of such shared equity may be made only after the Secretary
recovers all amounts owed to the Secretary with respect to such mortgage
pursuant to the program under this section (including amounts owed pursuant to
paragraph (8)).</text>
</subclause></clause><clause id="HB073FF6E71D74DCFBEEB28A256DE5A6"><enum>(iii)</enum><header>Formula</header><text display-inline="yes-display-inline">In determining a formula for determining
any payments to subordinate lien holders pursuant to subclauses (I) and (II) of
clause (ii), and in any reconsideration of such formula as the Oversight Board
may from time to time undertake, the Oversight Board shall take into
consideration the current market value of such liens. In no case may a formula
provide for the payment of more than 1 percent of the current appraised value
of the mortgaged property to a subordinate lien holder if the outstanding
balance owed to more senior lien holders is equal to or exceeds such current
appraised value.</text>
</clause><clause id="H910E15643793477891DE4C454B1566EB"><enum>(iv)</enum><header>Voluntary
program</header><text display-inline="yes-display-inline">This subparagraph may
not be construed to require any holder of any existing mortgage to participate
in the program under this section generally, or with respect to any particular
loan.</text>
</clause><clause id="H733C833D67664A6F8F65F16DE5786765"><enum>(v)</enum><header>Source of payments for
subordinate loans</header><text display-inline="yes-display-inline">Any amounts
paid to holders of any existing subordinate mortgages in connection with the
origination and insurance of a mortgage under this section shall derive only
from—</text>
<subclause id="H25BC37B808C4466F925D5D69C063C36D"><enum>(I)</enum><text>the holder of the
existing senior mortgage; or</text>
</subclause><subclause id="H7E6D5B4D85A3412383A9C01C4505C43D"><enum>(II)</enum><text>in the case only of the
shared equity approach under clause (ii)(II), the mortgagor under the mortgage
insured under this section</text>
</subclause></clause></subparagraph></paragraph><paragraph id="HBDA9A55BDBBF4BA29340E9C1DB84A352"><enum>(7)</enum><header>Required reduction of
debt service</header><text display-inline="yes-display-inline">The debt service
payments due under the mortgage insured under this section shall be in an
amount that is substantially reduced from the debt service payments due under
the existing mortgage or mortgages, which reduction may be achieved through a
reduction of indebtedness, a reduction in the interest rate being paid, or an
extension of the term of the mortgage, or any combination thereof.</text>
</paragraph><paragraph id="H8BAB22C33D194E4DB42E000298471000"><enum>(8)</enum><header>Financial recovery to
Federal Government through exit premium</header>
<subparagraph id="HC04EBD2C76D14437AA00EF1DABD1805"><enum>(A)</enum><header>Subordinate
lien</header><text display-inline="yes-display-inline">The mortgage shall
provide that the Secretary shall retain a lien on the residence involved, which
shall be subordinate to the mortgage insured under this section but senior to
all other mortgages on the residence that may exist at any time, and which
shall secure the repayment of the amount due under subparagraph (D).</text>
</subparagraph><subparagraph id="H233C42E4443C45C6B571CB57008DA27D"><enum>(B)</enum><header>No interest or payment
during mortgage</header><text>The amount secured by the lien retained by the
Secretary pursuant to subparagraph (A) shall not bear interest and shall not be
repayable to the Secretary except as provided in subparagraph (D) of this
paragraph.</text>
</subparagraph><subparagraph id="HE73553A84E9849ABA56DECF4F75E4009"><enum>(C)</enum><header>Net proceeds available
for exit premium</header><text display-inline="yes-display-inline">Upon the
sale, refinancing, or other disposition of the residence covered by a mortgage
insured under this section, any proceeds resulting from such disposition that
remain after deducting the remaining insured principal balance of the mortgage
insured under this section shall be available to meet the obligation under
subparagraph (D).</text>
</subparagraph><subparagraph commented="no" id="HDA1CF98579BB4021B7DDCFCA9345500"><enum>(D)</enum><header>Exit
premium</header><text display-inline="yes-display-inline">Upon any refinancing
of the mortgage insured under this section or any sale or disposition of the
residence covered by the mortgage, the Secretary shall, subject to the
availability of sufficient net proceeds described in subparagraph (C), receive
the greater of—</text>
<clause id="H5FA5AA9B9E6D4D3A835B6D36D800DFD4"><enum>(i)</enum><text>3 percent of the amount
of the original insured principal obligation of the mortgage; or</text>
</clause><clause id="H3EDB472A9FFB4BC5932B21514B39246B"><enum>(ii)</enum><text>a percentage of the
portion of the net proceeds described in subparagraph (C), which shall
be—</text>
<subclause commented="no" id="HC7723D0DEAA947688DE8E26B335D45D3"><enum>(I)</enum><text>in the case of any
refinancing, sale, or disposition occurring during the first year of the term
of the mortgage, 100 percent of such net proceeds;</text>
</subclause><subclause id="HBEC5E6BB6750452F9B5503ECBC4BBA65"><enum>(II)</enum><text display-inline="yes-display-inline">in the case of any refinancing, sale, or
disposition occurring during the second year of the term of the mortgage, 80
percent;</text>
</subclause><subclause id="H38426899FE2B476280BF8313C321F06D"><enum>(III)</enum><text display-inline="yes-display-inline">in the case of any refinancing, sale, or
disposition occurring during the third year of the term of the mortgage, 60
percent; and</text>
</subclause><subclause id="H6B772E44D4C14B2480AED55000B849A1"><enum>(IV)</enum><text display-inline="yes-display-inline">in the case of any refinancing, sale, or
disposition occurring during the fourth year of the term of the mortgage or at
any time thereafter, 50 percent;</text>
</subclause></clause><continuation-text continuation-text-level="subparagraph">except that such percentage of proceeds
shall be reduced by all fees the Secretary has collected for the mortgage prior
to such refinancing, sale, or disposition.</continuation-text></subparagraph><subparagraph id="H09C21C4D697D49DF8BC54675C0A19CF9"><enum>(E)</enum><header>Authority to prohibit
new second liens</header><text display-inline="yes-display-inline">The
Oversight Board shall prohibit borrowers from granting a new second lien on the
mortgaged property during the first five years of the term of the mortgage
insured under this section, except as the Oversight Board determines to be
necessary to ensure the appropriate maintenance of the mortgaged
property.</text>
</subparagraph></paragraph><paragraph id="H004D9F5C1325420500E989F46D375E78"><enum>(9)</enum><header>Documentation and
verification of income</header><text display-inline="yes-display-inline">In
complying with the FHA underwriting requirements under the program under this
section, the mortgagee under the mortgage shall document and verify the income
of the mortgagor by procuring an Internal Revenue Service transcript of the
income tax returns of the mortgagor for the two most recent years for which the
filing deadline for such years has passed and by any other method, in
accordance with procedures and standards that the Oversight Board or the
Secretary shall establish.</text>
</paragraph><paragraph id="H77AE62959B5A48AA886508F038F8C5FE"><enum>(10)</enum><header>Fixed rate
mortgage</header><text>The mortgage insured under this section shall bear
interest at a single rate that is fixed for the entire term of the
mortgage.</text>
</paragraph><paragraph id="H37F2AB1A30F1463BB100742E3C823C19"><enum>(11)</enum><header>Maximum loan
amount</header><text display-inline="yes-display-inline">Notwithstanding
section 203(b)(2), the mortgage being insured under this section shall involve
a principal obligation in an amount that does not exceed the limitation (for a
property of the applicable size) on the amount of the principal obligation that
would be allowable under the terms of section 202(a) of the Economic Stimulus
Act of 2008 if the mortgage were insured pursuant to such section. The
limitation on the amount of the principal obligation allowable under such Act
shall apply for the purposes of this Act until the termination under subsection
(n) of the program under this subsection.</text>
</paragraph><paragraph id="HC97499C65BC440D4816C9FA3D014F1E9"><enum>(12)</enum><header>Ineligibility for
fraud conviction</header><text display-inline="yes-display-inline">The
mortgagor shall not have been convicted under Federal or State law for mortgage
fraud during the 7-year period ending upon the insurance of the mortgage under
this section.</text>
</paragraph><paragraph id="H01E7654A037C4F92A1F997F6124204E"><enum>(13)</enum><header>Lender
review</header><text display-inline="yes-display-inline">The mortgagee under
the mortgage shall conduct an electronic database search of the mortgagor’s
criminal history to determine if the mortgagor has had a conviction described
in paragraph (12). The mortgagee may charge the mortgagor a reasonable fee for
the actual cost of the search not to exceed a maximum rate established by the
Oversight Board. The Oversight Board may provide clarification, if needed, to
help mortgagees identify any differences among the States in how they report
mortgage fraud convictions. The Oversight Board shall establish procedures
sufficient to allow the mortgagor to challenge a mortgagee’s determination with
respect to paragraph (12) (including to correct inaccuracies resulting from
theft of the mortgagor’s identity or personally identifiable
information).</text>
</paragraph><paragraph id="H69E7D25603E143D2A2762EF4DA635407"><enum>(14)</enum><header>Appraisals</header><text display-inline="yes-display-inline">Any appraisal conducted in connection with
a mortgage insured under this section shall—</text>
<subparagraph id="HD48E381454104BDDB819E7E501745B20"><enum>(A)</enum><text>be based on the current
value of the property;</text>
</subparagraph><subparagraph id="H9740C7062CDB43FC8B6300C255009596"><enum>(B)</enum><text>be conducted in
accordance with title XI of the Financial Institutions Reform, Recovery, and
Enforcement Act of 1989 (<external-xref legal-doc="usc" parsable-cite="usc/12/3331">12 U.S.C. 3331 et seq.</external-xref>);</text>
</subparagraph><subparagraph id="HBD43FF4142B94BF4B5003F612D8C0065"><enum>(C)</enum><text>be completed by an
appraiser who meets the competency requirements of the Uniform Standards of
Professional Appraisal Practice;</text>
</subparagraph><subparagraph id="H3239D11818AB4A728E53AB00017622B2"><enum>(D)</enum><text>be wholly consistent with
the appraisal standards, practices, and procedures under section 202(e) of this
Act that apply to all loans insured under this Act; and</text>
</subparagraph><subparagraph id="HE6E7444A60774AACB0FDB356CB005B51"><enum>(E)</enum><text>comply with the
requirements of subsection (g) of this section (relating to appraisal
independence).</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H4E30ACAD180A473A94E7D31639FE6356"><enum>(15)</enum><header>Statement of loan
terms</header>
<subparagraph id="H92EC385C12204B94A8E958A0374EA900"><enum>(A)</enum><header>Requirement</header><text display-inline="yes-display-inline">The mortgagor shall have been provided by
the mortgagee, not later than three days after application for the mortgage, a
form described in subparagraph (B) appropriately and accurately completed by
the mortgagee.</text>
</subparagraph><subparagraph id="H483FD1FB53E14A7DB95937B0F6B64DB8"><enum>(B)</enum><header>Form</header><text display-inline="yes-display-inline">The form described in this subparagraph
shall be a single page, written disclosure regarding the mortgage loan to be
insured under this section that, when completed by the mortgagee, sets forth,
in accordance with such requirements as the Secretary shall by regulation
establish a best possible estimate of—</text>
<clause id="H1EEC91CC18884A368C08C300B9FC1329"><enum>(i)</enum><text>the total loan amount
under the mortgage;</text>
</clause><clause id="H29225C4DA2624C83A4B1764B00BDDF46"><enum>(ii)</enum><text>the loan-to-value ratio
for the mortgage;</text>
</clause><clause id="HD07D10B98CD8476D9196B475768224AD"><enum>(iii)</enum><text>the final maturity date
for the mortgage;</text>
</clause><clause id="H839A04E9356F478FA0C92475742B3062"><enum>(iv)</enum><text>the amount of any
prepayment fee to be charged if the mortgage is paid in full before the final
maturity date for the mortgage, including the percentages of any net proceeds
to be received by the Secretary pursuant to paragraph (8)(D)(ii);</text>
</clause><clause id="HB71296AF70594EE593101F49483D0743"><enum>(v)</enum><text>the amount of the exit
premium under the mortgage pursuant to subsection (e)(3);</text>
</clause><clause id="H3356807377EB4A5DBA39DB9074A230C6"><enum>(vi)</enum><text>the interest rate under
the mortgage expressed as an annual percentage rate, and the amount of the
monthly payment due under such rate;</text>
</clause><clause id="H4EB0D414548B4A0CBF3D936E41AA43FF"><enum>(vii)</enum><text>the fully indexed rate
of interest under the mortgage expressed as an annual percentage rate and the
amount of the monthly payment due under such rate;</text>
</clause><clause id="H83E5F8BF69CD448EA51169391C074C02"><enum>(viii)</enum><text>the monthly household
income of the borrower upon which the mortgage is based;</text>
</clause><clause id="HB65E7444D81D488497BCFEEDCA458C48"><enum>(ix)</enum><text>the amount of the
monthly payment due under the mortgage, and the amount of such initial monthly
payment plus monthly amounts due for taxes and insurance on the property for
which the mortgage is made, both expressed as a percentage of the monthly
household income of the borrower; and</text>
</clause><clause id="H4CE6F69AE689464BBCC8AEC9DE605BF3"><enum>(x)</enum><text>the aggregate amount of
settlement charges for all settlement services provided in connection with the
mortgage, the amount of such charges that are included in the principal amount
and the amount of such charges the borrower must pay at closing, the aggregate
amount of mortgagee’s fees connection with the mortgage, and the aggregate
amount of other fees or required payments in connection with the
mortgage.</text>
</clause></subparagraph></paragraph></subsection><subsection display-inline="no-display-inline" id="H6EE388B678B440F59257000268AE3427"><enum>(d)</enum><header>Flexible underwriting
criteria</header>
<paragraph id="H0E5A89A133674A139DEEB9548DA21093"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The Oversight Board
shall establish, and the Secretary acting on behalf of the Oversight Board
shall implement, underwriting standards for mortgages insured under this
section that—</text>
<subparagraph id="H6E095E1AA96C4A2B9C00FAB4DC2163A"><enum>(A)</enum><text display-inline="yes-display-inline">ensure that each mortgagor under a mortgage
insured under this section has a reasonable expectation of repaying the
mortgage, taking into consideration the mortgagor’s income, assets,
liabilities, payment history, and other applicable criteria, but which shall
not result in a denial of insurance solely on the basis of the mortgagor’s
current FICO or other credit scores, or any delinquency or default by the
mortgagor under the existing mortgage or mortgages, or any case filed under
title 11, United States Code, by the mortgagor; and</text>
</subparagraph><subparagraph id="HCA34B053B88F4B428BEC16B205C7049F"><enum>(B)</enum><text>subject to the provisions
of subparagraph (A), permit a total debt-to-income ratio of up to 43
percent.</text>
</subparagraph></paragraph><paragraph id="H1DF9E4CEFD694A1E81941F27644813F9"><enum>(2)</enum><header>Exception</header>
<subparagraph id="H6925E29618A7469187A5D8269D9BB9A6"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">Subject to the
underwriting standards established under paragraph (1)(A) and any additional
requirements that the Oversight Board considers appropriate, the Oversight
Board shall permit a total debt-to-income ratio of more than 43 percent, but
not more than 50 percent, if the mortgagor has made, on a timely basis before
the endorsement of the mortgage insured under this section, not less than six
months of payments in an amount not less than the amount of the monthly payment
due under the mortgage to be insured under this section. The holder of the
existing senior mortgage shall exercise forbearance with respect to such
mortgage during the period in which such payments are made.</text>
</subparagraph><subparagraph id="H639954B100494EDF9CFD67B6003EDCDA"><enum>(B)</enum><header>Computation of
debt-to-income ratio</header><text>In computing the mortgagor’s total
debt-to-income ratio for purposes of mortgage qualification under the
underwriting standards established pursuant to this section—</text>
<clause id="HFC4B9007A03E40788B0620A904D24648"><enum>(i)</enum><text>if the mortgagor is a
debtor in a case under <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/11/13">chapter 13</external-xref> of title 11, United States Code, payments on
recurring debts other than housing expenses shall be based on the amounts being
paid on such debts under the mortgagor’s confirmed plan under such chapter;
and</text>
</clause><clause id="HB5498395296A4EDA84112F8BDCDFE982"><enum>(ii)</enum><text>if the mortgagor is a
debtor in a case under <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/11/7">chapter 7</external-xref> of title 11, United States Code, recurring
debts that are to be discharged in that case shall not be considered.</text>
</clause></subparagraph></paragraph><paragraph id="H7592BFF490FC469A00B32C68AB39A8F"><enum>(3)</enum><header>Authority</header><text>The
Oversight Board may alter the ratios under this subsection for a particular
class of borrowers subject to such requirements as the Board determines is
necessary and appropriate to fulfill the purposes of this Act.</text>
</paragraph><paragraph id="HAD1F4E7C96C54AF2AB3154362D12688F"><enum>(4)</enum><header>Representations and
warranties</header><text>The Oversight Board shall require the underwriter of
the insured loan to provide such representations and warranties as the
Oversight Board considers necessary or appropriate for the Secretary to enforce
compliance with all underwriting and appraisal standards of the program.</text>
</paragraph></subsection><subsection id="H12CE2967AD1B45A487D400DE9115FFA5"><enum>(e)</enum><header>Premiums</header><text>For
each mortgage insured under this section, the Oversight Board shall establish
and the Secretary shall collect—</text>
<paragraph id="H9E93C4A41E214F768882CAB774DDA55C"><enum>(1)</enum><text>at the time of insurance,
a single premium payment in an amount equal to 3.0 percent of the amount of the
original insured principal obligation of the mortgage, which shall be paid from
the proceeds of the mortgage being insured under this section, through the
reduction of the amount of indebtedness on the existing senior mortgage
required under subsection (c)(6)(A);</text>
</paragraph><paragraph id="H84E3F7874CA640BEA36BFEDDBBB95FED"><enum>(2)</enum><text display-inline="yes-display-inline">in addition to the premium under paragraph
(1), annual premium payments in an amount equal to 1.50 percent of the
remaining insured principal balance of the mortgage; and</text>
</paragraph><paragraph id="H7063B0EFF35F4441AC5E118923FBD871"><enum>(3)</enum><text>an exit premium in the
amount determined under subsection (c)(8), but which shall not be less than 3.0
percent of the original insured principal obligation of the mortgage, subject
only to the availability of sufficient net proceeds from sale, refinancing, or
other disposition of the property, as determined in subsection (c)(8).</text>
</paragraph></subsection><subsection id="H66101EBEB3D640C49F4284633E8820D6"><enum>(f)</enum><header>Origination fees and
mortgage rate</header><text>The Oversight Board shall establish and the
Secretary shall implement a reasonable limitation on origination fees for
mortgages insured under this section and shall establish procedures to ensure
that interest rates on such mortgages shall be commensurate with market rate
interest rates on such types of loans.</text>
</subsection><subsection display-inline="no-display-inline" id="HFE7C2656AEC14B67B61D7F00009917D0"><enum>(g)</enum><header>Appraisal
independence</header>
<paragraph id="H0075C6BB1CE14CD682319D24289755CC"><enum>(1)</enum><header>Prohibitions on
interested parties in a real estate transaction</header><text>No mortgage
lender, mortgage broker, mortgage banker, real estate broker, appraisal
management company, employee of an appraisal management company, nor any other
person with an interest in a real estate transaction involving an appraisal in
connection with a mortgage insured under this section shall improperly
influence, or attempt to improperly influence, through coercion, extortion,
collusion, compensation, instruction, inducement, intimidation, non-payment for
services rendered, or bribery, the development, reporting, result, or review of
a real estate appraisal sought in connection with the mortgage.</text>
</paragraph><paragraph id="H83F586EF55864F6A85318431007E4F51"><enum>(2)</enum><header>Exceptions</header><text>The
requirements of paragraph (1) shall not be construed as prohibiting a mortgage
lender, mortgage broker, mortgage banker, real estate broker, appraisal
management company, employee of an appraisal management company, or any other
person with an interest in a real estate transaction from asking an appraiser
to provide 1 or more of the following services:</text>
<subparagraph id="H228FFCAED94943FCB6711FB270B9B6BA"><enum>(A)</enum><text>Consider additional,
appropriate property information, including the consideration of additional
comparable properties to make or support an appraisal.</text>
</subparagraph><subparagraph id="HEEB148E32AE54A89B9B459A923CAFE66"><enum>(B)</enum><text>Provide further detail,
substantiation, or explanation for the appraiser’s value conclusion.</text>
</subparagraph><subparagraph id="HB816A5F9FDC04777BAAEFA6601A1747D"><enum>(C)</enum><text>Correct errors in the
appraisal report.</text>
</subparagraph></paragraph><paragraph id="HC0AD0D3271104FEE8C32CA5188BE4543"><enum>(3)</enum><header>Civil monetary
penalties</header><text>The Secretary may impose a civil money penalty for any
knowing and material violation of paragraph (1) under the same terms and
conditions as are authorized in section 536(a) of this Act.</text>
</paragraph></subsection><subsection id="H137A75FACFD94042949F2125BC567B8B"><enum>(h)</enum><header>Limitation on aggregate
insurance authority</header><text display-inline="yes-display-inline">The
aggregate original principal obligation of all mortgages insured under this
section may not exceed $300,000,000,000.</text>
</subsection><subsection id="HE89FD240D88749708F23E6258948BC42"><enum>(i)</enum><header>Enhancement of FHA
capacity</header><text>Under the direction of the Oversight Board, the
Secretary shall take such actions as may be necessary to—</text>
<paragraph id="H902E3031FD124FC4A19B48398F71F608"><enum>(1)</enum><text>contract for the
establishment of underwriting criteria, automated underwriting systems, pricing
standards, and other factors relating to eligibility for mortgages insured
under this section;</text>
</paragraph><paragraph id="H829F0732E5024E64BA7EDF069246F19B"><enum>(2)</enum><text display-inline="yes-display-inline">contract for independent quality reviews of
underwriting, including appraisal reviews and fraud detection, of mortgages
insured under this section or pools of such mortgages; and</text>
</paragraph><paragraph id="H00D116763FB74925A35CAA62B71CC911"><enum>(3)</enum><text>increase personnel of the
Department as necessary to process or monitor the processing of mortgages
insured under this section.</text>
</paragraph></subsection><subsection id="H5031B1B359C24B549C0011AEAE68B008"><enum>(j)</enum><header>Monitoring of
underwriting risk</header>
<paragraph id="H0F6C0C07D37E484B9FE1C9884153C396"><enum>(1)</enum><header>Monitoring of
designated underwriters</header><text display-inline="yes-display-inline">The
Oversight Board and the Secretary shall monitor independent quality reviews as
established pursuant to subsection (i)(2) to—</text>
<subparagraph id="H637AD36DCE28482EA587FCB9057DEB52"><enum>(A)</enum><text>determine compliance of
designated underwriters with underwriting standards;</text>
</subparagraph><subparagraph id="H1D0864C9032C49D5811BB05BCE507999"><enum>(B)</enum><text>determine rates of
delinquency, claims rates, and loss rates of designated underwriters;
and</text>
</subparagraph><subparagraph id="HD6A40C3F324A4D679E350022683CE357"><enum>(C)</enum><text>terminate eligibility of
designated underwriters that do not meet minimum performance standards as the
Oversight Board may establish and the Secretary implements.</text>
</subparagraph></paragraph><paragraph id="HB5CD1E9A2BEE435A8C45255F63BDA079"><enum>(2)</enum><header>Reports by Oversight
Board</header><text>The Oversight Board shall submit monthly reports to the
Congress identifying the progress of the program for mortgage insurance under
this section, which shall contain the following information for each
month:</text>
<subparagraph id="H3C4318AB1F4549E8A4D3528C455451D4"><enum>(A)</enum><text>The number of new
mortgages insured under this section, including the location of the properties
subject to such mortgages by census tract.</text>
</subparagraph><subparagraph id="HB838C17EC3364B03A5C6EA00D0669EE4"><enum>(B)</enum><text>The aggregate principal
obligation of new mortgages insured under this section.</text>
</subparagraph><subparagraph id="H15DC93F58BBE43A9A19B4B91B49BF721"><enum>(C)</enum><text>The average amount by
which the indebtedness on existing mortgages is reduced in accordance with
subsection (c)(6).</text>
</subparagraph><subparagraph id="H2C6DD9DCF02B4720B9DE959F058FE200"><enum>(D)</enum><text>The average amount by
which the debt service payments on existing mortgages is reduced in accordance
with subsection (c)(7).</text>
</subparagraph><subparagraph id="H4DDA0B79C8024A228B59D7B3D5DED633"><enum>(E)</enum><text>The amount of premiums
collected for insurance of mortgages under this section.</text>
</subparagraph><subparagraph id="HAB8E81C39DAF4B3B9540EBAEFC13CEB9"><enum>(F)</enum><text>The claim and loss rates
for mortgages insured under this section.</text>
</subparagraph><subparagraph id="H8DC6D264058A4894826E27EB4494610"><enum>(G)</enum><text display-inline="yes-display-inline">The race, ethnicity, gender, and income of
the mortgagors, aggregated by geographical areas at least as specific as census
tracts, except where necessary to protect privacy of the borrower.</text>
</subparagraph><subparagraph id="H8B85430EB3BB4759BC19ED2F4926C0BB"><enum>(H)</enum><text>Any other information
that the Oversight Board considers appropriate.</text>
</subparagraph></paragraph><paragraph id="H73044752FE6541E8A6D2E3357EB51D0"><enum>(3)</enum><header>Report by Inspector
General</header><text>The Inspector General of the Department of Housing and
Urban Development shall conduct an annual audit of the program for mortgage
insurance under this section to determine compliance with this section and
program rules.</text>
</paragraph></subsection><subsection id="HEE65C00DD44A48DCB3E84800CF821E23"><enum>(k)</enum><header>GNMA commitment
authority</header>
<paragraph id="HE08ABFB65EB748789FDC83AAAD4B4ED"><enum>(1)</enum><header>Guarantees</header><text display-inline="yes-display-inline">The Secretary shall take such actions as
may be necessary to ensure that securities based on and backed by a trust or
pool composed of mortgages insured under this section are available to be
guaranteed by the Government National Mortgage Association as to the timely
payment of principal and interest.</text>
</paragraph><paragraph id="H971AB0F83FE3464AB000E1E006975C2"><enum>(2)</enum><header>Guarantee
authority</header><text display-inline="yes-display-inline">To carry out the
purposes of section 306 of the National Housing Act (<external-xref legal-doc="usc" parsable-cite="usc/12/1721">12 U.S.C. 1721</external-xref>), the
Government National Mortgage Association may enter into new commitments to
issue guarantees of securities based on or backed by mortgages insured under
this section, not exceeding $300,000,000,000. The amount of authority provided
under the preceding sentence to enter into new commitments to issue guarantees
is in addition to any amount of authority to make new commitments to issue
guarantees that is provided to the Association under any other provision of
law.</text>
</paragraph></subsection><subsection id="H2204A4EDA1DF49738D92EB41802BA725"><enum>(l)</enum><header>Special risk insurance
fund</header><text>The insurance of each mortgage under this section shall be
the obligation of the Special Risk Insurance Fund established by section
238.</text>
</subsection><subsection id="H0027FE690DE34718A10057C0FF31ABCB"><enum>(m)</enum><header>Definitions</header><text>For
purposes of this section, the following definitions shall apply:</text>
<paragraph id="H76034B8C649F4C78BCC4E1BE5672B545"><enum>(1)</enum><header>Existing
mortgage</header><text>The term <quote>existing mortgage</quote> means, with
respect to a mortgage insured under this section, a mortgage that is to be
extinguished, and paid or prepaid, from the proceeds of the mortgage insured
under this section.</text>
</paragraph><paragraph id="H653D1C6A4C98479F93163B6783E38E37"><enum>(2)</enum><header>Existing senior
mortgage</header><text display-inline="yes-display-inline">The term
<quote>existing senior mortgage</quote> means, with respect to a mortgage
insured under this section, the existing mortgage that has superior
priority.</text>
</paragraph><paragraph id="H1484B6559D5F419BA4F20079177C1259"><enum>(3)</enum><header>Existing subordinate
mortgage</header><text display-inline="yes-display-inline">The term
<quote>existing subordinate mortgage</quote> means, with respect to a mortgage
insured under this section, an existing mortgage that has subordinate priority
to the existing senior mortgage.</text>
</paragraph></subsection><subsection id="HE9CF2BC7270F4C848F38D446BDF219B6"><enum>(n)</enum><header>Sunset</header>
<paragraph id="H4D0BECDEF60D4B34B821F40902CF009D"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Except as provided in
paragraph (2), the authority of the Secretary to make any new commitment to
insure any mortgage under this section shall terminate upon the expiration of
the 2-year period beginning on the date of the enactment of the
<short-title>FHA Housing Stabilization and Homeownership
Retention Act of 2008</short-title>.</text>
</paragraph><paragraph id="H180A566026E84C78A445E6EC7E8FE772"><enum>(2)</enum><header>Extensions</header><text display-inline="yes-display-inline">The Oversight Board may, not more than four
times, extend the authority to enter into new commitments to insure mortgages
under this section beyond the date specified in paragraph (1), except that each
such extension shall—</text>
<subparagraph id="H34C7578582C4434885E274BB19723078"><enum>(A)</enum><text display-inline="yes-display-inline">be effective only if, before the program
terminates pursuant to paragraph (1) or any previous extension pursuant to this
paragraph, the Oversight Board—</text>
<clause id="H65A944BD1BCD4151AADD5F641E3D84E4"><enum>(i)</enum><text display-inline="yes-display-inline">certifies the need for such extension in
writing to the Congress; and</text>
</clause><clause id="H5B379890E51249DCB7836B9840DF9CA3"><enum>(ii)</enum><text>causes notice of such
extension to be published in the Federal Register no later than the beginning
of the 3-month period that ends upon the scheduled termination date of the
program; and</text>
</clause></subparagraph><subparagraph id="H9C17E615E72E43E0B6C071E100BEF44E"><enum>(B)</enum><text>be for a period of not
more than 6 months.</text>
</subparagraph></paragraph></subsection><subsection id="H69ABAFE180014407ACBC65BF5FA834B8"><enum>(o)</enum><header>Authorizations of
appropriations</header><text>There is authorized to be appropriated for each of
fiscal years 2008 and 2009—</text>
<paragraph commented="no" id="HB6336AAB21254952BCBB644D5C2B365"><enum>(1)</enum><text display-inline="yes-display-inline">$210,000,000 for providing counseling
regarding loss mitigation for mortgagors with 1- to 4-family residences,
including determining eligibility for the program under this section, with
grants to be administered through the Neighborhood Reinvestment Corporation,
except that—</text>
<subparagraph id="HF7068E7D1D2C4F94BA865B7235695339"><enum>(A)</enum><text>not less than 15 percent
of the funds made available pursuant to this paragraph shall be provided to
counseling organizations that target counseling services regarding loss
mitigation to minority and low-income homeowners or provide such services in
neighborhoods with high concentrations of minority and low-income
homeowners;</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="H1128F446BA514875A58182D8F500F8A5"><enum>(B)</enum><text display-inline="yes-display-inline">$35,000,000 of the funds made available
pursuant to this paragraph shall be used by the Neighborhood Reinvestment
Corporation (referred to in this subparagraph as the <quote>NRC</quote>) to
make grants to State and local legal organizations or attorneys that have
demonstrated legal experience in home foreclosure or eviction law to provide
legal assistance related to home ownership preservation, home foreclosure
prevention, and tenancy associated with home foreclosure or to counseling
intermediaries that have been approved by the Department of Housing and Urban
Development for the purpose of making such grants or contracting for such legal
assistance; of the amount provided under this subparagraph, at least 60 percent
shall be allocated for legal assistance to low-income homeowners or tenants;
such attorneys shall be capable of assisting homeowners in owner-occupied homes
or tenants who live in homes with mortgages in default, in danger of default,
or subject to or at risk of foreclosure or eviction and who have legal issues
that cannot be handled by counselors employed by NRC intermediaries; in using
the amount made available under this subparagraph, the NRC shall give priority
consideration to State and local legal organizations and attorneys that (i)
provide legal assistance in the 100 metropolitan statistical areas (as defined
by the Director of the Office of Management and Budget) with the highest home
foreclosure rates, and (ii) have the capacity to begin using the financial
assistance within 90 days after receipt of the assistance; as a condition of
the receipt of a grant under this subparagraph, the grantee shall submit to NRC
information relating to the demographic characteristics of the assisted
homeowners or tenants, the dollar amount and terms of the relevant mortgages
and the outcome of legal proceedings related to the foreclosure or eviction
proceedings, including the resolutions thereof;</text>
</subparagraph><subparagraph id="H74A4108F68F4456AB95B99BB20A219DE"><enum>(C)</enum><text display-inline="yes-display-inline">some such sums shall be used for such
counseling for veterans recently returning from active duty in the Armed
Forces;</text>
</subparagraph><subparagraph id="HDD31F0EB423C4BA59B07261CCCDA536D"><enum>(D)</enum><text display-inline="yes-display-inline">the NRC shall give priority consideration
for funding with amounts made available pursuant to this paragraph, except for
funds made available under subparagraphs (A) and (B), to entities that have an
effective plan in place for making contact, including personal contact, with
defaulted mortgagors, and such a plan may include use of third parties
(including both for-profit and not-for-profit entities) to make personal
contact with defaulted mortgagors, or visits to such mortgagors, or
both;</text>
</subparagraph><subparagraph id="HA50FEDBF6A57477187F0AB1EE33BFB8B"><enum>(E)</enum><text>except with respect to
funds reserved under subparagraphs (A) and (B), the NRC shall give priority
consideration for funding with amounts made available pursuant to this
paragraph to entities that have a written plan that has been implemented for
providing in-person counseling and for making contact, including personal
contact, with defaulted mortgagors, for the purpose of providing counseling or
providing information about available counseling, both</text><clause commented="no" display-inline="yes-display-inline" id="H25B6D47EE0C047558E03DBB4C0C4861F"><enum>(i)</enum><text>prior to commencement of
any foreclosure proceedings, and</text><subclause commented="no" display-inline="yes-display-inline" id="H65D440A9D42D47F3B2CF69C9683F8D47"><enum>(ii)</enum><text display-inline="yes-display-inline">in the event effective in person or phone
contact has not been made with such defaulted mortgagors prior thereto, then
prior to the conclusion of the foreclosure process; and</text>
</subclause></clause></subparagraph><subparagraph id="H709058C29D644489B3403297C0FF4C11"><enum>(F)</enum><text display-inline="yes-display-inline">not less than 2 percent of the funds made
available pursuant to this paragraph shall be used only for identifying and
notifying borrowers under existing mortgages who are eligible under this
section for insurance of refinancing mortgages, and in making funds reserved
under this subparagraph available for such purpose, the Secretary shall give
preference to assistance for programs that have a proven history of outreach
within minority communities; and</text>
</subparagraph></paragraph><paragraph id="H29436AA46E9B4CF4A9DB6C89C6E88F03"><enum>(2)</enum><text>$150,000,000 for costs of
activities under subsection (i).</text>
</paragraph></subsection><subsection display-inline="no-display-inline" id="H55C364792B13454600F6D2115BCDD184"><enum>(p)</enum><header>Audit and report by
Inspector General</header>
<paragraph id="H7EA55578081B4058BAB5247576259181"><enum>(1)</enum><header>Audit</header><text display-inline="yes-display-inline">The Inspector General of the Department of
Housing and Urban Development shall conduct an audit of the program for loss
mitigation counseling funded with amounts made available under subsection
(o)(1) to determine compliance with such subsection.</text>
</paragraph><paragraph id="H97D71853A3904A4D8469BBF2C512A800"><enum>(2)</enum><header>Reports to
Congress</header><text>Not later than March 30, 2009, and every calendar
quarter thereafter, the Inspector General shall submit to the appropriate
committees of the Congress a report summarizing the activities of the Inspector
General and the Neighborhood Reinvestment Corporation during the 120-day period
ending on the date of such report. Each report shall include, for the period
covered by such report, a detailed statement of all obligations, expenditures,
and revenues associated with paragraphs (1) and (2) of subsection (o),
including—</text>
<subparagraph id="H75F81992E0A74F3CA9EC093E7968EE9"><enum>(A)</enum><text>obligations and
expenditures of appropriated funds;</text>
</subparagraph><subparagraph id="H5DF2202AE2ED424A9EC55CC6543E4702"><enum>(B)</enum><text>the number of homeowners
eligible in such program;</text>
</subparagraph><subparagraph id="H6426D8834856408D00D8FA1D466CBC16"><enum>(C)</enum><text>the number of homeowners
participating in such program;</text>
</subparagraph><subparagraph id="H04607BFB67D0482D853C44A7ED81EB4F"><enum>(D)</enum><text>the status of homeowners
within such program;</text>
</subparagraph><subparagraph id="HE1F421AF2893431692AF0018FAE84C"><enum>(E)</enum><text>the number of homeowners
who have rejected assistance from the Neighborhood Reinvestment Corporation;
and</text>
</subparagraph><subparagraph id="HAFFFCFFCD860407884BDE41F4BA5CECE"><enum>(F)</enum><text>information on
participating counseling
services.</text>
</subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H81371171CF314909BCEF601B75A5D053"><enum>(b)</enum><header>Special risk insurance
fund</header><text>Section 238 of the National Housing Act (<external-xref legal-doc="usc" parsable-cite="usc/12/1715z-3">12 U.S.C. 1715z–3</external-xref>)
is amended—</text>
<paragraph id="HE8568E5436234FBD9F49F87D46780657"><enum>(1)</enum><text>in subsection (a)(1), by
striking <quote>or 243</quote> each place such term appears and inserting
<quote>243, or 257</quote>; and</text>
</paragraph><paragraph id="H70154B24BD1443C282275FA6EE9A0AD"><enum>(2)</enum><text>in subsection (b), by
striking <quote>and 243</quote> each place such term appears and inserting
<quote>243, and 257</quote>.</text>
</paragraph></subsection></section><section id="H0BB559A28D3E4C91AC7FC368D6A07C35"><enum>103.</enum><header>Study of Auction or
Bulk Refinance Program</header>
<subsection id="H179F823377684ECD80F9D1892985C0F1"><enum>(a)</enum><header>Study</header><text display-inline="yes-display-inline">The Board of Governors of the Federal
Reserve System (in this section referred to as the <quote>Board of
Governors</quote>), in consultation with other members of the Oversight Board
established by section 257(a) of the National Housing Act (as added by the
amendment made by section 102(a) of this Act), shall conduct a study of the
need for and efficacy of an auction or bulk refinancing mechanism to facilitate
refinancing of existing residential mortgages that are at risk for foreclosure
into mortgages insured under the mortgage insurance program under title II of
the National Housing Act. The study shall identify and examine various options
for mechanisms under which lenders and servicers of such mortgages may make
bids for forward commitments for such insurance in an expedited manner.</text>
</subsection><subsection id="H7B3D8339DE9A4870A0879E4210846B9E"><enum>(b)</enum><header>Content</header>
<paragraph id="HB45E20E57A4142128C422B37B4D4038E"><enum>(1)</enum><header>Analysis</header><text display-inline="yes-display-inline">The study required under subsection (a)
shall analyze—</text>
<subparagraph id="H6F73054901E943468252BECD40804842"><enum>(A)</enum><text>the feasibility of
establishing a mechanism that would facilitate the more rapid refinancing of
borrowers at risk of foreclosure into performing mortgages insured under title
II of the National Housing Act;</text>
</subparagraph><subparagraph id="H8B6967CF26974897A4B962AD161EACB1"><enum>(B)</enum><text>whether such a mechanism
would provide an effective and efficient mechanism to reduce foreclosures on
qualified existing mortgages;</text>
</subparagraph><subparagraph id="H8E345C2D511C4220B9D975289522C099"><enum>(C)</enum><text>whether the use of an
auction or bulk refinance program is necessary to stabilize the housing market
and reduce the impact of turmoil in that market on the economy of the United
States;</text>
</subparagraph><subparagraph id="H46F722FC2C03491FACB12BADC2DB3D00"><enum>(D)</enum><text>whether there are other
mechanisms or authority that would be useful to reduce foreclosure; and</text>
</subparagraph><subparagraph id="H8E93ABE33DE142E2B84F47CEC72197EE"><enum>(E)</enum><text>and any other factors
that the Board of Governors considers relevant.</text>
</subparagraph></paragraph><paragraph id="H08750CFEA25647E7BEC2D2F070E97F85"><enum>(2)</enum><header>Determinations</header><text display-inline="yes-display-inline">To the extent that the Board of Governors
finds that a facility of the type described in paragraph (1) is feasible and
useful, the study shall—</text>
<subparagraph id="HAC08445645524567AD987CF8F8C3149F"><enum>(A)</enum><text>determine and identify
any additional authority or resources needed to establish and operate such a
mechanism;</text>
</subparagraph><subparagraph id="H1BF4BECD46B6482C9BE179E3F7B0F95F"><enum>(B)</enum><text>determine whether there
is a need for additional authority with respect to the loan underwriting
criteria included in the amendment made by section 102(a) of this Act or with
respect to eligibility of participating borrowers, lenders, or holders of
liens; and</text>
</subparagraph><subparagraph id="H1BD55E80A3B14C06B250D661B34C3644"><enum>(C)</enum><text>determine whether such
underwriting criteria should be established on the basis of individual loans,
in the aggregate, or otherwise to facilitate the goal of refinancing borrowers
at risk of foreclosure into viable loans insured under the National Housing
Act.</text>
</subparagraph></paragraph></subsection><subsection id="H1FAEB7F77A70433A8F272111FA0B400"><enum>(c)</enum><header>Report</header><text display-inline="yes-display-inline">Not later than the expiration of the 60-day
period beginning on the date of the enactment of this Act, the Board of
Governors shall submit a report regarding the results of the study conducted
under this section to the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and Urban Affairs of the
Senate. The report shall include a detailed description of the analysis
required under subsection (b)(1) and of the determinations made pursuant to
subsection (b)(2), and shall include any other findings and recommendations of
the Board of Governors pursuant to the study, including identifying various
options for mechanisms described in subsection (a).</text>
</subsection></section><section id="H503A40751B6641BB00A31F254B6FC9A2" section-type="subsequent-section"><enum>104.</enum><header>Temporary increase
in maximum loan guaranty amount for certain housing loans guaranteed by
Secretary of Veterans Affairs</header><text display-inline="no-display-inline">Notwithstanding subparagraph (C) of section
3703(a)(1) of title 38, United States Code, for purposes of any loan described
in subparagraph (A)(i)(IV) of such section that is originated during the period
beginning on the date of the enactment of this Act and ending on December 31,
2008, the term <quote>maximum guaranty amount</quote> shall mean an amount
equal to 25 percent of the higher of—</text>
<paragraph id="H732BF740A1F14BC98D8C24620288854B"><enum>(1)</enum><text>the limitation determined
under section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act (12
U.S.C. 1454(a)(2)) for the calendar year in which the loan is originated for a
single-family residence; or</text>
</paragraph><paragraph id="H26AFA2A7D7D643B79F07A40ED8BD0DB"><enum>(2)</enum><text>125 percent of the area
median price for a single-family residence, but in no case to exceed 175
percent of the limitation determined under such section 305(a)(2) for the
calendar year in which the loan is originated for a single-family
residence.</text>
</paragraph></section><section id="HA3E733674F03428DABB400645407127B"><enum>105.</enum><header>Study of possible
accounting revisions relating to property at risk of foreclosure and the
availability of credit for refinancing home mortgages at risk of
foreclosure</header>
<subsection id="HA54D1E1F92564BD5AA82C61CE0A149A5"><enum>(a)</enum><header>Study
required</header><text display-inline="yes-display-inline">The Board of
Governors of the Federal Reserve System shall conduct a study on mark-to-market
accounting standards applicable to depository institutions with respect to
their residential mortgages that are at risk of foreclosure, the effects of
such accounting standards and capital requirements on a depository
institution’s capacity to provide refinancing to residential mortgagors that
are at risk of foreclosure and to residential mortgagors during periods of
market value declines and increased foreclosures, and the feasibility of
modifications of such standards, requirements, and regulatory actions during
periods of market fluctuation in order to maintain the ability of the
institution to continue to carry mortgages on residential property at risk of
foreclosure and assure the availability of credit to refinance at-risk
residential mortgages.</text>
</subsection><subsection id="H2CDA424151744A33A63E563139857F8F"><enum>(b)</enum><header>Report
required</header><text display-inline="yes-display-inline">The Board of
Governors of the Federal Reserve System shall submit a report to the Congress
before the end of the 90-day period beginning on the date of the enactment of
this Act containing the findings and determinations of the Board with respect
to the study conducted under subsection (a) and such administrative and
legislative recommendations as the Board may determine to be
appropriate.</text>
</subsection></section><section display-inline="no-display-inline" id="HBA4E8B3F9F1B45B8B784F69DB0ED8EA" section-type="subsequent-section"><enum>106.</enum><header>GAO study of the
effect of tightening credit markets in communities affected by the subprime
mortgage foreclosure crises and predatory lending on prospective first-time
homebuyers seeking mortgages</header><text display-inline="no-display-inline">The Comptroller General of the United States
shall conduct a study to analyze the effects of tightening credit markets on
prospective first-time home buyers who reside in selected communities that have
been most detrimentally affected by both the current subprime mortgage
foreclosure crisis and predatory mortgage lending. Such study shall also
analyze the adequacy of financial literacy outreach efforts by agencies of the
Federal Government tasked with implementing financial literacy education in
such communities and shall assess whether the current funding levels for such
efforts are at sufficient levels to reduce the levels of subprime mortgage
delinquencies and foreclosures and to increase the level of financial literacy
in the selected communities so as to minimize the incidences of predatory
mortgage lending. Not later than the expiration of the 6-month period beginning
on the date of the enactment of this Act, the Comptroller General shall submit
a report to the Congress setting forth the results of the study and including
recommendations regarding such funding levels.</text>
</section><enum>II</enum><header>Office of Housing
Counseling</header>
<section id="HCC263C4501374B53A41D9B5998631870"><enum>201.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Expand and Preserve Home Ownership Through Counseling
Act</quote>.</text>
</section><section id="HA13266D499714D9A8870765E008C9DC3"><enum>202.</enum><header>Establishment of
Office of Housing Counseling</header><text display-inline="no-display-inline">Section 4 of the Department of
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> (42
U.S.C. 3533) is amended by adding at the end the following new
subsection:</text>
<quoted-block act-name="Housing" changed="added" committee-id="HBA00" id="H55380E01B422401DAED21EBE837FB570" reported-display-style="italic">
<subsection id="HEE1CB0B3792D4F3FAD8B0074440027E8"><enum>(g)</enum><header>Office of Housing
Counseling</header>
<paragraph id="H71E49879559E4CEFBD2419AFDE54463"><enum>(1)</enum><header>Establishment</header><text>There
is established, in the Office of the Secretary, the Office of Housing
Counseling.</text>
</paragraph><paragraph id="H115D47742FFE40D79C618BD0DCD91900"><enum>(2)</enum><header>Director</header><text>There
is established the position of Director of Housing Counseling. The Director
shall be the head of the Office of Housing Counseling and shall be appointed by
the Secretary. Such position shall be a career-reserved position in the Senior
Executive Service.</text>
</paragraph><paragraph id="H2DDEB96477EC498BA870BDCCF42393E4"><enum>(3)</enum><header>Functions</header>
<subparagraph id="H472F83DA7D3048BCB8911C4F5C0369E0"><enum>(A)</enum><header>In
general</header><text>The Director shall have ultimate responsibility within
the Department, except for the Secretary, for all activities and matters
relating to homeownership counseling and rental housing counseling,
including—</text>
<clause id="HC5C66695E31A4E88A0052152C9004FC8"><enum>(i)</enum><text>research, grant
administration, public outreach, and policy development relating to such
counseling; and</text>
</clause><clause id="H1B54B9F630AC48C6922000FB3CE6A8C8"><enum>(ii)</enum><text>establishment,
coordination, and administration of all regulations, requirements, standards,
and performance measures under programs and laws administered by the Department
that relate to housing counseling, homeownership counseling (including
maintenance of homes), mortgage-related counseling (including home equity
conversion mortgages and credit protection options to avoid foreclosure), and
rental housing counseling, including the requirements, standards, and
performance measures relating to housing counseling.</text>
</clause></subparagraph><subparagraph id="H8A89252621C947EB93BCAA6EC2F20064"><enum>(B)</enum><header>Specific
functions</header><text display-inline="yes-display-inline">The Director shall
carry out the functions assigned to the Director and the Office under this
section and any other provisions of law. Such functions shall include
establishing rules necessary for—</text>
<clause id="H1DA08DD5958341DBBEB7636951342C06"><enum>(i)</enum><text>the counseling procedures
under section 106(g)(1) of the <act-name parsable-cite="HUDA">Housing and Urban
Development Act</act-name> of 1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x(h)(1)</external-xref>);</text>
</clause><clause id="HEBC62B4A76A8413186ADFA1B0548FDD"><enum>(ii)</enum><text>carrying out all other
functions of the Secretary under section 106(g) of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1968, including the establishment, operation, and publication of the
availability of the toll-free telephone number under paragraph (2) of such
section;</text>
</clause><clause id="H4C69E03161564F0999B9ED3EB0547CBB"><enum>(iii)</enum><text>carrying out section 5
of the Real Estate Settlement Procedures Act of 1974 (<external-xref legal-doc="usc" parsable-cite="usc/12/2604">12 U.S.C. 2604</external-xref>) for home
buying information booklets prepared pursuant to such section;</text>
</clause><clause id="HF12DB37100AA4639A6B800371EC295AC"><enum>(iv)</enum><text>carrying out the
certification program under section 106(e) of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x(e)</external-xref>);</text>
</clause><clause id="H7FE5FC7AD624407EAC79441DC26BB06B"><enum>(v)</enum><text>carrying out the
assistance program under section 106(a)(4) of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1968, including criteria for selection of applications to receive
assistance;</text>
</clause><clause id="H0AC611401890486C9E7FB334C6851777"><enum>(vi)</enum><text>carrying out any
functions regarding abusive, deceptive, or unscrupulous lending practices
relating to residential mortgage loans that the Secretary considers
appropriate, which shall include conducting the study under section 206 of the
Expand and Preserve Home Ownership Through Counseling Act;</text>
</clause><clause id="HD3AEA7ADAA0749969600A94413E658D7"><enum>(vii)</enum><text>providing for operation
of the advisory committee established under paragraph (4) of this
subsection;</text>
</clause><clause id="HD22F63AB4A534187ACAA6FD9F6B1999E"><enum>(viii)</enum><text>collaborating with
community-based organizations with expertise in the field of housing
counseling; and</text>
</clause><clause id="H71E795C084504F0AA3392875432DA888"><enum>(ix)</enum><text>providing for the
building of capacity to provide housing counseling services in areas that lack
sufficient services.</text>
</clause></subparagraph></paragraph><paragraph id="H0708F029385149F0BC93603F6E73808E"><enum>(4)</enum><header>Advisory
Committee</header>
<subparagraph id="HFA992A05A5ED48C7A565F41E57095131"><enum>(A)</enum><header>In
general</header><text>The Secretary shall appoint an advisory committee to
provide advice regarding the carrying out of the functions of the
Director.</text>
</subparagraph><subparagraph id="H984CB200A23C418F926C7C7B3EB6B147"><enum>(B)</enum><header>Members</header><text>Such
advisory committee shall consist of not more than 12 individuals, and the
membership of the committee shall equally represent all aspects of the mortgage
and real estate industry, including consumers.</text>
</subparagraph><subparagraph id="HA7C5CF20DD904F5396B7E313C4C9F705"><enum>(C)</enum><header>Terms</header><text>Except
as provided in subparagraph (D), each member of the advisory committee shall be
appointed for a term of 3 years. Members may be reappointed at the discretion
of the Secretary.</text>
</subparagraph><subparagraph id="HBD2DF1A814874D5796D151AACC4FC8F6"><enum>(D)</enum><header>Terms of initial
appointees</header><text>As designated by the Secretary at the time of
appointment, of the members first appointed to the advisory committee, 4 shall
be appointed for a term of 1 year and 4 shall be appointed for a term of 2
years.</text>
</subparagraph><subparagraph id="HED5E54120E3A4FD4AF000033E6191290"><enum>(E)</enum><header>Prohibition of pay;
travel expenses</header><text>Members of the advisory committee shall serve
without pay, but shall receive travel expenses, including per diem in lieu of
subsistence, in accordance with applicable provisions under subchapter I of
<external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/5/57">chapter 57</external-xref> of title 5, United States Code.</text>
</subparagraph><subparagraph id="H94A4BEBE5A524AEE909FEAC3B6B3C0B3"><enum>(F)</enum><header>Advisory role
only</header><text>The advisory committee shall have no role in reviewing or
awarding housing counseling grants.</text>
</subparagraph></paragraph><paragraph id="H303F166CEDE545F9A5A090D62E4278F7"><enum>(5)</enum><header>Scope of homeownership
counseling</header><text>In carrying out the responsibilities of the Director,
the Director shall ensure that homeownership counseling provided by, in
connection with, or pursuant to any function, activity, or program of the
Department addresses the entire process of homeownership, including the
decision to purchase a home, the selection and purchase of a home, issues
arising during or affecting the period of ownership of a home (including
refinancing, default and foreclosure, and other financial decisions), and the
sale or other disposition of a
home.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="HB90B77B15AC84AEBA24D93A7BDC8D01C"><enum>203.</enum><header>Counseling
procedures</header>
<subsection id="H6D2067692EF54C1B8F3298AF2FE447E9"><enum>(a)</enum><header>In
general</header><text>Section 106 of the <act-name parsable-cite="HUDA">Housing
and Urban Development Act</act-name> of 1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x</external-xref>) is amended by
adding at the end the following new subsection:</text>
<quoted-block act-name="Housing" changed="added" committee-id="HBA00" id="H6526645A5D86434FA287E782C24E30F1" reported-display-style="italic">
<subsection id="H8D5D58F2FD3143E5ADF26683693841C2"><enum>(g)</enum><header>Procedures and
activities</header>
<paragraph id="H56FF60B654334AD8AD13CE7EFD7044A"><enum>(1)</enum><header>Counseling
procedures</header>
<subparagraph id="HFE9AE332993A44A0A1CC74CBBAEDCFD3"><enum>(A)</enum><header>In
general</header><text>The Secretary shall establish, coordinate, and monitor
the administration by the Department of Housing and Urban Development of the
counseling procedures for homeownership counseling and rental housing
counseling provided in connection with any program of the Department, including
all requirements, standards, and performance measures that relate to
homeownership and rental housing counseling.</text>
</subparagraph><subparagraph id="H8D4C06338AC644F298E40076A7B9D0FC"><enum>(B)</enum><header>Homeownership
counseling</header><text>For purposes of this subsection and as used in the
provisions referred to in this subparagraph, the term <term>homeownership
counseling</term> means counseling related to homeownership and residential
mortgage loans. Such term includes counseling related to homeownership and
residential mortgage loans that is provided pursuant to—</text>
<clause id="HC13E3E5C1484499BBE00A804F5EE3F44"><enum>(i)</enum><text>section 105(a)(20) of the
<act-name parsable-cite="HCDA">Housing and Community Development Act of
1974</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/5305">42 U.S.C. 5305(a)(20)</external-xref>);</text>
</clause><clause id="HDAC47FBA8E744AAC94DE2011F0937D68"><enum>(ii)</enum><text>in the
<act-name parsable-cite="USHA">United States Housing Act of
1937</act-name>—</text>
<subclause id="H2C77394D1ECF4515A601AE0085256BB"><enum>(I)</enum><text>section 9(e) (42 U.S.C.
1437g(e));</text>
</subclause><subclause id="H0031D8580B4E416CA5A3E87A9508157"><enum>(II)</enum><text>section 8(y)(1)(D) (42
U.S.C. 1437f(y)(1)(D));</text>
</subclause><subclause id="HBC38465B442243F7B9298700B810CB6"><enum>(III)</enum><text>section 18(a)(4)(D) (42
U.S.C. 1437p(a)(4)(D));</text>
</subclause><subclause id="HA8B08542BF9D4C39A61054B83C2EFA03"><enum>(IV)</enum><text>section 23(c)(4) (42
U.S.C. 1437u(c)(4));</text>
</subclause><subclause id="HBF9A1117974B4E47A2DBCF7CAB82C43B"><enum>(V)</enum><text>section 32(e)(4) (42
U.S.C. 1437z–4(e)(4));</text>
</subclause><subclause id="HE9C0C152179C47EFA31E16C0D06F7143"><enum>(VI)</enum><text>section 33(d)(2)(B) (42
U.S.C. 1437z–5(d)(2)(B));</text>
</subclause><subclause id="HBAE70CBC0B1349FAACF1A16343BC0355"><enum>(VII)</enum><text>sections 302(b)(6) and
303(b)(7) (<external-xref legal-doc="usc" parsable-cite="usc/42/1437aaa-1">42 U.S.C. 1437aaa–1(b)(6)</external-xref>, 1437aaa–2(b)(7)); and</text>
</subclause><subclause id="HA16FDB44D852445485136400F400F3A0"><enum>(VIII)</enum><text>section 304(c)(4) (42
U.S.C. 1437aaa–3(c)(4));</text>
</subclause></clause><clause id="HE943A6F21FDE49B8BE24B6881CA691E3"><enum>(iii)</enum><text>section 302(a)(4) of
the American Homeownership and Economic Opportunity Act of 2000 (42 U.S.C.
1437f note);</text>
</clause><clause id="H85FC49222FBB411E9E6EDAB9E8A0DDDD"><enum>(iv)</enum><text>sections 233(b)(2) and
258(b) of the <act-name parsable-cite="CGNHA">Cranston-Gonzalez National
Affordable Housing Act</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/12773">42 U.S.C. 12773(b)(2)</external-xref>, 12808(b));</text>
</clause><clause id="H32D432ADC1C14C94B13510CE9DB1E6EC"><enum>(v)</enum><text>this section and section
101(e) of the <act-name parsable-cite="HUDA">Housing and Urban Development
Act</act-name> of 1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x</external-xref>, 1701w(e));</text>
</clause><clause id="H3834E400BB5345A800CA42A9BB7CA0BD"><enum>(vi)</enum><text>section 220(d)(2)(G) of
the Low-Income Housing Preservation and Resident Homeownership Act of 1990 (12
U.S.C. 4110(d)(2)(G));</text>
</clause><clause id="HCD2A4C3C94704844A093F91C167DC5D8"><enum>(vii)</enum><text>sections 422(b)(6),
423(b)(7), 424(c)(4), 442(b)(6), and 443(b)(6) of the
<act-name parsable-cite="CGNHA">Cranston-Gonzalez National Affordable Housing
Act</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/12872">42 U.S.C. 12872(b)(6)</external-xref>, 12873(b)(7), 12874(c)(4), 12892(b)(6),
and 12893(b)(6));</text>
</clause><clause id="H31D68D427AEF4DE894A2AE10F8793B00"><enum>(viii)</enum><text>section
491(b)(1)(F)(iii) of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11408(b)(1)(F)(iii));</text>
</clause><clause id="HA1869F9BED704B9086D6B5605EC41744"><enum>(ix)</enum><text>sections 202(3) and
810(b)(2)(A) of the Native American Housing and Self-Determination Act of 1996
(<external-xref legal-doc="usc" parsable-cite="usc/25/4132">25 U.S.C. 4132(3)</external-xref>, 4229(b)(2)(A));</text>
</clause><clause id="H440DEE93A69845CEAB5B9452F1741ED6"><enum>(x)</enum><text>in the
<act-name parsable-cite="NHA">National Housing Act</act-name>—</text>
<subclause id="H1597DFA542AC4597BA36AE9C18A6AB56"><enum>(I)</enum><text>in section 203 (12 U.S.C.
1709), the penultimate undesignated paragraph of paragraph (2) of subsection
(b), subsection (c)(2)(A), and subsection (r)(4);</text>
</subclause><subclause id="HE11975BF01074230A412760591A80067"><enum>(II)</enum><text>subsections (a) and
(c)(3) of section 237 (<external-xref legal-doc="usc" parsable-cite="usc/12/1715z-2">12 U.S.C. 1715z–2</external-xref>); and</text>
</subclause><subclause id="HC3250006C1C245EEBB00E17D555D6305"><enum>(III)</enum><text>subsections (d)(2)(B)
and (m)(1) of section 255 (<external-xref legal-doc="usc" parsable-cite="usc/12/1715z-20">12 U.S.C. 1715z–20</external-xref>);</text>
</subclause></clause><clause id="H5A8D0568E4EB4BFA8497CCC6A8636860"><enum>(xi)</enum><text>section 502(h)(4)(B) of
the <act-name parsable-cite="HA49">Housing Act of 1949</act-name> (42 U.S.C.
1472(h)(4)(B)); and</text>
</clause><clause id="HDF539623E3E142B9813DBBB2B91572F8"><enum>(xii)</enum><text>section 508 of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1970 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701z-7">12 U.S.C. 1701z–7</external-xref>).</text>
</clause></subparagraph><subparagraph id="HD89C7E8B3A2648C39E5F408493A7EF74"><enum>(C)</enum><header>Rental housing
counseling</header><text>For purposes of this subsection, the term <term>rental
housing counseling</term> means counseling related to rental of residential
property, which may include counseling regarding future homeownership
opportunities and providing referrals for renters and prospective renters to
entities providing counseling and shall include counseling related to such
topics that is provided pursuant to—</text>
<clause id="H450741B256654E23A87DB6E9516300FB"><enum>(i)</enum><text>section 105(a)(20) of the
<act-name parsable-cite="HCDA">Housing and Community Development Act of
1974</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/5305">42 U.S.C. 5305(a)(20)</external-xref>);</text>
</clause><clause id="H7097582055924CFCA4C3B29FE0DFEC29"><enum>(ii)</enum><text>in the
<act-name parsable-cite="USHA">United States Housing Act of
1937</act-name>—</text>
<subclause id="HA4145678208A489CA5A0FB9C35498BF"><enum>(I)</enum><text>section 9(e) (42 U.S.C.
1437g(e));</text>
</subclause><subclause id="HC8C310AA919B449C817159BB7EE36D75"><enum>(II)</enum><text>section 18(a)(4)(D) (42
U.S.C. 1437p(a)(4)(D));</text>
</subclause><subclause id="H848832F6F0854DD4B3AE7E639546AE"><enum>(III)</enum><text>section 23(c)(4) (42
U.S.C. 1437u(c)(4));</text>
</subclause><subclause id="H3BD147F8ECE349069259AD9CE1129665"><enum>(IV)</enum><text>section 32(e)(4) (42
U.S.C. 1437z–4(e)(4));</text>
</subclause><subclause id="HFA0F0F6382CC42818155AF3C4360FB2E"><enum>(V)</enum><text>section 33(d)(2)(B) (42
U.S.C. 1437z–5(d)(2)(B)); and</text>
</subclause><subclause id="H449D391B31BE491892D037BFCE60202E"><enum>(VI)</enum><text>section 302(b)(6) (42
U.S.C. 1437aaa–1(b)(6));</text>
</subclause></clause><clause id="HC8DED53BF72E4981A9DA25328CB49F78"><enum>(iii)</enum><text>section 233(b)(2) of
the <act-name parsable-cite="CGNHA">Cranston-Gonzalez National Affordable
Housing Act</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/12773">42 U.S.C. 12773(b)(2)</external-xref>);</text>
</clause><clause id="H30E712C0A21641E7AD5505E2D39200F9"><enum>(iv)</enum><text>section 106 of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x</external-xref>);</text>
</clause><clause id="H7CDCC44854CF4474BE55B07895E9B160"><enum>(v)</enum><text>section 422(b)(6) of the
<act-name parsable-cite="CGNHA">Cranston-Gonzalez National Affordable Housing
Act</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/12872">42 U.S.C. 12872(b)(6)</external-xref>);</text>
</clause><clause id="H6672183DF4BF48F3A8FA23C9A85B2BB3"><enum>(vi)</enum><text>section
491(b)(1)(F)(iii) of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11408(b)(1)(F)(iii));</text>
</clause><clause id="HF18AFD09984D446FACE8F4F8728C5874"><enum>(vii)</enum><text>sections 202(3) and
810(b)(2)(A) of the Native American Housing and Self-Determination Act of 1996
(<external-xref legal-doc="usc" parsable-cite="usc/25/4132">25 U.S.C. 4132(3)</external-xref>, 4229(b)(2)(A)); and</text>
</clause><clause id="HFC2CC65F2C4345239400AC622B29EB66"><enum>(viii)</enum><text>the rental assistance
program under section 8 of the <act-name parsable-cite="USHA">United States
Housing Act of 1937</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/1437f">42 U.S.C. 1437f</external-xref>).</text>
</clause></subparagraph></paragraph><paragraph id="HD2D2C15FA5224867A11550161DD1F709"><enum>(2)</enum><header>Standards for
materials</header><text display-inline="yes-display-inline">The Secretary, in
conjunction with the advisory committee established under subsection (g)(4) of
the Department of Housing and Urban Development Act, shall establish standards
for materials and forms to be used, as appropriate, by organizations providing
homeownership counseling services, including any recipients of assistance
pursuant to subsection (a)(4).</text>
</paragraph><paragraph id="H1FA3FAFEAB844474954DCABF8BD2018E"><enum>(3)</enum><header>Mortgage software
systems</header>
<subparagraph id="HCBF759B0B6334482960099940032071D"><enum>(A)</enum><header>Certification</header><text>The
Secretary shall provide for the certification of various computer software
programs for consumers to use in evaluating different residential mortgage loan
proposals. The Secretary shall require, for such certification, that the
mortgage software systems take into account—</text>
<clause id="H7C3AECBF06F345FFB9D0F62B258C7B39"><enum>(i)</enum><text>the consumer’s financial
situation and the cost of maintaining a home, including insurance, taxes, and
utilities;</text>
</clause><clause id="H971DEA79DDC94740B23B73627F67CA79"><enum>(ii)</enum><text>the amount of time the
consumer expects to remain in the home or expected time to maturity of the
loan; and</text>
</clause><clause id="H0AEF5ABA27F647168960BF34CB6156B"><enum>(iii)</enum><text>such other factors as
the Secretary considers appropriate to assist the consumer in evaluating
whether to pay points, to lock in an interest rate, to select an adjustable or
fixed rate loan, to select a conventional or government-insured or guaranteed
loan and to make other choices during the loan application process.</text>
</clause><continuation-text continuation-text-level="subparagraph">If
the Secretary determines that available existing software is inadequate to
assist consumers during the residential mortgage loan application process, the
Secretary shall arrange for the development by private sector software
companies of new mortgage software systems that meet the Secretary’s
specifications.</continuation-text></subparagraph><subparagraph id="H2812234BD9E7405E9609C89D154D3761"><enum>(B)</enum><header>Use and initial
availability</header><text>Such certified computer software programs shall be
used to supplement, not replace, housing counseling. The Secretary shall
provide that such programs are initially used only in connection with the
assistance of housing counselors certified pursuant to subsection (e).</text>
</subparagraph><subparagraph id="H5FB37F0B439A462700DF6CF5004CC0B4"><enum>(C)</enum><header>Availability</header><text>After
a period of initial availability under subparagraph (B) as the Secretary
considers appropriate, the Secretary shall take reasonable steps to make
mortgage software systems certified pursuant to this paragraph widely available
through the Internet and at public locations, including public libraries,
senior-citizen centers, public housing sites, offices of public housing
agencies that administer rental housing assistance vouchers, and housing
counseling centers.</text>
</subparagraph></paragraph><paragraph id="H526942B41B8A499A95A66B77090349BB"><enum>(4)</enum><header>National public service
multimedia campaigns to promote housing counseling</header>
<subparagraph id="H4ED63870E87646C3A1B7650064278CC4"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The Director of
Housing Counseling shall develop, implement, and conduct national public
service multimedia campaigns designed to make persons facing mortgage
foreclosure, persons considering a subprime mortgage loan to purchase a home,
elderly persons, persons who face language barriers, low-income persons, and
other potentially vulnerable consumers aware that it is advisable, before
seeking or maintaining a residential mortgage loan, to obtain homeownership
counseling from an unbiased and reliable sources and that such homeownership
counseling is available, including through programs sponsored by the Secretary
of Housing and Urban Development.</text>
</subparagraph><subparagraph id="HCF7FD8DA19ED40D6A6591500A9250154"><enum>(B)</enum><header>Contact
information</header><text display-inline="yes-display-inline">Each segment of
the multimedia campaign under subparagraph (A) shall publicize the toll-free
telephone number and web site of the Department of Housing and Urban
Development through which persons seeking housing counseling can locate a
housing counseling agency in their State that is certified by the Secretary of
Housing and Urban Development and can provide advice on buying a home, renting,
defaults, foreclosures, credit issues, and reverse mortgages.</text>
</subparagraph><subparagraph id="HC116BB84C57C46CAB30767235E43DC63"><enum>(C)</enum><header>Authorization of
appropriations</header><text display-inline="yes-display-inline">There are
authorized to be appropriated to the Secretary, not to exceed $3,000,000 for
fiscal years 2008, 2009, and 2010, for the develop, implement, and conduct of
national public service multimedia campaigns under this paragraph.</text>
</subparagraph></paragraph><paragraph id="H87F8016ED8504CC5B3D332E9482FB4CD"><enum>(5)</enum><header>Education
programs</header><text>The Secretary shall provide advice and technical
assistance to States, units of general local government, and nonprofit
organizations regarding the establishment and operation of, including
assistance with the development of content and materials for, educational
programs to inform and educate consumers, particularly those most vulnerable
with respect to residential mortgage loans (such as elderly persons, persons
facing language barriers, low-income persons, and other potentially vulnerable
consumers), regarding home mortgages, mortgage refinancing, home equity loans,
and home repair
loans.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H51C9A5383CDD474188486751E1BC7247"><enum>(b)</enum><header>Conforming amendments
to grant program for homeownership counseling
organizations</header><text>Section 106(c)(5)(A)(ii) of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x(c)(5)(A)(ii)</external-xref>) is amended—</text>
<paragraph id="HED21FAE49B5A4EFBA7635154A5917776"><enum>(1)</enum><text>in subclause (III), by
striking <quote>and</quote> at the end;</text>
</paragraph><paragraph id="H4FFDCF613F194459A3BAAECEE6984ED3"><enum>(2)</enum><text>in subclause (IV) by
striking the period at the end and inserting <quote>; and</quote>; and</text>
</paragraph><paragraph id="HFFC075147123405AA59500A53DDF00E3"><enum>(3)</enum><text>by inserting after
subclause (IV) the following new subclause:</text>
<quoted-block changed="added" committee-id="HBA00" id="HC5FA947BB0D142A89C2B52B60D27221" reported-display-style="italic">
<subclause id="H12FC99FF67764485811DFC00EA366797"><enum>(V)</enum><text>notify the housing or
mortgage applicant of the availability of mortgage software systems provided
pursuant to subsection
(g)(3).</text>
</subclause><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section id="HD5BDC64E586640F688751747A202637E"><enum>204.</enum><header>Grants for housing
counseling assistance</header><text display-inline="no-display-inline">Section
106(a) of the <act-name parsable-cite="HUDA">Housing and Urban Development
Act</act-name> of 1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x(a)(3)</external-xref>) is amended by adding at the end
the following new paragraph:</text>
<quoted-block act-name="Housing" changed="added" committee-id="HBA00" id="HDF197CA146664C608F36C63486E94CDD" reported-display-style="italic">
<paragraph id="H637ADCB2694946DF96626C9E73CD3C39" indent="up1"><enum>(4)</enum><header>Homeownership and
rental counseling assistance</header>
<subparagraph id="HF58E7D7C977B47FEB37C9F11182497FA"><enum>(A)</enum><header>In
general</header><text>The Secretary shall make financial assistance available
under this paragraph to States, units of general local governments, and
nonprofit organizations providing homeownership or rental counseling (as such
terms are defined in subsection (g)(1)).</text>
</subparagraph><subparagraph id="HA8809193A9EF495691544068C46DAEEC"><enum>(B)</enum><header>Qualified
entities</header><text>The Secretary shall establish standards and guidelines
for eligibility of organizations (including governmental and nonprofit
organizations) to receive assistance under this paragraph.</text>
</subparagraph><subparagraph id="HDB3119E74B394EA0ABD101A132300567"><enum>(C)</enum><header>Distribution</header><text>Assistance
made available under this paragraph shall be distributed in a manner that
encourages efficient and successful counseling programs.</text>
</subparagraph><subparagraph id="H467E825FC26447AB859849EF8673B7F3"><enum>(D)</enum><header>Authorization of
appropriations</header><text>There are authorized to be appropriated
$45,000,000 for each of fiscal years 2008 through 2011 for—</text>
<clause id="H5E61A654E0964A269BC1265C00804055"><enum>(i)</enum><text>the operations of the
Office of Housing Counseling of the Department of Housing and Urban
Development;</text>
</clause><clause id="H2F11C7A847D641F1A30062979F682014"><enum>(ii)</enum><text>the responsibilities of
the Secretary under paragraphs (2) through (5) of subsection (g); and</text>
</clause><clause id="H496B538DF59E445389C73FC386DBCCB6"><enum>(iii)</enum><text>assistance pursuant to
this paragraph for entities providing homeownership and rental
counseling.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="H8AF1C08346AC4CF3B9F02965A3C190F"><enum>205.</enum><header>Requirements to use
HUD-certified counselors under HUD programs</header><text display-inline="no-display-inline">Section 106(e) of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x(e)</external-xref>) is amended—</text>
<paragraph id="HDF13DD27D0F44F1387AA3DF0E0184380"><enum>(1)</enum><text>by striking paragraph (1)
and inserting the following new paragraph:</text>
<quoted-block changed="added" committee-id="HBA00" id="H21EFA21FCF384129A67E12BE36CBE946" reported-display-style="italic">
<paragraph id="HFBD7F9B7737B42D580FCEDD4EA71836F"><enum>(1)</enum><header>Requirement for
assistance</header><text>An organization may not receive assistance for
counseling activities under subsection (a)(1)(iii), (a)(2), (a)(4), (c), or (d)
of this section, or under section 101(e), unless the organization, or the
individuals through which the organization provides such counseling, has been
certified by the Secretary under this subsection as competent to provide such
counseling.</text>
</paragraph><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="HEDFF3CFAE4894D558F00723664BB0068"><enum>(2)</enum><text>in paragraph (2)—</text>
<subparagraph id="H29FBDE899B15468D8600676300BB7058"><enum>(A)</enum><text>by inserting <quote>and
for certifying organizations</quote> before the period at the end of the first
sentence; and</text>
</subparagraph><subparagraph id="H31FFB4C87AF047C8AEC36757E9D73BB7"><enum>(B)</enum><text>in the second sentence by
striking <quote>for certification</quote> and inserting <quote>, for
certification of an organization, that each individual through which the
organization provides counseling shall demonstrate, and, for certification of
an individual,</quote>;</text>
</subparagraph></paragraph><paragraph id="H46C5F6EBA7C543B59D55C828306B9961"><enum>(3)</enum><text>in paragraph (3), by
inserting <quote>organizations and</quote> before
<quote>individuals</quote>;</text>
</paragraph><paragraph id="H1146CF19D6454C4AA5E7C3E04569923C"><enum>(4)</enum><text>by redesignating
paragraph (3) as paragraph (5); and</text>
</paragraph><paragraph id="HF630530A91844CFAB3E281B236002B03"><enum>(5)</enum><text>by inserting after
paragraph (2) the following new paragraphs:</text>
<quoted-block changed="added" committee-id="HBA00" id="HA567B365B14A42B384F83C1D3DE0D15E" reported-display-style="italic">
<paragraph id="HEFF826FB5BC5494C9BDA48C3C57411D"><enum>(3)</enum><header>Requirement under hud
programs</header><text>Any homeownership counseling or rental housing
counseling (as such terms are defined in subsection (g)(1)) required under, or
provided in connection with, any program administered by the Department of
Housing and Urban Development shall be provided only by organizations or
counselors certified by the Secretary under this subsection as competent to
provide such counseling.</text>
</paragraph><paragraph id="HC4FBF5E36A3F47E987A7FD93ACF89C4F"><enum>(4)</enum><header>Outreach</header><text>The
Secretary shall take such actions as the Secretary considers appropriate to
ensure that individuals and organizations providing homeownership or rental
housing counseling are aware of the certification requirements and standards of
this subsection and of the training and certification programs under subsection
(f).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section id="HA73610C51A8C40D6B1791353773CC0A4"><enum>206.</enum><header>Study of defaults and
foreclosures</header><text display-inline="no-display-inline">The Secretary of
Housing and Urban Development shall conduct an extensive study of the root
causes of default and foreclosure of home loans, using as much empirical data
as are available. The study shall also examine the role of escrow accounts in
helping prime and nonprime borrowers to avoid defaults and foreclosures. Not
later than 12 months after the date of the enactment of this Act, the Secretary
shall submit to the Congress a preliminary report regarding the study. Not
later than 24 months after such date of enactment, the Secretary shall submit a
final report regarding the results of the study, which shall include any
recommended legislation relating to the study, and recommendations for best
practices and for a process to identify populations that need counseling the
most.</text>
</section><section id="H830E90E340F04B019D4EC1E93082400"><enum>207.</enum><header>Definitions for
counseling-related programs</header><text display-inline="no-display-inline">Section 106 of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x</external-xref>), as amended by the preceding provisions of this title,
is further amended by adding at the end the following new subsection:</text>
<quoted-block act-name="Housing" changed="added" committee-id="HBA00" id="H5A999C963BC54658B2FCD8DC5EF105AE" reported-display-style="italic">
<subsection id="H896FE56CF6C848279F6200C82398F100"><enum>(h)</enum><header>Definitions</header><text>For
purposes of this section:</text>
<paragraph id="HE503272F027D46AABCE76B4059E44E3"><enum>(1)</enum><header>Nonprofit
organization</header><text>The term <term>nonprofit organization</term> has the
meaning given such term in section 104(5) of the
<act-name parsable-cite="CGNHA">Cranston-Gonzalez National Affordable Housing
Act</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/12704">42 U.S.C. 12704(5)</external-xref>), except that subparagraph (D) of such
section shall not apply for purposes of this section.</text>
</paragraph><paragraph id="H7E04F2D8679642749D548FEC7B782ED3"><enum>(2)</enum><header>State</header><text>The
term <term>State</term> means each of the several States, the Commonwealth of
Puerto Rico, the District of Columbia, the Commonwealth of the Northern Mariana
Islands, Guam, the Virgin Islands, American Samoa, the Trust Territories of the
Pacific, or any other possession of the United States.</text>
</paragraph><paragraph id="H586EFD789C9A431EACC6AE72AECCDDEB"><enum>(3)</enum><header>Unit of general local
government</header><text>The term <term>unit of general local government</term>
means any city, county, parish, town, township, borough, village, or other
general purpose political subdivision of a
State.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="HC23F7E7A0D5C44E7AF63BE5FC505D0FB"><enum>208.</enum><header>Updating and
simplification of mortgage information booklet</header><text display-inline="no-display-inline">Section 5 of the Real Estate Settlement
Procedures Act of 1974 (<external-xref legal-doc="usc" parsable-cite="usc/12/2604">12 U.S.C. 2604</external-xref>) is amended—</text>
<paragraph id="HD40C8D4C00444E2C80FF684F7D2C1E"><enum>(1)</enum><text>in the section heading,
by striking <quote><header-in-text level="section" style="traditional">special</header-in-text></quote> and inserting
<quote><header-in-text level="section" style="traditional">home
buying</header-in-text></quote>;</text>
</paragraph><paragraph id="H22E100185BB84CDFAE0052007EA4412"><enum>(2)</enum><text>by striking subsections
(a) and (b) and inserting the following new subsections:</text>
<quoted-block changed="added" committee-id="HBA00" id="H579AB0B476D243AEA9A04246D8790BC" reported-display-style="italic">
<subsection id="HD083BF39AABF46E99D1831CB997BA059"><enum>(a)</enum><header>Preparation and
distribution</header><text>The Secretary shall prepare, at least once every 5
years, a booklet to help consumers applying for federally related mortgage
loans to understand the nature and costs of real estate settlement services.
The Secretary shall prepare the booklet in various languages and cultural
styles, as the Secretary determines to be appropriate, so that the booklet is
understandable and accessible to homebuyers of different ethnic and cultural
backgrounds. The Secretary shall distribute such booklets to all lenders that
make federally related mortgage loans. The Secretary shall also distribute to
such lenders lists, organized by location, of homeownership counselors
certified under section 106(e) of the <act-name parsable-cite="HUDA">Housing
and Urban Development Act</act-name> of 1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x(e)</external-xref>) for use in
complying with the requirement under subsection (c) of this section.</text>
</subsection><subsection id="H493EB89F4CEC461FADFAFE1E9E57083B"><enum>(b)</enum><header>Contents</header><text>Each
booklet shall be in such form and detail as the Secretary shall prescribe and,
in addition to such other information as the Secretary may provide, shall
include in plain and understandable language the following information:</text>
<paragraph id="HEECA5885BF784578A35459BE715315AC"><enum>(1)</enum><text>A description and
explanation of the nature and purpose of the costs incident to a real estate
settlement or a federally related mortgage loan. The description and
explanation shall provide general information about the mortgage process as
well as specific information concerning, at a minimum—</text>
<subparagraph id="H1863020DC0D14777B8510000AF27D5F8"><enum>(A)</enum><text>balloon payments;</text>
</subparagraph><subparagraph id="HD61191DEFC2F428DAB2CAF00957B7736"><enum>(B)</enum><text>prepayment penalties;
and</text>
</subparagraph><subparagraph id="HFA8BE50423244A4CB7ED965B39DE31"><enum>(C)</enum><text>the trade-off between
closing costs and the interest rate over the life of the loan.</text>
</subparagraph></paragraph><paragraph id="HE92A586DC89745A388D266E1148326B"><enum>(2)</enum><text>An explanation and sample
of the uniform settlement statement required by section 4.</text>
</paragraph><paragraph id="H00039DD79C394FD483868D9F5E692B17"><enum>(3)</enum><text>A list and explanation of
lending practices, including those prohibited by the Truth in Lending Act or
other applicable Federal law, and of other unfair practices and unreasonable or
unnecessary charges to be avoided by the prospective buyer with respect to a
real estate settlement.</text>
</paragraph><paragraph id="H01ABA9C553204B5586A9DDCE5EF7FBD"><enum>(4)</enum><text>A list and explanation of
questions a consumer obtaining a federally related mortgage loan should ask
regarding the loan, including whether the consumer will have the ability to
repay the loan, whether the consumer sufficiently shopped for the loan, whether
the loan terms include prepayment penalties or balloon payments, and whether
the loan will benefit the borrower.</text>
</paragraph><paragraph id="HEC99F7A3C743499DA000B8DAB5F2FD3"><enum>(5)</enum><text>An explanation of the
right of rescission as to certain transactions provided by sections 125 and 129
of the Truth in Lending Act.</text>
</paragraph><paragraph id="H263FAFBB08BC4575AC4BFBAD8D1D371E"><enum>(6)</enum><text>A brief explanation of
the nature of a variable rate mortgage and a reference to the booklet entitled
<quote>Consumer Handbook on Adjustable Rate Mortgages</quote>, published by the
Board of Governors of the Federal Reserve System pursuant to section
226.19(b)(1) of title 12, Code of Federal Regulations, or to any suitable
substitute of such booklet that such Board of Governors may subsequently adopt
pursuant to such section.</text>
</paragraph><paragraph id="H72A946029ACD420E9EEC4F01174412A6"><enum>(7)</enum><text>A brief explanation of
the nature of a home equity line of credit and a reference to the pamphlet
required to be provided under section 127A of the Truth in Lending Act.</text>
</paragraph><paragraph id="HF2081B5BBFB74374B68BBAC3EC058B"><enum>(8)</enum><text>Information about
homeownership counseling services made available pursuant to section 106(a)(4)
of the <act-name parsable-cite="HUDA">Housing and Urban Development
Act</act-name> of 1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x(a)(4)</external-xref>), a recommendation that the
consumer use such services, and notification that a list of certified providers
of homeownership counseling in the area, and their contact information, is
available.</text>
</paragraph><paragraph id="HE3A54D9898434D98811B3538D4473966"><enum>(9)</enum><text>An explanation of the
nature and purpose of escrow accounts when used in connection with loans
secured by residential real estate and the requirements under section 10 of
this Act regarding such accounts.</text>
</paragraph><paragraph id="HF82089BCCCAC497AAD1C5E5B862D16E1"><enum>(10)</enum><text>An explanation of the
choices available to buyers of residential real estate in selecting persons to
provide necessary services incidental to a real estate settlement.</text>
</paragraph><paragraph id="H66C70F33726C48E5B3DE86EB0575767F"><enum>(11)</enum><text>An explanation of a
consumer’s responsibilities, liabilities, and obligations in a mortgage
transaction.</text>
</paragraph><paragraph id="H240C9FBDA44B468B9C29A3DF7BC40020"><enum>(12)</enum><text>An explanation of the
nature and purpose of real estate appraisals, including the difference between
an appraisal and a home inspection.</text>
</paragraph><paragraph id="H2DA4C334F24F4670AB59A050B13BE066"><enum>(13)</enum><text>Notice that the Office
of Housing of the Department of Housing and Urban Development has made publicly
available a brochure regarding loan fraud and a World Wide Web address and
toll-free telephone number for obtaining the brochure.</text>
</paragraph><continuation-text continuation-text-level="subsection">The
booklet prepared pursuant to this section shall take into consideration
differences in real estate settlement procedures that may exist among the
several States and territories of the United States and among separate
political subdivisions within the same State and
territory.</continuation-text></subsection><after-quoted-block>;</after-quoted-block></quoted-block>
</paragraph><paragraph id="HB6777417874E4BB19E49063300AF573"><enum>(3)</enum><text>in subsection (c), by
inserting at the end the following new sentence: <quote>Each lender shall also
include with the booklet a reasonably complete or updated list of homeownership
counselors who are certified pursuant to section 106(e) of the
<act-name parsable-cite="HUDA">Housing and Urban Development Act</act-name> of
1968 (<external-xref legal-doc="usc" parsable-cite="usc/12/1701x">12 U.S.C. 1701x(e)</external-xref>) and located in the area of the lender.</quote>;
and</text>
</paragraph><paragraph id="H46C9823DA3154B6B99E0934FC57EEAB"><enum>(4)</enum><text>in subsection (d), by
inserting after the period at the end of the first sentence the following:
<quote>The lender shall provide the HUD-issued booklet in the version that is
most appropriate for the person receiving it.</quote>.</text>
</paragraph></section><enum>III</enum><header>Combating mortgage
fraud</header>
<section id="H8A18CE1EDA904033B87D939F9475F1BA" section-type="subsequent-section"><enum>301.</enum><header>Authorization of
appropriations to combat mortgage fraud</header><text display-inline="no-display-inline">For fiscal years 2008, 2009, 2010, 2011, and
2012, there are authorized to be appropriated to the Attorney General a total
of—</text>
<paragraph id="HE6B1DEC3AD614CA1003B06EF45EAF28F"><enum>(1)</enum><text>$31,250,000 to support
the employment of 30 additional agents of the Federal Bureau of Investigation
and 2 additional dedicated prosecutors at the Department of Justice to
coordinate prosecution of mortgage fraud efforts with the offices of the United
States Attorneys; and</text>
</paragraph><paragraph id="H31FF6E257B464C42802139A095122B3B"><enum>(2)</enum><text display-inline="yes-display-inline">$750,000 to support the operations of
interagency task forces of the Federal Bureau of Investigation in the areas
with the 15 highest concentrations of mortgage fraud.</text>
</paragraph></section>
May 5, 2008
Reported with an amendment, committed to the Committee of
the Whole House on the State of the Union, and ordered to be
printed