[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5857 Introduced in House (IH)]







110th CONGRESS
  2d Session
                                H. R. 5857

 To establish licensing and registration requirements for residential 
mortgage originators, improve mortgage disclosures, create an Office of 
     Housing Counseling, to provide incentives to facilitate loan 
   modifications, reform the regulation of the Government Sponsored 
Enterprises, modernize the Federal Housing Administration, improve home 
    ownership for veterans, reform appraisal activities, and combat 
                mortgage fraud, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 22, 2008

 Mr. Bachus (for himself, Mrs. Biggert, Mrs. Capito, Mr. Boehner, Mr. 
 Blunt, Mr. Putnam, Ms. Granger, Mr. McCotter, Ms. Pryce of Ohio, Mr. 
 Roskam, Mr. Shays, Mr. Neugebauer, Mr. LaTourette, Mr. Jones of North 
 Carolina, Mr. Castle, Ms. Ginny Brown-Waite of Florida, Mr. Heller of 
Nevada, Mr. Sessions, Mr. Lucas, Mr. Davis of Kentucky, Mr. Bonner, Mr. 
 Rogers of Alabama, Mr. Latham, Mr. Turner, Mr. Chabot, Mr. Mario Diaz-
Balart of Florida, Mr. Rogers of Michigan, Mr. Gallegly, Mr. Kirk, Mr. 
   Terry, Mr. Manzullo, Mr. Boozman, and Mr. Carter) introduced the 
   following bill; which was referred to the Committee on Financial 
    Services, and in addition to the Committees on Armed Services, 
 Veterans' Affairs, and the Judiciary, for a period to be subsequently 
   determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
 To establish licensing and registration requirements for residential 
mortgage originators, improve mortgage disclosures, create an Office of 
     Housing Counseling, to provide incentives to facilitate loan 
   modifications, reform the regulation of the Government Sponsored 
Enterprises, modernize the Federal Housing Administration, improve home 
    ownership for veterans, reform appraisal activities, and combat 
                mortgage fraud, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Homeownership Protection and Housing 
Market Stabilization Act of 2008''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
  TITLE I--LICENSING SYSTEM FOR RESIDENTIAL MORTGAGE LOAN ORIGINATORS

Sec. 101. Purposes and methods for establishing a mortgage licensing 
                            system and registry.
Sec. 102. Definitions.
Sec. 103. License or registration required.
Sec. 104. State license and registration application and issuance.
Sec. 105. Standards for State license renewal.
Sec. 106. System of registration administration by Federal banking 
                            agencies.
Sec. 107. Secretary of Housing and Urban Development backup authority 
                            to establish a loan originator licensing 
                            system.
Sec. 108. Backup authority to establish a nationwide mortgage licensing 
                            and registry system.
Sec. 109. Fees.
Sec. 110. Background checks of loan originators.
Sec. 111. Confidentiality of information.
Sec. 112. Liability provisions.
Sec. 113. Enforcement under HUD backup licensing system.
            TITLE II--RESIDENTIAL MORTGAGE LOAN DISCLOSURES

Sec. 201. Required disclosures.
Sec. 202. Disclosures required in monthly statements for residential 
                            mortgage loans.
                TITLE III--OFFICE OF HOUSING COUNSELING

Sec. 301. Short title.
Sec. 302. Establishment of Office of Housing Counseling.
Sec. 303. Counseling procedures.
Sec. 304. Grants for housing counseling assistance.
Sec. 305. Requirements to use HUD-certified counselors under HUD 
                            programs.
Sec. 306. Study of defaults and foreclosures.
Sec. 307. Definitions for counseling-related programs.
Sec. 308. Updating and simplification of mortgage information booklet.
 TITLE IV--INCENTIVES FOR BEST PRACTICES AND MORTGAGE LOAN MODIFICATION

Sec. 401. CRA credit for certain lender practices.
Sec. 402. Safe harbor for qualified loan modifications or workout plans 
                            for certain residential mortgage loans.
                       TITLE V--FHA MODERNIZATION

Sec. 501. Short title.
Sec. 502. Findings and purposes.
Sec. 503. Maximum principal loan obligation.
Sec. 504. Extension of mortgage term.
Sec. 505. Mortgage insurance premiums.
Sec. 506. Rehabilitation loans.
Sec. 507. Discretionary action.
Sec. 508. Insurance of condominiums.
Sec. 509. Mutual Mortgage Insurance Fund.
Sec. 510. Hawaiian home lands and Indian reservations.
Sec. 511. Conforming and technical amendments.
Sec. 512. Home equity conversion mortgages.
Sec. 513. Conforming loan limit in disaster areas.
Sec. 514. Participation of mortgage brokers and correspondent lenders.
Sec. 515. Sense of Congress regarding technology for financial systems.
Sec. 516. Savings provision.
Sec. 517. Implementation.
                  TITLE VI--HOMEOWNERSHIP FOR VETERANS

Sec. 601. Temporary increase in maximum loan guaranty amount for 
                            housing loans guaranteed by Secretary of 
                            Veterans Affairs.
Sec. 602. Counseling on mortgage foreclosures for members of the Armed 
                            Forces returning from service abroad.
Sec. 603. Enhancement of protections for servicemembers relating to 
                            mortgages and mortgage foreclosures.
                  TITLE VII--MORTGAGE ESCROW ACCOUNTS

Sec. 701. Escrow and impound accounts relating to certain consumer 
                            credit transactions.
Sec. 702. Disclosure notice required for consumers who waive escrow 
                            services.
                       TITLE VIII--MORTGAGE FRAUD

Sec. 801. Authorization of appropriations for mortgage fraud 
                            prevention, investigation, and prosecution.
                     TITLE IX--APPRAISAL ACTIVITIES

Sec. 901. Property appraisal requirements.
Sec. 902. Amendments relating to appraisal subcommittee of FIEC, 
                            appraiser independence, and approved 
                            appraiser education.
Sec. 903. Study required on improvements in appraisal process and 
                            compliance programs.
                TITLE X--FEDERAL HOUSING FINANCE REFORM

Sec. 1001. Short title.
Sec. 1002. Definitions.
 Subtitle A--Reform of Regulation of Enterprises and Federal Home Loan 
                                 Banks

             Chapter 1--Improvement of Safety and Soundness

Sec. 1011. Establishment of the Federal Housing Finance Agency.
Sec. 1012. Duties and authorities of Director.
Sec. 1013. Federal Housing Enterprise Board.
Sec. 1014. Authority to require reports by regulated entities.
Sec. 1015. Disclosure of income and charitable contributions by 
                            enterprises.
Sec. 1016. Assessments.
Sec. 1017. Examiners and accountants.
Sec. 1018. Prohibition and withholding of executive compensation.
Sec. 1019. Reviews of regulated entities.
Sec. 1020. Regulations and orders.
Sec. 1021. Non-waiver of privileges.
Sec. 1022. Risk-Based capital requirements.
Sec. 1023. Minimum and critical capital levels.
Sec. 1024. Review of and authority over enterprise assets and 
                            liabilities.
Sec. 1025. Corporate governance of enterprises.
Sec. 1026. Required registration under Securities Exchange Act of 1934.
Sec. 1027. Liaison with Financial Institutions Examination Council.
Sec. 1028. Guarantee fee study.
Sec. 1029. Conforming amendments.
             Chapter 2--Improvement of Mission Supervision

Sec. 1031. Transfer of product approval and housing goal oversight.
Sec. 1032. Review of enterprise products.
Sec. 1033. Conforming loan limits.
Sec. 1034. Annual housing report regarding regulated entities.
Sec. 1035. Annual reports by regulated entities on affordable housing 
                            stock.
Sec. 1036. Mortgagor identification requirements for mortgages of 
                            regulated entities.
Sec. 1037. Revision of housing goals.
Sec. 1038. Duty to serve underserved markets.
Sec. 1039. Monitoring and enforcing compliance with housing goals.
Sec. 1040. Consistency with mission.
Sec. 1041. Enforcement.
Sec. 1042. Conforming amendments.
                  Chapter 3--Prompt Corrective Action

Sec. 1045. Capital classifications.
Sec. 1046. Supervisory actions applicable to undercapitalized regulated 
                            entities.
Sec. 1047. Supervisory actions applicable to significantly 
                            undercapitalized regulated entities.
Sec. 1048. Authority over critically undercapitalized regulated 
                            entities.
Sec. 1049. Conforming amendments.
                     Chapter 4--Enforcement Actions

Sec. 1051. Cease-and-desist proceedings.
Sec. 1052. Temporary cease-and-desist proceedings.
Sec. 1053. Prejudgment attachment.
Sec. 1054. Enforcement and jurisdiction.
Sec. 1055. Civil money penalties.
Sec. 1056. Removal and prohibition authority.
Sec. 1057. Criminal penalty.
Sec. 1058. Subpoena authority.
Sec. 1059. Conforming amendments.
                     Chapter 5--General Provisions

Sec. 1061. Boards of enterprises.
Sec. 1062. Report on portfolio operations, safety and soundness, and 
                            mission of enterprises.
Sec. 1063. Conforming and technical amendments.
Sec. 1064. Study of alternative secondary market systems.
Sec. 1065. Effective date.
                  Subtitle B--Federal Home Loan Banks

Sec. 1071. Definitions.
Sec. 1072. Directors.
Sec. 1073. Federal Housing Finance Agency oversight of Federal Home 
                            Loan Banks.
Sec. 1074. Joint activities of Banks.
Sec. 1075. Sharing of information between Federal Home Loan Banks.
Sec. 1076. Reorganization of Banks and voluntary merger.
Sec. 1077. Securities and Exchange Commission disclosure.
Sec. 1078. Community financial institution members.
Sec. 1079. Technical and conforming amendments.
Sec. 1080. Study of affordable housing program use for long-term care 
                            facilities.
Sec. 1081. Effective date.
Subtitle C--Transfer of Functions, Personnel, and Property of Office of 
 Federal Housing Enterprise Oversight, Federal Housing Finance Board, 
            and Department of Housing and Urban Development

       Chapter 1--Office of Federal Housing Enterprise Oversight

Sec. 1085. Abolishment of OFHEO.
Sec. 1086. Continuation and coordination of certain regulations.
Sec. 1087. Transfer and rights of employees of OFHEO.
Sec. 1088. Transfer of property and facilities.
                Chapter 2--Federal Housing Finance Board

Sec. 1091. Abolishment of the Federal Housing Finance Board.
Sec. 1092. Continuation and coordination of certain regulations.
Sec. 1093. Transfer and rights of employees of the Federal Housing 
                            Finance Board.
Sec. 1094. Transfer of property and facilities.
         Chapter 3--Department of Housing and Urban Development

Sec. 1095. Termination of enterprise-related functions.
Sec. 1096. Continuation and coordination of certain regulations.
Sec. 1097. Transfer and rights of employees of Department of Housing 
                            and Urban Development.
Sec. 1098. Transfer of appropriations, property, and facilities.

  TITLE I--LICENSING SYSTEM FOR RESIDENTIAL MORTGAGE LOAN ORIGINATORS

SEC. 101. PURPOSES AND METHODS FOR ESTABLISHING A MORTGAGE LICENSING 
              SYSTEM AND REGISTRY.

    In order to increase uniformity, reduce regulatory burden, enhance 
consumer protection, and reduce fraud, the States, through the 
Conference of State Bank Supervisors and the American Association of 
Residential Mortgage Regulators, are hereby encouraged to establish a 
Nationwide Mortgage Licensing System and Registry for the residential 
mortgage industry that accomplishes all of the following objectives:
            (1) Provides uniform license applications and reporting 
        requirements for State-licensed loan originators.
            (2) Provides a comprehensive licensing and supervisory 
        database.
            (3) Aggregates and improves the flow of information to and 
        between regulators.
            (4) Provides increased accountability and tracking of loan 
        originators.
            (5) Streamlines the licensing process and reduces the 
        regulatory burden.
            (6) Enhances consumer protections and supports anti-fraud 
        measures.
            (7) Provides consumers with easily accessible information 
        regarding the employment history of, and publicly adjudicated 
        disciplinary and enforcement actions against, loan originators.

SEC. 102. DEFINITIONS.

    For purposes of this title, the following definitions shall apply:
            (1) Federal banking agencies.--The term ``Federal banking 
        agencies'' means the Board of Governors of the Federal Reserve 
        System, the Comptroller of the Currency, the Director of the 
        Office of Thrift Supervision, the National Credit Union 
        Administration, and the Federal Deposit Insurance Corporation.
            (2) Depository institution.--The term ``depository 
        institution'' has the same meaning as in section 3 of the 
        Federal Deposit Insurance Act and includes any credit union.
            (3) Loan originator.--
                    (A) In general.--The term ``loan originator''--
                            (i) means an individual who--
                                    (I) takes a residential mortgage 
                                loan application;
                                    (II) assists a consumer in 
                                obtaining or applying to obtain a 
                                residential mortgage loan; or
                                    (III) offers or negotiates terms of 
                                a residential mortgage loan, for direct 
                                or indirect compensation or gain, or in 
                                the expectation of direct or indirect 
                                compensation or gain;
                            (ii) includes any individual who represents 
                        to the public, through advertising or other 
                        means of communicating or providing information 
                        (including the use of business cards, 
                        stationery, brochures, signs, rate lists, or 
                        other promotional items), that such individual 
                        can or will provide or perform any of the 
                        activities described in clause (i);
                            (iii) does not include any individual who 
                        is not otherwise described in clause (i) or 
                        (ii) and who performs purely administrative or 
                        clerical tasks on behalf of a person who is 
                        described in any such clause;
                            (iv) does not include a person or entity 
                        that only performs real estate brokerage 
                        activities and is licensed or registered in 
                        accordance with applicable State law, unless 
                        the person or entity is compensated by a 
                        lender, a mortgage broker, or other loan 
                        originator or by any agent of such lender, 
                        mortgage broker, or other loan originator.
                    (B) Other definitions relating to loan 
                originator.--For purposes of this subsection, an 
                individual ``assists a consumer in obtaining or 
                applying to obtain a residential mortgage loan'' by, 
                among other things, advising on loan terms (including 
                rates, fees, other costs), preparing loan packages, or 
                collecting information on behalf of the consumer with 
                regard to a residential mortgage loan.
                    (C) Administrative or clerical tasks.--The term 
                ``administrative or clerical tasks'' means the receipt, 
                collection, and distribution of information common for 
                the processing or underwriting of a loan in the 
                mortgage industry and communication with a consumer to 
                obtain information necessary for the processing or 
                underwriting of a residential mortgage loan.
                    (D) Real estate brokerage activity defined.--The 
                term ``real estate brokerage activity'' means any 
                activity that involves offering or providing real 
                estate brokerage services to the public, including--
                            (i) acting as a real estate agent or real 
                        estate broker for a buyer, seller, lessor, or 
                        lessee of real property;
                            (ii) listing or advertising real property 
                        for sale, purchase, lease, rental, or exchange;
                            (iii) providing advice in connection with 
                        sale, purchase, lease, rental, or exchange of 
                        real property;
                            (iv) bringing together parties interested 
                        in the sale, purchase, lease, rental, or 
                        exchange of real property;
                            (v) negotiating, on behalf of any party, 
                        any portion of a contract relating to the sale, 
                        purchase, lease, rental, or exchange of real 
                        property (other than in connection with 
                        providing financing with respect to any such 
                        transaction);
                            (vi) engaging in any activity for which a 
                        person engaged in the activity is required to 
                        be registered or licensed as a real estate 
                        agent or real estate broker under any 
                        applicable law; and
                            (vii) offering to engage in any activity, 
                        or act in any capacity, described in clause 
                        (i), (ii), (iii), (iv), (v), or (vi).
            (4) Loan processor or underwriter.--
                    (A) In general.--The term ``loan processor or 
                underwriter'' means an individual who performs clerical 
                or support duties at the direction of and subject to 
                the supervision and instruction of--
                            (i) a State-licensed loan originator; or
                            (ii) a registered loan originator.
                    (B) Clerical or support duties.--For purposes of 
                subparagraph (A), the term ``clerical or support 
                duties'' may include--
                            (i) the receipt, collection, distribution, 
                        and analysis of information common for the 
                        processing or underwriting of a residential 
                        mortgage loan; and
                            (ii) communicating with a consumer to 
                        obtain the information necessary for the 
                        processing or underwriting of a loan, to the 
                        extent that such communication does not include 
                        offering or negotiating loan rates or terms, or 
                        counseling consumers about residential mortgage 
                        loan rates or terms.
            (5) Nationwide mortgage licensing system and registry.--The 
        term ``Nationwide Mortgage Licensing System and Registry'' 
        means a mortgage licensing system developed and maintained by 
        the Conference of State Bank Supervisors and the American 
        Association of Residential Mortgage Regulators for the State 
        licensing and registration of State-licensed loan originators 
        and the registration of registered loan originators or any 
        system established by the Secretary under section 108.
            (6) Registered loan originator.--The term ``registered loan 
        originator'' means any individual who--
                    (A) meets the definition of loan originator and is 
                an employee of a depository institution or a subsidiary 
                of a depository institution; and
                    (B) is registered with, and maintains a unique 
                identifier through, the Nationwide Mortgage Licensing 
                System and Registry.
            (7) Residential mortgage loan.--The term ``residential 
        mortgage loan'' means any loan primarily for personal, family, 
        or household use that is secured by a mortgage, deed of trust, 
        or other equivalent consensual security interest on a dwelling 
        (as defined in section 103(v) of the Truth in Lending Act) or 
        residential real estate upon which is constructed or intended 
        to be constructed a dwelling (as so defined).
            (8) Secretary.--The term ``Secretary'' means the Secretary 
        of Housing and Urban Development.
            (9) State-licensed loan originator.--The term ``State-
        licensed loan originator'' means any individual who--
                    (A) is a loan originator;
                    (B) is not an employee of a depository institution 
                or any subsidiary of a depository institution; and
                    (C) is licensed by a State or by the Secretary 
                under section 107 and registered as a loan originator 
                with, and maintains a unique identifier through, the 
                Nationwide Mortgage Licensing System and Registry.
            (10) Unique identifier.--The term ``unique identifier'' 
        means a number or other identifier that--
                    (A) permanently identifies a loan originator; and
                    (B) is assigned by protocols established by the 
                Nationwide Mortgage Licensing System and Registry and 
                the Federal banking agencies to facilitate electronic 
                tracking of loan originators and uniform identification 
                of, and public access to, the employment history of and 
                the publicly adjudicated disciplinary and enforcement 
                actions against loan originators.

SEC. 103. LICENSE OR REGISTRATION REQUIRED.

    (a) In General.--An individual may not engage in the business of a 
loan originator without first--
            (1) obtaining and maintaining--
                    (A) a registration as a registered loan originator; 
                or
                    (B) a license and registration as a State-licensed 
                loan originator; and
            (2) obtaining a unique identifier.
    (b) Loan Processors and Underwriters.--
            (1) Supervised loan processors and underwriters.--A loan 
        processor or underwriter who does not represent to the public, 
        through advertising or other means of communicating or 
        providing information (including the use of business cards, 
        stationery, brochures, signs, rate lists, or other promotional 
        items), that such individual can or will perform any of the 
        activities of a loan originator shall not be required to be a 
        State-licensed loan originator or a registered loan originator.
            (2) Independent contractors.--A loan processor or 
        underwriter may not work as an independent contractor unless 
        such processor or underwriter is a State-licensed loan 
        originator or a registered loan originator.

SEC. 104. STATE LICENSE AND REGISTRATION APPLICATION AND ISSUANCE.

    (a) Background Checks.--In connection with an application to any 
State for licensing and registration as a State-licensed loan 
originator, the applicant shall, at a minimum, furnish to the 
Nationwide Mortgage Licensing System and Registry information 
concerning the applicant's identity, including--
            (1) fingerprints for submission to the Federal Bureau of 
        Investigation, and any governmental agency or entity authorized 
        to receive such information for a State and national criminal 
        history background check; and
            (2) personal history and experience, including 
        authorization for the System to obtain--
                    (A) an independent credit report obtained from a 
                consumer reporting agency described in section 603(p) 
                of the Fair Credit Reporting Act; and
                    (B) information related to any administrative, 
                civil or criminal findings by any governmental 
                jurisdiction.
    (b) Issuance of License.--The minimum standards for licensing and 
registration as a State-licensed loan originator shall include the 
following:
            (1) The applicant has not had a loan originator or similar 
        license revoked in any governmental jurisdiction during the 5-
        year period immediately preceding the filing of the present 
        application.
            (2) The applicant has not been convicted, pled guilty or 
        nolo contendere in a domestic, foreign, or military court of a 
        felony during the 7-year period immediately preceding the 
        filing of the present application.
            (3) The applicant has demonstrated financial 
        responsibility, character, and general fitness such as to 
        command the confidence of the community and to warrant a 
        determination that the loan originator will operate honestly, 
        fairly, and efficiently within the purposes of this title.
            (4) The applicant has completed the pre-licensing education 
        requirement described in subsection (c).
            (5) The applicant has passed a written test that meets the 
        test requirement described in subsection (d).
    (c) Pre-Licensing Education of Loan Originators.--
            (1) Minimum educational requirements.--In order to meet the 
        pre-licensing education requirement referred to in subsection 
        (b)(4), a person shall complete at least 20 hours of education 
        approved in accordance with paragraph (2), which shall include 
        at least 3 hours of Federal law and regulations and 3 hours of 
        ethics which shall include instruction on fraud, consumer 
        protection and fair lending issues.
            (2) Approved educational courses.--For purposes of 
        paragraph (1), pre-licensing education courses shall be 
        reviewed, and published by the Nationwide Mortgage Licensing 
        System and Registry.
            (3) Limitation and standards.--
                    (A) Limitation.--To maintain the independence of 
                the approval process, the Nationwide Mortgage Licensing 
                System and Registry shall not directly or indirectly 
                offer pre-licensure educational courses for loan 
                originators.
                    (B) Standards.--In approving courses under this 
                section, the Nationwide Mortgage Licensing System and 
                Registry shall apply reasonable standards in the review 
                and approval of courses.
    (d) Testing of Loan Originators.--
            (1) In general.--In order to meet the written test 
        requirement referred to in subsection (b)(5), an individual 
        shall pass, in accordance with the standards established under 
        this subsection, a qualified written test developed by the 
        Nationwide Mortgage Licensing System and Registry and 
        administered by an approved test provider.
            (2) Qualified test.--A written test shall not be treated as 
        a qualified written test for purposes of paragraph (1) unless--
                    (A) the test consists of a minimum of 100 
                questions; and
                    (B) the test adequately measures the applicant's 
                knowledge and comprehension in appropriate subject 
                areas, including--
                            (i) ethics;
                            (ii) Federal law and regulation pertaining 
                        to mortgage origination;
                            (iii) State law and regulation pertaining 
                        to mortgage origination; and
                            (iv) Federal and State law and regulation, 
                        including instruction on fraud, consumer 
                        protection, and fair lending issues.
            (3) Minimum competence.--
                    (A) Passing score.--An individual shall not be 
                considered to have passed a qualified written test 
                unless the individual achieves a test score of not less 
                than 75 percent correct answers to questions.
                    (B) Initial retests.--An individual may retake a 
                test 3 consecutive times with each consecutive taking 
                occurring in less than 14 days after the preceding 
                test.
                    (C) Subsequent retests.--After 3 consecutive tests, 
                an individual shall wait at least 14 days before taking 
                the test again.
                    (D) Retest after lapse of license.--A State-
                licensed loan originator who fails to maintain a valid 
                license for a period of 5 years or longer shall retake 
                the test, not taking into account any time during which 
                such individual is a registered loan originator.

SEC. 105. STANDARDS FOR STATE LICENSE RENEWAL.

    (a) In General.--The minimum standards for license renewal for 
State-licensed loan originators shall include the following:
            (1) The loan originator continues to meet the minimum 
        standards for license issuance.
            (2) The loan originator has satisfied the annual continuing 
        education requirements described in subsection (b).
    (b) Continuing Education for State-Licensed Loan Originators.--
            (1) In general.--In order to meet the annual continuing 
        education requirements referred to in subsection (a)(2), a 
        State-licensed loan originator shall complete at least 8 hours 
        of education approved in accordance with paragraph (2), which 
        shall include at least 3 hours of Federal law and regulations 
        and 2 hours of ethics, including education on fraud, consumer 
        protection, and fair lending issues.
            (2) Approved educational courses.--For purposes of 
        paragraph (1), continuing education courses shall be reviewed, 
        and published by the Nationwide Mortgage Licensing System and 
        Registry.
            (3) Calculation of continuing education credits.--A State-
        licensed loan originator--
                    (A) may only receive credit for a continuing 
                education course in the year in which the course is 
                taken; and
                    (B) may not take the same approved course in the 
                same or successive years to meet the annual 
                requirements for continuing education.
            (4) Instructor credit.--A State-licensed loan originator 
        who is approved as an instructor of an approved continuing 
        education course may receive credit for the originator's own 
        annual continuing education requirement at the rate of 2 hours 
        credit for every 1 hour taught.
            (5) Limitation and standards.--
                    (A) Limitation.--To maintain the independence of 
                the approval process, the Nationwide Mortgage Licensing 
                System and Registry shall not directly or indirectly 
                offer any continuing education courses for loan 
                originators.
                    (B) Standards.--In approving courses under this 
                section, the Nationwide Mortgage Licensing System and 
                Registry shall apply reasonable standards in the review 
                and approval of courses.

SEC. 106. SYSTEM OF REGISTRATION ADMINISTRATION BY FEDERAL BANKING 
              AGENCIES.

    (a) Development.--
            (1) In general.--The Federal banking agencies shall jointly 
        develop and maintain a system for registering employees of 
        depository institutions or subsidiaries of depository 
        institutions as registered loan originators with the Nationwide 
        Mortgage Licensing System and Registry. The system shall be 
        implemented before the end of the 1-year period beginning on 
        the date of the enactment of this Act.
            (2) Registration requirements.--In connection with the 
        registration of any loan originator who is an employee of a 
        depository institution or a subsidiary of a depository 
        institution with the Nationwide Mortgage Licensing System and 
        Registry, the appropriate Federal banking agency shall, at a 
        minimum, furnish or cause to be furnished to the Nationwide 
        Mortgage Licensing System and Registry information concerning 
        the employees's identity, including--
                    (A) fingerprints for submission to the Federal 
                Bureau of Investigation, and any governmental agency or 
                entity authorized to receive such information for a 
                State and national criminal history background check; 
                and
                    (B) personal history and experience, including 
                authorization for the Nationwide Mortgage Licensing 
                System and Registry to obtain information related to 
                any administrative, civil or criminal findings by any 
                governmental jurisdiction.
    (b) Coordination.--
            (1) Unique identifier.--The Federal banking agencies, 
        through the Financial Institutions Examination Council, shall 
        coordinate with the Nationwide Mortgage Licensing System and 
        Registry to establish protocols for assigning a unique 
        identifier to each registered loan originator that will 
        facilitate electronic tracking and uniform identification of, 
        and public access to, the employment history of and publicly 
        adjudicated disciplinary and enforcement actions against loan 
        originators.
            (2) Nationwide mortgage licensing system and registry 
        development.--To facilitate the transfer of information 
        required by subsection (a)(2), the Nationwide Mortgage 
        Licensing System and Registry shall coordinate with the Federal 
        banking agencies, through the Financial Institutions 
        Examination Council, concerning the development and operation, 
        by such System and Registry, of the registration functionality 
        and data requirements for loan originators.
    (c) Consideration of Factors and Procedures.--In establishing the 
registration procedures under subsection (a) and the protocols for 
assigning a unique identifier to a registered loan originator, the 
Federal banking agencies shall make such de minimis exceptions as may 
be appropriate to paragraphs (1)(A) and (2) of section 103(a), shall 
make reasonable efforts to utilize existing information to minimize the 
burden of registering loan originators, and shall consider methods for 
automating the process to the greatest extent practicable consistent 
with the purposes of this title.

SEC. 107. SECRETARY OF HOUSING AND URBAN DEVELOPMENT BACKUP AUTHORITY 
              TO ESTABLISH A LOAN ORIGINATOR LICENSING SYSTEM.

    (a) Back up Licensing System.--If, by the end of the 1-year period, 
or the 2-year period in the case of a State whose legislature meets 
only biennially, beginning on the date of the enactment of this Act or 
at any time thereafter, the Secretary determines that a State does not 
have in place by law or regulation a system for licensing and 
registering loan originators that meets the requirements of sections 
104 and 105 and subsection (d) or does not participate in the 
Nationwide Mortgage Licensing System and Registry, the Secretary shall 
provide for the establishment and maintenance of a system for the 
licensing and registration by the Secretary of loan originators 
operating in such State as State-licensed loan originators.
    (b) Licensing and Registration Requirements.--The system 
established by the Secretary under subsection (a) for any State shall 
meet the requirements of sections 104 and 105 for State-licensed loan 
originators.
    (c) Unique Identifier.--The Secretary shall coordinate with the 
Nationwide Mortgage Licensing System and Registry to establish 
protocols for assigning a unique identifier to each loan originator 
licensed by the Secretary as a State-licensed loan originator that will 
facilitate electronic tracking and uniform identification of, and 
public access to, the employment history of and the publicly 
adjudicated disciplinary and enforcement actions against loan 
originators.
    (d) State Licensing Law Requirements.--For purposes of this 
section, the law in effect in a State meets the requirements of this 
subsection if the Secretary determines the law satisfies the following 
minimum requirements:
            (1) A State loan originator supervisory authority is 
        maintained to provide effective supervision and enforcement of 
        such law, including the suspension, termination, or nonrenewal 
        of a license for a violation of State or Federal law.
            (2) The State loan originator supervisory authority ensures 
        that all State-licensed loan originators operating in the State 
        are registered with Nationwide Mortgage Licensing System and 
        Registry.
            (3) The State loan originator supervisory authority is 
        required to regularly report violations of such law, as well as 
        enforcement actions and other relevant information, to the 
        Nationwide Mortgage Licensing System and Registry.
    (e) Temporary Extension of Period.--The Secretary may extend, by 
not more than 6 months, the 1-year or 2-year period, as the case may 
be, referred to in subsection (a) for the licensing of loan originators 
in any State under a State licensing law that meets the requirements of 
sections 104 and 105 and subsection (d) if the Secretary determines 
that such State is making a good faith effort to establish a State 
licensing law that meets such requirements, license mortgage 
originators under such law, and register such originators with the 
Nationwide Mortgage Licensing System and Registry.
    (f) Limitation on HUD-Licensed Loan Originators.--Any loan 
originator who is licensed by the Secretary under a system established 
under this section for any State may not use such license to originate 
loans in any other State.

SEC. 108. BACKUP AUTHORITY TO ESTABLISH A NATIONWIDE MORTGAGE LICENSING 
              AND REGISTRY SYSTEM.

    If at any time the Secretary determines that the Nationwide 
Mortgage Licensing System and Registry is failing to meet the 
requirements and purposes of this title for a comprehensive licensing, 
supervisory, and tracking system for loan originators, the Secretary 
shall establish and maintain such a system to carry out the purposes of 
this title and the effective registration and regulation of loan 
originators.

SEC. 109. FEES.

    The Federal banking agencies, the Secretary, and the Nationwide 
Mortgage Licensing System and Registry may charge reasonable fees to 
cover the costs of maintaining and providing access to information from 
the Nationwide Mortgage Licensing System and Registry to the extent 
such fees are not charged to consumers for access such system and 
registry.

SEC. 110. BACKGROUND CHECKS OF LOAN ORIGINATORS.

    (a) Access to Records.--Notwithstanding any other provision of law, 
in providing identification and processing functions, the Attorney 
General shall provide access to all criminal history information to the 
appropriate State officials responsible for regulating State-licensed 
loan originators to the extent criminal history background checks are 
required under the laws of the State for the licensing of such loan 
originators.
    (b) Agent.--For the purposes of this section and in order to reduce 
the points of contact which the Federal Bureau of Investigation may 
have to maintain for purposes of subsection (a), the Conference of 
State Bank Supervisors or a wholly owned subsidiary may be used as a 
channeling agent of the States for requesting and distributing 
information between the Department of Justice and the appropriate State 
agencies.

SEC. 111. CONFIDENTIALITY OF INFORMATION.

    (a) System Confidentiality.--Except as otherwise provided in this 
section, any requirement under Federal or State law regarding the 
privacy or confidentiality of any information or material provided to 
the Nationwide Mortgage Licensing System and Registry or a system 
established by the Secretary under section 108, and any privilege 
arising under Federal or State law (including the rules of any Federal 
or State court) with respect to such information or material, shall 
continue to apply to such information or material after the information 
or material has been disclosed to the system. Such information and 
material may be shared with all State and Federal regulatory officials 
with mortgage industry oversight authority without the loss of 
privilege or the loss of confidentiality protections provided by 
Federal and State laws.
    (b) Nonapplicability of Certain Requirements.--Information or 
material that is subject to a privilege or confidentiality under 
subsection (a) shall not be subject to--
            (1) disclosure under any Federal or State law governing the 
        disclosure to the public of information held by an officer or 
        an agency of the Federal Government or the respective State; or
            (2) subpoena or discovery, or admission into evidence, in 
        any private civil action or administrative process, unless with 
        respect to any privilege held by the Nationwide Mortgage 
        Licensing System and Registry or the Secretary with respect to 
        such information or material, the person to whom such 
        information or material pertains waives, in whole or in part, 
        in the discretion of such person, that privilege.
    (c) Coordination With Other Law.--Any State law, including any 
State open record law, relating to the disclosure of confidential 
supervisory information or any information or material described in 
subsection (a) that is inconsistent with subsection (a) shall be 
superseded by the requirements of such provision to the extent State 
law provides less confidentiality or a weaker privilege.
    (d) Public Access to Information.--This section shall not apply 
with respect to the information or material relating to the employment 
history of, and publicly adjudicated disciplinary and enforcement 
actions against, loan originators that is included in Nationwide 
Mortgage Licensing System and Registry for access by the public.

SEC. 112. LIABILITY PROVISIONS.

    The Secretary, any State official or agency, any Federal banking 
agency, or any organization serving as the administrator of the 
Nationwide Mortgage Licensing System and Registry or a system 
established by the Secretary under section 108, or any officer or 
employee of any such entity, shall not be subject to any civil action 
or proceeding for monetary damages by reason of the good-faith action 
or omission of any officer or employee of any such entity, while acting 
within the scope of office or employment, relating to the collection, 
furnishing, or dissemination of information concerning persons who are 
loan originators or are applying for licensing or registration as loan 
originators.

SEC. 113. ENFORCEMENT UNDER HUD BACKUP LICENSING SYSTEM.

    (a) Summons Authority.--The Secretary may--
            (1) examine any books, papers, records, or other data of 
        any loan originator operating in any State which is subject to 
        a licensing system established by the Secretary under section 
        107; and
            (2) summon any loan originator referred to in paragraph (1) 
        or any person having possession, custody, or care of the 
        reports and records relating to such loan originator, to appear 
        before the Secretary or any delegate of the Secretary at a time 
        and place named in the summons and to produce such books, 
        papers, records, or other data, and to give testimony, under 
        oath, as may be relevant or material to an investigation of 
        such loan originator for compliance with the requirements of 
        this title.
    (b) Examination Authority.--
            (1) In general.--If the Secretary establishes a licensing 
        system under section 107 for any State, the Secretary shall 
        appoint examiners for the purposes of administering such 
        section.
            (2) Power to examine.--Any examiner appointed under 
        paragraph (1) shall have power, on behalf of the Secretary, to 
        make any examination of any loan originator operating in any 
        State which is subject to a licensing system established by the 
        Secretary under section 107 whenever the Secretary determines 
        an examination of any loan originator is necessary to determine 
        the compliance by the originator with this title.
            (3) Report of examination.--Each examiner appointed under 
        paragraph (1) shall make a full and detailed report of 
        examination of any loan originator examined to the Secretary.
            (4) Administration of oaths and affirmations; evidence.--In 
        connection with examinations of loan originators operating in 
        any State which is subject to a licensing system established by 
        the Secretary under section 107, or with other types of 
        investigations to determine compliance with applicable law and 
        regulations, the Secretary and examiners appointed by the 
        Secretary may administer oaths and affirmations and examine and 
        take and preserve testimony under oath as to any matter in 
        respect to the affairs of any such loan originator.
            (5) Assessments.--The cost of conducting any examination of 
        any loan originator operating in any State which is subject to 
        a licensing system established by the Secretary under section 
        107 shall be assessed by the Secretary against the loan 
        originator to meet the Secretary's expenses in carrying out 
        such examination.
    (c) Cease and Desist Proceeding.--
            (1) Authority of secretary.--If the Secretary finds, after 
        notice and opportunity for hearing, that any person is 
        violating, has violated, or is about to violate any provision 
        of this title, or any regulation thereunder, with respect to a 
        State which is subject to a licensing system established by the 
        Secretary under section 107, the Secretary may publish such 
        findings and enter an order requiring such person, and any 
        other person that is, was, or would be a cause of the 
        violation, due to an act or omission the person knew or should 
        have known would contribute to such violation, to cease and 
        desist from committing or causing such violation and any future 
        violation of the same provision, rule, or regulation. Such 
        order may, in addition to requiring a person to cease and 
        desist from committing or causing a violation, require such 
        person to comply, or to take steps to effect compliance, with 
        such provision or regulation, upon such terms and conditions 
        and within such time as the Secretary may specify in such 
        order. Any such order may, as the Secretary deems appropriate, 
        require future compliance or steps to effect future compliance, 
        either permanently or for such period of time as the Secretary 
        may specify, with such provision or regulation with respect to 
        any loan originator.
            (2) Hearing.--The notice instituting proceedings pursuant 
        to paragraph (1) shall fix a hearing date not earlier than 30 
        days nor later than 60 days after service of the notice unless 
        an earlier or a later date is set by the Secretary with the 
        consent of any respondent so served.
            (3) Temporary order.--Whenever the Secretary determines 
        that the alleged violation or threatened violation specified in 
        the notice instituting proceedings pursuant to paragraph (1), 
        or the continuation thereof, is likely to result in significant 
        dissipation or conversion of assets, significant harm to 
        consumers, or substantial harm to the public interest prior to 
        the completion of the proceedings, the Secretary may enter a 
        temporary order requiring the respondent to cease and desist 
        from the violation or threatened violation and to take such 
        action to prevent the violation or threatened violation and to 
        prevent dissipation or conversion of assets, significant harm 
        to consumers, or substantial harm to the public interest as the 
        Secretary deems appropriate pending completion of such 
        proceedings. Such an order shall be entered only after notice 
        and opportunity for a hearing, unless the Secretary determines 
        that notice and hearing prior to entry would be impracticable 
        or contrary to the public interest. A temporary order shall 
        become effective upon service upon the respondent and, unless 
        set aside, limited, or suspended by the Secretary or a court of 
        competent jurisdiction, shall remain effective and enforceable 
        pending the completion of the proceedings.
            (4) Review of temporary orders.--
                    (A) Review by secretary.--At any time after the 
                respondent has been served with a temporary cease-and-
                desist order pursuant to paragraph (3), the respondent 
                may apply to the Secretary to have the order set aside, 
                limited, or suspended. If the respondent has been 
                served with a temporary cease-and-desist order entered 
                without a prior hearing before the Secretary, the 
                respondent may, within 10 days after the date on which 
                the order was served, request a hearing on such 
                application and the Secretary shall hold a hearing and 
                render a decision on such application at the earliest 
                possible time.
                    (B) Judicial review.--Within--
                            (i) 10 days after the date the respondent 
                        was served with a temporary cease-and-desist 
                        order entered with a prior hearing before the 
                        Secretary; or
                            (ii) 10 days after the Secretary renders a 
                        decision on an application and hearing under 
                        paragraph (1), with respect to any temporary 
                        cease-and-desist order entered without a prior 
                        hearing before the Secretary,
                the respondent may apply to the United States district 
                court for the district in which the respondent resides 
                or has its principal place of business, or for the 
                District of Columbia, for an order setting aside, 
                limiting, or suspending the effectiveness or 
                enforcement of the order, and the court shall have 
                jurisdiction to enter such an order. A respondent 
                served with a temporary cease-and-desist order entered 
                without a prior hearing before the Secretary may not 
                apply to the court except after hearing and decision by 
                the Secretary on the respondent's application under 
                subparagraph (A).
                    (C) No automatic stay of temporary order.--The 
                commencement of proceedings under subparagraph (B) 
                shall not, unless specifically ordered by the court, 
                operate as a stay of the Secretary's order.
            (5) Authority of the secretary to prohibit persons from 
        serving as loan originators.--In any cease-and-desist 
        proceeding under paragraph (1), the Secretary may issue an 
        order to prohibit, conditionally or unconditionally, and 
        permanently or for such period of time as the Secretary shall 
        determine, any person who has violated this title or 
        regulations thereunder, from acting as a loan originator if the 
        conduct of that person demonstrates unfitness to serve as a 
        loan originator.
    (d) Authority of the Secretary To Assess Money Penalties.--
            (1) In general.--The Secretary may impose a civil penalty 
        on a loan originator operating in any State which is subject to 
        licensing system established by the Secretary under section 107 
        if the Secretary finds, on the record after notice and 
        opportunity for hearing, that such loan originator has violated 
        or failed to comply with any requirement of this title or any 
        regulation prescribed by the Secretary under this title or 
        order issued under subsection (c).
            (2) Maximum amount of penalty.--The maximum amount of 
        penalty for each act or omission described in paragraph (1) 
        shall be $5,000 for each day the violation continues.

            TITLE II--RESIDENTIAL MORTGAGE LOAN DISCLOSURES

SEC. 201. REQUIRED DISCLOSURES.

    (a) Additional Information.--Section 128(a) of Truth in Lending Act 
(15 U.S.C. 1638(a)) is amended by adding at the end the following new 
paragraphs:
            ``(16) In the case of an extension of credit that is 
        secured by the dwelling of a consumer, under which the annual 
        rate of interest is variable, or with respect to which the 
        regular payments may otherwise be variable, in addition to the 
        other disclosures required under this subsection, the 
        disclosures provided under this subsection shall state the 
        maximum amount of the regular required payments on the loan, 
        based on the maximum interest rate allowed, introduced with the 
        following language in conspicuous type size and format: `Your 
        payment can go as high as $__', the blank to be filled in with 
        the maximum possible payment amount.
            ``(17) In the case of a residential mortgage loan for which 
        an escrow or impound account will be established for the 
        payment of all applicable taxes, insurance, and assessments, 
        the following statement: `Your payments will be increased to 
        cover taxes and insurance. In the first year, you will pay an 
        additional $__ [insert the amount of the monthly payment to the 
        account] every month to cover the costs of taxes and 
        insurance.'.
            ``(18) In the case of a variable rate residential mortgage 
        loan for which an escrow or impound account will be established 
        for the payment of all applicable taxes, insurance, and 
        assessments--
                    ``(A) the amount of initial monthly payment due 
                under the loan for the payment of principal and 
                interest, and the amount of such initial monthly 
                payment including the monthly payment deposited in the 
                account for the payment of all applicable taxes, 
                insurance, and assessments; and
                    ``(B) the amount of the fully indexed monthly 
                payment due under the loan for the payment of principal 
                and interest, and the amount of such fully indexed 
                monthly payment including the monthly payment deposited 
                in the account for the payment of all applicable taxes, 
                insurance, and assessments.
            ``(19) In the case of a residential mortgage loan, the 
        aggregate amount of settlement charges for all settlement 
        services provided in connection with the loan, the amount of 
        charges that are included in the loan and the amount of such 
        charges the borrower must pay at closing, the approximate 
        amount of the wholesale rate of funds in connection with the 
        loan, and the aggregate amount of other fees or required 
        payments in connection with the loan.
            ``(20) In the case of a residential mortgage loan, the 
        aggregate amount of fees paid to the mortgage originator in 
        connection with the loan, the amount of such fees paid directly 
        by the consumer, and any additional amount received by the 
        originator from the creditor based on the interest rate of the 
        loan.''.
    (b) Timing.--Section 128(b) of the Truth in Lending Act (15 U.S.C. 
1638(b)) is amended by adding at the end the following new paragraph:
            ``(4) Residential mortgage loan disclosures.--In the case 
        of a residential mortgage loan, the information required to be 
        disclosed under subsection (a) with respect to such loan shall 
        be disclosed before the earlier of--
                    ``(A) the time required under the first sentence of 
                paragraph (1); or
                    ``(B) the end of the 3-day period beginning on the 
                date the application for the loan from a consumer is 
                received by the creditor.''.
    (c) Enhanced Mortgage Loan Disclosures.--Section 128(b)(2) of the 
Truth in Lending Act (15 U.S.C. 1638(b)(2)) is amended--
            (1) by striking ``(2) In the'' and inserting the following:
            ``(2) Mortgage disclosures.--
                    ``(A) In general.--In the'';
            (2) by striking ``a residential mortgage transaction, as 
        defined in section 103(w)'' and inserting ``any extension of 
        credit that is secured by the dwelling of a consumer'';
            (3) by striking ``shall be made in accordance'' and all 
        that follows through ``extended, or'';
            (4) by striking ``If the'' and all that follows through the 
        end of the paragraph and inserting the following new 
        subparagraphs:
                    ``(B) Statement and timing of disclosures.--In the 
                case of an extension of credit that is secured by the 
                dwelling of a consumer, in addition to the other 
                disclosures required by subsection (a), the disclosures 
                provided under this paragraph shall state in 
                conspicuous type size and format, the following: `You 
                are not required to complete this agreement merely 
                because you have received these disclosures or signed a 
                loan application.'.
                            ``(i) state in conspicuous type size and 
                        format, the following: `You are not required to 
                        complete this agreement merely because you have 
                        received these disclosures or signed a loan 
                        application.'; and
                            ``(ii) be furnished to the borrower not 
                        later than 7 business days before the date of 
                        consummation of the transaction, subject to 
                        subparagraph (D).
                    ``(C) Variable rates or payment schedules.--In the 
                case of an extension of credit that is secured by the 
                dwelling of a consumer, under which the annual rate of 
                interest is variable, or with respect to which the 
                regular payments may otherwise be variable, in addition 
                to the other disclosures required by subsection (a), 
                the disclosures provided under this paragraph shall 
                label the payment schedule as follows: `Payment 
                Schedule: Payments Will Vary Based on Interest Rate 
                Changes.'.
                    ``(D) Updating apr.--In any case in which the 
                disclosure statement provided 7 business days before 
                the date of consummation of the transaction contains an 
                annual percentage rate of interest that is no longer 
                accurate, as determined under section 107(c), the 
                creditor shall furnish an additional, corrected 
                statement to the borrower, not later than 3 business 
                days before the date of consummation of the 
                transaction.''.

SEC. 202. DISCLOSURES REQUIRED IN MONTHLY STATEMENTS FOR RESIDENTIAL 
              MORTGAGE LOANS.

    Section 128 of the Truth in Lending Act (15 U.S.C. 1638) is amended 
by adding at the end the following new subsection:
    ``(e) Periodic Statements for Residential Mortgage Loans.--
            ``(1) In general.--The creditor, assignee, or servicer with 
        respect to any residential mortgage loan shall transmit to the 
        obligor, for each billing cycle, a statement setting forth each 
        of the following items, to the extent applicable, in a 
        conspicuous and prominent manner:
                    ``(A) The amount of the principal obligation under 
                the mortgage.
                    ``(B) The current interest rate in effect for the 
                loan.
                    ``(C) The date on which the interest rate may next 
                reset or adjust.
                    ``(D) The amount of any prepayment fee to be 
                charged, if any.
                    ``(E) A description of any late payment fees.
                    ``(F) A telephone number and electronic mail 
                address that may be used by the obligor to obtain 
                information regarding the mortgage.
                    ``(G) Such other information as the Board may 
                prescribe in regulations.
            ``(2) Development and use of standard form.--The Federal 
        banking agencies shall jointly develop and prescribe a standard 
        form for the disclosure required under this subsection, taking 
        into account that the statements required may be transmitted in 
        writing or electronically.''.

                TITLE III--OFFICE OF HOUSING COUNSELING

SEC. 301. SHORT TITLE.

    This title may be cited as the ``Expand and Preserve Home Ownership 
Through Counseling Act''.

SEC. 302. ESTABLISHMENT OF OFFICE OF HOUSING COUNSELING.

    Section 4 of the Department of Housing and Urban Development Act 
(42 U.S.C. 3533) is amended by adding at the end the following new 
subsection:
    ``(g) Office of Housing Counseling.--
            ``(1) Establishment.--There is established, in the Office 
        of the Secretary, the Office of Housing Counseling.
            ``(2) Director.--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.
            ``(3) Functions.--
                    ``(A) In general.--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--
                            ``(i) research, grant administration, 
                        public outreach, and policy development 
                        relating to such counseling; and
                            ``(ii) 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.
                    ``(B) Specific functions.--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--
                            ``(i) the counseling procedures under 
                        section 106(g)(1) of the Housing and Urban 
                        Development Act of 1968 (12 U.S.C. 
                        1701x(h)(1));
                            ``(ii) carrying out all other functions of 
                        the Secretary under section 106(g) of the 
                        Housing and Urban Development Act of 1968, 
                        including the establishment, operation, and 
                        publication of the availability of the toll-
                        free telephone number under paragraph (2) of 
                        such section;
                            ``(iii) carrying out section 5 of the Real 
                        Estate Settlement Procedures Act of 1974 (12 
                        U.S.C. 2604) for home buying information 
                        booklets prepared pursuant to such section;
                            ``(iv) carrying out the certification 
                        program under section 106(e) of the Housing and 
                        Urban Development Act of 1968 (12 U.S.C. 
                        1701x(e));
                            ``(v) carrying out the assistance program 
                        under section 106(a)(4) of the Housing and 
                        Urban Development Act of 1968, including 
                        criteria for selection of applications to 
                        receive assistance;
                            ``(vi) 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 6 of the Expand and Preserve Home 
                        Ownership Through Counseling Act;
                            ``(vii) providing for operation of the 
                        advisory committee established under paragraph 
                        (4) of this subsection;
                            ``(viii) collaborating with community-based 
                        organizations with expertise in the field of 
                        housing counseling; and
                            ``(ix) providing for the building of 
                        capacity to provide housing counseling services 
                        in areas that lack sufficient services.
            ``(4) Advisory committee.--
                    ``(A) In general.--The Secretary shall appoint an 
                advisory committee to provide advice regarding the 
                carrying out of the functions of the Director.
                    ``(B) Members.--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.
                    ``(C) Terms.--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.
                    ``(D) Terms of initial appointees.--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.
                    ``(E) Prohibition of pay; travel expenses.--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 chapter 57 of title 5, 
                United States Code.
                    ``(F) Advisory role only.--The advisory committee 
                shall have no role in reviewing or awarding housing 
                counseling grants.
            ``(5) Scope of homeownership counseling.--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.''.

SEC. 303. COUNSELING PROCEDURES.

    (a) In General.--Section 106 of the Housing and Urban Development 
Act of 1968 (12 U.S.C. 1701x) is amended by adding at the end the 
following new subsection:
    ``(g) Procedures and Activities.--
            ``(1) Counseling procedures.--
                    ``(A) In general.--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.
                    ``(B) Homeownership counseling.--For purposes of 
                this subsection and as used in the provisions referred 
                to in this subparagraph, the term `homeownership 
                counseling' 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--
                            ``(i) section 105(a)(20) of the Housing and 
                        Community Development Act of 1974 (42 U.S.C. 
                        5305(a)(20));
                            ``(ii) in the United States Housing Act of 
                        1937--
                                    ``(I) section 9(e) (42 U.S.C. 
                                1437g(e));
                                    ``(II) section 8(y)(1)(D) (42 
                                U.S.C. 1437f(y)(1)(D));
                                    ``(III) section 18(a)(4)(D) (42 
                                U.S.C. 1437p(a)(4)(D));
                                    ``(IV) section 23(c)(4) (42 U.S.C. 
                                1437u(c)(4));
                                    ``(V) section 32(e)(4) (42 U.S.C. 
                                1437z-4(e)(4));
                                    ``(VI) section 33(d)(2)(B) (42 
                                U.S.C. 1437z-5(d)(2)(B));
                                    ``(VII) sections 302(b)(6) and 
                                303(b)(7) (42 U.S.C. 1437aaa-1(b)(6), 
                                1437aaa-2(b)(7)); and
                                    ``(VIII) section 304(c)(4) (42 
                                U.S.C. 1437aaa-3(c)(4));
                            ``(iii) section 302(a)(4) of the American 
                        Homeownership and Economic Opportunity Act of 
                        2000 (42 U.S.C. 1437f note);
                            ``(iv) sections 233(b)(2) and 258(b) of the 
                        Cranston-Gonzalez National Affordable Housing 
                        Act (42 U.S.C. 12773(b)(2), 12808(b));
                            ``(v) this section and section 101(e) of 
                        the Housing and Urban Development Act of 1968 
                        (12 U.S.C. 1701x, 1701w(e));
                            ``(vi) 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));
                            ``(vii) sections 422(b)(6), 423(b)(7), 
                        424(c)(4), 442(b)(6), and 443(b)(6) of the 
                        Cranston-Gonzalez National Affordable Housing 
                        Act (42 U.S.C. 12872(b)(6), 12873(b)(7), 
                        12874(c)(4), 12892(b)(6), and 12893(b)(6));
                            ``(viii) section 491(b)(1)(F)(iii) of the 
                        McKinney-Vento Homeless Assistance Act (42 
                        U.S.C. 11408(b)(1)(F)(iii));
                            ``(ix) sections 202(3) and 810(b)(2)(A) of 
                        the Native American Housing and Self-
                        Determination Act of 1996 (25 U.S.C. 4132(3), 
                        4229(b)(2)(A));
                            ``(x) in the National Housing Act--
                                    ``(I) 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);
                                    ``(II) subsections (a) and (c)(3) 
                                of section 237 (12 U.S.C. 1715z-2); and
                                    ``(III) subsections (d)(2)(B) and 
                                (m)(1) of section 255 (12 U.S.C. 1715z-
                                20);
                            ``(xi) section 502(h)(4)(B) of the Housing 
                        Act of 1949 (42 U.S.C. 1472(h)(4)(B)); and
                            ``(xii) section 508 of the Housing and 
                        Urban Development Act of 1970 (12 U.S.C. 1701z-
                        7).
                    ``(C) Rental housing counseling.--For purposes of 
                this subsection, the term `rental housing counseling' 
                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--
                            ``(i) section 105(a)(20) of the Housing and 
                        Community Development Act of 1974 (42 U.S.C. 
                        5305(a)(20));
                            ``(ii) in the United States Housing Act of 
                        1937--
                                    ``(I) section 9(e) (42 U.S.C. 
                                1437g(e));
                                    ``(II) section 18(a)(4)(D) (42 
                                U.S.C. 1437p(a)(4)(D));
                                    ``(III) section 23(c)(4) (42 U.S.C. 
                                1437u(c)(4));
                                    ``(IV) section 32(e)(4) (42 U.S.C. 
                                1437z-4(e)(4));
                                    ``(V) section 33(d)(2)(B) (42 
                                U.S.C. 1437z-5(d)(2)(B)); and
                                    ``(VI) section 302(b)(6) (42 U.S.C. 
                                1437aaa-1(b)(6));
                            ``(iii) section 233(b)(2) of the Cranston-
                        Gonzalez National Affordable Housing Act (42 
                        U.S.C. 12773(b)(2));
                            ``(iv) section 106 of the Housing and Urban 
                        Development Act of 1968 (12 U.S.C. 1701x);
                            ``(v) section 422(b)(6) of the Cranston-
                        Gonzalez National Affordable Housing Act (42 
                        U.S.C. 12872(b)(6));
                            ``(vi) section 491(b)(1)(F)(iii) of the 
                        McKinney-Vento Homeless Assistance Act (42 
                        U.S.C. 11408(b)(1)(F)(iii));
                            ``(vii) sections 202(3) and 810(b)(2)(A) of 
                        the Native American Housing and Self-
                        Determination Act of 1996 (25 U.S.C. 4132(3), 
                        4229(b)(2)(A)); and
                            ``(viii) the rental assistance program 
                        under section 8 of the United States Housing 
                        Act of 1937 (42 U.S.C. 1437f).
            ``(2) Standards for materials.--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).
            ``(3) Mortgage software systems.--
                    ``(A) Certification.--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--
                            ``(i) the consumer's financial situation 
                        and the cost of maintaining a home, including 
                        insurance, taxes, and utilities;
                            ``(ii) the amount of time the consumer 
                        expects to remain in the home or expected time 
                        to maturity of the loan;
                            ``(iii) 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.
                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.
                    ``(B) Use and initial availability.--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).
                    ``(C) Availability.--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.
            ``(4) National public service multimedia campaigns to 
        promote housing counseling.--
                    ``(A) In general.--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.
                    ``(B) Contact information.--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.
                    ``(C) Authorization of appropriations.--There are 
                authorized to be appropriated to the Secretary, not to 
                exceed $3,000,000 for fiscal years 2009, 2010, and 2011 
                for the development, implementation, and conducting of 
                national public service multimedia campaigns under this 
                paragraph.
            ``(5) Education programs.--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.''.
    (b) Conforming Amendments to Grant Program for Homeownership 
Counseling Organizations.--Section 106(c)(5)(A)(ii) of the Housing and 
Urban Development Act of 1968 (12 U.S.C. 1701x(c)(5)(A)(ii)) is 
amended--
            (1) in subclause (III), by striking ``and'' at the end;
            (2) in subclause (IV) by striking the period at the end and 
        inserting ``; and''; and
            (3) by inserting after subclause (IV) the following new 
        subclause:
                                    ``(V) notify the housing or 
                                mortgage applicant of the availability 
                                of mortgage software systems provided 
                                pursuant to subsection (g)(3).''.

SEC. 304. GRANTS FOR HOUSING COUNSELING ASSISTANCE.

    Section 106(a) of the Housing and Urban Development Act of 1968 (12 
U.S.C. 1701x(a)(3)) is amended by adding at the end the following new 
paragraph:
    ``(4) Homeownership and Rental Counseling Assistance.--
            ``(A) In general.--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)).
            ``(B) Qualified entities.--The Secretary shall establish 
        standards and guidelines for eligibility of organizations 
        (including governmental and nonprofit organizations) to receive 
        assistance under this paragraph.
            ``(C) Distribution.--Assistance made available under this 
        paragraph shall be distributed in a manner that encourages 
        efficient and successful counseling programs.
            ``(D) Authorization of appropriations.--There are 
        authorized to be appropriated $45,000,000 for each of fiscal 
        years 2009 through 2012 for--
                    ``(i) the operations of the Office of Housing 
                Counseling of the Department of Housing and Urban 
                Development;
                    ``(ii) the responsibilities of the Secretary under 
                paragraphs (2) through (5) of subsection (g); and
                    ``(iii) assistance pursuant to this paragraph for 
                entities providing homeownership and rental 
                counseling.''.

SEC. 305. REQUIREMENTS TO USE HUD-CERTIFIED COUNSELORS UNDER HUD 
              PROGRAMS.

    Section 106(e) of the Housing and Urban Development Act of 1968 (12 
U.S.C. 1701x(e)) is amended--
            (1) by striking paragraph (1) and inserting the following 
        new paragraph:
            ``(1) Requirement for assistance.--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.'';
            (2) in paragraph (2)--
                    (A) by inserting ``and for certifying 
                organizations'' before the period at the end of the 
                first sentence; and
                    (B) in the second sentence by striking ``for 
                certification'' and inserting ``, for certification of 
                an organization, that each individual through which the 
                organization provides counseling shall demonstrate, 
                and, for certification of an individual,'';
            (3) in paragraph (3), by inserting ``organizations and'' 
        before ``individuals'';
            (4) by redesignating paragraph (3) as paragraph (5); and
            (5) by inserting after paragraph (2) the following new 
        paragraphs:
            ``(3) Requirement under hud programs.--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.
            ``(4) Outreach.--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).''.

SEC. 306. STUDY OF DEFAULTS AND FORECLOSURES.

    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.

SEC. 307. DEFINITIONS FOR COUNSELING-RELATED PROGRAMS.

    Section 106 of the Housing and Urban Development Act of 1968 (12 
U.S.C. 1701x), as amended by the preceding provisions of this title, is 
further amended by adding at the end the following new subsection:
    ``(h) Definitions.--For purposes of this section:
            ``(1) Nonprofit organization.--The term `nonprofit 
        organization' has the meaning given such term in section 104(5) 
        of the Cranston-Gonzalez National Affordable Housing Act (42 
        U.S.C. 12704(5)), except that subparagraph (D) of such section 
        shall not apply for purposes of this section.
            ``(2) State.--The term `State' 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.
            ``(3) Unit of general local government.--The term `unit of 
        general local government' means any city, county, parish, town, 
        township, borough, village, or other general purpose political 
        subdivision of a State.''.

SEC. 308. UPDATING AND SIMPLIFICATION OF MORTGAGE INFORMATION BOOKLET.

    Section 5 of the Real Estate Settlement Procedures Act of 1974 (12 
U.S.C. 2604) is amended--
            (1) in the section heading, by striking ``special'' and 
        inserting ``home buying'';
            (2) by striking subsections (a) and (b) and inserting the 
        following new subsections:
    ``(a) Preparation and Distribution.--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 Housing and Urban 
Development Act of 1968 (12 U.S.C. 1701x(e)) for use in complying with 
the requirement under subsection (c) of this section.
    ``(b) Contents.--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:
            ``(1) 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--
                    ``(A) balloon payments;
                    ``(B) prepayment penalties; and
                    ``(C) the trade-off between closing costs and the 
                interest rate over the life of the loan.
            ``(2) An explanation and sample of the uniform settlement 
        statement required by section 4.
            ``(3) 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.
            ``(4) 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.
            ``(5) An explanation of the right of rescission as to 
        certain transactions provided by sections 125 and 129 of the 
        Truth in Lending Act.
            ``(6) A brief explanation of the nature of a variable rate 
        mortgage and a reference to the booklet entitled `Consumer 
        Handbook on Adjustable Rate Mortgages', 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.
            ``(7) 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.
            ``(8) Information about homeownership counseling services 
        made available pursuant to section 106(a)(4) of the Housing and 
        Urban Development Act of 1968 (12 U.S.C. 1701x(a)(4)), 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.
            ``(9) 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.
            ``(10) 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.
            ``(11) An explanation of a consumer's responsibilities, 
        liabilities, and obligations in a mortgage transaction.
            ``(12) An explanation of the nature and purpose of real 
        estate appraisals, including the difference between an 
        appraisal and a home inspection.
            ``(13) 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.
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.'';
            (3) in subsection (c), by inserting at the end the 
        following new sentence: ``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 Housing and Urban Development Act of 1968 (12 
        U.S.C. 1701x(e)) and located in the area of the lender.''; and
            (4) in subsection (d), by inserting after the period at the 
        end of the first sentence the following: ``The lender shall 
        provide the HUD-issued booklet in the version that is most 
        appropriate for the person receiving it.''.

 TITLE IV--INCENTIVES FOR BEST PRACTICES AND MORTGAGE LOAN MODIFICATION

SEC. 401. CRA CREDIT FOR CERTAIN LENDER PRACTICES.

    Section 804 of the Community Reinvestment Act of 1977 (12 U.S.C. 
2903) is amended by adding at the end the following new subsection:
    ``(d) Efforts on Behalf of Subprime Borrowers.--In assessing and 
taking into account, under subsection (a), the record of a regulated 
financial institution, the appropriate Federal financial supervisory 
agency may consider as a factor, in accordance with such guidelines as 
the agency may issue, any of the following programs undertaken by the 
institution:
            ``(1) A program to provide or support the provision of home 
        ownership or credit counseling to low- and moderate-income 
        consumer borrowers through programs reasonably available to the 
        consumer that have been certified or approved by the Secretary 
        of Housing and Urban Development for such purpose.
            ``(2) A program to provide or support the provision of 
        foreclosure-prevention counseling and other prevention efforts 
        to low- and moderate-income consumer borrowers through programs 
        reasonably available to the consumer that have been certified 
        or approved by the Secretary of Housing and Urban Development 
        for such purpose.
            ``(3) A program to transition low- and moderate-income 
        consumer borrowers from higher-cost mortgage loans to lower-
        cost mortgage loans.''.

SEC. 402. SAFE HARBOR FOR QUALIFIED LOAN MODIFICATIONS OR WORKOUT PLANS 
              FOR CERTAIN RESIDENTIAL MORTGAGE LOANS.

    (a) Standard for Loan Modifications or Workout Plans.--Absent 
specific contractual provisions to the contrary--
            (1) the duty to maximize, or to not adversely affect, the 
        recovery of total proceeds from pooled residential mortgage 
        loans is owed by a servicer of such pooled loans to the 
        securitization vehicle for the benefit of all investors and 
        holders of beneficial interests in the pooled loans, in the 
        aggregate, and not to any individual party or group of parties; 
        and
            (2) a servicer of pooled residential mortgage loans shall 
        be deemed to be acting on behalf of the securitization vehicle 
        in the best interest of all investors and holders of beneficial 
        interests in the pooled loans, in the aggregate, if for a loan 
        that is in payment default under the loan agreement or for 
        which payment default is imminent or reasonably foreseeable, 
        the loan servicer makes reasonable and documented efforts to 
        implement a modification or workout plan or, if such efforts 
        are unsuccessful or such plan would be infeasible, engages in 
        other loss mitigation, including accepting a short payment or 
        partial discharge of principal, or agreeing to a short sale of 
        the property, to the extent that the servicer reasonably 
        believes the modification or workout plan or other mitigation 
        actions will maximize the net present value to be realized on 
        the loan over that which would be realized through foreclosure.
    (b) Safe Harbor.--Absent specific contractual provisions to the 
contrary, a servicer of a residential mortgage loan that acts in a 
manner consistent with the duty set forth in subsection (a), shall not 
be liable for entering into a qualified loan modification or workout 
plan, to--
            (1) any person, based on that person's ownership of a 
        residential mortgage loan or any interest in a pool of 
        residential mortgage loans or in securities that distribute 
        payments out of the principal, interest and other payments in 
        loans on the pool;
            (2) any person who is obligated to make payments determined 
        in reference to any loan or any interest referred to in 
        paragraph (1); or
            (3) any person that insures any loan or any interest 
        referred to in paragraph (1) under any law or regulation of the 
        United States or any law or regulation of any State or 
        political subdivision of any State.
    (c) Rule of Construction.--No provision of this section shall be 
construed as limiting the ability of a servicer to enter into loan 
modifications or workout plans other than qualified loan modification 
or workout plans.
    (d) Definitions.--For purposes of this section, the following 
definitions shall apply:
            (1) Qualified loan modification or workout plan.--The term 
        ``qualified loan modification or workout plan'' means a 
        modification or plan that--
                    (A) is scheduled to remain in place until the 
                borrower sells or refinances the property, or for at 
                least 5 years from the date of adoption of the plan, 
                whichever is sooner;
                    (B) does not provide for a repayment schedule that 
                results in negative amortization at any time; and
                    (C) does not require the borrower to pay additional 
                points and fees.
            (2) Residential mortgage loan defined.--The term 
        ``residential mortgage loan'' means a loan that is secured by a 
        lien on an owner-occupied residential dwelling.
            (3) Securitization vehicle.--The term ``securitization 
        vehicle'' means a trust, corporation, partnership, limited 
        liability entity, special purpose entity, or other structure 
        that--
                    (A) is the issuer, or is created by the issuer, of 
                mortgage pass-through certificates, participation 
                certificates, mortgage-backed securities, or other 
                similar securities backed by a pool of assets that 
                includes residential mortgage loans; and
                    (B) holds such loans.
    (e) Effective Period.--This section shall apply only with respect 
to qualified loan modification or workout plans initiated prior to 
January 1, 2011.

                       TITLE V--FHA MODERNIZATION

SEC. 501. SHORT TITLE.

    This title may be cited as the ``Expanding American Homeownership 
Act of 2008''.

SEC. 502. FINDINGS AND PURPOSES.

    (a) Findings.--The Congress finds that--
            (1) one of the primary missions of the Federal Housing 
        Administration (FHA) single family mortgage insurance program 
        is to reach borrowers who are underserved, or not served, by 
        the existing conventional mortgage marketplace;
            (2) the FHA program has a long history of innovation, which 
        includes pioneering the 30-year self-amortizing mortgage and a 
        safe-to-seniors reverse mortgage product, both of which were 
        once thought too risky to private lenders;
            (3) the FHA single family mortgage insurance program 
        traditionally has been a major provider of mortgage insurance 
        for home purchases;
            (4) the FHA mortgage insurance premium structure, as well 
        as FHA's product offerings, should be revised to reflect FHA's 
        enhanced ability to determine risk at the loan level and to 
        allow FHA to better respond to changes in the mortgage market;
            (5) during past recessions, including the oil-patch 
        downturns in the mid-1980s, FHA remained a viable credit 
        enhancer and was therefore instrumental in preventing a more 
        catastrophic collapse in housing markets and a greater loss of 
        homeowner equity; and
            (6) as housing price appreciation slows and interest rates 
        rise, many homeowners and prospective homebuyers will need the 
        less-expensive, safer financing alternative that FHA mortgage 
        insurance provides.
    (b) Purposes.--The purposes of this title are--
            (1) to provide flexibility to FHA to allow for the 
        insurance of housing loans for low- and moderate-income 
        homebuyers during all economic cycles in the mortgage market;
            (2) to modernize the FHA single family mortgage insurance 
        program by making it more reflective of enhancements to loan-
        level risk assessments and changes to the mortgage market; and
            (3) to adjust the loan limits for the single family 
        mortgage insurance program to reflect rising house prices and 
        the increased costs associated with new construction.

SEC. 503. MAXIMUM PRINCIPAL LOAN OBLIGATION.

    Paragraph (2) of section 203(b) of the National Housing Act (12 
U.S.C. 1709(b)(2)) is amended--
            (1) by striking subparagraphs (A) and (B) and inserting the 
        following new subparagraphs:
                    ``(A) not to exceed the lesser of--
                            ``(i) in the case of a 1-family residence, 
                        the median 1-family house price in the area, as 
                        determined by the Secretary; and in the case of 
                        a 2-, 3-, or 4-family residence, the percentage 
                        of such median price that bears the same ratio 
                        to such median price as the dollar amount 
                        limitation in effect under section 305(a)(2) of 
                        the Federal Home Loan Mortgage Corporation Act 
                        (12 U.S.C. 1454(a)(2)) for a 2-, 3-, or 4-
                        family residence, respectively, bears to the 
                        dollar amount limitation in effect under such 
                        section for a 1-family residence; or
                            ``(ii) 132 percent of the dollar amount 
                        limitation in effect for 2007 under such 
                        section 305(a)(2) for a residence of the 
                        applicable size (without regard to any 
                        authority to increase such limitations with 
                        respect to properties located in Alaska, Guam, 
                        Hawaii, or the Virgin Islands), except that 
                        each such maximum dollar amount shall be 
                        adjusted effective January 1 of each year 
                        beginning with 2009, by adding to or 
                        subtracting from each such amount (as it may 
                        have been previously adjusted) a percentage 
                        thereof equal to the percentage increase or 
                        decrease, during the most recently completed 
                        12-month or 4-quarter period ending before the 
                        time of determining such annual adjustment, in 
                        an housing price index developed or selected by 
                        the Secretary for purposes of adjustments under 
                        this clause;
                except that the dollar amount limitation in effect for 
                any area under this subparagraph may not be less than 
                the greater of (I) the dollar amount limitation in 
                effect under this section for the area on October 21, 
                1998, or (II) 65 percent of the dollar limitation 
                determined under such section 305(a)(2) for a residence 
                of the applicable size; and
                    ``(B) not to exceed the appraised value of the 
                property, plus any initial service charges, appraisal, 
                inspection and other fees in connection with the 
                mortgage as approved by the Secretary.'';
            (2) in the matter after and below subparagraph (B), by 
        striking the second sentence (relating to a definition of 
        ``average closing cost'') and all that follows through ``title 
        38, United States Code''; and
            (3) by striking the last undesignated paragraph (relating 
        to counseling with respect to the responsibilities and 
        financial management involved in homeownership).

SEC. 504. EXTENSION OF MORTGAGE TERM.

    Paragraph (3) of section 203(b) of the National Housing Act (12 
U.S.C. 1709(b)(3)) is amended--
            (1) by striking ``thirty-five years'' and inserting ``forty 
        years''; and
            (2) by striking ``(or thirty years if such mortgage is not 
        approved for insurance prior to construction)''.

SEC. 505. MORTGAGE INSURANCE PREMIUMS.

    Section 203(c) of the National Housing Act (12 U.S.C. 1709(c)) is 
amended--
            (1) in paragraph (2), in the matter preceding subparagraph 
        (A), by striking ``Notwithstanding'' and inserting ``Except as 
        provided in paragraph (3) and notwithstanding''; and
            (2) by adding at the end the following new paragraph:
    ``(3) Flexible Risk-Based Premiums.--
            ``(A) In general.--For any mortgage insured by the 
        Secretary under this title that is secured by a 1- to 4-family 
        dwelling and for which the loan application is received by the 
        mortgagee on or after October 1, 2008, the Secretary may 
        establish a mortgage insurance premium structure involving a 
        single premium payment collected prior to the insurance of the 
        mortgage or annual payments (which may be collected on a 
        periodic basis), or both, subject to the limitations in 
        subparagraphs (B) and (C). The rate of premium for such a 
        mortgage may vary during the mortgage term as long as the basis 
        for determining the variable rate is established before the 
        execution of the mortgage. The Secretary may change a premium 
        structure established under this subparagraph but only to the 
        extent that such change is not applied to any mortgage already 
        executed.
            ``(B) Maximum up-front premium amounts.--For any mortgage 
        insured under a premium structure established pursuant to this 
        paragraph, the amount of any single premium payment authorized 
        by subparagraph (A), if established and collected prior to the 
        insurance of the mortgage, may not exceed the following amount:
                    ``(i) Except as provided in clauses (ii) and (iii), 
                3.0 percent of the amount of the original insured 
                principal obligation of the mortgage.
                    ``(ii) If the mortgagor has a credit score 
                equivalent to a FICO score of 560 or more, 2.25 percent 
                of the original insured principal obligation of the 
                mortgage.
                    ``(iii) If the annual premium payment is equal to 
                the maximum amount allowable under clause (i) of 
                subparagraph (C), 1.5 percent of the amount of the 
                original insured principal obligation of the mortgage.
            ``(C) Maximum annual premium amounts.--For any mortgage 
        insured under a premium structure established pursuant to this 
        paragraph, the amount of any annual premium payment collected 
        may not exceed the following amount:
                    ``(i) Except as provided in clauses (ii) and (iii), 
                2.0 percent of the remaining insured principal 
                obligation of the mortgage.
                    ``(ii) If the mortgagor is a mortgagor described in 
                clause (ii) of subparagraph (B), 0.55 percent of the 
                remaining insured principal obligation of the mortgage.
                    ``(iii) If the single premium payment collected at 
                the time of insurance is equal to maximum amount 
                allowable under clause (i) of subparagraph (B), 1.0 
                percent of the remaining insured principal obligation 
                of the mortgage.
            ``(D) Payment incentive.--Notwithstanding subparagraph (C), 
        for any mortgage insured under a premium structure established 
        pursuant to this paragraph and for which the annual premium 
        payment exceeds the amount set forth in subparagraph (C)(ii), 
        if during the 5-year period beginning upon the time of 
        insurance all mortgage insurance premiums for such mortgage 
        have been paid on a timely basis, upon the expiration of such 
        period the Secretary shall reduce the amount of the annual 
        premium payments due thereafter under such mortgage to an 
        amount equal to the amount set forth in subparagraph (C)(ii).
            ``(E) Establishment and alteration of premium structure.--A 
        premium structure shall be established or changed under 
        subparagraph (A) only by providing notice to mortgagees and to 
        the Congress, at least 30 days before the premium structure is 
        established or changed.
            ``(F) Considerations for premium structure.--When 
        establishing a premium structure under subparagraph (A) or when 
        changing such a premium structure, the Secretary shall consider 
        the following:
                    ``(i) The effect of the proposed premium structure 
                on the Secretary's ability to meet the operational 
                goals of the Mutual Mortgage Insurance Fund as provided 
                in section 202(a).
                    ``(ii) Underwriting variables.
                    ``(iii) The extent to which new pricing under the 
                proposed premium structure has potential for acceptance 
                in the private market.
                    ``(iv) The administrative capability of the 
                Secretary to administer the proposed premium structure.
                    ``(v) The effect of the proposed premium structure 
                on the Secretary's ability to maintain the availability 
                of mortgage credit and provide stability to mortgage 
                markets.''.

SEC. 506. REHABILITATION LOANS.

    Subsection (k) of section 203 of the National Housing Act (12 
U.S.C. 1709(k)) is amended--
            (1) in paragraph (1), by striking ``on'' and all that 
        follows through ``1978''; and
            (2) in paragraph (5)--
                    (A) by striking ``General Insurance Fund'' the 
                first place it appears and inserting ``Mutual Mortgage 
                Insurance Fund''; and
                    (B) in the second sentence, by striking the comma 
                and all that follows through ``General Insurance 
                Fund''.

SEC. 507. DISCRETIONARY ACTION.

    The National Housing Act is amended--
            (1) in subsection (e) of section 202 (12 U.S.C. 1708(e))--
                    (A) in paragraph (3)(B), by striking ``section 
                202(e) of the National Housing Act'' and inserting 
                ``this subsection''; and
                    (B) by redesignating such subsection as subsection 
                (f);
            (2) by striking paragraph (4) of section 203(s) (12 U.S.C. 
        1709(s)(4)) and inserting the following new paragraph:
            ``(4) the Secretary of Agriculture;''; and
            (3) by transferring subsection (s) of section 203 (as 
        amended by paragraph (2) of this section) to section 202, 
        inserting such subsection after subsection (d) of section 202, 
        and redesignating such subsection as subsection (e).

SEC. 508. INSURANCE OF CONDOMINIUMS.

    (a) In General.--Section 234 of the National Housing Act (12 U.S.C. 
1715y) is amended--
            (1) in subsection (c)--
                    (A) in the first sentence--
                            (i) by striking ``and'' before ``(2)''; and
                            (ii) by inserting before the period at the 
                        end the following: ``, and (3) the project has 
                        a blanket mortgage insured by the Secretary 
                        under subsection (d)''; and
                    (B) in clause (B) of the third sentence, by 
                striking ``thirty-five years'' and inserting ``forty 
                years''; and
            (2) in subsection (g), by striking ``, except that'' and 
        all that follows and inserting a period.
    (b) Definition of Mortgage.--Section 201(a) of the National Housing 
Act (12 U.S.C. 1707(a)) is amended--
            (1) in clause (1), by striking ``or'' and inserting a 
        comma; and
            (2) by inserting before the semicolon the following: ``, or 
        (c) a first mortgage given to secure the unpaid purchase price 
        of a fee interest in, or long-term leasehold interest in, a 
        one-family unit in a multifamily project, including a project 
        in which the dwelling units are attached, semi-detached, or 
        detached, and an undivided interest in the common areas and 
        facilities which serve the project''.

SEC. 509. MUTUAL MORTGAGE INSURANCE FUND.

    (a) In General.--Subsection (a) of section 202 of the National 
Housing Act (12 U.S.C. 1708(a)) is amended to read as follows:
    ``(a) Mutual Mortgage Insurance Fund.--
            ``(1) Establishment.--Subject to the provisions of the 
        Federal Credit Reform Act of 1990, there is hereby created a 
        Mutual Mortgage Insurance Fund (in this title referred to as 
        the `Fund'), which shall be used by the Secretary to carry out 
        the provisions of this title with respect to mortgages insured 
        under section 203. The Secretary may enter into commitments to 
        guarantee, and may guarantee, such insured mortgages.
            ``(2) Limit on loan guarantees.--The authority of the 
        Secretary to enter into commitments to guarantee such insured 
        mortgages shall be effective for any fiscal year only to the 
        extent that the aggregate original principal loan amount under 
        such mortgages, any part of which is guaranteed, does not 
        exceed the amount specified in appropriations Acts for such 
        fiscal year.
            ``(3) Fiduciary responsibility.--The Secretary has a 
        responsibility to ensure that the Mutual Mortgage Insurance 
        Fund remains financially sound.
            ``(4) Annual independent actuarial study.--The Secretary 
        shall provide for an independent actuarial study of the Fund to 
        be conducted annually, which shall analyze the financial 
        position of the Fund. The Secretary shall submit a report 
        annually to the Congress describing the results of such study 
        and assessing the financial status of the Fund. The report 
        shall recommend adjustments to underwriting standards, program 
        participation, or premiums, if necessary, to ensure that the 
        Fund remains financially sound.
            ``(5) Quarterly reports.--During each fiscal year, the 
        Secretary shall submit a report to the Congress for each 
        quarter, which shall specify for mortgages that are obligations 
        of the Fund--
                    ``(A) the cumulative volume of loan guarantee 
                commitments that have been made during such fiscal year 
                through the end of the quarter for which the report is 
                submitted;
                    ``(B) the types of loans insured, categorized by 
                risk;
                    ``(C) any significant changes between actual and 
                projected claim and prepayment activity;
                    ``(D) projected versus actual loss rates; and
                    ``(E) updated projections of the annual subsidy 
                rates to ensure that increases in risk to the Fund are 
                identified and mitigated by adjustments to underwriting 
                standards, program participation, or premiums, and the 
                financial soundness of the Fund is maintained.
        The first quarterly report under this paragraph shall be 
        submitted on the last day of the first quarter of fiscal year 
        2009, or upon the expiration of the 90-day period beginning on 
        the date of the enactment of the Expanding American 
        Homeownership Act of 2008, whichever is later.
            ``(6) Adjustment of premiums.--If, pursuant to the 
        independent actuarial study of the Fund required under 
        paragraph (4), the Secretary determines that the Fund is not 
        meeting the operational goals established under paragraph (7) 
        or there is a substantial probability that the Fund will not 
        maintain its established target subsidy rate, the Secretary may 
        either make programmatic adjustments under section 203 as 
        necessary to reduce the risk to the Fund, or make appropriate 
        premium adjustments.
            ``(7) Operational goals.--The operational goals for the 
        Fund are--
                    ``(A) to charge borrowers under loans that are 
                obligations of the Fund an appropriate premium for the 
                risk that such loans pose to the Fund;
                    ``(B) to minimize the default risk to the Fund and 
                to homeowners;
                    ``(C) to curtail the impact of adverse selection on 
                the Fund; and
                    ``(D) to meet the housing needs of the borrowers 
                that the single family mortgage insurance program under 
                this title is designed to serve.''.
    (b) Obligations of Fund.--The National Housing Act is amended as 
follows:
            (1) Homeownership voucher program mortgages.--In section 
        203(v) (12 U.S.C. 1709(v))--
                    (A) by striking ``Notwithstanding section 202 of 
                this title, the'' and inserting ``The''; and
                    (B) by striking ``General Insurance Fund'' the 
                first place such term appears and all that follows and 
                inserting ``Mutual Mortgage Insurance Fund.''.
            (2) Home equity conversion mortgages.--Section 255(i)(2)(A) 
        of the National Housing Act (12 U.S.C. 1715z-20(i)(2)(A)) is 
        amended by striking ``General Insurance Fund'' and inserting 
        ``Mutual Mortgage Insurance Fund''.
    (c) Conforming Amendments.--The National Housing Act is amended--
            (1) in section 205 (12 U.S.C. 1711), by striking 
        subsections (g) and (h); and
            (2) in section 519(e) (12 U.S.C. 1735c(e)), by striking 
        ``203(b)'' and all that follows through ``203(i)'' and 
        inserting ``203, except as determined by the Secretary''.

SEC. 510. HAWAIIAN HOME LANDS AND INDIAN RESERVATIONS.

    (a) Hawaiian Home Lands.--Section 247(c) of the National Housing 
Act (12 U.S.C. 1715z-12) is amended--
            (1) by striking ``General Insurance Fund established in 
        section 519'' and inserting ``Mutual Mortgage Insurance Fund''; 
        and
            (2) in the second sentence, by striking ``(1) all 
        references'' and all that follows through ``and (2)''.
    (b) Indian Reservations.--Section 248(f) of the National Housing 
Act (12 U.S.C. 1715z-13) is amended--
            (1) by striking ``General Insurance Fund'' the first place 
        it appears through ``519'' and inserting ``Mutual Mortgage 
        Insurance Fund''; and
            (2) in the second sentence, by striking ``(1) all 
        references'' and all that follows through ``and (2)''.

SEC. 511. CONFORMING AND TECHNICAL AMENDMENTS.

    (a) Repeals.--The following provisions of the National Housing Act 
are repealed:
            (1) Subsection (i) of section 203 (12 U.S.C. 1709(i)).
            (2) Subsection (o) of section 203 (12 U.S.C. 1709(o)).
            (3) Subsection (p) of section 203 (12 U.S.C. 1709(p)).
            (4) Subsection (q) of section 203 (12 U.S.C. 1709(q)).
            (5) Section 222 (12 U.S.C. 1715m).
            (6) Section 237 (12 U.S.C. 1715z-2).
            (7) Section 245 (12 U.S.C. 1715z-10).
    (b) Definition of Area.--Section 203(u)(2)(A) of the National 
Housing Act (12 U.S.C. 1709(u)(2)(A)) is amended by striking ``shall'' 
and all that follows and inserting ``means a metropolitan statistical 
area as established by the Office of Management and Budget;''.
    (c) Definition of State.--Section 201(d) of the National Housing 
Act (12 U.S.C. 1707(d)) is amended by striking ``the Trust Territory of 
the Pacific Islands'' and inserting ``the Commonwealth of the Northern 
Mariana Islands''.

SEC. 512. HOME EQUITY CONVERSION MORTGAGES.

    (a) In General.--Section 255 of the National Housing Act (12 U.S.C. 
1715z-20) is amended--
            (1) in subsection (g)--
                    (A) by striking the first sentence; and
                    (B) by striking ``established under section 
                203(b)(2)'' and all that follows through ``located'' 
                and inserting ``limitation established under section 
                305(a)(2) of the Federal Home Loan Mortgage Corporation 
                Act for a 1-family residence'';
            (2) in subsection (i)(1)(C), by striking ``limitations'' 
        and inserting ``limitation''; and
            (3) by adding at the end the following new subsection:
    ``(n) Authority To Insure Home Purchase Mortgage.--
            ``(1) In general.--Notwithstanding any other provision in 
        this section, the Secretary may insure, upon application by a 
        mortgagee, a home equity conversion mortgage upon such terms 
        and conditions as the Secretary may prescribe, when the primary 
        purpose of the home equity conversion mortgage is to enable an 
        elderly mortgagor to purchase a 1- to 4-family dwelling in 
        which the mortgagor will occupy or occupies one of the units.
            ``(2) Limitation on principal obligation.--A home equity 
        conversion mortgage insured pursuant to paragraph (1) shall 
        involve a principal obligation that does not exceed the dollar 
        amount limitation determined under section 305(a)(2) of the 
        Federal Home Loan Mortgage Corporation Act for a residence of 
        the applicable size.''.
    (b) Mortgages for Cooperatives.--Subsection (b) of section 255 of 
the National Housing Act (12 U.S.C. 1715z-20(b)) is amended--
            (1) in paragraph (4)--
                    (A) by inserting ``a first or subordinate mortgage 
                or lien'' before ``on all stock'';
                    (B) by inserting ``unit'' after ``dwelling''; and
                    (C) by inserting ``a first mortgage or first lien'' 
                before ``on a leasehold''; and
            (2) in paragraph (5), by inserting ``a first or subordinate 
        lien on'' before ``all stock''.
    (c) Study Regarding Mortgage Insurance Premiums.--The Secretary of 
Housing and Urban Development shall conduct a study regarding mortgage 
insurance premiums charged under the program under section 255 of the 
National Housing Act (12 U.S.C. 1715z-20) for insurance of home equity 
conversion mortgages to analyze and determine--
            (1) the effects of reducing the amounts of such premiums 
        from the amounts charged as of the date of the enactment of 
        this Act on--
                    (A) costs to mortgagors; and
                    (B) the financial soundness of the program; and
            (2) the feasibility and effectiveness of exempting, from 
        all the requirements under the program regarding payment of 
        mortgage insurance premiums (including both up-front or annual 
        mortgage insurance premiums under section 203(c)(2) of such 
        Act), any mortgage insured under the program under which part 
        or all of the amount of future payments made to the homeowner 
        are used for costs of a long-term care insurance contract 
        covering the mortgagor or members of the household residing in 
        the mortgaged property.

SEC. 513. CONFORMING LOAN LIMIT IN DISASTER AREAS.

    Section 203(h) of the National Housing Act (12 U.S.C. 1709) is 
amended--
            (1) by inserting after ``property'' the following: ``plus 
        any initial service charges, appraisal, inspection and other 
        fees in connection with the mortgage as approved by the 
        Secretary,'';
            (2) by striking the second sentence (as added by chapter 7 
        of the Emergency Supplemental Appropriations Act of 1994 
        (Public Law 103-211; 108 Stat. 12)); and
            (3) by adding at the end the following new sentence: ``In 
        any case in which the single family residence to be insured 
        under this subsection is within a jurisdiction in which the 
        President has declared a major disaster to have occurred, the 
        Secretary is authorized, for a temporary period not to exceed 
        36 months from the date of such Presidential declaration, to 
        enter into agreements to insure a mortgage which involves a 
        principal obligation of up to 100 percent of the dollar 
        limitation determined under section 305(a)(2) of the Federal 
        Home Loan Mortgage Corporation Act for a single family 
        residence, and not in excess of 100 percent of the appraised 
        value of the property plus any initial service charges, 
        appraisal, inspection and other fees in connection with the 
        mortgage as approved by the Secretary.''.

SEC. 514. PARTICIPATION OF MORTGAGE BROKERS AND CORRESPONDENT LENDERS.

    (a) Definitions.--
            (1) In general.--Section 201 of the National Housing Act 
        (12 U.S.C. 1707) is amended--
                    (A) by striking ``As used in section 203 of this 
                title--'' and inserting ``As used in this title and for 
                purposes of participation in insurance programs under 
                this title, except as specifically provided otherwise, 
                the following definitions shall apply:'';
                    (B) by striking subsection (b) and inserting the 
                following:
            ``(2) The term `mortgagee' means any of the following 
        entities, and its successors and assigns, to the extent such 
        entity is approved by the Secretary:
                    ``(A) A lender or correspondent lender, who--
                            ``(i) makes, underwrites, and services 
                        mortgages;
                            ``(ii) submits to the Secretary such 
                        financial audits performed in accordance with 
                        the standards for financial audits of the 
                        Government Auditing Standards issued by the 
                        Comptroller of the United States;
                            ``(iii) meet the minimum net worth 
                        requirement that the Secretary shall establish; 
                        and
                            ``(iv) complies with such other 
                        requirements as the Secretary may establish.
                    ``(B) A correspondent lender who--
                            ``(i) closes a mortgage in its name but 
                        does not underwrite or service the mortgage;
                            ``(ii) posts a surety bond, in lieu of any 
                        requirement to provide audited financial 
                        statements or meet a minimum net worth 
                        requirement, in--
                                    ``(I) a form satisfactory to the 
                                Secretary; and
                                    ``(II) an amount of $75,000, as 
                                such amount is adjusted annually by the 
                                Secretary (as determined under 
                                regulations of the Secretary) by the 
                                change for such year in the Consumer 
                                Price Index for All Urban Consumers 
                                published monthly by the Bureau of 
                                Labor Statistics of the Department of 
                                Labor; and
                            ``(iii) complies with such other 
                        requirements as the Secretary may establish.
                    ``(C) A mortgage broker who--
                            ``(i) closes the mortgage in the name of 
                        the lender and does not make, underwrite, or 
                        service the mortgage;
                            ``(ii) is licensed, under the laws of the 
                        State in which the property that is subject to 
                        the mortgage is located, to act as a mortgage 
                        broker in such State;
                            ``(iii) posts a surety bond in accordance 
                        with the requirements of subparagraph (B)(ii); 
                        and
                            ``(iv) complies with such other 
                        requirements as the Secretary may establish.
            ``(3) The term `mortgagor' includes the original borrower 
        under a mortgage and the successors and assigns of the original 
        borrower.'';
                    (C) in subsection (a), by redesignating clauses (1) 
                and (2) as clauses (A) and (B) respectively; and
                    (D) by redesignating subsections (a), (c), (d), 
                (e), and (f) as paragraphs (1), (4), (5), (6), and (7), 
                respectively, and realigning such paragraphs two ems 
                from the left margin.
            (2) Mortgagee review.--Section 202(c)(7) of the National 
        Housing Act (12 U.S.C. 1708(c)(7)) is amended--
                    (A) in subparagraph (A), by inserting ``, as 
                defined in section 201,'' after ``mortgagee'';
                    (B) by striking subparagraph (B); and
                    (C) by redesignating subparagraphs (C) and (D) as 
                subparagraphs (B) and (C), respectively.
            (3) Multifamily rental housing insurance.--Section 
        207(a)(2) of the National Housing Act (12 U.S.C. 1713(a)(2)) is 
        amended by striking ``means the original lender under a 
        mortgage, and its successors and assigns, and'' and inserting 
        ``has the meaning given such term in section 201, except that 
        such term also''.
            (4) War housing insurance.--Section 601(b) of the National 
        Housing Act (12 U.S.C. 1736(b)) is amended by striking 
        ``includes the original lender under a mortgage, and his 
        successors and assigns approved by the Secretary'' and 
        inserting ``has the meaning given such term in section 201''.
            (5) Armed services housing mortgage insurance.--Section 
        801(b) of the National Housing Act (12 U.S.C. 1748(b)) is 
        amended by striking ``includes the original lender under a 
        mortgage, and his successors and assigns approved by the 
        Secretary'' and inserting ``has the meaning given such term in 
        section 201''.
            (6) Group practice facilities mortgage insurance.--Section 
        1106(8) of the National Housing Act (12 U.S.C. 1749aaa-5(8)) is 
        amended by striking ``means the original lender under a 
        mortgage, and his or its successors and assigns, and'' and 
        inserting ``has the meaning given such term in section 201, 
        except that such term also''.
    (b) Eligibility for Insurance.--
            (1) Title i.--Paragraph (1) of section 8(b) of the National 
        Housing Act (12 U.S.C. 1706c(b)(1)) is amended--
                    (A) by striking ``, and be held by,''; and
                    (B) by striking ``as responsible and able to 
                service the mortgage properly''.
            (2) Single family housing mortgage insurance.--Paragraph 
        (1) of section 203(b) of the National Housing Act (12 U.S.C. 
        1709(b)(1)) is amended--
                    (A) by striking ``, and be held by,''; and
                    (B) by striking ``as responsible and able to 
                service the mortgage properly''.
            (3) Section 221 mortgage insurance.--Paragraph (1) of 
        section 221(d) of the National Housing Act (12 U.S.C. 
        1715l(d)(1)) is amended--
                    (A) by striking `` and be held by''; and
                    (B) by striking ``as responsible and able to 
                service the mortgage properly''.
            (4) Home equity conversion mortgage insurance.--Paragraph 
        (1) of section 255(d) of the National Housing Act (12 U.S.C. 
        1715z-20(d)(1)) is amended by striking ``as responsible and 
        able to service the mortgage properly''.
            (5) War housing mortgage insurance.--Paragraph (1) of 
        section 603(b) of the National Housing Act (12 U.S.C. 
        1738(b)(1)) is amended--
                    (A) by striking ``, and be held by,''; and
                    (B) by striking ``as responsible and able to 
                service the mortgage properly''.
            (6) War housing mortgage insurance for large-scale housing 
        projects.--Paragraph (1) of section 611(b) of the National 
        Housing Act (12 U.S.C. 1746(b)(1)) is amended--
                    (A) by striking `` and be held by''; and
                    (B) by striking ``as responsible and able to 
                service the mortgage properly''.
            (7) Group practice facility mortgage insurance.--Section 
        1101(b)(2) of the National Housing Act (12 U.S.C. 
        1749aaa(b)(2)) is amended--
                    (A) by striking `` and held by''; and
                    (B) by striking ``as responsible and able to 
                service the mortgage properly''.
            (8) National defense housing insurance.--Paragraph (1) of 
        section 903(b) of the National Housing Act (12 U.S.C. 
        1750b(b)(1)) is amended--
                    (A) by striking ``, and be held by,''; and
                    (B) by striking ``as responsible and able to 
                service the mortgage properly''.

SEC. 515. SENSE OF CONGRESS REGARDING TECHNOLOGY FOR FINANCIAL SYSTEMS.

    (a) Congressional Findings.--The Congress finds the following:
            (1) The Government Accountability Office has cited the FHA 
        single family housing mortgage insurance program as a ``high-
        risk'' program, with a primary reason being non-integrated and 
        out-dated financial management systems.
            (2) The ``Audit of the Federal Housing Administration's 
        Financial Statements for Fiscal Years 2004 and 2003'', 
        conducted by the Inspector General of the Department of Housing 
        and Urban Development reported as a material weakness that 
        ``HUD/FHA's automated data processing [ADP] system environment 
        must be enhanced to more effectively support FHA's business and 
        budget processes''.
            (3) Existing technology systems for the FHA program have 
        not been updated to meet the latest standards of the Mortgage 
        Industry Standards Maintenance Organization and have numerous 
        deficiencies that lenders have outlined.
            (4) Improvements to technology used in the FHA program 
        will--
                    (A) allow the FHA program to improve the management 
                of the FHA portfolio, garner greater efficiencies in 
                its operations, and lower costs across the program;
                    (B) result in efficiencies and lower costs for 
                lenders participating in the program, allowing them to 
                better use the FHA products in extending homeownership 
                opportunities to higher credit risk or lower-income 
                families, in a sound manner.
            (5) The Mutual Mortgage Insurance Fund operates without 
        cost to the taxpayers and generates revenues for the Federal 
        Government.
    (b) Sense of Congress.--It is the sense of the Congress that--
            (1) the Secretary of Housing and Urban Development should 
        use a portion of the funds received from premiums paid for FHA 
        single family housing mortgage insurance that are in excess of 
        the amounts paid out in claims to substantially increase the 
        funding for technology used in such FHA program;
            (2) the goal of this investment should be to bring the 
        technology used in such FHA program to the level and 
        sophistication of the technology used in the conventional 
        mortgage lending market, or to exceed such level; and
            (3) the Secretary of Housing and Urban Development should 
        report to the Congress not later than 180 days after the date 
        of the enactment of this Act regarding the progress the 
        Department is making toward such goal and if progress is not 
        sufficient, the resources needed to make greater progress.

SEC. 516. SAVINGS PROVISION.

    Any mortgage insured under title II of the National Housing Act 
before the date of enactment of this Act shall continue to be governed 
by the laws, regulations, orders, and terms and conditions to which it 
was subject on the day before the date of the enactment of this Act.

SEC. 517. IMPLEMENTATION.

    The Secretary of Housing and Urban Development shall by notice 
establish any additional requirements that may be necessary to 
immediately carry out the provisions of this title. The notice shall 
take effect upon issuance.

                  TITLE VI--HOMEOWNERSHIP FOR VETERANS

SEC. 601. TEMPORARY INCREASE IN MAXIMUM LOAN GUARANTY AMOUNT FOR 
              HOUSING LOANS GUARANTEED BY SECRETARY OF VETERANS 
              AFFAIRS.

    Section 201(a) of the Economic Stimulus Act of 2008 (Public Law 
110-185; 122 Stat. 613) is amended by adding at the end the following 
new paragraph:
            ``(3) Va guaranteed housing loans.--Notwithstanding 
        subparagraph (C) of section 3703(a)(1) of title 38, United 
        States Code, for purposes of any loan described in that section 
        for which the mortgagee issues a loan commitment during the 
        period beginning on February 13, 2008, and ending at the end of 
        December 31, 2008, the term `maximum guaranty amount' means the 
        dollar amount that is equal to 25 percent of the amount 
        determined under paragraph (2) of this subsection for a 
        residence of the applicable size located in the area in which 
        the residence for which the loan is made is located.''.

SEC. 602. COUNSELING ON MORTGAGE FORECLOSURES FOR MEMBERS OF THE ARMED 
              FORCES RETURNING FROM SERVICE ABROAD.

    (a) In General.--The Secretary of Defense shall develop and 
implement a program to advise members of the Armed Forces (including 
members of the National Guard and Reserve) who are returning from 
service on active duty abroad (including service in Operation Iraqi 
Freedom and Operation Enduring Freedom) on actions to be taken by such 
members to prevent or forestall mortgage foreclosures.
    (b) Elements.--The program required by subsection (a) shall include 
the following:
            (1) Credit counseling.
            (2) Home mortgage counseling.
            (3) Such other counseling and information as the Secretary 
        considers appropriate for purposes of the program.
    (c) Timing of Provision of Counseling.--Counseling and other 
information under the program required by subsection (a) shall be 
provided to a member of the Armed Forces covered by the program as soon 
as practicable after the return of the member from service as described 
in subsection (a).

SEC. 603. ENHANCEMENT OF PROTECTIONS FOR SERVICEMEMBERS RELATING TO 
              MORTGAGES AND MORTGAGE FORECLOSURES.

    (a) Extension of Period of Protections Against Mortgage 
Foreclosures.--
            (1) Extension of protection period.--Subsection (c) of 
        section 303 of the Servicemembers Civil Relief Act (50 U.S.C. 
        App. 533) is amended by striking ``90 days'' and inserting ``9 
        months''.
            (2) Extension of stay of proceedings period.--Subsection 
        (b) of such section is amended by striking ``90 days'' and 
        inserting ``9 months''.
    (b) Treatment of Mortgages as Obligations Subject to Interest Rate 
Limitation.--Section 207 of the Servicemembers Civil Relief Act (50 
U.S.C. App. 527) is amended--
            (1) in subsection (a)(1), by striking ``in excess of 6 
        percent'' and all that follows and inserting ``in excess of 6 
        percent--
                    ``(A) during the period of military service and one 
                year thereafter, in the case of an obligation or 
                liability consisting of a mortgage, trust deed, or 
                other security in the nature of a mortgage; or
                    ``(B) during the period of military service, in the 
                case of any other obligation or liability.''; and
            (2) by striking subsection (d) and inserting the following 
        new subsection:
    ``(d) Definitions.--In this section:
            ``(1) Interest.--The term `interest' includes service 
        charges, renewal charges, fees, or any other charges (except 
        bona fide insurance) with respect to an obligation or 
        liability.
            ``(2) Obligation or liability.--The term `obligation or 
        liability' includes an obligation or liability consisting of a 
        mortgage, trust deed, or other security in the nature of a 
        mortgage.''.
    (c) Effective Date; Sunset.--
            (1) Effective date.--The amendment made by subsection (a) 
        shall take effect on the date of the enactment of this Act.
            (2) Sunset.--The amendments made by subsection (a) shall 
        expire on December 31, 2010. Effective January 1, 2011, the 
        provisions of subsections (b) and (c) of section 303 of the 
        Servicemembers Civil Relief Act, as in effect on the day before 
        the date of the enactment of this Act, are hereby revived.

                  TITLE VII--MORTGAGE ESCROW ACCOUNTS

SEC. 701. ESCROW AND IMPOUND ACCOUNTS RELATING TO CERTAIN CONSUMER 
              CREDIT TRANSACTIONS.

    (a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C. 
1631 et seq.) is amended by inserting after section 129 the following 
new section:

``SEC. 129A. ESCROW OR IMPOUND ACCOUNTS RELATING TO CERTAIN CONSUMER 
              CREDIT TRANSACTIONS.

    ``(a) In General.--Except as provided in subsection (b) or (c), a 
creditor, in connection with the formation or consummation of a 
consumer credit transaction secured by a first lien on the principal 
dwelling of the consumer, other than a consumer credit transaction 
under an open end credit plan or a reverse mortgage, shall establish, 
at the time of the consummation of such transaction, an escrow or 
impound account for the payment of taxes and hazard insurance, and, if 
applicable, flood insurance, mortgage insurance, ground rents, and any 
other required periodic payments or premiums with respect to the 
property or the loan terms, as provided in, and in accordance with, 
this section.
    ``(b) When Required.--No impound, trust, or other type of account 
for the payment of property taxes, insurance premiums, or other 
purposes relating to the property may be required as a condition of a 
real property sale contract or a loan secured by a first deed of trust 
or mortgage on the principal dwelling of the consumer, other than a 
consumer credit transaction under an open end credit plan or a reverse 
mortgage, except when--
            ``(1) any such impound, trust, or other type of escrow or 
        impound account for such purposes is required by Federal or 
        State law;
            ``(2) a loan is made, guaranteed, or insured by a State or 
        Federal governmental lending or insuring agency;
            ``(3) the consumer's debt-to-income ratio at the time the 
        home mortgage is established taking into account income from 
        all sources including the consumer's employment exceeds 50 
        percent;
            ``(4) the transaction is secured by a first mortgage or 
        lien on the consumer's principal dwelling and the annual 
        percentage rate on the credit, at the time of consummation of 
        the transaction, will exceed by more than 3.0 percentage points 
        the yield on Treasury securities having comparable periods of 
        maturity on the 15th day of the month immediately preceding the 
        month in which the application of the extension of credit is 
        received by the creditor;
            ``(5) a consumer obtains a mortgage referred to in section 
        103(aa);
            ``(6) the original principal amount of such loan at the 
        time of consummation of the transaction is--
                    ``(A) 90 percent or more of the sale price, if the 
                property involved is purchased with the proceeds of the 
                loan; or
                    ``(B) 90 percent or more of the appraised value of 
                the property securing the loan;
            ``(7) the combined principal amount of all loans secured by 
        the real property exceeds 95 percent of the appraised value of 
        the property securing the loans at the time of consummation of 
        the last mortgage transaction;
            ``(8) the consumer was the subject of a proceeding under 
        title 11, United States Code, at any time during the 7-year 
        period preceding the date of the transaction (as determined on 
        the basis of the date of entry of the order for relief or the 
        date of adjudication, as the case may be, with respect to such 
        proceeding and included in a consumer report on the consumer 
        under the Fair Credit Reporting Act); or
            ``(9) so required by the Board pursuant to regulation.
    ``(c) Duration of Mandatory Escrow or Impound Account.--An escrow 
or impound account established pursuant to subsection (b), shall remain 
in existence for a minimum period of 5 years and until such borrower 
has sufficient equity in the dwelling securing the consumer credit 
transaction so as to no longer be required to maintain private mortgage 
insurance, or such other period as may be provided in regulations to 
address situations such as borrower delinquency, unless the underlying 
mortgage establishing the account is terminated.
    ``(d) Clarification on Escrow Accounts for Loans Not Meeting 
Statutory Test.--For mortgages not covered by the requirements of 
subsection (b), no provision of this section shall be construed as 
precluding the establishment of an impound, trust, or other type of 
account for the payment of property taxes, insurance premiums, or other 
purposes relating to the property--
            ``(1) on terms mutually agreeable to the parties to the 
        loan;
            ``(2) at the discretion of the lender or servicer, as 
        provided by the contract between the lender or servicer and the 
        borrower; or
            ``(3) pursuant to the requirements for the escrowing of 
        flood insurance payments for regulated lending institutions in 
        section 102(d) of the Flood Disaster Protection Act of 1973.
    ``(e) Administration of Mandatory Escrow or Impound Accounts.--
            ``(1) In general.--Except as may otherwise be provided for 
        in this title or in regulations prescribed by the Board, escrow 
        or impound accounts established pursuant to subsection (b) 
        shall be established in a federally insured depository 
        institution.
            ``(2) Administration.--Except as provided in this section 
        or regulations prescribed under this section, an escrow or 
        impound account subject to this section shall be administered 
        in accordance with--
                    ``(A) the Real Estate Settlement Procedures Act of 
                1974 and regulations prescribed under such Act;
                    ``(B) the Flood Disaster Protection Act of 1973 and 
                regulations prescribed under such Act; and
                    ``(C) the law of the State, if applicable, where 
                the real property securing the consumer credit 
                transaction is located.
            ``(3) Applicability of payment of interest.--If prescribed 
        by applicable State or Federal law, each creditor shall pay 
        interest to the consumer on the amount held in any impound, 
        trust, or escrow account that is subject to this section in the 
        manner as prescribed by that applicable State or Federal law.
            ``(4) Penalty coordination with respa.--Any action or 
        omission on the part of any person which constitutes a 
        violation of the Real Estate Settlement Procedures Act of 1974 
        or any regulation prescribed under such Act for which the 
        person has paid any fine, civil money penalty, or other damages 
        shall not give rise to any additional fine, civil money 
        penalty, or other damages under this section, unless the action 
        or omission also constitutes a direct violation of this 
        section.
    ``(f) Disclosures Relating to Mandatory Escrow or Impound 
Account.--In the case of any impound, trust, or escrow account that is 
subject to this section, the creditor shall disclose by written notice 
to the consumer at least 3 business days before the consummation of the 
consumer credit transaction giving rise to such account or in 
accordance with timeframes established in prescribed regulations the 
following information:
            ``(1) The fact that an escrow or impound account will be 
        established at consummation of the transaction.
            ``(2) The amount required at closing to initially fund the 
        escrow or impound account.
            ``(3) The amount, in the initial year after the 
        consummation of the transaction, of the estimated taxes and 
        hazard insurance, including flood insurance, if applicable, and 
        any other required periodic payments or premiums that reflects, 
        as appropriate, either the taxable assessed value of the real 
        property securing the transaction, including the value of any 
        improvements on the property or to be constructed on the 
        property (whether or not such construction will be financed 
        from the proceeds of the transaction) or the replacement costs 
        of the property.
            ``(4) The estimated monthly amount payable to be escrowed 
        for taxes, hazard insurance (including flood insurance, if 
        applicable) and any other required periodic payments or 
        premiums.
            ``(5) The fact that, if the consumer chooses to terminate 
        the account at the appropriate time in the future, the consumer 
        will become responsible for the payment of all taxes, hazard 
        insurance, and flood insurance, if applicable, as well as any 
        other required periodic payments or premiums on the property 
        unless a new escrow or impound account is established.
    ``(g) Definitions.--For purposes of this section, the following 
definitions shall apply:
            ``(1) Flood insurance.--The term `flood insurance' means 
        flood insurance coverage provided under the national flood 
        insurance program pursuant to the National Flood Insurance Act 
        of 1968.
            ``(2) Hazard insurance.--The term `hazard insurance' shall 
        have the same meaning as provided for `hazard insurance', 
        `casualty insurance', `homeowner's insurance', or other similar 
        term under the law of the State where the real property 
        securing the consumer credit transaction is located.''.
    (b) Implementation.--
            (1) Regulations.--The Board of Governors of the Federal 
        Reserve System, the Comptroller of the Currency, the Director 
        of the Office of Thrift Supervision, the Federal Deposit 
        Insurance Corporation, the National Credit Union Administration 
        Board, (hereafter in this Act referred to as the ``Federal 
        banking agencies'') and the Federal Trade Commission shall 
        prescribe, in final form, such regulations as determined to be 
        necessary to implement the amendments made by subsection (a) 
        before the end of the 180-day period beginning on the date of 
        the enactment of this Act.
            (2) Effective date.--The amendments made by subsection (a) 
        shall only apply to covered mortgage loans consummated after 
        the end of the 1-year period beginning on the date of the 
        publication of final regulations in the Federal Register.
    (c) Clerical Amendment.--The table of sections for chapter 2 of the 
Truth in Lending Act is amended by inserting after the item relating to 
section 129 the following new item:

``129A. Escrow or impound accounts relating to certain consumer credit 
                            transactions.''.

SEC. 702. DISCLOSURE NOTICE REQUIRED FOR CONSUMERS WHO WAIVE ESCROW 
              SERVICES.

    (a) In General.--Section 129A of the Truth in Lending Act (as added 
by section 701) is amended by adding at the end the following new 
subsection:
    ``(h) Disclosure Notice Required for Consumers Who Waive Escrow 
Services.--
            ``(1) In general.--If--
                    ``(A) an impound, trust, or other type of account 
                for the payment of property taxes, insurance premiums, 
                or other purposes relating to real property securing a 
                consumer credit transaction is not established in 
                connection with the transaction; or
                    ``(B) a consumer chooses, at any time after such an 
                account is established in connection with any such 
                transaction and in accordance with any statute, 
                regulation, or contractual agreement, to close such 
                account,
        the creditor or servicer shall provide a timely and clearly 
        written disclosure to the consumer that advises the consumer of 
        the responsibilities of the consumer and implications for the 
        consumer in the absence of any such account.
            ``(2) Disclosure requirements.--Any disclosure provided to 
        a consumer under paragraph (1) shall include the following:
                    ``(A) Information concerning any applicable fees or 
                costs associated with either the non-establishment of 
                any such account at the time of the transaction, or any 
                subsequent closure of any such account.
                    ``(B) A clear and prominent notice that the 
                consumer is responsible for personally and directly 
                paying the non-escrowed items, in addition to paying 
                the mortgage loan payment, in the absence of any such 
                account, and the fact that the costs for taxes, 
                insurance, and related fees can be substantial.
                    ``(C) A clear explanation of the consequences of 
                any failure to pay non-escrowed items, including the 
                possible requirement for the forced placement of 
                insurance by the creditor or servicer and the 
                potentially higher cost (including any potential 
                commission payments to the servicer) or reduced 
                coverage for the consumer in the event of any such 
                creditor-placed insurance.''.
    (b) Implementation.--
            (1) Regulations.--The Federal banking agencies and the 
        Federal Trade Commission shall prescribe, in final form, such 
        regulations as such agencies determine to be necessary to 
        implement the amendments made by subsection (a) before the end 
        of the 180-day period beginning on the date of the enactment of 
        this Act.
            (2) Effective date.--The amendments made by subsection (a) 
        shall only apply in accordance with the regulations established 
        in paragraph (1) and beginning on the date occurring 180 days 
        after the date of the publication of final regulations in the 
        Federal Register.

                       TITLE VIII--MORTGAGE FRAUD

SEC. 801. AUTHORIZATION OF APPROPRIATIONS FOR MORTGAGE FRAUD 
              PREVENTION, INVESTIGATION, AND PROSECUTION.

    For fiscal years 2009, 2010, 2011, 2012, and 2013, there are 
authorized to be appropriated to the Attorney General a total of 
$20,000,000, in addition to other amounts authorized to be appropriated 
to the Attorney General for any such fiscal year, for the purpose of 
enhancing the efforts of the Department of Justice and the Federal 
Bureau of Investigation to prevent, investigate, and prosecute mortgage 
fraud.

                     TITLE IX--APPRAISAL ACTIVITIES

SEC. 901. PROPERTY APPRAISAL REQUIREMENTS.

    (a) In General.--Chapter 2 of the Truth in Lending Act (15 U.S.C. 
1631 et seq.) is amended by inserting after section 129A (as added by 
section 701(a)) the following new section:

``SEC. 129B PROVISIONS APPLICABLE TO NONTRADITIONAL MORTGAGES.

    ``(a) Property Appraisal Requirements.--
            ``(1) In general.--A creditor may not extend credit in the 
        form of a subprime mortgage to any consumer without first 
        obtaining a written appraisal of the property to be mortgaged 
        prepared in accordance with the requirements of this 
        subsection.
            ``(2) Appraisal requirements.--
                    ``(A) Physical inspection.--An appraisal of 
                property to be secured by a subprime mortgage does not 
                meet the requirement of this subsection unless it is 
                performed by a qualified appraiser who conducts a 
                physical inspection of the mortgaged property.
                    ``(B) Second appraisal under certain 
                circumstances.--
                            ``(i) In general.--If the purpose of the 
                        subprime mortgage is to finance the purchase or 
                        acquisition of the mortgaged property from a 
                        person within 180 days of the purchase or 
                        acquisition of such property by that person at 
                        a price that was lower than the current sale 
                        price of the property, the creditor shall 
                        obtain a second appraisal from a second 
                        qualified appraiser that supports the current 
                        sale price of the property.
                            ``(ii) No cost to consumer.--The cost of 
                        any second appraisal required under clause (i) 
                        may not be charged to the consumer.
                    ``(C) Qualified appraiser defined.--For purposes of 
                this subsection, the term `qualified appraiser' means a 
                person who--
                            ``(i) is certified or licensed by the State 
                        in which property to be appraised is located; 
                        and
                            ``(ii) performs each appraisal in 
                        conformity with the Uniform Standards of 
                        Professional Appraisal Practice and Title XI of 
                        the Financial Institutions Reform, Recovery, 
                        and Enforcement Act of 1989, and the 
                        regulations prescribed under such title, as in 
                        effect on the date of the appraisal.
            ``(3) Free copy of appraisal.--A creditor shall provide 1 
        copy of each appraisal conducted in accordance with this 
        subsection in connection with a higher-cost mortgage to the 
        consumer without charge.
            ``(4) Violations.--In addition to any other liability to 
        any person under this title, a creditor found to have willfully 
        failed to obtain an appraisal as required in this subsection 
        shall be liable to the consumer for the sum of $2,000.''.
    (b) Clerical Amendment.--The table of sections for chapter 2 of the 
Truth in Lending Act is amended by inserting after the item relating to 
section 129A (as added by section 701(c)) the following new item:

``129B. Provisions applicable to nontraditional mortgages.''.

SEC. 902. AMENDMENTS RELATING TO APPRAISAL SUBCOMMITTEE OF FIEC, 
              APPRAISER INDEPENDENCE, AND APPROVED APPRAISER EDUCATION.

    (a) Annual Report of Appraisal Subcommittee.--Section 1103(a)(4) of 
Financial Institutions Reform, Recovery, and Enforcement Act of 1989 
(12 U.S.C. 3332(a)(4)) is amended by inserting ``in detail the 
activities of the Appraisal Subcommittee and'' after ``which 
describes''.
    (b) Open Meetings.--Section 1104(b) of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3333(b)) is 
amended by inserting ``in public session after notice to the general 
public'' after ``shall meet''.
    (c) Regulations.--Section 1106 of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3335) is 
amended by inserting ``prescribe regulations after notice and 
opportunity for comment,'' after ``hold hearings''.
    (d) Criteria.--Section 1116 of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3345) is amended--
            (1) in subsection (c), by inserting ``whose criteria for 
        the licensing of a real estate appraiser currently meet or 
        exceed the minimum criteria issued by the Appraiser 
        Qualifications Board of The Appraiser Foundation for the 
        licensing of real estate appraisers'' before the period at the 
        end; and
            (2) by striking subsection (e).
    (e) Temporary Practice.--Section 1122(a)(1) of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3351(a)(1)) is amended--
            (1) by striking subparagraph (A);
            (2) by redesignating subparagraphs (B) and (C) as 
        subparagraphs (A) and (B), respectively; and
            (3) by moving the left margin of such subparagraphs 2 ems 
        to the right.
    (f) Reciprocity.--Subsection (b) of section 1122 of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3351(b)) is amended to read as follows:
    ``(b) Reciprocity.--A State appraiser certifying or licensing 
agency shall issue a reciprocal certification or license for an 
individual from another State when--
            ``(1) the appraiser licensing and certification program of 
        such other State is in compliance with the provisions of this 
        title; and
            ``(2) the appraiser holds a valid certification from a 
        State whose requirements for certification or licensing meet 
        the requirements for certification and licensing as established 
        by the Appraiser Qualifications Board of The Appraisal 
        Foundation.''.
    (g) Consideration of Professional Appraisal Designations.--Section 
1122(d) of the Financial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.S.C. 3351(d)) is amended by adding at the end the 
following new sentence: ``Consideration may be given for professional 
appraisal designations conferred by sponsoring organizations of The 
Appraisal Foundation as an indication of proficiency in addition to the 
criteria established by certification or licensing.''.
    (h) Appraiser Independence.--Section 1122 of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3351) is amended by adding at the end the following new subsection:
    ``(g) Appraiser Independence.--
            ``(1) In general.--No mortgage lender, mortgage broker or 
        mortgage banker, real estate broker, nor any other person with 
        an interest in a real estate transaction involving an appraisal 
        shall improperly influence or attempt to improperly influence, 
        through coercion, extortion, or bribery, the development, 
        reporting, result, or review of a real estate appraisal sought 
        in connection with a mortgage loan.
            ``(2) Exceptions.--The requirements of paragraph (1) shall 
        not be construed as prohibiting a mortgage lender, mortgage 
        broker, mortgage banker, real estate broker, 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:
                    ``(A) Consider additional, appropriate property 
                information.
                    ``(B) Provide further detail, substantiation, or 
                explanation for the appraiser's value conclusion.
                    ``(C) Correct errors in the appraisal report.''.
    (i) Appraiser Education.--Section 1122 of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
3351) is amended by inserting after subsection (g) (as added by 
subsection (h) of this section) the following new subsection:
    ``(h) Approved Education.--A State certifying or licensing agency 
shall accept courses and seminars approved by the Appraiser 
Qualification Board's Course Approval Program.''.

SEC. 903. STUDY REQUIRED ON IMPROVEMENTS IN APPRAISAL PROCESS AND 
              COMPLIANCE PROGRAMS.

    (a) Study.--The Comptroller General shall conduct a comprehensive 
study on possible improvements in the appraisal process generally, and 
specifically on the consistency in and the effectiveness of, and 
possible improvements in, State compliance efforts and programs in 
accordance with title XI of Financial Institutions Reform, Recovery, 
and Enforcement Act of 1989.
    (b) Report.--Before the end of the 18-month period beginning on the 
date of the enactment of this Act, the Comptroller General shall submit 
a report on the study under subsection (a) to the Committee on 
Financial Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate, together with such 
recommendations for administrative or legislative action, at the 
Federal or State level, as the Comptroller General may determine to be 
appropriate.

                TITLE X--FEDERAL HOUSING FINANCE REFORM

SEC. 1001. SHORT TITLE.

    This title may be cited as the ``Federal Housing Finance Reform Act 
of 2008''.

SEC. 1002. DEFINITIONS.

    Section 1303 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4502) is amended--
            (1) in paragraph (7), by striking ``an enterprise'' and 
        inserting ``a regulated entity'';
            (2) by striking ``the enterprise'' each place such term 
        appears (except in paragraphs (4) and (18)) and inserting ``the 
        regulated entity'';
            (3) in paragraph (5), by striking ``Office of Federal 
        Housing Enterprise Oversight of the Department of Housing and 
        Urban Development'' and inserting ``Federal Housing Finance 
        Agency'';
            (4) in each of paragraphs (8), (9), (10), and (19), by 
        striking ``Secretary'' each place that term appears and 
        inserting ``Director'';
            (5) in paragraph (13), by inserting ``, with respect to an 
        enterprise,'' after ``means'';
            (6) by redesignating paragraphs (16) through (19) as 
        paragraphs (20) through (23), respectively;
            (7) by striking paragraphs (14) and (15) and inserting the 
        following new paragraphs:
            ``(18) Regulated entity.--The term `regulated entity' 
        means--
                    ``(A) the Federal National Mortgage Association and 
                any affiliate thereof;
                    ``(B) the Federal Home Loan Mortgage Corporation 
                and any affiliate thereof; and
                    ``(C) each Federal home loan bank.
            ``(19) Regulated entity-affiliated party.--The term 
        `regulated entity-affiliated party' means--
                    ``(A) any director, officer, employee, or agent 
                for, a regulated entity, or controlling shareholder of 
                an enterprise;
                    ``(B) any shareholder, affiliate, consultant, or 
                joint venture partner of a regulated entity, and any 
                other person, as determined by the Director (by 
                regulation or on a case-by-case basis) that 
                participates in the conduct of the affairs of a 
                regulated entity, except that a shareholder of a 
                regulated entity shall not be considered to have 
                participated in the affairs of that regulated entity 
                solely by reason of being a member or customer of the 
                regulated entity;
                    ``(C) any independent contractor for a regulated 
                entity (including any attorney, appraiser, or 
                accountant), if--
                            ``(i) the independent contractor knowingly 
                        or recklessly participates in--
                                    ``(I) any violation of any law or 
                                regulation;
                                    ``(II) any breach of fiduciary 
                                duty; or
                                    ``(III) any unsafe or unsound 
                                practice; and
                            ``(ii) such violation, breach, or practice 
                        caused, or is likely to cause, more than a 
                        minimal financial loss to, or a significant 
                        adverse effect on, the regulated entity; and
                    ``(D) any not-for-profit corporation that receives 
                its principal funding, on an ongoing basis, from any 
                regulated entity.'';
            (8) by redesignating paragraphs (8) through (13) as 
        paragraphs (12) through (17), respectively;
            (9) by inserting after paragraph (7) the following new 
        paragraph:
            ``(11) Federal home loan bank.--The term `Federal home loan 
        bank' means a bank established under the authority of the 
        Federal Home Loan Bank Act.'';
            (10) by redesignating paragraphs (2) through (7) as 
        paragraphs (5) through (10), respectively; and
            (11) by inserting after paragraph (1) the following new 
        paragraphs:
            ``(2) Agency.--The term `Agency' means the Federal Housing 
        Finance Agency.
            ``(3) Authorizing statutes.--The term `authorizing 
        statutes' means--
                    ``(A) the Federal National Mortgage Association 
                Charter Act;
                    ``(B) the Federal Home Loan Mortgage Corporation 
                Act; and
                    ``(C) the Federal Home Loan Bank Act.
            ``(4) Board.--The term `Board' means the Federal Housing 
        Enterprise Board established under section 1313B.''.

 Subtitle A--Reform of Regulation of Enterprises and Federal Home Loan 
                                 Banks

             CHAPTER 1--IMPROVEMENT OF SAFETY AND SOUNDNESS

SEC. 1011. ESTABLISHMENT OF THE FEDERAL HOUSING FINANCE AGENCY.

    (a) In General.--The Housing and Community Development Act of 1992 
(12 U.S.C. 4501 et seq.) is amended by striking sections 1311 and 1312 
and inserting the following:

``SEC. 1311. ESTABLISHMENT OF THE FEDERAL HOUSING FINANCE AGENCY.

    ``(a) Establishment.--There is established the Federal Housing 
Finance Agency, which shall be an independent agency of the Federal 
Government.
    ``(b) General Supervisory and Regulatory Authority.--
            ``(1) In general.--Each regulated entity shall, to the 
        extent provided in this title, be subject to the supervision 
        and regulation of the Agency.
            ``(2) Authority over fannie mae, freddie mac, and federal 
        home loan banks.--The Director of the Federal Housing Finance 
        Agency shall have general supervisory and regulatory authority 
        over each regulated entity and shall exercise such general 
        regulatory and supervisory authority, including such duties and 
        authorities set forth under section 1313 of this Act, to ensure 
        that the purposes of this Act, the authorizing statutes, and 
        any other applicable law are carried out. The Director shall 
        have the same supervisory and regulatory authority over any 
        joint office of the Federal home loan banks, including the 
        Office of Finance of the Federal Home Loan Banks, as the 
        Director has over the individual Federal home loan banks.
    ``(c) Savings Provision.--The authority of the Director to take 
actions under subtitles B and C shall not in any way limit the general 
supervisory and regulatory authority granted to the Director.

``SEC. 1312. DIRECTOR.

    ``(a) Establishment of Position.--There is established the position 
of the Director of the Federal Housing Finance Agency, who shall be the 
head of the Agency.
    ``(b) Appointment; Term.--
            ``(1) Appointment.--The Director shall be appointed by the 
        President, by and with the advice and consent of the Senate, 
        from among individuals who are citizens of the United States, 
        have a demonstrated understanding of financial management or 
        oversight, and have a demonstrated understanding of capital 
        markets, including the mortgage securities markets and housing 
        finance.
            ``(2) Term and removal.--The Director shall be appointed 
        for a term of 5 years and may be removed by the President only 
        for cause.
            ``(3) Vacancy.--A vacancy in the position of Director that 
        occurs before the expiration of the term for which a Director 
        was appointed shall be filled in the manner established under 
        paragraph (1), and the Director appointed to fill such vacancy 
        shall be appointed only for the remainder of such term.
            ``(4) Service after end of term.--An individual may serve 
        as the Director after the expiration of the term for which 
        appointed until a successor has been appointed.
            ``(5) Transitional provision.--Notwithstanding paragraphs 
        (1) and (2), the Director of the Office of Federal Housing 
        Enterprise Oversight of the Department of Housing and Urban 
        Development shall serve as the Director until a successor has 
        been appointed under paragraph (1).
    ``(c) Deputy Director of the Division of Enterprise Regulation.--
            ``(1) In general.--The Agency shall have a Deputy Director 
        of the Division of Enterprise Regulation, who shall be 
        appointed by the Director from among individuals who are 
        citizens of the United States, and have a demonstrated 
        understanding of financial management or oversight and of 
        mortgage securities markets and housing finance.
            ``(2) Functions.--The Deputy Director of the Division of 
        Enterprise Regulation shall have such functions, powers, and 
        duties with respect to the oversight of the enterprises as the 
        Director shall prescribe.
    ``(d) Deputy Director of the Division of Federal Home Loan Bank 
Regulation.--
            ``(1) In general.--The Agency shall have a Deputy Director 
        of the Division of Federal Home Loan Bank Regulation, who shall 
        be appointed by the Director from among individuals who are 
        citizens of the United States, have a demonstrated 
        understanding of financial management or oversight and of the 
        Federal Home Loan Bank System and housing finance.
            ``(2) Functions.--The Deputy Director of the Division of 
        Federal Home Loan Bank Regulation shall have such functions, 
        powers, and duties with respect to the oversight of the Federal 
        home loan banks as the Director shall prescribe.
    ``(e) Deputy Director for Housing.--
            ``(1) In general.--The Agency shall have a Deputy Director 
        for Housing, who shall be appointed by the Director from among 
        individuals who are citizens of the United States, and have a 
        demonstrated understanding of the housing markets and housing 
        finance and of community and economic development.
            ``(2) Functions.--The Deputy Director for Housing shall 
        have such functions, powers, and duties with respect to the 
        oversight of the housing mission and goals of the enterprises, 
        and with respect to oversight of the housing finance and 
        community and economic development mission of the Federal home 
        loan banks, as the Director shall prescribe.
    ``(f) Limitations.--The Director and each of the Deputy Directors 
may not--
            ``(1) have any direct or indirect financial interest in any 
        regulated entity or regulated entity-affiliated party;
            ``(2) hold any office, position, or employment in any 
        regulated entity or regulated entity-affiliated party; or
            ``(3) have served as an executive officer or director of 
        any regulated entity, or regulated entity-affiliated party, at 
        any time during the 3-year period ending on the date of 
        appointment of such individual as Director or Deputy Director.
    ``(g) Ombudsman.--The Director shall establish the position of the 
Ombudsman in the Agency. The Director shall provide that the Ombudsman 
will consider complaints and appeals from any regulated entity and any 
person that has a business relationship with a regulated entity and 
shall specify the duties and authority of the Ombudsman.''.
    (b) Appointment of Director.--Notwithstanding any other provision 
of law or of this title, the President may, any time after the date of 
the enactment of this Act, appoint an individual to serve as the 
Director of the Federal Housing Finance Agency, as such office is 
established by the amendment made by subsection (a). This subsection 
shall take effect on the date of the enactment of this Act.

SEC. 1012. DUTIES AND AUTHORITIES OF DIRECTOR.

    (a) In General.--The Housing and Community Development Act of 1992 
(12 U.S.C. 4513) is amended by striking section 1313 and inserting the 
following new sections:

``SEC. 1313. DUTIES AND AUTHORITIES OF DIRECTOR.

    ``(a) Duties.--
            ``(1) Principal duties.--The principal duties of the 
        Director shall be--
                    ``(A) to oversee the operations of each regulated 
                entity and any joint office of the Federal Home Loan 
                Banks; and
                    ``(B) to ensure that--
                            ``(i) each regulated entity operates in a 
                        safe and sound manner, including maintenance of 
                        adequate capital and internal controls;
                            ``(ii) the operations and activities of 
                        each regulated entity foster liquid, efficient, 
                        competitive, and resilient national housing 
                        finance markets that minimize the cost of 
                        housing finance (including activities relating 
                        to mortgages on housing for low- and moderate-
                        income families involving a reasonable economic 
                        return that may be less than the return earned 
                        on other activities);
                            ``(iii) each regulated entity complies with 
                        this title and the rules, regulations, 
                        guidelines, and orders issued under this title 
                        and the authorizing statutes; and
                            ``(iv) each regulated entity carries out 
                        its statutory mission only through activities 
                        that are consistent with this title and the 
                        authorizing statutes.
            ``(2) Scope of authority.--The authority of the Director 
        shall include the authority--
                    ``(A) to review and, if warranted based on the 
                principal duties described in paragraph (1), reject any 
                acquisition or transfer of a controlling interest in an 
                enterprise; and
                    ``(B) to exercise such incidental powers as may be 
                necessary or appropriate to fulfill the duties and 
                responsibilities of the Director in the supervision and 
                regulation of each regulated entity.
    ``(b) Delegation of Authority.--The Director may delegate to 
officers or employees of the Agency, including each of the Deputy 
Directors, any of the functions, powers, or duties of the Director, as 
the Director considers appropriate.
    ``(c) Litigation Authority.--
            ``(1) In general.--In enforcing any provision of this 
        title, any regulation or order prescribed under this title, or 
        any other provision of law, rule, regulation, or order, or in 
        any other action, suit, or proceeding to which the Director is 
        a party or in which the Director is interested, and in the 
        administration of conservatorships and receiverships, the 
        Director may act in the Director's own name and through the 
        Director's own attorneys, or request that the Attorney General 
        of the United States act on behalf of the Director.
            ``(2) Consultation with attorney general.--The Director 
        shall provide notice to, and consult with, the Attorney General 
        of the United States before taking an action under paragraph 
        (1) of this subsection or under section 1344(a), 1345(d), 
        1348(c), 1372(e), 1375(a), 1376(d), or 1379D(c), except that, 
        if the Director determines that any delay caused by such prior 
        notice and consultation may adversely affect the safety and 
        soundness responsibilities of the Director under this title, 
        the Director shall notify the Attorney General as soon as 
        reasonably possible after taking such action.
            ``(3) Subject to suit.--Except as otherwise provided by 
        law, the Director shall be subject to suit (other than suits on 
        claims for money damages) by a regulated entity or director or 
        officer thereof with respect to any matter under this title or 
        any other applicable provision of law, rule, order, or 
        regulation under this title, in the United States district 
        court for the judicial district in which the regulated entity 
        has its principal place of business, or in the United States 
        District Court for the District of Columbia, and the Director 
        may be served with process in the manner prescribed by the 
        Federal Rules of Civil Procedure.

``SEC. 1313A. PRUDENTIAL MANAGEMENT AND OPERATIONS STANDARDS.

    ``(a) Standards.--The Director shall establish standards, by 
regulation, guideline, or order, for each regulated entity relating 
to--
            ``(1) adequacy of internal controls and information 
        systems, including information security and privacy policies 
        and practices, taking into account the nature and scale of 
        business operations;
            ``(2) independence and adequacy of internal audit systems;
            ``(3) management of credit and counterparty risk, including 
        systems to identify concentrations of credit risk and 
        prudential limits to restrict exposure of the regulated entity 
        to a single counterparty or groups of related counterparties;
            ``(4) management of interest rate risk exposure;
            ``(5) management of market risk, including standards that 
        provide for systems that accurately measure, monitor, and 
        control market risks and, as warranted, that establish 
        limitations on market risk;
            ``(6) adequacy and maintenance of liquidity and reserves;
            ``(7) management of any asset and investment portfolio;
            ``(8) investments and acquisitions by a regulated entity, 
        to ensure that they are consistent with the purposes of this 
        Act and the authorizing statutes;
            ``(9) maintenance of adequate records, in accordance with 
        consistent accounting policies and practices that enable the 
        Director to evaluate the financial condition of the regulated 
        entity;
            ``(10) issuance of subordinated debt by that particular 
        regulated entity, as the Director considers necessary;
            ``(11) overall risk management processes, including 
        adequacy of oversight by senior management and the board of 
        directors and of processes and policies to identify, measure, 
        monitor, and control material risks, including reputational 
        risks, and for adequate, well-tested business resumption plans 
        for all major systems with remote site facilities to protect 
        against disruptive events; and
            ``(12) such other operational and management standards as 
        the Director determines to be appropriate.
    ``(b) Failure To Meet Standards.--
            ``(1) Plan requirement.--
                    ``(A) In general.--If the Director determines that 
                a regulated entity fails to meet any standard 
                established under subsection (a)--
                            ``(i) if such standard is established by 
                        regulation, the Director shall require the 
                        regulated entity to submit an acceptable plan 
                        to the Director within the time allowed under 
                        subparagraph (C); and
                            ``(ii) if such standard is established by 
                        guideline, the Director may require the 
                        regulated entity to submit a plan described in 
                        clause (i).
                    ``(B) Contents.--Any plan required under 
                subparagraph (A) shall specify the actions that the 
                regulated entity will take to correct the deficiency. 
                If the regulated entity is undercapitalized, the plan 
                may be a part of the capital restoration plan for the 
                regulated entity under section 1369C.
                    ``(C) Deadlines for submission and review.--The 
                Director shall by regulation establish deadlines that--
                            ``(i) provide the regulated entities with 
                        reasonable time to submit plans required under 
                        subparagraph (A), and generally require a 
                        regulated entity to submit a plan not later 
                        than 30 days after the Director determines that 
                        the entity fails to meet any standard 
                        established under subsection (a); and
                            ``(ii) require the Director to act on plans 
                        expeditiously, and generally not later than 30 
                        days after the plan is submitted.
            ``(2) Required order upon failure to submit or implement 
        plan.--If a regulated entity fails to submit an acceptable plan 
        within the time allowed under paragraph (1)(C), or fails in any 
        material respect to implement a plan accepted by the Director, 
        the following shall apply:
                    ``(A) Required correction of deficiency.--The 
                Director shall, by order, require the regulated entity 
                to correct the deficiency.
                    ``(B) Other authority.--The Director may, by order, 
                take one or more of the following actions until the 
                deficiency is corrected:
                            ``(i) Prohibit the regulated entity from 
                        permitting its average total assets (as such 
                        term is defined in section 1316(b)) during any 
                        calendar quarter to exceed its average total 
                        assets during the preceding calendar quarter, 
                        or restrict the rate at which the average total 
                        assets of the entity may increase from one 
                        calendar quarter to another.
                            ``(ii) Require the regulated entity--
                                    ``(I) in the case of an enterprise, 
                                to increase its ratio of core capital 
                                to assets.
                                    ``(II) in the case of a Federal 
                                home loan bank, to increase its ratio 
                                of total capital (as such term is 
                                defined in section 6(a)(5) of the 
                                Federal Home Loan Bank Act (12 U.S.C. 
                                1426(a)(5))) to assets.
                            ``(iii) Require the regulated entity to 
                        take any other action that the Director 
                        determines will better carry out the purposes 
                        of this section than any of the actions 
                        described in this subparagraph.
            ``(3) Mandatory restrictions.--In complying with paragraph 
        (2), the Director shall take one or more of the actions 
        described in clauses (i) through (iii) of paragraph (2)(B) if--
                    ``(A) the Director determines that the regulated 
                entity fails to meet any standard prescribed under 
                subsection (a);
                    ``(B) the regulated entity has not corrected the 
                deficiency; and
                    ``(C) during the 18-month period before the date on 
                which the regulated entity first failed to meet the 
                standard, the entity underwent extraordinary growth, as 
                defined by the Director.
    ``(c) Other Enforcement Authority Not Affected.--The authority of 
the Director under this section is in addition to any other authority 
of the Director.''.
    (b) Independence in Congressional Testimony and Recommendations.--
Section 111 of Public Law 93-495 (12 U.S.C. 250) is amended by striking 
``the Federal Housing Finance Board'' and inserting ``the Director of 
the Federal Housing Finance Agency''.

SEC. 1013. FEDERAL HOUSING ENTERPRISE BOARD.

    (a) In General.--Title XIII of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4501 et seq.) is amended by 
inserting after section 1313A, as added by section 1002 of this title, 
the following new section:

``SEC. 1313B. FEDERAL HOUSING ENTERPRISE BOARD.

    ``(a) In General.--There is established the Federal Housing 
Enterprise Board, which shall advise the Director with respect to 
overall strategies and policies in carrying out the duties of the 
Director under this title.
    ``(b) Limitations.--The Board may not exercise any executive 
authority, and the Director may not delegate to the Board any of the 
functions, powers, or duties of the Director.
    ``(c) Composition.--The Board shall be comprised of 3 members, of 
whom--
            ``(1) one member shall be the Secretary of the Treasury;
            ``(2) one member shall be the Secretary of Housing and 
        Urban Development; and
            ``(3) one member shall be the Director, who shall serve as 
        the Chairperson of the Board.
    ``(d) Meetings.--
            ``(1) In general.--The Board shall meet upon notice by the 
        Director, but in no event shall the Board meet less frequently 
        than once every 3 months.
            ``(2) Special meetings.--Either the Secretary of the 
        Treasury or the Secretary of Housing and Urban Development may, 
        upon giving written notice to the Director, require a special 
        meeting of the Board.
    ``(e) Testimony.--On an annual basis, the Board shall testify 
before Congress regarding--
            ``(1) the safety and soundness of the regulated entities;
            ``(2) any material deficiencies in the conduct of the 
        operations of the regulated entities;
            ``(3) the overall operational status of the regulated 
        entities;
            ``(4) an evaluation of the performance of the regulated 
        entities in carrying out their respective missions;
            ``(5) operations, resources, and performance of the Agency; 
        and
            ``(6) such other matters relating to the Agency and its 
        fulfillment of its mission, as the Board determines 
        appropriate.''.
    (b) Annual Report of the Director.--Section 1319B(a) of the Housing 
and Community Development Act of 1992 (12 U.S.C. 4521(a)) is amended--
            (1) in paragraph (3), by striking ``and'' at the end; and
            (2) by striking paragraph (4) and inserting the following 
        new paragraphs:
            ``(4) an assessment of the Board or any of its members with 
        respect to--
                    ``(A) the safety and soundness of the regulated 
                entities;
                    ``(B) any material deficiencies in the conduct of 
                the operations of the regulated entities;
                    ``(C) the overall operational status of the 
                regulated entities; and
                    ``(D) an evaluation of the performance of the 
                regulated entities in carrying out their missions;
            ``(5) operations, resources, and performance of the Agency;
            ``(6) a description of the demographic makeup of the 
        workforce of the Agency; and
            ``(7) such other matters relating to the Agency and its 
        fulfillment of its mission.''.

SEC. 1014. AUTHORITY TO REQUIRE REPORTS BY REGULATED ENTITIES.

    Section 1314 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4514) is amended--
            (1) in the section heading, by striking ``enterprises'' and 
        inserting ``regulated entities'';
            (2) in subsection (a)--
                    (A) in the subsection heading, by striking 
                ``Special Reports and Reports of Financial Condition'' 
                and inserting ``Regular and Special Reports'';
                    (B) in paragraph (1)--
                            (i) in the paragraph heading, by striking 
                        ``Financial condition'' and inserting ``Regular 
                        reports''; and
                            (ii) by striking ``reports of financial 
                        condition and operations'' and inserting 
                        ``regular reports on the condition (including 
                        financial condition), management, activities, 
                        or operations of the regulated entity, as the 
                        Director considers appropriate''; and
                    (C) in paragraph (2), after ``submit special 
                reports'' insert ``on any of the topics specified in 
                paragraph (1) or such other topics''; and
            (3) by adding at the end the following new subsection:
    ``(c) Reports of Fraudulent Financial Transactions.--
            ``(1) Requirement to report.--The Director shall require a 
        regulated entity to submit to the Director a timely report upon 
        discovery by the regulated entity that it has purchased or sold 
        a fraudulent loan or financial instrument or suspects a 
        possible fraud relating to a purchase or sale of any loan or 
        financial instrument. The Director shall require the regulated 
        entities to establish and maintain procedures designed to 
        discover any such transactions.
            ``(2) Protection from liability for reports.--
                    ``(A) In general.--If a regulated entity makes a 
                report pursuant to paragraph (1), or a regulated 
                entity-affiliated party makes, or requires another to 
                make, such a report, and such report is made in a good 
                faith effort to comply with the requirements of 
                paragraph (1), such regulated entity or regulated 
                entity-affiliated party shall not be liable to any 
                person under any law or regulation of the United 
                States, any constitution, law, or regulation of any 
                State or political subdivision of any State, or under 
                any contract or other legally enforceable agreement 
                (including any arbitration agreement), for such report 
                or for any failure to provide notice of such report to 
                the person who is the subject of such report or any 
                other person identified in the report.
                    ``(B) Rule of construction.--Subparagraph (A) shall 
                not be construed as creating--
                            ``(i) any inference that the term `person', 
                        as used in such subparagraph, may be construed 
                        more broadly than its ordinary usage so as to 
                        include any government or agency of government; 
                        or
                            ``(ii) any immunity against, or otherwise 
                        affecting, any civil or criminal action brought 
                        by any government or agency of government to 
                        enforce any constitution, law, or regulation of 
                        such government or agency.''.

SEC. 1015. DISCLOSURE OF INCOME AND CHARITABLE CONTRIBUTIONS BY 
              ENTERPRISES.

    Section 1314 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4514), as amended by the preceding provisions of this title, 
is further amended by adding at the end the following new subsections:
    ``(d) Disclosure of Charitable Contributions by Enterprises.--
            ``(1) Required disclosure.--The Director shall, by 
        regulation, require each enterprise to submit a report 
        annually, in a format designated by the Director, containing 
        the following information:
                    ``(A) Total value.--The total value of 
                contributions made by the enterprise to nonprofit 
                organizations during its previous fiscal year.
                    ``(B) Substantial contributions.--If the value of 
                contributions made by the enterprise to any nonprofit 
                organization during its previous fiscal year exceeds 
                the designated amount, the name of that organization 
                and the value of contributions.
                    ``(C) Substantial contributions to insider-
                affiliated charities.--Identification of each 
                contribution whose value exceeds the designated amount 
                that were made by the enterprise during the 
                enterprise's previous fiscal year to any nonprofit 
                organization of which a director, officer, or 
                controlling person of the enterprise, or a spouse 
                thereof, was a director or trustee, the name of such 
                nonprofit organization, and the value of the 
                contribution.
            ``(2) Definitions.--For purposes of this subsection--
                    ``(A) the term `designated amount' means such 
                amount as may be designated by the Director by 
                regulation, consistent with the public interest and the 
                protection of investors for purposes of this 
                subsection; and
                    ``(B) the Director may, by such regulations as the 
                Director deems necessary or appropriate in the public 
                interest, define the terms officer and controlling 
                person.
            ``(3) Public availability.--The Director shall make the 
        information submitted pursuant to this subsection publicly 
        available.
    ``(e) Disclosure of Income.--Each enterprise shall include, in each 
annual report filed under section 13 of the Securities Exchange Act of 
1934 (15 U.S.C. 78m), the income reported by the issuer to the Internal 
Revenue Service for the most recent taxable year. Such income shall--
            ``(1) be presented in a prominent location in each such 
        report and in a manner that permits a ready comparison of such 
        income to income otherwise required to be included in such 
        reports under regulations issued under such section; and
            ``(2) be submitted to the Securities and Exchange 
        Commission in a form and manner suitable for entry into the 
        EDGAR system of such Commission for public availability under 
        such system.''.

SEC. 1016. ASSESSMENTS.

    Section 1316 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4516) is amended--
            (1) by striking subsection (a) and inserting the following 
        new subsection:
    ``(a) Annual Assessments.--The Director shall establish and collect 
from the regulated entities annual assessments in an amount not 
exceeding the amount sufficient to provide for reasonable costs and 
expenses of the Agency, including--
            ``(1) the expenses of any examinations under section 1317 
        of this Act and under section 20 of the Federal Home Loan Bank 
        Act;
            ``(2) the expenses of obtaining any reviews and credit 
        assessments under section 1319;
            ``(3) such amounts in excess of actual expenses for any 
        given year as deemed necessary by the Director to maintain a 
        working capital fund in accordance with subsection (e); and
            ``(4) the wind up of the affairs of the Office of Federal 
        Housing Enterprise Oversight and the Federal Housing Finance 
        Board under title III of the Federal Housing Finance Reform Act 
        of 2008.'';
            (2) in subsection (b)--
                    (A) in the subsection heading, by striking 
                ``Enterprises'' and inserting ``Regulated Entities'';
                    (B) by realigning paragraph (2) two ems from the 
                left margin, so as to align the left margin of such 
                paragraph with the left margins of paragraph (1);
                    (C) in paragraph (1)--
                            (i) by striking ``Each enterprise'' and 
                        inserting ``Each regulated entity'';
                            (ii) by striking ``each enterprise'' and 
                        inserting ``each regulated entity''; and
                            (iii) by striking ``both enterprises'' and 
                        inserting ``all of the regulated entities''; 
                        and
                    (D) in paragraph (3)--
                            (i) in subparagraph (B), by striking 
                        ``subparagraph (A)'' and inserting ``clause 
                        (i)'';
                            (ii) by redesignating subparagraphs (A), 
                        (B), and (C) as clauses (i), (ii) and (ii), 
                        respectively, and realigning such clauses, as 
                        so redesignated, so as to be indented 6 ems 
                        from the left margin;
                            (iii) by striking the matter that precedes 
                        clause (i), as so redesignated, and inserting 
                        the following:
            ``(3) Definition of total assets.--For purposes of this 
        section, the term `total assets' means as follows:
                    ``(A) Enterprises.--With respect to an enterprise, 
                the sum of--''; and
                            (iv) by adding at the end the following new 
                        subparagraph:
                    ``(B) Federal home loan banks.--With respect to a 
                Federal home loan bank, the total assets of the Bank, 
                as determined by the Director in accordance with 
                generally accepted accounting principles.'';
            (3) by striking subsection (c) and inserting the following 
        new subsection:
    ``(c) Increased Costs of Regulation.--
            ``(1) Increase for inadequate capitalization.--The 
        semiannual payments made pursuant to subsection (b) by any 
        regulated entity that is not classified (for purposes of 
        subtitle B) as adequately capitalized may be increased, as 
        necessary, in the discretion of the Director to pay additional 
        estimated costs of regulation of the regulated entity.
            ``(2) Adjustment for enforcement activities.--The Director 
        may adjust the amounts of any semiannual payments for an 
        assessment under subsection (a) that are to be paid pursuant to 
        subsection (b) by a regulated entity, as necessary in the 
        discretion of the Director, to ensure that the costs of 
        enforcement activities under this Act for a regulated entity 
        are borne only by such regulated entity.
            ``(3) Additional assessment for deficiencies.--If at any 
        time, as a result of increased costs of regulation of a 
        regulated entity that is not classified (for purposes of 
        subtitle B) as adequately capitalized or as the result of 
        supervisory or enforcement activities under this Act for a 
        regulated entity, the amount available from any semiannual 
        payment made by such regulated entity pursuant to subsection 
        (b) is insufficient to cover the costs of the Agency with 
        respect to such entity, the Director may make and collect from 
        such regulated entity an immediate assessment to cover the 
        amount of such deficiency for the semiannual period. If, at the 
        end of any semiannual period during which such an assessment is 
        made, any amount remains from such assessment, such remaining 
        amount shall be deducted from the assessment for such regulated 
        entity for the following semiannual period.'';
            (4) in subsection (d), by striking ``If'' and inserting 
        ``Except with respect to amounts collected pursuant to 
        subsection (a)(3), if''; and
            (5) by striking subsections (e) through (g) and inserting 
        the following new subsections:
    ``(e) Working Capital Fund.--At the end of each year for which an 
assessment under this section is made, the Director shall remit to each 
regulated entity any amount of assessment collected from such regulated 
entity that is attributable to subsection (a)(3) and is in excess of 
the amount the Director deems necessary to maintain a working capital 
fund.
    ``(f) Treatment of Assessments.--
            ``(1) Deposit.--Amounts received by the Director from 
        assessments under this section may be deposited by the Director 
        in the manner provided in section 5234 of the Revised Statutes 
        (12 U.S.C. 192) for monies deposited by the Comptroller of the 
        Currency.
            ``(2) Not government funds.--The amounts received by the 
        Director from any assessment under this section shall not be 
        construed to be Government or public funds or appropriated 
        money.
            ``(3) No apportionment of funds.--Notwithstanding any other 
        provision of law, the amounts received by the Director from any 
        assessment under this section shall not be subject to 
        apportionment for the purpose of chapter 15 of title 31, United 
        States Code, or under any other authority.
            ``(4) Use of funds.--The Director may use any amounts 
        received by the Director from assessments under this section 
        for compensation of the Director and other employees of the 
        Agency and for all other expenses of the Director and the 
        Agency.
            ``(5) Availability of oversight fund amounts.--
        Notwithstanding any other provision of law, any amounts 
        remaining in the Federal Housing Enterprises Oversight Fund 
        established under this section (as in effect before the 
        effective date under section 1065 of the Federal Housing 
        Finance Reform Act of 2008), and any amounts remaining from 
        assessments on the Federal Home Loan banks pursuant to section 
        18(b) of the Federal Home Loan Bank Act (12 U.S.C. 1438(b)), 
        shall, upon such effective date, be treated for purposes of 
        this subsection as amounts received from assessments under this 
        section.
            ``(6) Treasury investments.--
                    ``(A) Authority.--The Director may request the 
                Secretary of the Treasury to invest such portions of 
                amount received by the Director from assessments paid 
                under this section that, in the Director's discretion, 
                are not required to meet the current working needs of 
                the Agency.
                    ``(B) Government obligations.--Pursuant to a 
                request under subparagraph (A), the Secretary of the 
                Treasury shall invest such amounts in government 
                obligations guaranteed as to principal and interest by 
                the United States with maturities suitable to the needs 
                of Agency and bearing interest at a rate determined by 
                the Secretary of the Treasury taking into consideration 
                current market yields on outstanding marketable 
                obligations of the United States of comparable 
                maturity.
    ``(g) Budget and Financial Management.--
            ``(1) Financial operating plans and forecasts.--The 
        Director shall provide to the Director of the Office of 
        Management and Budget copies of the Director's financial 
        operating plans and forecasts as prepared by the Director in 
        the ordinary course of the Agency's operations, and copies of 
        the quarterly reports of the Agency's financial condition and 
        results of operations as prepared by the Director in the 
        ordinary course of the Agency's operations.
            ``(2) Financial statements.--The Agency shall prepare 
        annually a statement of assets and liabilities and surplus or 
        deficit; a statement of income and expenses; and a statement of 
        sources and application of funds.
            ``(3) Financial management systems.--The Agency shall 
        implement and maintain financial management systems that comply 
        substantially with Federal financial management systems 
        requirements, applicable Federal accounting standards, and that 
        uses a general ledger system that accounts for activity at the 
        transaction level.
            ``(4) Assertion of internal controls.--The Director shall 
        provide to the Comptroller General an assertion as to the 
        effectiveness of the internal controls that apply to financial 
        reporting by the Agency, using the standards established in 
        section 3512(c) of title 31, United States Code.
            ``(5) Rule of construction.--This subsection may not be 
        construed as implying any obligation on the part of the 
        Director to consult with or obtain the consent or approval of 
        the Director of the Office of Management and Budget with 
        respect to any reports, plans, forecasts, or other information 
        referred to in paragraph (1) or any jurisdiction or oversight 
        over the affairs or operations of the Agency.
    ``(h) Audit of Agency.--
            ``(1) In general.--The Comptroller General shall annually 
        audit the financial transactions of the Agency in accordance 
        with the U.S. generally accepted government auditing standards 
        as may be prescribed by the Comptroller General of the United 
        States. The audit shall be conducted at the place or places 
        where accounts of the Agency are normally kept. The 
        representatives of the Government Accountability Office shall 
        have access to the personnel and to all books, accounts, 
        documents, papers, records (including electronic records), 
        reports, files, and all other papers, automated data, things, 
        or property belonging to or under the control of or used or 
        employed by the Agency pertaining to its financial transactions 
        and necessary to facilitate the audit, and such representatives 
        shall be afforded full facilities for verifying transactions 
        with the balances or securities held by depositories, fiscal 
        agents, and custodians. All such books, accounts, documents, 
        records, reports, files, papers, and property of the Agency 
        shall remain in possession and custody of the Agency. The 
        Comptroller General may obtain and duplicate any such books, 
        accounts, documents, records, working papers, automated data 
        and files, or other information relevant to such audit without 
        cost to the Comptroller General and the Comptroller General's 
        right of access to such information shall be enforceable 
        pursuant to section 716(c) of title 31, United States Code.
            ``(2) Report.--The Comptroller General shall submit to the 
        Congress a report of each annual audit conducted under this 
        subsection. The report to the Congress shall set forth the 
        scope of the audit and shall include the statement of assets 
        and liabilities and surplus or deficit, the statement of income 
        and expenses, the statement of sources and application of 
        funds, and such comments and information as may be deemed 
        necessary to inform Congress of the financial operations and 
        condition of the Agency, together with such recommendations 
        with respect thereto as the Comptroller General may deem 
        advisable. A copy of each report shall be furnished to the 
        President and to the Agency at the time submitted to the 
        Congress.
            ``(3) Assistance and costs.--For the purpose of conducting 
        an audit under this subsection, the Comptroller General may, in 
        the discretion of the Comptroller General, employ by contract, 
        without regard to section 5 of title 41, United States Code, 
        professional services of firms and organizations of certified 
        public accountants for temporary periods or for special 
        purposes. Upon the request of the Comptroller General, the 
        Director of the Agency shall transfer to the Government 
        Accountability Office from funds available, the amount 
        requested by the Comptroller General to cover the full costs of 
        any audit and report conducted by the Comptroller General. The 
        Comptroller General shall credit funds transferred to the 
        account established for salaries and expenses of the Government 
        Accountability Office, and such amount shall be available upon 
        receipt and without fiscal year limitation to cover the full 
        costs of the audit and report.''.

SEC. 1017. EXAMINERS AND ACCOUNTANTS.

    (a) Examinations.--Section 1317 of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4517) is amended--
            (1) in subsection (a), by adding after the period at the 
        end the following: ``Each examination under this subsection of 
        a regulated entity shall include a review of the procedures 
        required to be established and maintained by the regulated 
        entity pursuant to section 1314(c) (relating to fraudulent 
        financial transactions) and the report regarding each such 
        examination shall describe any problems with such procedures 
        maintained by the regulated entity.'';
            (2) in subsection (b)--
                    (A) by inserting ``of a regulated entity'' after 
                ``under this section''; and
                    (B) by striking ``to determine the condition of an 
                enterprise for the purpose of ensuring its financial 
                safety and soundness'' and inserting ``or 
                appropriate''; and
            (3) in subsection (c)--
                    (A) in the second sentence, by inserting ``to 
                conduct examinations under this section'' before the 
                period; and
                    (B) in the third sentence, by striking ``from 
                amounts available in the Federal Housing Enterprises 
                Oversight Fund''.
    (b) Enhanced Authority To Hire Examiners and Accountants.--Section 
1317 of the Housing and Community Development Act of 1992 (12 U.S.C. 
4517) is amended by adding at the end the following new subsection:
    ``(g) Appointment of Accountants, Economists, Specialists, and 
Examiners.--
            ``(1) Applicability.--This section applies with respect to 
        any position of examiner, accountant, specialist in financial 
        markets, specialist in information technology, and economist at 
        the Agency, with respect to supervision and regulation of the 
        regulated entities, that is in the competitive service.
            ``(2) Appointment authority.--The Director may appoint 
        candidates to any position described in paragraph (1)--
                    ``(A) in accordance with the statutes, rules, and 
                regulations governing appointments in the excepted 
                service; and
                    ``(B) notwithstanding any statutes, rules, and 
                regulations governing appointments in the competitive 
                service.
            ``(3) Rule of construction.--The appointment of a candidate 
        to a position under the authority of this subsection shall not 
        be considered to cause such position to be converted from the 
        competitive service to the excepted service.''.
    (c) Repeal.--Section 20 of the Federal Home Loan Bank Act (12 
U.S.C. 1440) is amended--
            (1) by striking the section heading and inserting the 
        following: ``examinations and gao audits'';
            (2) in the third sentence, by striking ``the Board and'' 
        each place such term appears; and
            (3) by striking the first two sentences and inserting the 
        following: ``The Federal home loan banks shall be subject to 
        examinations by the Director to the extent provided in section 
        1317 of the Federal Housing Enterprises Financial Safety and 
        Soundness Act of 1992 (12 U.S.C. 4517).''.

SEC. 1018. PROHIBITION AND WITHHOLDING OF EXECUTIVE COMPENSATION.

    (a) In General.--Section 1318 of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4518) is amended--
            (1) in the section heading, by striking ``of excessive'' 
        and inserting ``and withholding of executive'';
            (2) by redesignating subsection (b) as subsection (d); and
            (3) by inserting after subsection (a) the following new 
        subsections:
    ``(b) Factors.--In making any determination under subsection (a), 
the Director may take into consideration any factors the Director 
considers relevant, including any wrongdoing on the part of the 
executive officer, and such wrongdoing shall include any fraudulent act 
or omission, breach of trust or fiduciary duty, violation of law, rule, 
regulation, order, or written agreement, and insider abuse with respect 
to the regulated entity. The approval of an agreement or contract 
pursuant to section 309(d)(3)(B) of the Federal National Mortgage 
Association Charter Act (12 U.S.C. 1723a(d)(3)(B)) or section 303(h)(2) 
of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
1452(h)(2)) shall not preclude the Director from making any subsequent 
determination under subsection (a).
    ``(c) Withholding of Compensation.--In carrying out subsection (a), 
the Director may require a regulated entity to withhold any payment, 
transfer, or disbursement of compensation to an executive officer, or 
to place such compensation in an escrow account, during the review of 
the reasonableness and comparability of compensation.''.
    (b) Conforming Amendments.--
            (1) Fannie mae.--Section 309(d) of the Federal National 
        Mortgage Association Charter Act (12 U.S.C. 1723a(d)) is 
        amended by adding at the end the following new paragraph:
    ``(4) Notwithstanding any other provision of this section, the 
corporation shall not transfer, disburse, or pay compensation to any 
executive officer, or enter into an agreement with such executive 
officer, without the approval of the Director, for matters being 
reviewed under section 1318 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518).''.
            (2) Freddie mac.--Section 303(h) of the Federal Home Loan 
        Mortgage Corporation Act (12 U.S.C. 1452(h)) is amended by 
        adding at the end the following new paragraph:
    ``(4) Notwithstanding any other provision of this section, the 
Corporation shall not transfer, disburse, or pay compensation to any 
executive officer, or enter into an agreement with such executive 
officer, without the approval of the Director, for matters being 
reviewed under section 1318 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518).''.
            (3) Federal home loan banks.--Section 7 of the Federal Home 
        Loan Bank Act (12 U.S.C. 1427) is amended by adding at the end 
        the following new subsection:
    ``(l) Withholding of Compensation.--Notwithstanding any other 
provision of this section, a Federal home loan bank shall not transfer, 
disburse, or pay compensation to any executive officer, or enter into 
an agreement with such executive officer, without the approval of the 
Director, for matters being reviewed under section 1318 of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 (12 
U.S.C. 4518).''.

SEC. 1019. REVIEWS OF REGULATED ENTITIES.

    Section 1319 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4519) is amended--
            (1) by striking the section designation and heading and 
        inserting the following:

``SEC. 1319. REVIEWS OF REGULATED ENTITIES.'';

        and
            (2) by striking ``is a nationally recognized'' and all that 
        follows through ``1934'' and inserting the following: ``the 
        Director considers appropriate, including an entity that is 
        registered under section 15 of the Securities Exchange Act of 
        1934 (15 U.S.C. 78a) as a nationally registered statistical 
        rating organization''.

SEC. 1020. REGULATIONS AND ORDERS.

    Section 1319G of the Housing and Community Development Act of 1992 
(12 U.S.C. 4526) is amended--
            (1) by striking subsection (a) and inserting the following 
        new subsection:
    ``(a) Authority.--The Director shall issue any regulations, 
guidelines, and orders necessary to carry out the duties of the 
Director under this title and each of the authorizing statutes to 
ensure that the purposes of this title and such statutes are 
accomplished.'';
            (2) in subsection (b), by inserting ``, this title, or any 
        of the authorizing statutes'' after ``under this section''; and
            (3) by striking subsection (c).

SEC. 1021. NON-WAIVER OF PRIVILEGES.

    Part 1 of subtitle A of title XIII of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4511) is amended by adding at the 
end the following new section:

``SEC. 1319H. PRIVILEGES NOT AFFECTED BY DISCLOSURE.

    ``(a) In General.--The submission by any person of any information 
to the Agency for any purpose in the course of any supervisory or 
regulatory process of the Agency shall not be construed as waiving, 
destroying, or otherwise affecting any privilege such person may claim 
with respect to such information under Federal or State law as to any 
person or entity other than the Agency.
    ``(b) Rule of Construction.--No provision of subsection (a) may be 
construed as implying or establishing that--
            ``(1) any person waives any privilege applicable to 
        information that is submitted or transferred under any 
        circumstance to which subsection (a) does not apply; or
            ``(2) any person would waive any privilege applicable to 
        any information by submitting the information to the Agency, 
        but for this subsection.''.

SEC. 1022. RISK-BASED CAPITAL REQUIREMENTS.

    (a) In General.--Section 1361 of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4611) is amended to read as follows:

``SEC. 1361. RISK-BASED CAPITAL LEVELS FOR REGULATED ENTITIES.

    ``(a) In General.--
            ``(1) Enterprises.--The Director shall, by regulation, 
        establish risk-based capital requirements for the enterprises 
        to ensure that the enterprises operate in a safe and sound 
        manner, maintaining sufficient capital and reserves to support 
        the risks that arise in the operations and management of the 
        enterprises.
            ``(2) Federal home loan banks.--The Director shall 
        establish risk-based capital standards under section 6 of the 
        Federal Home Loan Bank Act for the Federal home loan banks.
    ``(b) Confidentiality of Information.--Any person that receives any 
book, record, or information from the Director or a regulated entity to 
enable the risk-based capital requirements established under this 
section to be applied shall--
            ``(1) maintain the confidentiality of the book, record, or 
        information in a manner that is generally consistent with the 
        level of confidentiality established for the material by the 
        Director or the regulated entity; and
            ``(2) be exempt from section 552 of title 5, United States 
        Code, with respect to the book, record, or information.
    ``(c) No Limitation.--Nothing in this section shall limit the 
authority of the Director to require other reports or undertakings, or 
take other action, in furtherance of the responsibilities of the 
Director under this Act.''.
    (b) Federal Home Loan Banks Risk-Based Capital.--Section 6(a)(3) of 
the Federal Home Loan Bank Act (12 U.S.C. 1426(a)(3)) is amended--
            (1) by striking subparagraph (A) and inserting the 
        following new subparagraph:
                    ``(A) Risk-based capital standards.--The Director 
                shall, by regulation, establish risk-based capital 
                standards for the Federal home loan banks to ensure 
                that the Federal home loan banks operate in a safe and 
                sound manner, with sufficient permanent capital and 
                reserves to support the risks that arise in the 
                operations and management of the Federal home loans 
                banks.''; and
            (2) in subparagraph (B), by striking ``(A)(ii)'' and 
        inserting ``(A)''.

SEC. 1023. MINIMUM AND CRITICAL CAPITAL LEVELS.

    (a) Minimum Capital Level.--Section 1362 of the Housing and 
Community Development Act of 1992 (12 U.S.C. 4612) is amended--
            (1) in subsection (a), by striking ``In General'' and 
        inserting ``Enterprises''; and
            (2) by striking subsection (b) and inserting the following 
        new subsections:
    ``(b) Federal Home Loan Banks.--For purposes of this subtitle, the 
minimum capital level for each Federal home loan bank shall be the 
minimum capital required to be maintained to comply with the leverage 
requirement for the bank established under section 6(a)(2) of the 
Federal Home Loan Bank Act (12 U.S.C. 1426(a)(2)).
    ``(c) Establishment of Revised Minimum Capital Levels.--
Notwithstanding subsections (a) and (b) and notwithstanding the capital 
classifications of the regulated entities, the Director may, by 
regulations issued under section 1319G, establish a minimum capital 
level for the enterprises, for the Federal home loan banks, or for both 
the enterprises and the banks, that is higher than the level specified 
in subsection (a) for the enterprises or the level specified in 
subsection (b) for the Federal home loan banks, to the extent needed to 
ensure that the regulated entities operate in a safe and sound manner.
    ``(d) Authority To Require Temporary Increase.--Notwithstanding 
subsections (a) and (b) and any minimum capital level established 
pursuant to subsection (c), the Director may, by order, increase the 
minimum capital level for a regulated entity on a temporary basis for 
such period as the Director may provide if the Director--
            ``(1) makes any determination specified in subparagraphs 
        (A) through (C) of section 1364(c)(1);
            ``(2) determines that the regulated entity has violated any 
        of the prudential standards established pursuant to section 
        1313A and, as a result of such violation, determines that an 
        unsafe and unsound condition exists; or
            ``(3) determines that an unsafe and unsound condition 
        exists, except that a temporary increase in minimum capital 
        imposed on a regulated entity pursuant to this paragraph shall 
        not remain in place for a period of more than 6 months unless 
        the Director makes a renewed determination of the existence of 
        an unsafe and unsound condition.
    ``(e) Authority To Establish Additional Capital and Reserve 
Requirements for Particular Programs.--The Director may, at any time by 
order or regulation, establish such capital or reserve requirements 
with respect to any program or activity of a regulated entity as the 
Director considers appropriate to ensure that the regulated entity 
operates in a safe and sound manner, with sufficient capital and 
reserves to support the risks that arise in the operations and 
management of the regulated entity.
    ``(f) Periodic Review.--The Director shall periodically review the 
amount of core capital maintained by the enterprises, the amount of 
capital retained by the Federal home loan banks, and the minimum 
capital levels established for such regulated entities pursuant to this 
section. The Director shall rescind any temporary minimum capital level 
increase if the Director determines that the circumstances or facts 
justifying the temporary increase are no longer present.''.
    (b) Critical Capital Levels.--
            (1) In general.--Section 1363 of the Housing and Community 
        Development Act of 1992 (12 U.S.C. 4613) is amended--
                    (A) by striking ``For'' and inserting ``(a) 
                Enterprises.--For''; and
                    (B) by adding at the end the following new 
                subsection:
    ``(b) Federal Home Loan Banks.--
            ``(1) In general.--For purposes of this subtitle, the 
        critical capital level for each Federal home loan bank shall be 
        such amount of capital as the Director shall, by regulation 
        require.
            ``(2) Consideration of other critical capital levels.--In 
        establishing the critical capital level under paragraph (1) for 
        the Federal home loan banks, the Director shall take due 
        consideration of the critical capital level established under 
        subsection (a) for the enterprises, with such modifications as 
        the Director determines to be appropriate to reflect the 
        difference in operations between the banks and the 
        enterprises.''.
            (2) Regulations.--Not later than the expiration of the 180-
        day period beginning on the effective date under section 1065, 
        the Director of the Federal Housing Finance Agency shall issue 
        regulations pursuant to section 1363(b) of the Housing and 
        Community Development Act of 1992 (as added by paragraph (1) of 
        this subsection) establishing the critical capital level under 
        such section.

SEC. 1024. REVIEW OF AND AUTHORITY OVER ENTERPRISE ASSETS AND 
              LIABILITIES.

    (a) In General.--Subtitle B of title XIII of the Housing and 
Community Development Act of 1992 (12 U.S.C. 4611 et seq.) is amended--
            (1) by striking the subtitle designation and heading and 
        inserting the following:

 ``Subtitle B--Required Capital Levels for Regulated Entities, Special 
      Enforcement Powers, and Reviews of Assets and Liabilities'';

        and
            (2) by adding at the end the following new section:

``SEC. 1369E. REVIEWS OF ENTERPRISE ASSETS AND LIABILITIES.

    ``(a) In General.--The Director shall, by regulation, establish 
standards by which the portfolio holdings, or rate of growth of the 
portfolio holdings, of the enterprises will be deemed to be consistent 
with the mission and the safe and sound operations of the enterprises. 
In developing such standards, the Director shall consider--
            ``(1) the size or growth of the mortgage market;
            ``(2) the need for the portfolio in maintaining liquidity 
        or stability of the secondary mortgage market (including the 
        market for the mortgage-backed securities the enterprises 
        issue);
            ``(3) the need for an inventory of mortgages in connection 
        with securitizations;
            ``(4) the need for the portfolio to directly support the 
        affordable housing mission of the enterprises;
            ``(5) the liquidity needs of the enterprises;
            ``(6) any potential risks posed to the enterprises by the 
        nature of the portfolio holdings; and
            ``(7) any additional factors that the Director determines 
        to be necessary to carry out the purpose under the first 
        sentence of this subsection to establish standards for 
        assessing whether the portfolio holdings are consistent with 
        the mission and safe and sound operations of the enterprises.
    ``(b) Temporary Adjustments.--The Director may, by order, make 
temporary adjustments to the established standards for an enterprise or 
both enterprises, such as during times of economic distress or market 
disruption.
    ``(c) Authority To Require Disposition or Acquisition.--The 
Director shall monitor the portfolio of each enterprise. Pursuant to 
subsection (a) and notwithstanding the capital classifications of the 
enterprises, the Director may, by order, require an enterprise, under 
such terms and conditions as the Director determines to be appropriate, 
to dispose of or acquire any asset, if the Director determines that 
such action is consistent with the purposes of this Act or any of the 
authorizing statutes.''.
    (b) Regulations.--Not later than the expiration of the 180-day 
period beginning on the effective date under section 1065, the Director 
of the Federal Housing Finance Agency shall issue regulations pursuant 
to section 1369E(a) of the Housing and Community Development Act of 
1992 (as added by subsection (a) of this section) establishing the 
portfolio holdings standards under such section.

SEC. 1025. CORPORATE GOVERNANCE OF ENTERPRISES.

    The Housing and Community Development Act of 1992 is amended by 
inserting before section 1323 (12 U.S.C. 4543) the following new 
section:

``SEC. 1322A. CORPORATE GOVERNANCE OF ENTERPRISES.

    ``(a) Board of Directors.--
            ``(1) Independence.--A majority of seated members of the 
        board of directors of each enterprise shall be independent 
        board members, as defined under rules set forth by the New York 
        Stock Exchange, as such rules may be amended from time to time.
            ``(2) Frequency of meetings.--To carry out its obligations 
        and duties under applicable laws, rules, regulations, and 
        guidelines, the board of directors of an enterprise shall meet 
        at least eight times a year and not less than once a calendar 
        quarter.
            ``(3) Non-management board member meetings.--The non-
        management directors of an enterprise shall meet at regularly 
        scheduled executive sessions without management participation.
            ``(4) Quorum; prohibition on proxies.--For the transaction 
        of business, a quorum of the board of directors of an 
        enterprise shall be at least a majority of the seated board of 
        directors and a board member may not vote by proxy.
            ``(5) Information.--The management of an enterprise shall 
        provide a board member of the enterprise with such adequate and 
        appropriate information that a reasonable board member would 
        find important to the fulfillment of his or her fiduciary 
        duties and obligations.
            ``(6) Annual review.--At least annually, the board of 
        directors of each enterprise shall review, with appropriate 
        professional assistance, the requirements of laws, rules, 
        regulations, and guidelines that are applicable to its 
        activities and duties.
    ``(b) Committees of Boards of Directors.--
            ``(1) Frequency of meetings.--Any committee of the board of 
        directors of an enterprise shall meet with sufficient frequency 
        to carry out its obligations and duties under applicable laws, 
        rules, regulations, and guidelines.
            ``(2) Required committees.--Each enterprise shall provide 
        for the establishment, however styled, of the following 
        committees of the board of directors:
                    ``(A) Audit committee.
                    ``(B) Compensation committee.
                    ``(C) Nominating/corporate governance committee.
        Such committees shall be in compliance with the charter, 
        independence, composition, expertise, duties, responsibilities, 
        and other requirements set forth under section 10A(m) of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78j-1(m)), with 
        respect to the audit committee, and under rules issued by the 
        New York Stock Exchange, as such rules may be amended from time 
        to time.
    ``(c) Compensation.--
            ``(1) In general.--The compensation of board members, 
        executive officers, and employees of an enterprise--
                    ``(A) shall not be in excess of that which is 
                reasonable and appropriate;
                    ``(B) shall be commensurate with the duties and 
                responsibilities of such persons;
                    ``(C) shall be consistent with the long-term goals 
                of the enterprise;
                    ``(D) shall not focus solely on earnings 
                performance, but shall take into account risk 
                management, operational stability and legal and 
                regulatory compliance as well; and
                    ``(E) shall be undertaken in a manner that complies 
                with applicable laws, rules, and regulations.
            ``(2) Reimbursement.--If an enterprise is required to 
        prepare an accounting restatement due to the material 
        noncompliance of the enterprise, as a result of misconduct, 
        with any financial reporting requirement under the securities 
        laws, the chief executive officer and chief financial officer 
        of the enterprise shall reimburse the enterprise as provided 
        under section 304 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
        7243). This provision does not otherwise limit the authority of 
        the Agency to employ remedies available to it under its 
        enforcement authorities.
    ``(d) Code of Conduct and Ethics.--
            ``(1) In general.--An enterprise shall establish and 
        administer a written code of conduct and ethics that is 
        reasonably designed to assure the ability of board members, 
        executive officers, and employees of the enterprise to 
        discharge their duties and responsibilities, on behalf of the 
        enterprise, in an objective and impartial manner, and that 
        includes standards required under section 406 of the Sarbanes-
        Oxley Act of 2002 (15 U.S.C. 7264) and other applicable laws, 
        rules, and regulations.
            ``(2) Review.--Not less than once every three years, an 
        enterprise shall review the adequacy of its code of conduct and 
        ethics for consistency with practices appropriate to the 
        enterprise and make any appropriate revisions to such code.
    ``(e) Conduct and Responsibilities of Board of Directors.--The 
board of directors of an enterprise shall be responsible for directing 
the conduct and affairs of the enterprise in furtherance of the safe 
and sound operation of the enterprise and shall remain reasonably 
informed of the condition, activities, and operations of the 
enterprise. The responsibilities of the board of directors shall 
include having in place adequate policies and procedures to assure its 
oversight of, among other matters, the following:
            ``(1) Corporate strategy, major plans of action, risk 
        policy, programs for legal and regulatory compliance and 
        corporate performance, including prudent plans for growth and 
        allocation of adequate resources to manage operations risk.
            ``(2) Hiring and retention of qualified executive officers 
        and succession planning for such executive officers.
            ``(3) Compensation programs of the enterprise.
            ``(4) Integrity of accounting and financial reporting 
        systems of the enterprise, including independent audits and 
        systems of internal control.
            ``(5) Process and adequacy of reporting, disclosures, and 
        communications to shareholders, investors, and potential 
        investors.
            ``(6) Extensions of credit to board members and executive 
        officers.
            ``(7) Responsiveness of executive officers in providing 
        accurate and timely reports to Federal regulators and in 
        addressing the supervisory concerns of Federal regulators in a 
        timely and appropriate manner.
    ``(f) Prohibition of Extensions of Credit.--An enterprise may not 
directly or indirectly, including through any subsidiary, extend or 
maintain credit, arrange for the extension of credit, or renew an 
extension of credit, in the form of a personal loan to or for any board 
member or executive officer of the enterprise, as provided by section 
13(k) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(k)).
    ``(g) Certification of Disclosures.--The chief executive officer 
and the chief financial officer of an enterprise shall review each 
quarterly report and annual report issued by the enterprise and such 
reports shall include certifications by such officers as required by 
section 302 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7241).
    ``(h) Change of Audit Partner.--An enterprise may not accept audit 
services from an external auditing firm if the lead or coordinating 
audit partner who has primary responsibility for the external audit of 
the enterprise, or the external audit partner who has responsibility 
for reviewing the external audit has performed audit services for the 
enterprise in each of the five previous fiscal years.
    ``(i) Compliance Program.--
            ``(1) Requirement.--Each enterprise shall establish and 
        maintain a compliance program that is reasonably designed to 
        assure that the enterprise complies with applicable laws, 
        rules, regulations, and internal controls.
            ``(2) Compliance officer.--The compliance program of an 
        enterprise shall be headed by a compliance officer, however 
        styled, who reports directly to the chief executive officer of 
        the enterprise. The compliance officer shall report regularly 
        to the board of directors or an appropriate committee of the 
        board of directors on compliance with and the adequacy of 
        current compliance policies and procedures of the enterprise, 
        and shall recommend any adjustments to such policies and 
        procedures that the compliance officer considers necessary and 
        appropriate.
    ``(j) Risk Management Program.--
            ``(1) Requirement.--Each enterprise shall establish and 
        maintain a risk management program that is reasonably designed 
        to manage the risks of the operations of the enterprise.
            ``(2) Risk management officer.--The risk management program 
        of an enterprise shall be headed by a risk management officer, 
        however styled, who reports directly to the chief executive 
        officer of the enterprise. The risk management officer shall 
        report regularly to the board of directors or an appropriate 
        committee of the board of directors on compliance with and the 
        adequacy of current risk management policies and procedures of 
        the enterprise, and shall recommend any adjustments to such 
        policies and procedures that the risk management officer 
        considers necessary and appropriate.
    ``(k) Compliance With Other Laws.--
            ``(1) Deregistered or unregistered common stock.--If an 
        enterprise deregisters or has not registered its common stock 
        with the Securities and Exchange Commission under the 
        Securities Exchange Act of 1934, the enterprise shall comply or 
        continue to comply with sections 10A(m) and 13(k) of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78j-1(m), 78m(k)) 
        and sections 302, 304, and 406 of the Sarbanes-Oxley Act of 
        2002 (15 U.S.C. 7241, 7243, 7264), subject to such requirements 
        as provided by subsection (l) of this section.
            ``(2) Registered common stock.--An enterprise that has its 
        common stock registered with the Securities and Exchange 
        Commission shall maintain such registered status, unless it 
        provides 60 days prior written notice to the Director stating 
        its intent to deregister and its understanding that it will 
        remain subject to the requirements of the sections of the 
        Securities Exchange Act of 1934 and the Sarbanes-Oxley Act of 
        2002, subject to such requirements as provided by subsection 
        (l) of this section.
    ``(l) Other Matters.--The Director may from time to time establish 
standards, by regulation, order, or guideline, regarding such other 
corporate governance matters of the enterprises as the Director 
considers appropriate.
    ``(m) Modification of Standards.--In connection with standards of 
Federal or State law (including the Revised Model Corporation Act) or 
New York Stock Exchange rules that are made applicable to an enterprise 
by section 1710.10 of the Director's rules (12 C.F.R. 1710.10) and by 
subsections (a), (b), (g), (i), (j), and (k) of this section, the 
Director, in the Director's sole discretion, may modify the standards 
contained in this section or in part 1710 of the Director's rules (12 
C.F.R. Part 1710) in accordance with section 553 of title 5, United 
States Code, and upon written notice to the enterprise.''.

SEC. 1026. REQUIRED REGISTRATION UNDER SECURITIES EXCHANGE ACT OF 1934.

    The Housing and Community Development Act of 1992 is amended by 
adding after section 1322A, as added by the preceding provisions of 
this title, the following new section:

``SEC. 1322B. REQUIRED REGISTRATION UNDER SECURITIES EXCHANGE ACT OF 
              1934.

    ``(a) In General.--Each regulated entity shall register at least 
one class of the capital stock of such regulated entity, and maintain 
such registration with the Securities and Exchange Commission, under 
the Securities Exchange Act of 1934.
    ``(b) Enterprises.--Each enterprise shall comply with sections 14 
and 16 of the Securities Exchange Act of 1934.''.

SEC. 1027. LIAISON WITH FINANCIAL INSTITUTIONS EXAMINATION COUNCIL.

    Section 1007 of the Federal Financial Institutions Examination 
Council Act of 1978 (12 U.S.C. 3306) is amended--
            (1) in the section heading, by inserting after ``state'' 
        the following: ``and federal housing finance agency''; and
            (2) by inserting after ``financial institutions'' the 
        following: ``, and one representative of the Federal Housing 
        Finance Agency,''.

SEC. 1028. GUARANTEE FEE STUDY.

    (a) In General.--The Director of the Federal Housing Finance 
Agency, in consultation with the heads of the federal banking agencies, 
shall, not later than 18 months after the date of the enactment of this 
Act, submit to the Congress a study concerning the pricing, 
transparency and reporting of the Federal National Mortgage 
Association, the Federal Home Loan Mortgage Corporation, and the 
Federal home loan banks with regard to guarantee fees and concerning 
analogous practices, transparency and reporting requirements (including 
advances pricing practices by the Federal Home Loan Banks) of other 
participants in the business of mortgage purchases and securitization.
    (b) Factors.--The study required by this section shall examine 
various factors such as credit risk, counterparty risk considerations, 
economic value considerations, and volume considerations used by the 
regulated entities (as such term is defined in section 1303 of the 
Housing and Community Development Act of 1992) included in the study in 
setting the amount of fees they charge.
    (c) Contents of Report.--The report required under subsection (a) 
shall identify and analyze--
            (1) the factors used by each enterprise (as such term is 
        defined in section 1303 of the Housing and Community 
        Development Act of 1992) in determining the amount of the 
        guarantee fees it charges;
            (2) the total revenue the enterprises earn from guarantee 
        fees;
            (3) the total costs incurred by the enterprises for 
        providing guarantees;
            (4) the average guarantee fee charged by the enterprises;
            (5) an analysis of how and why the guarantee fees charged 
        differ from such fees charged during the previous year;
            (6) a breakdown of the revenue and costs associated with 
        providing guarantees, based on product type and risk 
        classifications; and
            (7) other relevant information on guarantee fees with other 
        participants in the mortgage and securitization business.
    (d) Protection of Information.--Nothing in this section may be 
construed to require or authorize the Director of the Federal Housing 
Finance Agency, in connection with the study mandated by this section, 
to disclose information of the enterprises or other organization that 
is confidential or proprietary.
    (e) Effective Date.--This section shall take effect on the date of 
the enactment of this Act.

SEC. 1029. CONFORMING AMENDMENTS.

    (a) 1992 Act.--Part 1 of subtitle A of title XIII of the Housing 
and Community Development Act of 1992 (12 U.S.C. 4511 et seq.), as 
amended by the preceding provisions of this title, is further amended--
            (1) by striking ``an enterprise'' each place such term 
        appears in such part (except in sections 1313(a)(2)(A), 
        1313A(b)(2)(B)(ii)(I), and 1316(b)(3)) and inserting ``a 
        regulated entity'';
            (2) by striking ``the enterprise'' each place such term 
        appears in such part (except in section 1316(b)(3)) and 
        inserting ``the regulated entity'';
            (3) by striking ``the enterprises'' each place such term 
        appears in such part (except in sections 1312(c)(2), and 
        1312(e)(2)) and inserting ``the regulated entities'';
            (4) by striking ``each enterprise'' each place such term 
        appears in such part and inserting ``each regulated entity'';
            (5) by striking ``Office'' each place such term appears in 
        such part (except in sections 1311(b)(2), 1312(b)(5), 1315(b), 
        and 1316(a)(4), (g), and (h), 1317(c), and 1319A(a)) and 
        inserting ``Agency'';
            (6) in section 1315 (12 U.S.C. 4515)--
                    (A) in subsection (a)--
                            (i) in the subsection heading, by striking 
                        ``Office Personnel'' and inserting ``In 
                        General''; and
                            (ii) by striking ``The'' and inserting 
                        ``Subject to title III of the Federal Housing 
                        Finance Reform Act of 2008, the'';
                    (B) by striking subsections (d) and (f); and
                    (C) by redesignating subsection (e) as subsection 
                (d);
            (7) in section 1319B (12 U.S.C. 4521), by striking 
        ``Committee on Banking, Finance and Urban Affairs'' each place 
        such term appears and inserting ``Committee on Financial 
        Services''; and
            (8) in section 1319F (12 U.S.C. 4525), striking all that 
        follows ``United States Code'' and inserting ``, the Agency 
        shall be considered an agency responsible for the regulation or 
        supervision of financial institutions.''.
    (b) Amendments to Fannie Mae Charter Act.--The Federal National 
Mortgage Association Charter Act (12 U.S.C. 1716 et seq.) is amended--
            (1) by striking ``Director of the Office of Federal Housing 
        Enterprise Oversight of the Department of Housing and Urban 
        Development'' each place such term appears, and inserting 
        ``Director of the Federal Housing Finance Agency'', in--
                    (A) section 303(c)(2) (12 U.S.C. 1718(c)(2));
                    (B) section 309(d)(3)(B) (12 U.S.C. 
                1723a(d)(3)(B)); and
                    (C) section 309(k)(1); and
            (2) in section 309--
                    (A) in subsections (d)(3)(A) and (n)(1), by 
                striking ``Banking, Finance and Urban Affairs'' each 
                place such term appears and inserting ``Financial 
                Services''; and
                    (B) in subsection (m)--
                            (i) in paragraph (1), by striking 
                        ``Secretary'' the second place such term 
                        appears and inserting ``Director'';
                            (ii) in paragraph (2), by striking 
                        ``Secretary'' the second place such term 
                        appears and inserting ``Director''; and
                            (iii) by striking ``Secretary'' each other 
                        place such term appears and inserting 
                        ``Director of the Federal Housing Finance 
                        Agency''; and
                    (C) in subsection (n), by striking ``Secretary'' 
                each place such term appears and inserting ``Director 
                of the Federal Housing Finance Agency''.
    (c) Amendments to Freddie Mac Act.--The Federal Home Loan Mortgage 
Corporation Act is amended--
            (1) by striking ``Director of the Office of Federal Housing 
        Enterprise Oversight of the Department of Housing and Urban 
        Development'' each place such term appears, and inserting 
        ``Director of the Federal Housing Finance Agency'', in--
                    (A) section 303(b)(2) (12 U.S.C. 1452(b)(2));
                    (B) section 303(h)(2) (12 U.S.C. 1452(h)(2)); and
                    (C) section 307(c)(1) (12 U.S.C. 1456(c)(1));
            (2) in sections 303(h)(1) and 307(f)(1) (12 U.S.C. 
        1452(h)(1), 1456(f)(1)), by striking ``Banking, Finance and 
        Urban Affairs'' each place such term appears and inserting 
        ``Financial Services'';
            (3) in section 306(i) (12 U.S.C. 1455(i))--
                    (A) by striking ``1316(c)'' and inserting 
                ``306(c)''; and
                    (B) by striking ``section 106'' and inserting 
                ``section 1316''; and
            (4) in section 307 (12 U.S.C. 1456)--
                    (A) in subsection (e)--
                            (i) in paragraph (1), by striking 
                        ``Secretary'' the second place such term 
                        appears and inserting ``Director'';
                            (ii) in paragraph (2), by striking 
                        ``Secretary'' the second place such term 
                        appears and inserting ``Director''; and
                            (iii) by striking ``Secretary'' each other 
                        place such term appears and inserting 
                        ``Director of the Federal Housing Finance 
                        Agency''; and
                    (B) in subsection (f), by striking ``Secretary'' 
                each place such term appears and inserting ``Director 
                of the Federal Housing Finance Agency''.

             CHAPTER 2--IMPROVEMENT OF MISSION SUPERVISION

SEC. 1031. TRANSFER OF PRODUCT APPROVAL AND HOUSING GOAL OVERSIGHT.

    Part 2 of subtitle A of title XIII of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4541 et seq.) is amended--
            (1) by striking the designation and heading for the part 
        and inserting the following:

   ``PART 2--PRODUCT APPROVAL BY DIRECTOR, CORPORATE GOVERNANCE, AND 
                   ESTABLISHMENT OF HOUSING GOALS'';

        and
            (2) by striking sections 1321 and 1322.

SEC. 1032. REVIEW OF ENTERPRISE PRODUCTS.

    (a) In General.--Part 2 of subtitle A of title XIII of the Housing 
and Community Development Act of 1992 is amended by inserting before 
section 1323 (12 U.S.C. 4543) the following new section:

``SEC. 1321. PRIOR APPROVAL AUTHORITY FOR PRODUCTS OF ENTERPRISES.

    ``(a) In General.--The Director shall require each enterprise to 
obtain the approval of the Director for any product of the enterprise 
before initially offering the product.
    ``(b) Standard for Approval.--In considering any request for 
approval of a product pursuant to subsection (a), the Director shall 
make a determination that--
            ``(1) in the case of a product of the Federal National 
        Mortgage Association, the Director determines that the product 
        is authorized under paragraph (2), (3), (4), or (5) of section 
        302(b) or section 304 of the Federal National Mortgage 
        Association Charter Act (12 U.S.C. 1717(b), 1719);
            ``(2) in the case of a product of the Federal Home Loan 
        Mortgage Corporation, the Director determines that the product 
        is authorized under paragraph (1), (4), or (5) of section 
        305(a) of the Federal Home Loan Mortgage Corporation Act (12 
        U.S.C. 1454(a));
            ``(3) the product is in the public interest;
            ``(4) the product is consistent with the safety and 
        soundness of the enterprise or the mortgage finance system; and
            ``(5) the product does not materially impair the efficiency 
        of the mortgage finance system.
    ``(c) Procedure for Approval.--
            ``(1) Submission of request.--An enterprise shall submit to 
        the Director a written request for approval of a product that 
        describes the product in such form as prescribed by order or 
        regulation of the Director.
            ``(2) Request for public comment.--Immediately upon receipt 
        of a request for approval of a product, as required under 
        paragraph (1), the Director shall publish notice of such 
        request and of the period for public comment pursuant to 
        paragraph (3) regarding the product, and a description of the 
        product proposed by the request. The Director shall give 
        interested parties the opportunity to respond in writing to the 
        proposed product.
            ``(3) Public comment period.--During the 30-day period 
        beginning on the date of publication pursuant to paragraph (2) 
        of a request for approval of a product, the Director shall 
        receive public comments regarding the proposed product.
            ``(4) Offering of product.--
                    ``(A) In general.--Not later than 30 days after the 
                close of the public comment period described in 
                paragraph (3), the Director shall approve or deny the 
                product, specifying the grounds for such decision in 
                writing.
                    ``(B) Failure to act.--If the Director fails to act 
                within the 30-day period described in subparagraph (A), 
                the enterprise may offer the product.
    ``(d) Expedited Review.--
            ``(1) Determination and notice.--If an enterprise 
        determines that any new activity, service, undertaking, or 
        offering is not a product, as defined in subsection (f), the 
        enterprise shall provide written notice to the Director prior 
        to the commencement of such activity, service, undertaking, or 
        offering.
            ``(2) Director determination of applicable procedure.--
        Immediately upon receipt of any notice pursuant to paragraph 
        (1), the Director shall make a determination under paragraph 
        (3).
            ``(3) Determination and treatment as product.--If the 
        Director determines that any new activity, service, 
        undertaking, or offering consists of, relates to, or involves a 
        product--
                    ``(A) the Director shall notify the enterprise of 
                the determination;
                    ``(B) the new activity, service, undertaking, or 
                offering described in the notice under paragraph (1) 
                shall be considered a product for purposes of this 
                section; and
                    ``(C) the enterprise shall withdraw its request or 
                submit a written request for approval of the product 
                pursuant to subsection (c).
    ``(e) Conditional Approval.--The Director may conditionally approve 
the offering of any product by an enterprise, and may establish terms, 
conditions, or limitations with respect to such product with which the 
enterprise must comply in order to offer such product.
    ``(f) Definition of Product.--For purposes of this section, the 
term `product' does not include--
            ``(1) the automated loan underwriting system of an 
        enterprise in existence as of the date of the enactment of the 
        Federal Housing Finance Reform Act of 2008, including any 
        upgrade to the technology, operating system, or software to 
        operate the underwriting system; or
            ``(2) any modification to the mortgage terms and conditions 
        or mortgage underwriting criteria relating to the mortgages 
        that are purchased or guaranteed by an enterprise: Provided, 
        That such modifications do not alter the underlying transaction 
        so as to include services or financing, other than residential 
        mortgage financing, or create significant new exposure to risk 
        for the enterprise or the holder of the mortgage.
    ``(g) No Limitation.--Nothing in this section shall be deemed to 
restrict--
            ``(1) the safety and soundness authority of the Director 
        over all new and existing products or activities; or
            ``(2) the authority of the Director to review all new and 
        existing products or activities to determine that such products 
        or activities are consistent with the statutory mission of the 
        enterprise.''.
    (b) Conforming Amendments.--
            (1) Fannie mae.--Section 302(b)(6) of the Federal National 
        Mortgage Association Charter Act (12 U.S.C. 1717(b)(6)) is 
        amended--
                    (A) by striking ``implement any new program'' and 
                inserting ``initially offer any product'';
                    (B) by striking ``section 1303'' and inserting 
                ``section 1321(f)''; and
                    (C) by striking ``before obtaining the approval of 
                the Secretary under section 1322'' and inserting 
                ``except in accordance with section 1321''.
            (2) Freddie mac.--Section 305(c) of the Federal Home Loan 
        Mortgage Corporation Act (12 U.S.C. 1454(c)) is amended--
                    (A) by striking ``implement any new program'' and 
                inserting ``initially offer any product'';
                    (B) by striking ``section 1303'' and inserting 
                ``section 1321(f)''; and
                    (C) by striking ``before obtaining the approval of 
                the Secretary under section 1322'' and inserting 
                ``except in accordance with section 1321''.
            (3) 1992 act.--Section 1303 of the Housing and Community 
        Development Act of 1992 (12 U.S.C. 4502), as amended by section 
        1002 of this title, is further amended--
                    (A) by striking paragraph (17) (relating to the 
                definition of ``new program''); and
                    (B) by redesignating paragraphs (18) through (23) 
                as paragraphs (17) through (22), respectively.

SEC. 1033. CONFORMING LOAN LIMITS.

    (a) Fannie Mae.--
            (1) General limit.--Section 302(b)(2) of the Federal 
        National Mortgage Association Charter Act (12 U.S.C. 
        1717(b)(2)) is amended--
                    (A) in the 4th sentence, by striking ``the 
                Resolution Trust Corporation,''; and
                    (B) by striking the 7th and 8th sentences and 
                inserting the following new sentences: ``For 2008, such 
                limitations shall not exceed $417,000 for a mortgage 
                secured by a single-family residence, $533,850 for a 
                mortgage secured by a 2-family residence, $645,300 for 
                a mortgage secured by a 3-family residence, and 
                $801,950 for a mortgage secured by a 4-family 
                residence, except that such maximum limitations shall 
                be adjusted effective January 1 of each year beginning 
                with 2009, subject to the limitations in this 
                paragraph. Each adjustment shall be made by adding to 
                or subtracting from each such amount (as it may have 
                been previously adjusted) a percentage thereof equal to 
                the percentage increase or decrease, during the most 
                recent 12-month or four-quarter period ending before 
                the time of determining such annual adjustment, in the 
                housing price index maintained by the Director of the 
                Federal Housing Finance Agency (pursuant to section 
                1322 of the Housing and Community Development Act of 
                1992 (12 U.S.C. 4541)).''.
            (2) High-cost area limit.--Section 302(b)(2) of the Federal 
        National Mortgage Association Charter Act is (12 U.S.C. 
        1717(b)(2)) is amended by adding after the period at the end 
        the following: ``Such foregoing limitations shall also be 
        increased with respect to properties of a particular size 
        located in any area for which the median price for such size 
        residence exceeds the foregoing limitation for such size 
        residence, to the lesser of 150 percent of such foregoing 
        limitation for such size residence or the amount that is equal 
        to the median price in such area for such size residence, 
        except that, subject to the order, if any, issued by the 
        Director of the Federal Housing Finance Agency pursuant to 
        section 1033(d)(3) of the Federal Housing Finance Reform Act of 
        2008, such increase shall apply only with respect to mortgages 
        on which are based securities issued and sold by the 
        corporation.''.
    (b) Freddie Mac.--
            (1) General limit.--Section 305(a)(2) of the Federal Home 
        Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) is 
        amended--
                    (A) in the 3rd sentence, by striking ``the 
                Resolution Trust Corporation,''; and
                    (B) by striking the 6th and 7th sentences and 
                inserting the following new sentences: ``For 2008, such 
                limitations shall not exceed $417,000 for a mortgage 
                secured by a single-family residence, $533,850 for a 
                mortgage secured by a 2-family residence, $645,300 for 
                a mortgage secured by a 3-family residence, and 
                $801,950 for a mortgage secured by a 4-family 
                residence, except that such maximum limitations shall 
                be adjusted effective January 1 of each year beginning 
                with 2009, subject to the limitations in this 
                paragraph. Each adjustment shall be made by adding to 
                or subtracting from each such amount (as it may have 
                been previously adjusted) a percentage thereof equal to 
                the percentage increase or decrease, during the most 
                recent 12-month or four-quarter period ending before 
                the time of determining such annual adjustment, in the 
                housing price index maintained by the Director of the 
                Federal Housing Finance Agency (pursuant to section 
                1322 of the Housing and Community Development Act of 
                1992 (12 U.S.C. 4541)).''
            (2) High-cost area limit.--Section 305(a)(2) of the Federal 
        Home Loan Mortgage Corporation Act is amended by adding after 
        the period at the end the following: ``Such foregoing 
        limitations shall also be increased with respect to properties 
        of a particular size located in any area for which the median 
        price for such size residence exceeds the foregoing limitation 
        for such size residence, to the lesser of 150 percent of such 
        foregoing limitation for such size residence or the amount that 
        is equal to the median price in such area for such size 
        residence, except that, subject to the order, if any, issued by 
        the Director of the Federal Housing Finance Agency pursuant to 
        section 1033(d)(3) of the Federal Housing Finance Reform Act of 
        2008, such increase shall apply only with respect to mortgages 
        on which are based securities issued and sold by the 
        Corporation.''.
    (c) Housing Price Index.--Subpart A of part 2 of subtitle A of 
title XIII of the Housing and Community Development Act of 1992 (as 
amended by the preceding provisions of this title) is amended by 
inserting after section 1321 (as added by section 1032 of this title) 
the following new section:

``SEC. 1322. HOUSING PRICE INDEX.

    ``(a) In General.--The Director shall establish and maintain a 
method of assessing the national average 1-family house price for use 
for adjusting the conforming loan limitations of the enterprises. In 
establishing such method, the Director shall take into consideration 
the monthly survey of all major lenders conducted by the Federal 
Housing Finance Agency to determine the national average 1-family house 
price, the House Price Index maintained by the Office of Federal 
Housing Enterprise Oversight of the Department of Housing and Urban 
Development before the effective date under section 1065 of the Federal 
Housing Finance Reform Act of 2008, any appropriate house price indexes 
of the Bureau of the Census of the Department of Commerce, and any 
other indexes or measures that the Director considers appropriate.
    ``(b) GAO Audit.--
            ``(1) In general.--At such times as are required under 
        paragraph (2), the Comptroller General of the United States 
        shall conduct an audit of the methodology established by the 
        Director under subsection (a) to determine whether the 
        methodology established is an accurate and appropriate means of 
        measuring changes to the national average 1-family house price.
            ``(2) Timing.--An audit referred to in paragraph (1) shall 
        be conducted and completed not later than the expiration of the 
        180-day period that begins upon each of the following dates:
                    ``(A) Establishment.--The date upon which such 
                methodology is initially established under subsection 
                (a) in final form by the Director.
                    ``(B) Modification or amendment.--Each date upon 
                which any modification or amendment to such methodology 
                is adopted in final form by the Director.
            ``(3) Report.--Within 30 days of the completion of any 
        audit conducted under this subsection, the Comptroller General 
        shall submit a report detailing the results and conclusions of 
        the audit to the Director, the Committee on Financial Services 
        of the House of Representatives, and the Committee on Banking, 
        Housing, and Urban Affairs of the Senate.''.
    (d) Conditions on Conforming Loan Limit for High-Cost Areas.--
            (1) Study.--The Director of the Federal Housing Finance 
        Agency shall conduct a study under this subsection during the 
        six-month period beginning on the effective date under section 
        1065 of this title.
            (2) Issues.--The study under this subsection shall 
        determine--
                    (A) the effect that restricting the conforming loan 
                limits for high-cost areas only to mortgages on which 
                are based securities issued and sold by the Federal 
                National Mortgage Association and the Federal Home Loan 
                Mortgage Corporation (as provided in the last sentence 
                of section 302(b)(2) of the Federal National Mortgage 
                Association Charter Act and the last sentence of 
                section 305(a)(2) of the Federal Home Loan Mortgage 
                Corporation Act, pursuant to the amendments made by 
                subsections (a)(2) and (b)(2) of this section) would 
                have on the cost to borrowers for mortgages on housing 
                in such high-cost areas;
                    (B) the effects that such restrictions would have 
                on the availability of mortgages for housing in such 
                high-cost areas; and
                    (C) the extent to which the Federal National 
                Mortgage Association and the Federal Home Loan Mortgage 
                Corporation will be able to issue and sell securities 
                based on mortgages for housing located in such high-
                cost areas.
            (3) Determination.--
                    (A) In general.--Not later than the expiration of 
                the six-month period specified in paragraph (1), the 
                Director of the Federal Housing Finance Agency shall 
                make a determination, based on the results of the study 
                under this subsection, of whether the restriction of 
                conforming loan limits for high-cost areas only to 
                mortgages on which are based securities issued and sold 
                by the Federal National Mortgage Association and the 
                Federal Home Loan Mortgage Corporation (as provided in 
                the amendments made by subsections (a)(2) and (b)(2) of 
                this section) will result in an increase in the cost to 
                borrowers for mortgages on housing in such high-cost 
                areas.
                    (B) Order.--If such determination is that costs to 
                borrowers on housing in such high-cost areas will be 
                increased by such restrictions, the Director may issue 
                an order terminating such restrictions, in whole or in 
                part.
            (4) Publication.--Not later than the expiration of the six-
        month period specified in paragraph (1), the Director of the 
        Federal Housing Finance Agency shall cause to be published in 
        the Federal Register--
                    (A) a report that--
                            (i) describes the study under this 
                        subsection; and
                            (ii) sets forth the conclusions of the 
                        study regarding the issues to be determined 
                        under paragraph (2);
                    (B) notice of the determination of the Director 
                under paragraph (3); and
                    (C) the order of the Director under paragraph (3).
            (5) Definition.--For purposes of this subsection, the term 
        ``conforming loan limits for high-cost areas'' means the dollar 
        amount limitations applicable under the section 302(b)(2) of 
        the Federal National Mortgage Association Charter Act and 
        section 305(a)(2) of the Federal Home Loan Mortgage Corporation 
        Act (as amended by subsections (a) and (b) of this section) for 
        areas described in the last sentence of such sections (as so 
        amended).

SEC. 1034. ANNUAL HOUSING REPORT REGARDING REGULATED ENTITIES.

    (a) In General.--The Housing and Community Development Act of 1992 
is amended by striking section 1324 (12 U.S.C. 4544) and inserting the 
following new section:

``SEC. 1324. ANNUAL HOUSING REPORT REGARDING REGULATED ENTITIES.

    ``(a) In General.--After reviewing and analyzing the reports 
submitted under section 309(n) of the Federal National Mortgage 
Association Charter Act, section 307(f) of the Federal Home Loan 
Mortgage Corporation Act, and section 10(j)(11) of the Federal Home 
Loan Bank Act (12 U.S.C. 1430(j)(11)), the Director shall submit a 
report, not later than October 30 of each year, to the Committee on 
Financial Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate, on the activities of 
each regulated entity.
    ``(b) Contents.--The report shall--
            ``(1) discuss the extent to which--
                    ``(A) each enterprise is achieving the annual 
                housing goals established under subpart B of this part;
                    ``(B) each Federal home loan bank is complying with 
                section 10(j) of the Federal Home Loan Bank Act; and
                    ``(C) each regulated entity is achieving the 
                purposes of the regulated entity established by law;
            ``(2) aggregate and analyze relevant data on income to 
        assess the compliance by each enterprise with the housing goals 
        established under subpart B;
            ``(3) aggregate and analyze data on income, race, and 
        gender by census tract and other relevant classifications, and 
        compare such data with larger demographic, housing, and 
        economic trends;
            ``(4) examine actions that--
                    ``(A) each enterprise has undertaken or could 
                undertake to promote and expand the annual goals 
                established under subpart B and the purposes of the 
                enterprise established by law; and
                    ``(B) each Federal home loan bank has taken or 
                could undertake to promote and expand the community 
                investment program and affordable housing program of 
                the bank established under subsections (i) and (j) of 
                section 10 of the Federal Home Loan Bank Act;
            ``(5) examine the primary and secondary multifamily housing 
        mortgage markets and describe--
                    ``(A) the availability and liquidity of mortgage 
                credit;
                    ``(B) the status of efforts to provide standard 
                credit terms and underwriting guidelines for 
                multifamily housing and to securitize such mortgage 
                products; and
                    ``(C) any factors inhibiting such standardization 
                and securitization;
            ``(6) examine actions each regulated entity has undertaken 
        and could undertake to promote and expand opportunities for 
        first-time homebuyers, including the use of alternative credit 
        scoring;
            ``(7) describe any actions taken under section 1325(5) with 
        respect to originators found to violate fair lending 
        procedures;
            ``(8) discuss and analyze existing conditions and trends, 
        including conditions and trends relating to pricing, in the 
        housing markets and mortgage markets; and
            ``(9) identify the extent to which each enterprise is 
        involved in mortgage purchases and secondary market activities 
        involving subprime loans (as identified in accordance with the 
        regulations issued pursuant to section 1034(b) of the Federal 
        Housing Finance Reform Act of 2008) and compare the 
        characteristics of subprime loans purchased and securitized by 
        the enterprises to other loans purchased and securitized by the 
        enterprises.
    ``(c) Data Collection and Reporting.--
            ``(1) In general.--To assist the Director in analyzing the 
        matters described in subsection (b) and establishing the 
        methodology described in section 1322, the Director shall 
        conduct, on a monthly basis, a survey of mortgage markets in 
        accordance with this subsection.
            ``(2) Data points.--Each monthly survey conducted by the 
        Director under paragraph (1) shall collect data on--
                    ``(A) the characteristics of individual mortgages 
                that are eligible for purchase by the enterprises and 
                the characteristics of individual mortgages that are 
                not eligible for purchase by the enterprises including, 
                in both cases, information concerning--
                            ``(i) the price of the house that secures 
                        the mortgage;
                            ``(ii) the loan-to-value ratio of the 
                        mortgage, which shall reflect any secondary 
                        liens on the relevant property;
                            ``(iii) the terms of the mortgage;
                            ``(iv) the creditworthiness of the borrower 
                        or borrowers; and
                            ``(v) whether the mortgage, in the case of 
                        a conforming mortgage, was purchased by an 
                        enterprise; and
                    ``(B) such other matters as the Director determines 
                to be appropriate.
            ``(3) Public availability.--The Director shall make any 
        data collected by the Director in connection with the conduct 
        of a monthly survey available to the public in a timely manner, 
        provided that the Director may modify the data released to the 
        public to ensure that the data is not released in an 
        identifiable form.
            ``(4) Definition.--For purposes of this subsection, the 
        term `identifiable form' means any representation of 
        information that permits the identity of a borrower to which 
        the information relates to be reasonably inferred by either 
        direct or indirect means.''.
    (b) Standards for Subprime Loans.--The Director shall, not later 
than one year after the effective date under section 1065, by 
regulations issued under section 1316G of the Housing and Community 
Development Act of 1992, establish standards by which mortgages 
purchased and mortgages purchased and securitized shall be 
characterized as subprime for the purpose of, and only for the purpose 
of, complying with the reporting requirement under section 1324(b)(9) 
of such Act.

SEC. 1035. ANNUAL REPORTS BY REGULATED ENTITIES ON AFFORDABLE HOUSING 
              STOCK.

    The Housing and Community Development Act of 1992 is amended by 
inserting after section 1328 (12 U.S.C. 4548) the following new 
section:

``SEC. 1329. ANNUAL REPORTS ON AFFORDABLE HOUSING STOCK.

    ``(a) In General.--The regulated entities shall conduct, or provide 
for the conducting of, a study on an annual basis to determine the 
levels of affordable housing inventory, and the changes in such levels, 
in communities throughout the United States.
    ``(b) Contents.--The annual study under this section shall 
determine, for the United States, each State, and each community within 
each State--
            ``(1) the level of affordable housing inventory, including 
        affordable rental dwelling units and affordable homeownership 
        dwelling units;
            ``(2) any changes to the level of such inventory during the 
        12-month period of the study under this section, including--
                    ``(A) any additions to such inventory, 
                disaggregated by the category of such additions 
                (including new construction or housing conversion);
                    ``(B) any subtractions from such inventory, 
                disaggregated by the category of such subtractions 
                (including abandonment, demolition, or upgrade to 
                market-rate housing);
                    ``(C) the number of new affordable dwelling units 
                placed in service; and
                    ``(D) the number of affordable housing dwelling 
                units withdrawn from service;
            ``(3) the types of financing used to build any dwelling 
        units added to such inventory level and the period during which 
        such units are required to remain affordable;
            ``(4) any excess demand for affordable housing, including 
        the number of households on rental housing waiting lists and 
        the tenure of the wait on such lists; and
            ``(5) such other information as the Director may require.
    ``(c) Report.--For each annual study conducted pursuant to this 
section, the regulated entities shall submit to the Congress, and make 
publicly available, a report setting forth the findings of the study.
    ``(d) Regulations and Timing.--The Director shall, by regulation, 
establish requirements for the studies and reports under this section, 
including deadlines for the submission of such annual reports and 
standards for determining affordable housing.''.

SEC. 1036. MORTGAGOR IDENTIFICATION REQUIREMENTS FOR MORTGAGES OF 
              REGULATED ENTITIES.

    (a) In General.--Subpart A of part 2 of subtitle A of title XIII of 
the Housing and Community Development Act of 1992 (12 U.S.C. 4541 et 
seq.), as amended by the preceding provisions of this title, is further 
amended by adding at the end the following new section:

``SEC. 1330. MORTGAGOR IDENTIFICATION REQUIREMENTS FOR MORTGAGES OF 
              REGULATED ENTITIES.

    ``(a) Limitation.--The Director shall by regulation establish 
standards, and shall enforce compliance with such standards, that--
            ``(1) prohibit the enterprises from the purchase, service, 
        holding, selling, lending on the security of, or otherwise 
        dealing with any mortgage on a one- to four-family residence 
        that will be used as the principal residence of the mortgagor 
        that does not meet the requirements under subsection (b); and
            ``(2) prohibit the Federal home loan banks from providing 
        any advances to a member for use in financing, and from 
        accepting as collateral for any advance to a member, any 
        mortgage on a one- to four-family residence that will be used 
        as the principal residence of the mortgagor that does not meet 
        the requirements under subsection (b).
    ``(b) Identification Requirements.--The requirements under this 
subsection with respect to a mortgage are that the mortgagor have, at 
the time of settlement on the mortgage, a Social Security account 
number.''.
    (b) Fannie Mae.--Section 304 of the Federal National Mortgage 
Association Charter Act (12 U.S.C. 1719) is amended by adding at the 
end the following new subsection:
    ``(g) Prohibition Regarding Mortgagor Identification Requirement.--
Nothing in this Act may be construed to authorize the corporation to 
purchase, service, hold, sell, lend on the security of, or otherwise 
deal with any mortgage that the corporation is prohibited from so 
dealing with under the standards issued under section 1330 of the 
Housing and Community Development Act of 1992 by the Director of the 
Federal Housing Finance Agency.''.
    (c) Freddie Mac.--Section 305 of the Federal Home Loan Mortgage 
Corporation Act (12 U.S.C. 1454) is amended by adding at the end the 
following new subsection:
    ``(d) Prohibition Regarding Mortgagor Identification 
Requirements.--Nothing in this Act may be construed to authorize the 
Corporation to purchase, service, hold, sell, lend on the security of, 
or otherwise deal with any mortgage that the Corporation is prohibited 
from so dealing with under the standards issued under section 1330 of 
the Housing and Community Development Act of 1992 by the Director of 
the Federal Housing Finance Agency.''.
    (d) Federal Home Loan Banks.--Section 10(a) of the Federal Home 
Loan Bank Act (12 U.S.C. 1430(a)) is amended--
            (1) by redesignating paragraph (6) as paragraph (7); and
            (2) by inserting after paragraph (5) the following new 
        paragraph:
            ``(6) Prohibition regarding mortgagor identification 
        requirements.--Nothing in this Act may be construed to 
        authorize a Federal Home Loan Bank to provide any advance to a 
        member for use in financing, or accept as collateral for an 
        advance under this section, any mortgage that a Bank is 
        prohibited from so accepting under the standards issued under 
        section 1330 of the Housing and Community Development Act of 
        1992 by the Director of the Federal Housing Finance Agency.''.

SEC. 1037. REVISION OF HOUSING GOALS.

    (a) Housing Goals.--The Housing and Community Development Act of 
1992 is amended by striking sections 1331 through 1334 (12 U.S.C. 4561-
4) and inserting the following new sections:

``SEC. 1331. ESTABLISHMENT OF HOUSING GOALS.

    ``(a) In General.--The Director shall establish, effective for the 
first year that begins after the effective date under section 1065 of 
the Federal Housing Finance Reform Act of 2008 and each year 
thereafter, annual housing goals, with respect to the mortgage 
purchases by the enterprises, as follows:
            ``(1) Single family housing goals.--Three single-family 
        housing goals under section 1332.
            ``(2) Multifamily special affordable housing goals.--A 
        multifamily special affordable housing goal under section 1333.
    ``(b) Eliminating Interest Rate Disparities.--
            ``(1) In general.--Upon request by the Director, an 
        enterprise shall provide to the Director, in a form determined 
        by the Director, data the Director may review to determine 
        whether there exist disparities in interest rates charged on 
        mortgages to borrowers who are minorities as compared with 
        comparable mortgages to borrowers of similar creditworthiness 
        who are not minorities.
            ``(2) Remedial actions upon preliminary finding.--Upon a 
        preliminary finding by the Director that a pattern of 
        disparities in interest rates with respect to any lender or 
        lenders exists pursuant to the data provided by an enterprise 
        in paragraph (1), the Director shall--
                    ``(A) refer the preliminary finding to the 
                appropriate regulatory or enforcement agency for 
                further review;
                    ``(B) require the enterprise to submit additional 
                data with respect to any lender or lenders, as 
                appropriate and to the extent practicable, to the 
                Director who shall submit any such additional data to 
                the regulatory or enforcement agency for appropriate 
                action; and
                    ``(C) require the enterprise to undertake remedial 
                actions, as appropriate, pursuant to section 1325(5) 
                (12 U.S.C. 4545(5)).
            ``(3) Annual report to congress.--The Director shall submit 
        to the Committee on Financial Services of the House of 
        Representatives and the Committee on Banking, Housing, and 
        Urban Affairs of the Senate a report describing the actions 
        taken, and being taken, by the Director to carry out this 
        subsection. No such report shall identify any lender or lenders 
        who have not been found to have engaged in discriminatory 
        lending practices pursuant to a final adjudication on the 
        record, and after opportunity for an administrative hearing, in 
        accordance with subchapter II of chapter 5 of title 5, United 
        States Code.
            ``(4) Protection of identity of individuals.--In carrying 
        out this subsection, the Director shall ensure that no 
        property-related or financial information that would enable a 
        borrower to be identified shall be made public.
    ``(c) Timing.--The Director shall establish an annual deadline by 
which the Director shall establish the annual housing goals under this 
subpart for each year, taking into consideration the need for the 
enterprises to reasonably and sufficiently plan their operations and 
activities in advance, including operations and activities necessary to 
meet such annual goals.

``SEC. 1332. SINGLE-FAMILY HOUSING GOALS.

    ``(a) In General.--The Director shall establish annual goals for 
the purchase by each enterprise of conventional, conforming, single-
family, purchase money mortgages financing owner-occupied and rental 
housing for each of the following categories of families:
            ``(1) Low-income families.
            ``(2) Families that reside in low-income areas.
            ``(3) Very low-income families.
    ``(b) Refinance Subgoal.--
            ``(1) In general.--The Director shall establish a separate 
        subgoal within each goal under subsection (a)(1) for the 
        purchase by each enterprise of mortgages for low-income 
        families on single family housing given to pay off or prepay an 
        existing loan secured by the same property. The Director shall, 
        for each year, determine whether each enterprise has complied 
        with the subgoal under this subsection in the same manner 
        provided under this section for determining compliance with the 
        housing goals.
            ``(2) Enforcement.--For purposes of section 1336, the 
        subgoal established under paragraph (1) of this subsection 
        shall be considered to be a housing goal established under this 
        section. Such subgoal shall not be enforceable under any other 
        provision of this title (including subpart C of this part) 
        other than section 1336 or under any provision of the Federal 
        National Mortgage Association Charter Act or the Federal Home 
        Loan Mortgage Corporation Act.
    ``(c) Determination of Compliance.--The Director shall determine, 
for each year that the housing goals under this section are in effect 
pursuant to section 1331(a), whether each enterprise has complied with 
the single-family housing goals established under this section for such 
year. An enterprise shall be considered to be in compliance with such a 
goal for a year only if, for each of the types of families described in 
subsection (a), the percentage of the number of conventional, 
conforming, single-family, owner-occupied or rental, as applicable, 
purchase money mortgages purchased by each enterprise in such year that 
serve such families, meets or exceeds the target for the year for such 
type of family that is established under subsection (d).
    ``(d) Annual Targets.--
            ``(1) In general.--Except as provided in paragraph (2), for 
        each of the types of families described in subsection (a), the 
        target under this subsection for a year shall be the average 
        percentage, for the three years that most recently precede such 
        year and for which information under the Home Mortgage 
        Disclosure Act of 1975 is publicly available, of the number of 
        conventional, conforming, single-family, owner-occupied or 
        rental, as applicable, purchase money mortgages originated in 
        such year that serves such type of family, as determined by the 
        Director using the information obtained and determined pursuant 
        to paragraphs (3) and (4).
            ``(2) Authority to increase targets.--
                    ``(A) In general.--The Director may, for any year, 
                establish by regulation, for any or all of the types of 
                families described in subsection (a), percentage 
                targets that are higher than the percentages for such 
                year determined pursuant to paragraph (1), to reflect 
                expected changes in market performance related to such 
                information under the Home Mortgage Disclosure Act of 
                1975.
                    ``(B) Factors.--In establishing any targets 
                pursuant to subparagraph (A), the Director shall 
                consider the following factors:
                            ``(i) National housing needs.
                            ``(ii) Economic, housing, and demographic 
                        conditions.
                            ``(iii) The performance and effort of the 
                        enterprises toward achieving the housing goals 
                        under this section in previous years.
                            ``(iv) The size of the conventional 
                        mortgage market serving each of the types of 
                        families described in subsection (a) relative 
                        to the size of the overall conventional 
                        mortgage market.
                            ``(v) The ability of the enterprise to lead 
                        the industry in making mortgage credit 
                        available.
                            ``(vi) The need to maintain the sound 
                        financial condition of the enterprises.
            ``(3) HMDA information.--The Director shall annually obtain 
        information submitted in compliance with the Home Mortgage 
        Disclosure Act of 1975 regarding conventional, conforming, 
        single-family, owner-occupied or rental, as applicable, 
        purchase money mortgages originated and purchased for the 
        previous year.
            ``(4) Conforming mortgages.--In determining whether a 
        mortgage is a conforming mortgage for purposes of this 
        paragraph, the Director shall consider the original principal 
        balance of the mortgage loan to be the principal balance as 
        reported in the information referred to in paragraph (3), as 
        rounded to the nearest thousand dollars.
    ``(e) Notice of Determination and Enterprise Comment.--
            ``(1) Notice.--Within 30 days of making a determination 
        under subsection (c) regarding a compliance of an enterprise 
        for a year with a housing goal established under this section 
        and before any public disclosure thereof, the Director shall 
        provide notice of the determination to the enterprise, which 
        shall include an analysis and comparison, by the Director, of 
        the performance of the enterprise for the year and the targets 
        for the year under subsection (d).
            ``(2) Comment period.--The Director shall provide each 
        enterprise an opportunity to comment on the determination 
        during the 30-day period beginning upon receipt by the 
        enterprise of the notice.
    ``(f) Use of Borrower Income.--In monitoring the performance of 
each enterprise pursuant to the housing goals under this section and 
evaluating such performance (for purposes of section 1336), the 
Director shall consider a mortgagor's income to be such income at the 
time of origination of the mortgage.
    ``(g) Consideration of Units in Single-Family Rental Housing.--In 
establishing any goal under this subpart, the Director may take into 
consideration the number of housing units financed by any mortgage on 
single-family rental housing purchased by an enterprise.

``SEC. 1333. MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOAL.

    ``(a) Establishment.--
            ``(1) In general.--The Director shall establish, by 
        regulation, an annual goal for the purchase by each enterprise 
        of each of the following types of mortgages on multifamily 
        housing:
                    ``(A) Mortgages that finance dwelling units for 
                low-income families.
                    ``(B) Mortgages that finance dwelling units for 
                very low-income families.
                    ``(C) Mortgages that finance dwelling units 
                assisted by the low-income housing tax credit under 
                section 42 of the Internal Revenue Code of 1986.
            ``(2) Additional requirements for smaller projects.--The 
        Director shall establish, within the goal under this section, 
        additional requirements for the purchase by each enterprise of 
        mortgages described in paragraph (1) for multifamily housing 
        projects of a smaller or limited size, which may be based on 
        the number of dwelling units in the project or the amount of 
        the mortgage, or both, and shall include multifamily housing 
        projects of such smaller sizes as are typical among such 
        projects that serve rural areas.
            ``(3) Factors.--In establishing the goal under this section 
        relating to mortgages on multifamily housing for an enterprise 
        for a year, the Director shall consider--
                    ``(A) national multifamily mortgage credit needs;
                    ``(B) the performance and effort of the enterprise 
                in making mortgage credit available for multifamily 
                housing in previous years;
                    ``(C) the size of the multifamily mortgage market;
                    ``(D) the ability of the enterprise to lead the 
                industry in making mortgage credit available, 
                especially for underserved markets, such as for small 
                multifamily projects of 5 to 50 units, multifamily 
                properties in need of rehabilitation, and multifamily 
                properties located in rural areas; and
                    ``(E) the need to maintain the sound financial 
                condition of the enterprise.
    ``(b) Units Financed by Housing Finance Agency Bonds.--The Director 
shall give credit toward the achievement of the multifamily special 
affordable housing goal under this section (for purposes of section 
1336) to dwelling units in multifamily housing that otherwise qualifies 
under such goal and that is financed by tax-exempt or taxable bonds 
issued by a State or local housing finance agency, but only if such 
bonds--
            ``(1) are secured by a guarantee of the enterprise; or
            ``(2) are not investment grade and are purchased by the 
        enterprise.
    ``(c) Use of Tenant Income or Rent.--The Director shall monitor the 
performance of each enterprise in meeting the goals established under 
this section and shall evaluate such performance (for purposes of 
section 1336) based on--
            ``(1) the income of the prospective or actual tenants of 
        the property, where such data are available; or
            ``(2) where the data referred to in paragraph (1) are not 
        available, rent levels affordable to low-income and very low-
        income families.
A rent level shall be considered to be affordable for purposes of this 
subsection for an income category referred to in this subsection if it 
does not exceed 30 percent of the maximum income level of such income 
category, with appropriate adjustments for unit size as measured by the 
number of bedrooms.
    ``(d) Determination of Compliance.--The Director shall, for each 
year that the housing goal under this section is in effect pursuant to 
section 1331(a), determine whether each enterprise has complied with 
such goal and the additional requirements under subsection (a)(2).

``SEC. 1334. DISCRETIONARY ADJUSTMENT OF HOUSING GOALS.

    ``(a) Authority.--An enterprise may petition the Director in 
writing at any time during a year to reduce the level of any goal for 
such year established pursuant to this subpart.
    ``(b) Standard for Reduction.--The Director may reduce the level 
for a goal pursuant to such a petition only if--
            ``(1) market and economic conditions or the financial 
        condition of the enterprise require such action; or
            ``(2) efforts to meet the goal would result in the 
        constraint of liquidity, over-investment in certain market 
        segments, or other consequences contrary to the intent of this 
        subpart, or section 301(3) of the Federal National Mortgage 
        Association Charter Act (12 U.S.C. 1716(3)) or section 301(3) 
        of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
        1451 note), as applicable.
    ``(c) Determination.--The Director shall make a determination 
regarding any proposed reduction within 30 days of receipt of the 
petition regarding the reduction. The Director may extend such period 
for a single additional 15-day period, but only if the Director 
requests additional information from the enterprise. A denial by the 
Director to reduce the level of any goal under this section may be 
appealed to the United States District Court for the District of 
Columbia or the United States district court in the jurisdiction in 
which the headquarters of an enterprise is located.''.
    (b) Conforming Amendments.--The Housing and Community Development 
Act of 1992 is amended--
            (1) in section 1335(a) (12 U.S.C. 4565(a)), in the matter 
        preceding paragraph (1), by striking ``low- and moderate-income 
        housing goal'' and all that follows through ``section 1334'' 
        and inserting ``housing goals established under this subpart''; 
        and
            (2) in section 1336(a)(1) (12 U.S.C. 4566(a)(1)), by 
        striking ``sections 1332, 1333, and 1334,'' and inserting 
        ``this subpart''.
    (c) Definitions.--Section 1303 of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4502), as amended by the preceding 
provisions of this title, is further amended--
            (1) in paragraph (22) (relating to the definition of ``very 
        low-income''), by striking ``60 percent'' each place such term 
        appears and inserting ``50 percent'';
            (2) by redesignating paragraphs (19) through (22) as 
        paragraphs (23) through (26), respectively;
            (3) by inserting after paragraph (18) the following new 
        paragraph:
            ``(22) Rural area.--The term `rural area' has the meaning 
        given such term in section 520 of the Housing Act of 1949 (42 
        U.S.C. 1490), except that such term includes micropolitan areas 
        and tribal trust lands.''.
            (4) by redesignating paragraphs (13) through (18) as 
        paragraphs (16) through (21), respectively;
            (5) by inserting after paragraph (12) the following new 
        paragraph:
            ``(15) Low-income area.--The term `low income area' means a 
        census tract or block numbering area in which the median income 
        does not exceed 80 percent of the median income for the area in 
        which such census tract or block numbering area is located, 
        and, for the purposes of section 1332(a)(2), shall include 
        families having incomes not greater than 100 percent of the 
        area median income who reside in minority census tracts.'';
            (6) by redesignating paragraphs (11) and (12) as paragraphs 
        (13) and (14), respectively;
            (7) by inserting after paragraph (10) the following new 
        paragraph:
            ``(12) Extremely low-income.--The term `extremely low-
        income' means--
                    ``(A) in the case of owner-occupied units, income 
                not in excess of 30 percent of the area median income; 
                and
                    ``(B) in the case of rental units, income not in 
                excess of 30 percent of the area median income, with 
                adjustments for smaller and larger families, as 
                determined by the Secretary.'';
            (8) by redesignating paragraphs (7) through (10) as 
        paragraphs (8) through (11), respectively; and
            (9) by inserting after paragraph (6) the following new 
        paragraph:
            ``(7) Conforming mortgage.--The term `conforming mortgage' 
        means, with respect to an enterprise, a conventional mortgage 
        having an original principal obligation that does not exceed 
        the dollar limitation, in effect at the time of such 
        origination, under, as applicable--
                    ``(A) section 302(b)(2) of the Federal National 
                Mortgage Association Charter Act; or
                    ``(B) section 305(a)(2) of the Federal Home Loan 
                Mortgage Corporation Act.''.

SEC. 1038. DUTY TO SERVE UNDERSERVED MARKETS.

    (a) Establishment and Evaluation of Performance.--Section 1335 of 
the Housing and Community Development Act of 1992 (12 U.S.C. 4565) is 
amended--
            (1) in the section heading, by inserting ``duty to serve 
        underserved markets and'' before ``other'';
            (2) by striking subsection (b);
            (3) in subsection (a)--
                    (A) in the matter preceding paragraph (1), by 
                inserting ``and to carry out the duty under subsection 
                (a) of this section'' before ``, each enterprise 
                shall'';
                    (B) in paragraph (3), by inserting ``and'' after 
                the semicolon at the end;
                    (C) in paragraph (4), by striking ``; and'' and 
                inserting a period;
                    (D) by striking paragraph (5); and
                    (E) by redesignating such subsection as subsection 
                (b);
            (4) by inserting before subsection (b) (as so redesignated 
        by paragraph (3)(E) of this subsection) the following new 
        subsection:
    ``(a) Duty To Serve Underserved Markets.--
            ``(1) Duty.--In accordance with the purpose of the 
        enterprises under section 301(3) of the Federal National 
        Mortgage Association Charter Act (12 U.S.C. 1716) and section 
        301(b)(3) of the Federal Home Loan Mortgage Corporation Act (12 
        U.S.C. 1451 note) to undertake activities relating to mortgages 
        on housing for very low-, low-, and moderate-income families 
        involving a reasonable economic return that may be less than 
        the return earned on other activities, each enterprise shall 
        have the duty to increase the liquidity of mortgage investments 
        and improve the distribution of investment capital available 
        for mortgage financing for underserved markets.
            ``(2) Underserved markets.--To meet its duty under 
        paragraph (1), each enterprise shall comply with the following 
        requirements with respect to the following underserved markets:
                    ``(A) Manufactured housing.--The enterprise shall 
                lead the industry in developing loan products and 
                flexible underwriting guidelines to facilitate a 
                secondary market for mortgages on manufactured homes 
                for very low-, low-, and moderate-income families.
                    ``(B) Affordable housing preservation.--The 
                enterprise shall lead the industry in developing loan 
                products and flexible underwriting guidelines to 
                facilitate a secondary market to preserve housing 
                affordable to very
                low-, low-, and moderate-income families, including 
                housing projects subsidized under--
                            ``(i) the project-based and tenant-based 
                        rental assistance programs under section 8 of 
                        the United States Housing Act of 1937;
                            ``(ii) the program under section 236 of the 
                        National Housing Act;
                            ``(iii) the below-market interest rate 
                        mortgage program under section 221(d)(4) of the 
                        National Housing Act;
                            ``(iv) the supportive housing for the 
                        elderly program under section 202 of the 
                        Housing Act of 1959;
                            ``(v) the supportive housing program for 
                        persons with disabilities under section 811 of 
                        the Cranston-Gonzalez National Affordable 
                        Housing Act;
                            ``(vi) the programs under title IV of the 
                        McKinney-Vento Homeless Assistance Act (42 
                        U.S.C. 11361 et seq.), but only permanent 
                        supportive housing projects subsidized under 
                        such programs; and
                            ``(vii) the rural rental housing program 
                        under section 515 of the Housing Act of 1949.
                    ``(C) Rural and other underserved markets.--The 
                enterprise shall lead the industry in developing loan 
                products and flexible underwriting guidelines to 
                facilitate a secondary market for mortgages on housing 
                for very
                low-, low-, and moderate-income families in rural 
                areas, and for mortgages for housing for any other 
                underserved market for very low-, low-, and moderate-
                income families that the Secretary identifies as 
                lacking adequate credit through conventional lending 
                sources. Such underserved markets may be identified by 
                borrower type, market segment, or geographic area.''; 
                and
            (5) by adding at the end the following new subsection:
    ``(c) Evaluation and Reporting of Compliance.--
            ``(1) In general.--Not later than 6 months after the 
        effective date under section 1065 of the Federal Housing 
        Finance Reform Act of 2008, the Director shall establish a 
        manner for evaluating whether, and the extent to which, the 
        enterprises have complied with the duty under subsection (a) to 
        serve underserved markets and for rating the extent of such 
        compliance. Using such method, the Director shall, for each 
        year, evaluate such compliance and rate the performance of each 
        enterprise as to extent of compliance. The Director shall 
        include such evaluation and rating for each enterprise for a 
        year in the report for that year submitted pursuant to section 
        1319B(a).
            ``(2) Separate evaluations.--In determining whether an 
        enterprise has complied with the duty referred to in paragraph 
        (1), the Director shall separately evaluate whether the 
        enterprise has complied with such duty with respect to each of 
        the underserved markets identified in subsection (a), taking 
        into consideration--
                    ``(A) the development of loan products and more 
                flexible underwriting guidelines;
                    ``(B) the extent of outreach to qualified loan 
                sellers in each of such underserved markets; and
                    ``(C) the volume of loans purchased in each of such 
                underserved markets.
            ``(3) Manufactured housing market.--In determining whether 
        an enterprise has complied with the duty under subparagraph (A) 
        of subsection (a)(2), the Director may consider loans secured 
        by both real and personal property.''.
    (b) Enforcement.--Subsection (a) of section 1336 of the Housing and 
Community Development Act of 1992 (12 U.S.C. 4566(a)) is amended--
            (1) in paragraph (1), by inserting ``and with the duty 
        under section 1335(a) of each enterprise with respect to 
        underserved markets,'' before ``as provided in this section''; 
        and
            (2) by adding at the end of such subsection, as amended by 
        the preceding provisions of this subtitle, the following new 
        paragraph:
            ``(4) Enforcement of duty to provide mortgage credit to 
        underserved markets.--The duty under section 1335(a) of each 
        enterprise to serve underserved markets (as determined in 
        accordance with section 1335(c)) shall be enforceable under 
        this section to the same extent and under the same provisions 
        that the housing goals established under this subpart are 
        enforceable. Such duty shall not be enforceable under any other 
        provision of this title (including subpart C of this part) 
        other than this section or under any provision of the Federal 
        National Mortgage Association Charter Act or the Federal Home 
        Loan Mortgage Corporation Act.''.

SEC. 1039. MONITORING AND ENFORCING COMPLIANCE WITH HOUSING GOALS.

    (a) Additional Credit for Certain Mortgages.--Section 1336(a) of 
the Housing and Community Development Act of 1992 (12 U.S.C. 4566(a)) 
is amended--
            (1) in paragraph (2), by inserting ``, except as provided 
        in paragraph (4),'' after ``which''; and
            (2) by adding at the end the following new paragraph:
            ``(5) Additional credit.--The Director shall assign more 
        than 125 percent credit toward achievement, under this section, 
        of the housing goals for mortgage purchase activities of the 
        enterprises that comply with the requirements of such goals and 
        support--
                    ``(A) housing that meets energy efficiency or other 
                environmental standards that are established by a 
                Federal, State, or local governmental authority with 
                respect to the geographic area where the housing is 
                located or are otherwise widely recognized; or
                    ``(B) housing that includes a licensed childcare 
                center.
        The availability of additional credit under this paragraph 
        shall not be used to increase any housing goal, subgoal, or 
        target established under this subpart.''.
    (b) Monitoring and Enforcement.--Section 1336 of the Housing and 
Community Development Act of 1992 (12 U.S.C. 4566) is amended--
            (1) in subsection (b)--
                    (A) in the subsection heading, by inserting 
                ``Preliminary'' before ``Determination'';
                    (B) by striking paragraph (1) and inserting the 
                following new paragraph:
            ``(1) Notice.--If the Director preliminarily determines 
        that an enterprise has failed, or that there is a substantial 
        probability that an enterprise will fail, to meet any housing 
        goal established under this subpart, the Director shall provide 
        written notice to the enterprise of such a preliminary 
        determination, the reasons for such determination, and the 
        information on which the Director based the determination.'';
                    (C) in paragraph (2)--
                            (i) in subparagraph (A), by inserting 
                        ``finally'' before ``determining'';
                            (ii) by striking subparagraphs (B) and (C) 
                        and inserting the following new subparagraph:
                    ``(B) Extension or shortening of period.--The 
                Director may--
                            ``(i) extend the period under subparagraph 
                        (A) for good cause for not more than 30 
                        additional days; and
                            ``(ii) shorten the period under 
                        subparagraph (A) for good cause.''; and
                            (iii) by redesignating subparagraph (D) as 
                        subparagraph (C); and
                    (D) in paragraph (3)--
                            (i) in subparagraph (A), by striking 
                        ``determine'' and inserting ``issue a final 
                        determination of'';
                            (ii) in subparagraph (B), by inserting 
                        ``final'' before ``determinations''; and
                            (iii) in subparagraph (C)--
                                    (I) by striking ``Committee on 
                                Banking, Finance and Urban Affairs'' 
                                and inserting ``Committee on Financial 
                                Services''; and
                                    (II) by inserting ``final'' before 
                                ``determination'' each place such term 
                                appears; and
            (2) in subsection (c)--
                    (A) by striking the subsection designation and 
                heading and all that follows through the end of 
                paragraph (1) and inserting the following:
    ``(c) Cease and Desist Orders, Civil Money Penalties, and Remedies 
Including Housing Plans.--
            ``(1) Requirement.--If the Director finds, pursuant to 
        subsection (b), that there is a substantial probability that an 
        enterprise will fail, or has actually failed, to meet any 
        housing goal under this subpart and that the achievement of the 
        housing goal was or is feasible, the Director may require that 
        the enterprise submit a housing plan under this subsection. If 
        the Director makes such a finding and the enterprise refuses to 
        submit such a plan, submits an unacceptable plan, fails to 
        comply with the plan or the Director finds that the enterprise 
        has failed to meet any housing goal under this subpart, in 
        addition to requiring an enterprise to submit a housing plan, 
        the Director may issue a cease and desist order in accordance 
        with section 1341, impose civil money penalties in accordance 
        with section 1345, or order other remedies as set forth in 
        paragraph (7) of this subsection.'';
                    (B) in paragraph (2)--
                            (i) by striking ``Contents.--Each housing 
                        plan'' and inserting ``Housing plan.--If the 
                        Director requires a housing plan under this 
                        section, such a plan''; and
                            (ii) in subparagraph (B), by inserting 
                        ``and changes in its operations'' after 
                        ``improvements'';
                    (C) in paragraph (3)--
                            (i) by inserting ``comply with any remedial 
                        action or'' before ``submit a housing plan''; 
                        and
                            (ii) by striking ``under subsection (b)(3) 
                        that a housing plan is required'';
                    (D) in paragraph (4), by striking the first two 
                sentences and inserting the following: ``The Director 
                shall review each submission by an enterprise, 
                including a housing plan submitted under this 
                subsection, and not later than 30 days after 
                submission, approve or disapprove the plan or other 
                action. The Director may extend the period for approval 
                or disapproval for a single additional 30-day period if 
                the Director determines such extension necessary.''; 
                and
                    (E) by adding at the end the following new 
                paragraph:
            ``(7) Additional remedies for failure to meet goals.--In 
        addition to ordering a housing plan under this section, issuing 
        cease and desist orders under section 1341, and ordering civil 
        money penalties under section 1345, the Director may seek other 
        actions when an enterprise fails to meet a goal, and exercise 
        appropriate enforcement authority available to the Director 
        under this Act to prohibit the enterprise from initially 
        offering any product (as such term is defined in section 
        1321(f)) or engaging in any new activities, services, 
        undertakings, and offerings and to order the enterprise to 
        suspend products and activities, services, undertakings, and 
        offerings pending its achievement of the goal.''.

SEC. 1040. CONSISTENCY WITH MISSION.

    Subpart B of part 2 of subtitle A of title XIII of the Housing and 
Community Development Act of 1992 is amended by striking sections 1337 
and 1338 (42 U.S.C. 4562 note) and inserting the following new section:

``SEC. 1337. CONSISTENCY WITH MISSION.

    ``This subpart may not be construed to authorize an enterprise to 
engage in any program or activity that contravenes or is inconsistent 
with the Federal National Mortgage Association Charter Act or the 
Federal Home Loan Mortgage Corporation Act.''.

SEC. 1041. ENFORCEMENT.

    (a) Cease-and-Desist Proceedings.--Section 1341 of the Housing and 
Community Development Act of 1992 (12 U.S.C. 4581) is amended--
            (1) by striking subsection (a) and inserting the following 
        new subsection:
    ``(a) Grounds for Issuance.--The Director may issue and serve a 
notice of charges under this section upon an enterprise if the Director 
determines--
            ``(1) the enterprise has failed to meet any housing goal 
        established under subpart B, following a written notice and 
        determination of such failure in accordance with section 1336;
            ``(2) the enterprise has failed to submit a report under 
        section 1314, following a notice of such failure, an 
        opportunity for comment by the enterprise, and a final 
        determination by the Director;
            ``(3) the enterprise has failed to submit the information 
        required under subsection (m) or (n) of section 309 of the 
        Federal National Mortgage Association Charter Act, or 
        subsection (e) or (f) of section 307 of the Federal Home Loan 
        Mortgage Corporation Act;
            ``(4) the enterprise has violated any provision of this 
        part or any order, rule or regulation under this part;
            ``(5) the enterprise has failed to submit a housing plan 
        that complies with section 1336(c) within the applicable 
        period; or
            ``(6) the enterprise has failed to comply with a housing 
        plan under section 1336(c).'';
            (2) in subsection (b)(2), by striking ``requiring the 
        enterprise to'' and all that follows through the end of the 
        paragraph and inserting the following: ``requiring the 
        enterprise to--
                    ``(A) comply with the goal or goals;
                    ``(B) submit a report under section 1314;
                    ``(C) comply with any provision this part or any 
                order, rule or regulation under such part;
                    ``(D) submit a housing plan in compliance with 
                section 1336(c);
                    ``(E) comply with a housing plan submitted under 
                section 1336(c); or
                    ``(F) provide the information required under 
                subsection (m) or (n) of section 309 of the Federal 
                National Mortgage Association Charter Act or subsection 
                (e) or (f) of section 307 of the Federal Home Loan 
                Mortgage Corporation Act, as applicable.'';
            (3) in subsection (c), by inserting ``date of the'' before 
        ``service of the order''; and
            (4) by striking subsection (d).
    (b) Authority of Director To Enforce Notices and Orders.--Section 
1344 of the Housing and Community Development Act of 1992 (12 U.S.C. 
4584) is amended by striking subsection (a) and inserting the following 
new subsection:
    ``(a) Enforcement.--The Director may, in the discretion of the 
Director, apply to the United States District Court for the District of 
Columbia, or the United States district court within the jurisdiction 
of which the headquarters of the enterprise is located, for the 
enforcement of any effective and outstanding notice or order issued 
under section 1341 or 1345, or request that the Attorney General of the 
United States bring such an action. Such court shall have jurisdiction 
and power to order and require compliance with such notice or order.''.
    (c) Civil Money Penalties.--Section 1345 of the Housing and 
Community Development Act of 1992 (12 U.S.C. 4585) is amended--
            (1) by striking subsections (a) and (b) and inserting the 
        following new subsections:
    ``(a) Authority.--The Director may impose a civil money penalty, in 
accordance with the provisions of this section, on any enterprise that 
has failed to--
            ``(1) meet any housing goal established under subpart B, 
        following a written notice and determination of such failure in 
        accordance with section 1336(b);
            ``(2) submit a report under section 1314, following a 
        notice of such failure, an opportunity for comment by the 
        enterprise, and a final determination by the Director;
            ``(3) submit the information required under subsection (m) 
        or (n) of section 309 of the Federal National Mortgage 
        Association Charter Act, or subsection (e) or (f) of section 
        307 of the Federal Home Loan Mortgage Corporation Act;
            ``(4) comply with any provision of this part or any order, 
        rule or regulation under this part;
            ``(5) submit a housing plan pursuant to section 1336(c) 
        within the required period; or
            ``(6) comply with a housing plan for the enterprise under 
        section 1336(c).
    ``(b) Amount of Penalty.--The amount of the penalty, as determined 
by the Director, may not exceed--
            ``(1) for any failure described in paragraph (1), (5), or 
        (6) of subsection (a), $50,000 for each day that the failure 
        occurs; and
            ``(2) for any failure described in paragraph (2), (3), or 
        (4) of subsection (a), $20,000 for each day that the failure 
        occurs.'';
            (2) in subsection (c)--
                    (A) in paragraph (1)--
                            (i) in subparagraph (A), by inserting 
                        ``and'' after the semicolon at the end;
                            (ii) in subparagraph (B), by striking ``; 
                        and'' and inserting a period; and
                            (iii) by striking subparagraph (C); and
                    (B) in paragraph (2), by inserting after the period 
                at the end the following: ``In determining the penalty 
                under subsection (a)(1), the Director shall give 
                consideration to the length of time the enterprise 
                should reasonably take to achieve the goal.'';
            (3) in the first sentence of subsection (d)--
                    (A) by striking ``request the Attorney General of 
                the United States to'' and inserting ``, in the 
                discretion of the Director,''; and
                    (B) by inserting ``, or request that the Attorney 
                General of the United States bring such an action'' 
                before the period at the end;
            (4) by striking subsection (f); and
            (5) by redesignating subsection (g) as subsection (f).
    (d) Enforcement of Subpoenas.--Section 1348(c) of the Housing and 
Community Development Act of 1992 (12 U.S.C. 4588(c)) is amended--
            (1) by striking ``request the Attorney General of the 
        United States to'' and inserting ``, in the discretion of the 
        Director,''; and
            (2) by inserting ``or request that the Attorney General of 
        the United States bring such an action,'' after ``District of 
        Columbia,''.
    (e) Conforming Amendment.--The heading for subpart C of part 2 of 
subtitle A of title XIII of the Housing and Community Development Act 
of 1992 is amended to read as follows:

                      ``Subpart C--Enforcement''.

SEC. 1042. CONFORMING AMENDMENTS.

    Part 2 of subtitle A of title XIII of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4541 et seq.) is amended--
            (1) by striking ``Secretary'' each place such term appears 
        in such part and inserting ``Director'';
            (2) in the section heading for section 1323 (12 U.S.C. 
        4543), by inserting ``of enterprises'' before the period at the 
        end;
            (3) by striking section 1327 (12 U.S.C. 4547);
            (4) by striking section 1328 (12 U.S.C. 4548);
            (5) by redesignating section 1329 (as amended by section 
        1035) as section 1327;
            (6) in sections 1345(c)(1)(A), 1346(a), and 1346(b) (12 
        U.S.C. 4585(c)(1)(A), 4586(a), and 4586(b)), by striking 
        ``Secretary's'' each place such term appears and inserting 
        ``Director's''; and
            (7) by striking section 1349 (12 U.S.C. 4589).

                  CHAPTER 3--PROMPT CORRECTIVE ACTION

SEC. 1045. CAPITAL CLASSIFICATIONS.

    (a) In General.--Section 1364 of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4614) is amended--
            (1) in the heading for subsection (a), by striking ``In 
        General'' and inserting ``Enterprises''.
            (2) in subsection (c)--
                    (A) by striking ``subsection (b)'' and inserting 
                ``subsection (c)'';
                    (B) by striking ``enterprises'' and inserting 
                ``regulated entities''; and
                    (C) by striking the last sentence;
            (3) by redesignating subsections (c) (as so amended by 
        paragraph (2) of this subsection) and (d) as subsections (d) 
        and (f), respectively;
            (4) by striking subsection (b) and inserting the following 
        new subsections:
    ``(b) Federal Home Loan Banks.--
            ``(1) Establishment and criteria.--For purposes of this 
        subtitle, the Director shall, by regulation--
                    ``(A) establish the capital classifications 
                specified under paragraph (2) for the Federal home loan 
                banks;
                    ``(B) establish criteria for each such capital 
                classification based on the amount and types of capital 
                held by a bank and the risk-based, minimum, and 
                critical capital levels for the banks and taking due 
                consideration of the capital classifications 
                established under subsection (a) for the enterprises, 
                with such modifications as the Director determines to 
                be appropriate to reflect the difference in operations 
                between the banks and the enterprises; and
                    ``(C) shall classify the Federal home loan banks 
                according to such capital classifications.
            ``(2) Classifications.--The capital classifications 
        specified under this paragraph are--
                    ``(A) adequately capitalized;
                    ``(B) undercapitalized;
                    ``(C) significantly undercapitalized; and
                    ``(D) critically undercapitalized.
    ``(c) Discretionary Classification.--
            ``(1) Grounds for reclassification.--The Director may 
        reclassify a regulated entity under paragraph (2) if--
                    ``(A) at any time, the Director determines in 
                writing that the regulated entity is engaging in 
                conduct that could result in a rapid depletion of core 
                or total capital or, in the case of an enterprise, that 
                the value of the property subject to mortgages held or 
                securitized by the enterprise has decreased 
                significantly;
                    ``(B) after notice and an opportunity for hearing, 
                the Director determines that the regulated entity is in 
                an unsafe or unsound condition; or
                    ``(C) pursuant to section 1371(b), the Director 
                deems the regulated entity to be engaging in an unsafe 
                or unsound practice.
            ``(2) Reclassification.--In addition to any other action 
        authorized under this title, including the reclassification of 
        a regulated entity for any reason not specified in this 
        subsection, if the Director takes any action described in 
        paragraph (1) the Director may classify a regulated entity--
                    ``(A) as undercapitalized, if the regulated entity 
                is otherwise classified as adequately capitalized;
                    ``(B) as significantly undercapitalized, if the 
                regulated entity is otherwise classified as 
                undercapitalized; and
                    ``(C) as critically undercapitalized, if the 
                regulated entity is otherwise classified as 
                significantly undercapitalized.''; and
            (5) by inserting after subsection (d) (as so redesignated 
        by paragraph (3) of this subsection), the following new 
        subsection:
    ``(e) Restriction on Capital Distributions.--
            ``(1) In general.--A regulated entity shall make no capital 
        distribution if, after making the distribution, the regulated 
        entity would be undercapitalized.
            ``(2) Exception.--Notwithstanding paragraph (1), the 
        Director may permit a regulated entity, to the extent 
        appropriate or applicable, to repurchase, redeem, retire, or 
        otherwise acquire shares or ownership interests if the 
        repurchase, redemption, retirement, or other acquisition--
                    ``(A) is made in connection with the issuance of 
                additional shares or obligations of the regulated 
                entity in at least an equivalent amount; and
                    ``(B) will reduce the financial obligations of the 
                regulated entity or otherwise improve the financial 
                condition of the entity.''.
    (b) Regulations.--Not later than the expiration of the 180-day 
period beginning on the effective date under section 1065, the Director 
of the Federal Housing Finance Agency shall issue regulations to carry 
out section 1364(b) of the Housing and Community Development Act of 
1992 (as added by paragraph (4) of this subsection), relating to 
capital classifications for the Federal home loan banks.

SEC. 1046. SUPERVISORY ACTIONS APPLICABLE TO UNDERCAPITALIZED REGULATED 
              ENTITIES.

    Section 1365 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4615) is amended--
            (1) in the section heading, by striking ``enterprises'' and 
        inserting ``regulated entities'';
            (2) in subsection (a)--
                    (A) by redesignating paragraphs (1) and (2) as 
                paragraphs (2) and (3), respectively;
                    (B) by inserting before paragraph (2), as so 
                redesignated by subparagraph (A) of this paragraph, the 
                following paragraph:
            ``(1) Required monitoring.--The Director shall--
                    ``(A) closely monitor the condition of any 
                regulated entity that is classified as 
                undercapitalized;
                    ``(B) closely monitor compliance with the capital 
                restoration plan, restrictions, and requirements 
                imposed under this section; and
                    ``(C) periodically review the plan, restrictions, 
                and requirements applicable to the undercapitalized 
                regulated entity to determine whether the plan, 
                restrictions, and requirements are achieving the 
                purpose of this section.''; and
                    (C) by inserting at the end the following new 
                paragraphs:
            ``(4) Restriction of asset growth.--A regulated entity that 
        is classified as undercapitalized shall not permit its average 
        total assets (as such term is defined in section 1316(b) during 
        any calendar quarter to exceed its average total assets during 
        the preceding calendar quarter unless--
                    ``(A) the Director has accepted the capital 
                restoration plan of the regulated entity;
                    ``(B) any increase in total assets is consistent 
                with the plan; and
                    ``(C) the ratio of total capital to assets for the 
                regulated entity increases during the calendar quarter 
                at a rate sufficient to enable the entity to become 
                adequately capitalized within a reasonable time.
            ``(5) Prior approval of acquisitions, new products, and new 
        activities.--A regulated entity that is classified as 
        undercapitalized shall not, directly or indirectly, acquire any 
        interest in any entity or initially offer any new product (as 
        such term is defined in section 1321(f)) or engage in any new 
        activity, service, undertaking, or offering unless--
                    ``(A) the Director has accepted the capital 
                restoration plan of the regulated entity, the entity is 
                implementing the plan, and the Director determines that 
                the proposed action is consistent with and will further 
                the achievement of the plan; or
                    ``(B) the Director determines that the proposed 
                action will further the purpose of this section.'';
            (3) in the subsection heading for subsection (b), by 
        striking ``From Undercapitalized to Significantly 
        Undercapitalized''; and
            (4) by striking subsection (c) and inserting the following 
        new subsection:
    ``(c) Other Discretionary Safeguards.--The Director may take, with 
respect to a regulated entity that is classified as undercapitalized, 
any of the actions authorized to be taken under section 1366 with 
respect to a regulated entity that is classified as significantly 
undercapitalized, if the Director determines that such actions are 
necessary to carry out the purpose of this subtitle.''.

SEC. 1047. SUPERVISORY ACTIONS APPLICABLE TO SIGNIFICANTLY 
              UNDERCAPITALIZED REGULATED ENTITIES.

    Section 1366 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4616) is amended--
            (1) in the section heading, by striking ``enterprises'' and 
        inserting ``regulated entities'';
            (2) in subsection (a)(2)(A), by striking ``enterprise'' the 
        last place such term appears;
            (3) in subsection (b)--
                    (A) in the subsection heading, by striking 
                ``Discretionary Supervisory Actions'' and inserting 
                ``Specific Actions''.
                    (B) in the matter preceding paragraph (1), by 
                striking ``may, at any time, take any'' and inserting 
                ``shall carry out this section by taking, at any time, 
                one or more'';
                    (C) by redesignating paragraphs (5) and (6) as 
                paragraphs (6) and (7), respectively;
                    (D) by inserting after paragraph (4) the following 
                new paragraph:
            ``(5) Improvement of management.--Take one or more of the 
        following actions:
                    ``(A) New election of board.--Order a new election 
                for the board of directors of the regulated entity.
                    ``(B) Dismissal of directors or executive 
                officers.--Require the regulated entity to dismiss from 
                office any director or executive officer who had held 
                office for more than 180 days immediately before the 
                entity became undercapitalized. Dismissal under this 
                subparagraph shall not be construed to be a removal 
                pursuant to the Director's enforcement powers provided 
                in section 1377.
                    ``(C) Employ qualified executive officers.--Require 
                the regulated entity to employ qualified executive 
                officers (who, if the Director so specifies, shall be 
                subject to approval by the Director).''; and
                    (E) by inserting at the end the following new 
                paragraph:
            ``(8) Other action.--Require the regulated entity to take 
        any other action that the Director determines will better carry 
        out the purpose of this section than any of the actions 
        specified in this paragraph.'';
            (4) by redesignating subsection (c) as subsection (d); and
            (5) by inserting after subsection (b) the following new 
        subsection:
    ``(c) Restriction on Compensation of Executive Officers.--A 
regulated entity that is classified as significantly undercapitalized 
may not, without prior written approval by the Director--
            ``(1) pay any bonus to any executive officer; or
            ``(2) provide compensation to any executive officer at a 
        rate exceeding that officer's average rate of compensation 
        (excluding bonuses, stock options, and profit sharing) during 
        the 12 calendar months preceding the calendar month in which 
        the regulated entity became undercapitalized.''.

SEC. 1048. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED REGULATED 
              ENTITIES.

    (a) In General.--Section 1367 of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4617) is amended to read as follows:

``SEC. 1367. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED REGULATED 
              ENTITIES.

    ``(a) Appointment of Agency as Conservator or Receiver.--
            ``(1) In general.--Notwithstanding any other provision of 
        Federal or State law, if any of the grounds under paragraph (3) 
        exist, at the discretion of the Director, the Director may 
        establish a conservatorship or receivership, as appropriate, 
        for the purpose of reorganizing, rehabilitating, or winding up 
        the affairs of a regulated entity.
            ``(2) Appointment.--In any conservatorship or receivership 
        established under this section, the Director shall appoint the 
        Agency as conservator or receiver.
            ``(3) Grounds for appointment.--The grounds for appointing 
        a conservator or receiver for a regulated entity are as 
        follows:
                    ``(A) Assets insufficient for obligations.--The 
                assets of the regulated entity are less than the 
                obligations of the regulated entity to its creditors 
                and others.
                    ``(B) Substantial dissipation.--Substantial 
                dissipation of assets or earnings due to--
                            ``(i) any violation of any provision of 
                        Federal or State law; or
                            ``(ii) any unsafe or unsound practice.
                    ``(C) Unsafe or unsound condition.--An unsafe or 
                unsound condition to transact business.
                    ``(D) Cease-and-desist orders.--Any willful 
                violation of a cease-and-desist order that has become 
                final.
                    ``(E) Concealment.--Any concealment of the books, 
                papers, records, or assets of the regulated entity, or 
                any refusal to submit the books, papers, records, or 
                affairs of the regulated entity, for inspection to any 
                examiner or to any lawful agent of the Director.
                    ``(F) Inability to meet obligations.--The regulated 
                entity is likely to be unable to pay its obligations or 
                meet the demands of its creditors in the normal course 
                of business.
                    ``(G) Losses.--The regulated entity has incurred or 
                is likely to incur losses that will deplete all or 
                substantially all of its capital, and there is no 
                reasonable prospect for the regulated entity to become 
                adequately capitalized (as defined in section 
                1364(a)(1)).
                    ``(H) Violations of law.--Any violation of any law 
                or regulation, or any unsafe or unsound practice or 
                condition that is likely to--
                            ``(i) cause insolvency or substantial 
                        dissipation of assets or earnings; or
                            ``(ii) weaken the condition of the 
                        regulated entity.
                    ``(I) Consent.--The regulated entity, by resolution 
                of its board of directors or its shareholders or 
                members, consents to the appointment.
                    ``(J) Undercapitalization.--The regulated entity is 
                undercapitalized or significantly undercapitalized (as 
                defined in section 1364(a)(3) or in regulations issued 
                pursuant to section 1364(b), as applicable), and--
                            ``(i) has no reasonable prospect of 
                        becoming adequately capitalized;
                            ``(ii) fails to become adequately 
                        capitalized, as required by--
                                    ``(I) section 1365(a)(1) with 
                                respect to an undercapitalized 
                                regulated entity; or
                                    ``(II) section 1366(a)(1) with 
                                respect to a significantly 
                                undercapitalized regulated entity;
                            ``(iii) fails to submit a capital 
                        restoration plan acceptable to the Agency 
                        within the time prescribed under section 1369C; 
                        or
                            ``(iv) materially fails to implement a 
                        capital restoration plan submitted and accepted 
                        under section 1369C.
                    ``(K) Critical undercapitalization.--The regulated 
                entity is critically undercapitalized, as defined in 
                section 1364(a)(4) or in regulations issued pursuant to 
                section 1364(b), as applicable.
                    ``(L) Money laundering.--The Attorney General 
                notifies the Director in writing that the regulated 
                entity has been found guilty of a criminal offense 
                under section 1956 or 1957 of title 18, United States 
                Code, or section 5322 or 5324 of title 31, United 
                States Code.
            ``(4) Mandatory receivership.--
                    ``(A) In general.--The Director shall appoint the 
                Agency as receiver for a regulated entity if the 
                Director determines, in writing, that--
                            ``(i) the assets of the regulated entity 
                        are, and during the preceding 30 calendar days 
                        have been, less than the obligations of the 
                        regulated entity to its creditors and others; 
                        or
                            ``(ii) the regulated entity is not, and 
                        during the preceding 30 calendar days has not 
                        been, generally paying the debts of the 
                        regulated entity (other than debts that are the 
                        subject of a bona fide dispute) as such debts 
                        become due.
                    ``(B) Periodic determination required for 
                critically under capitalized regulated entity.--If a 
                regulated entity is critically undercapitalized, the 
                Director shall make a determination, in writing, as to 
                whether the regulated entity meets the criteria 
                specified in clause (i) or (ii) of subparagraph (A)--
                            ``(i) not later than 30 calendar days after 
                        the regulated entity initially becomes 
                        critically undercapitalized; and
                            ``(ii) at least once during each succeeding 
                        30-calendar day period.
                    ``(C) Determination not required if receivership 
                already in place.--Subparagraph (B) shall not apply 
                with respect to a regulated entity in any period during 
                which the Agency serves as receiver for the regulated 
                entity.
                    ``(D) Receivership terminates conservatorship.--The 
                appointment under this section of the Agency as 
                receiver of a regulated entity shall immediately 
                terminate any conservatorship established under this 
                title for the regulated entity.
            ``(5) Judicial review.--
                    ``(A) In general.--If the Agency is appointed 
                conservator or receiver under this section, the 
                regulated entity may, within 30 days of such 
                appointment, bring an action in the United States 
                District Court for the judicial district in which the 
                principal place of business of such regulated entity is 
                located, or in the United States District Court for the 
                District of Columbia, for an order requiring the Agency 
                to remove itself as conservator or receiver.
                    ``(B) Review.--Upon the filing of an action under 
                subparagraph (A), the court shall, upon the merits, 
                dismiss such action or direct the Agency to remove 
                itself as such conservator or receiver.
            ``(6) Directors not liable for acquiescing in appointment 
        of conservator or receiver.--The members of the board of 
        directors of a regulated entity shall not be liable to the 
        shareholders or creditors of the regulated entity for 
        acquiescing in or consenting in good faith to the appointment 
        of the Agency as conservator or receiver for that regulated 
        entity.
            ``(7) Agency not subject to any other federal agency.--When 
        acting as conservator or receiver, the Agency shall not be 
        subject to the direction or supervision of any other agency of 
        the United States or any State in the exercise of the rights, 
        powers, and privileges of the Agency.
    ``(b) Powers and Duties of the Agency as Conservator or Receiver.--
            ``(1) Rulemaking authority of the agency.--The Agency may 
        prescribe such regulations as the Agency determines to be 
        appropriate regarding the conduct of conservatorships or 
        receiverships.
            ``(2) General powers.--
                    ``(A) Successor to regulated entity.--The Agency 
                shall, as conservator or receiver, and by operation of 
                law, immediately succeed to--
                            ``(i) all rights, titles, powers, and 
                        privileges of the regulated entity, and of any 
                        stockholder, officer, or director of such 
                        regulated entity with respect to the regulated 
                        entity and the assets of the regulated entity; 
                        and
                            ``(ii) title to the books, records, and 
                        assets of any other legal custodian of such 
                        regulated entity.
                    ``(B) Operate the regulated entity.--The Agency 
                may, as conservator or receiver--
                            ``(i) take over the assets of and operate 
                        the regulated entity with all the powers of the 
                        shareholders, the directors, and the officers 
                        of the regulated entity and conduct all 
                        business of the regulated entity;
                            ``(ii) collect all obligations and money 
                        due the regulated entity;
                            ``(iii) perform all functions of the 
                        regulated entity in the name of the regulated 
                        entity which are consistent with the 
                        appointment as conservator or receiver; and
                            ``(iv) preserve and conserve the assets and 
                        property of such regulated entity.
                    ``(C) Functions of officers, directors, and 
                shareholders of a regulated entity.--The Agency may, by 
                regulation or order, provide for the exercise of any 
                function by any stockholder, director, or officer of 
                any regulated entity for which the Agency has been 
                named conservator or receiver.
                    ``(D) Powers as conservator.--The Agency may, as 
                conservator, take such action as may be--
                            ``(i) necessary to put the regulated entity 
                        in a sound and solvent condition; and
                            ``(ii) appropriate to carry on the business 
                        of the regulated entity and preserve and 
                        conserve the assets and property of the 
                        regulated entity, including, if two or more 
                        Federal home loan banks have been placed in 
                        conservatorship contemporaneously, merging two 
                        or more such banks into a single Federal home 
                        loan bank.
                    ``(E) Additional powers as receiver.--The Agency 
                may, as receiver, place the regulated entity in 
                liquidation and proceed to realize upon the assets of 
                the regulated entity, having due regard to the 
                conditions of the housing finance market.
                    ``(F) Organization of new regulated entities.--The 
                Agency may, as receiver, organize a successor regulated 
                entity that will operate pursuant to subsection (i).
                    ``(G) Transfer of assets and liabilities.--The 
                Agency may, as conservator or receiver, transfer any 
                asset or liability of the regulated entity in default 
                without any approval, assignment, or consent with 
                respect to such transfer. Any Federal home loan bank 
                may, with the approval of the Agency, acquire the 
                assets of any Bank in conservatorship or receivership, 
                and assume the liabilities of such Bank.
                    ``(H) Payment of valid obligations.--The Agency, as 
                conservator or receiver, shall, to the extent of 
                proceeds realized from the performance of contracts or 
                sale of the assets of a regulated entity, pay all valid 
                obligations of the regulated entity in accordance with 
                the prescriptions and limitations of this section.
                    ``(I) Subpoena authority.--
                            ``(i) In general.--
                                    ``(I) In general.--The Agency may, 
                                as conservator or receiver, and for 
                                purposes of carrying out any power, 
                                authority, or duty with respect to a 
                                regulated entity (including determining 
                                any claim against the regulated entity 
                                and determining and realizing upon any 
                                asset of any person in the course of 
                                collecting money due the regulated 
                                entity), exercise any power established 
                                under section 1348.
                                    ``(II) Applicability of law.--The 
                                provisions of section 1348 shall apply 
                                with respect to the exercise of any 
                                power exercised under this subparagraph 
                                in the same manner as such provisions 
                                apply under that section.
                            ``(ii) Authority of director.--A subpoena 
                        or subpoena duces tecum may be issued under 
                        clause (i) only by, or with the written 
                        approval of, the Director, or the designee of 
                        the Director.
                            ``(iii) Rule of construction.--This 
                        subsection shall not be construed to limit any 
                        rights that the Agency, in any capacity, might 
                        otherwise have under section 1317 or 1379D.
                    ``(J) Contracting for services.--The Agency may, as 
                conservator or receiver, provide by contract for the 
                carrying out of any of its functions, activities, 
                actions, or duties as conservator or receiver.
                    ``(K) Incidental powers.--The Agency may, as 
                conservator or receiver--
                            ``(i) exercise all powers and authorities 
                        specifically granted to conservators or 
                        receivers, respectively, under this section, 
                        and such incidental powers as shall be 
                        necessary to carry out such powers; and
                            ``(ii) take any action authorized by this 
                        section, which the Agency determines is in the 
                        best interests of the regulated entity or the 
                        Agency.
            ``(3) Authority of receiver to determine claims.--
                    ``(A) In general.--The Agency may, as receiver, 
                determine claims in accordance with the requirements of 
                this subsection and any regulations prescribed under 
                paragraph (4).
                    ``(B) Notice requirements.--The receiver, in any 
                case involving the liquidation or winding up of the 
                affairs of a closed regulated entity, shall--
                            ``(i) promptly publish a notice to the 
                        creditors of the regulated entity to present 
                        their claims, together with proof, to the 
                        receiver by a date specified in the notice 
                        which shall be not less than 90 days after the 
                        publication of such notice; and
                            ``(ii) republish such notice approximately 
                        1 month and 2 months, respectively, after the 
                        publication under clause (i).
                    ``(C) Mailing required.--The receiver shall mail a 
                notice similar to the notice published under 
                subparagraph (B)(i) at the time of such publication to 
                any creditor shown on the books of the regulated 
                entity--
                            ``(i) at the last address of the creditor 
                        appearing in such books; or
                            ``(ii) upon discovery of the name and 
                        address of a claimant not appearing on the 
                        books of the regulated entity within 30 days 
                        after the discovery of such name and address.
            ``(4) Rulemaking authority relating to determination of 
        claims.--Subject to subsection (c), the Director may prescribe 
        regulations regarding the allowance or disallowance of claims 
        by the receiver and providing for administrative determination 
        of claims and review of such determination.
            ``(5) Procedures for determination of claims.--
                    ``(A) Determination period.--
                            ``(i) In general.--Before the end of the 
                        180-day period beginning on the date on which 
                        any claim against a regulated entity is filed 
                        with the Agency as receiver, the Agency shall 
                        determine whether to allow or disallow the 
                        claim and shall notify the claimant of any 
                        determination with respect to such claim.
                            ``(ii) Extension of time.--The period 
                        described in clause (i) may be extended by a 
                        written agreement between the claimant and the 
                        Agency.
                            ``(iii) Mailing of notice sufficient.--The 
                        notification requirements of clause (i) shall 
                        be deemed to be satisfied if the notice of any 
                        determination with respect to any claim is 
                        mailed to the last address of the claimant 
                        which appears--
                                    ``(I) on the books of the regulated 
                                entity;
                                    ``(II) in the claim filed by the 
                                claimant; or
                                    ``(III) in documents submitted in 
                                proof of the claim.
                            ``(iv) Contents of notice of 
                        disallowance.--If any claim filed under clause 
                        (i) is disallowed, the notice to the claimant 
                        shall contain--
                                    ``(I) a statement of each reason 
                                for the disallowance; and
                                    ``(II) the procedures available for 
                                obtaining agency review of the 
                                determination to disallow the claim or 
                                judicial determination of the claim.
                    ``(B) Allowance of proven claim.--The receiver 
                shall allow any claim received on or before the date 
                specified in the notice published under paragraph 
                (3)(B)(i), or the date specified in the notice required 
                under paragraph (3)(C), which is proved to the 
                satisfaction of the receiver.
                    ``(C) Disallowance of claims filed after end of 
                filing period.--Claims filed after the date specified 
                in the notice published under paragraph (3)(B)(i), or 
                the date specified under paragraph (3)(C), shall be 
                disallowed and such disallowance shall be final.
                    ``(D) Authority to disallow claims.--
                            ``(i) In general.--The receiver may 
                        disallow any portion of any claim by a creditor 
                        or claim of security, preference, or priority 
                        which is not proved to the satisfaction of the 
                        receiver.
                            ``(ii) Payments to less than fully secured 
                        creditors.--In the case of a claim of a 
                        creditor against a regulated entity which is 
                        secured by any property or other asset of such 
                        regulated entity, the receiver--
                                    ``(I) may treat the portion of such 
                                claim which exceeds an amount equal to 
                                the fair market value of such property 
                                or other asset as an unsecured claim 
                                against the regulated entity; and
                                    ``(II) may not make any payment 
                                with respect to such unsecured portion 
                                of the claim other than in connection 
                                with the disposition of all claims of 
                                unsecured creditors of the regulated 
                                entity.
                            ``(iii) Exceptions.--No provision of this 
                        paragraph shall apply with respect to any 
                        extension of credit from any Federal Reserve 
                        Bank, Federal home loan bank, or the Treasury 
                        of the United States.
                    ``(E) No judicial review of determination pursuant 
                to subparagraph (d).--No court may review the 
                determination of the Agency under subparagraph (D) to 
                disallow a claim. This subparagraph shall not affect 
                the authority of a claimant to obtain de novo judicial 
                review of a claim pursuant to paragraph (6).
                    ``(F) Legal effect of filing.--
                            ``(i) Statute of limitation tolled.--For 
                        purposes of any applicable statute of 
                        limitations, the filing of a claim with the 
                        receiver shall constitute a commencement of an 
                        action.
                            ``(ii) No prejudice to other actions.--
                        Subject to paragraph (10), the filing of a 
                        claim with the receiver shall not prejudice any 
                        right of the claimant to continue any action 
                        which was filed before the date of the 
                        appointment of the receiver, subject to the 
                        determination of claims by the receiver.
            ``(6) Provision for judicial determination of claims.--
                    ``(A) In general.--The claimant may file suit on a 
                claim (or continue an action commenced before the 
                appointment of the receiver) in the district or 
                territorial court of the United States for the district 
                within which the principal place of business of the 
                regulated entity is located or the United States 
                District Court for the District of Columbia (and such 
                court shall have jurisdiction to hear such claim), 
                before the end of the 60-day period beginning on the 
                earlier of--
                            ``(i) the end of the period described in 
                        paragraph (5)(A)(i) with respect to any claim 
                        against a regulated entity for which the Agency 
                        is receiver; or
                            ``(ii) the date of any notice of 
                        disallowance of such claim pursuant to 
                        paragraph (5)(A)(i).
                    ``(B) Statute of limitations.--A claim shall be 
                deemed to be disallowed (other than any portion of such 
                claim which was allowed by the receiver), and such 
                disallowance shall be final, and the claimant shall 
                have no further rights or remedies with respect to such 
                claim, if the claimant fails, before the end of the 60-
                day period described under subparagraph (A), to file 
                suit on such claim (or continue an action commenced 
                before the appointment of the receiver).
            ``(7) Review of claims.--
                    ``(A) Other review procedures.--
                            ``(i) In general.--The Agency shall 
                        establish such alternative dispute resolution 
                        processes as may be appropriate for the 
                        resolution of claims filed under paragraph 
                        (5)(A)(i).
                            ``(ii) Criteria.--In establishing 
                        alternative dispute resolution processes, the 
                        Agency shall strive for procedures which are 
                        expeditious, fair, independent, and low cost.
                            ``(iii) Voluntary binding or nonbinding 
                        procedures.--The Agency may establish both 
                        binding and nonbinding processes, which may be 
                        conducted by any government or private party. 
                        All parties, including the claimant and the 
                        Agency, must agree to the use of the process in 
                        a particular case.
                    ``(B) Consideration of incentives.--The Agency 
                shall seek to develop incentives for claimants to 
                participate in the alternative dispute resolution 
                process.
            ``(8) Expedited determination of claims.--
                    ``(A) Establishment required.--The Agency shall 
                establish a procedure for expedited relief outside of 
                the routine claims process established under paragraph 
                (5) for claimants who--
                            ``(i) allege the existence of legally valid 
                        and enforceable or perfected security interests 
                        in assets of any regulated entity for which the 
                        Agency has been appointed receiver; and
                            ``(ii) allege that irreparable injury will 
                        occur if the routine claims procedure is 
                        followed.
                    ``(B) Determination period.--Before the end of the 
                90-day period beginning on the date any claim is filed 
                in accordance with the procedures established under 
                subparagraph (A), the Director shall--
                            ``(i) determine--
                                    ``(I) whether to allow or disallow 
                                such claim; or
                                    ``(II) whether such claim should be 
                                determined pursuant to the procedures 
                                established under paragraph (5); and
                            ``(ii) notify the claimant of the 
                        determination, and if the claim is disallowed, 
                        provide a statement of each reason for the 
                        disallowance and the procedure for obtaining 
                        agency review or judicial determination.
                    ``(C) Period for filing or renewing suit.--Any 
                claimant who files a request for expedited relief shall 
                be permitted to file a suit, or to continue a suit 
                filed before the appointment of the receiver, seeking a 
                determination of the rights of the claimant with 
                respect to such security interest after the earlier 
                of--
                            ``(i) the end of the 90-day period 
                        beginning on the date of the filing of a 
                        request for expedited relief; or
                            ``(ii) the date the Agency denies the 
                        claim.
                    ``(D) Statute of limitations.--If an action 
                described under subparagraph (C) is not filed, or the 
                motion to renew a previously filed suit is not made, 
                before the end of the 30-day period beginning on the 
                date on which such action or motion may be filed under 
                subparagraph (B), the claim shall be deemed to be 
                disallowed as of the end of such period (other than any 
                portion of such claim which was allowed by the 
                receiver), such disallowance shall be final, and the 
                claimant shall have no further rights or remedies with 
                respect to such claim.
                    ``(E) Legal effect of filing.--
                            ``(i) Statute of limitation tolled.--For 
                        purposes of any applicable statute of 
                        limitations, the filing of a claim with the 
                        receiver shall constitute a commencement of an 
                        action.
                            ``(ii) No prejudice to other actions.--
                        Subject to paragraph (10), the filing of a 
                        claim with the receiver shall not prejudice any 
                        right of the claimant to continue any action 
                        that was filed before the appointment of the 
                        receiver, subject to the determination of 
                        claims by the receiver.
            ``(9) Payment of claims.--
                    ``(A) In general.--The receiver may, in the 
                discretion of the receiver, and to the extent funds are 
                available from the assets of the regulated entity, pay 
                creditor claims, in such manner and amounts as are 
                authorized under this section, which are--
                            ``(i) allowed by the receiver;
                            ``(ii) approved by the Agency pursuant to a 
                        final determination pursuant to paragraph (7) 
                        or (8); or
                            ``(iii) determined by the final judgment of 
                        any court of competent jurisdiction.
                    ``(B) Agreements against the interest of the 
                agency.--No agreement that tends to diminish or defeat 
                the interest of the Agency in any asset acquired by the 
                Agency as receiver under this section shall be valid 
                against the Agency unless such agreement is in writing, 
                and executed by an authorized official of the regulated 
                entity, except that such requirements for qualified 
                financial contracts shall be applied in a manner 
                consistent with reasonable business trading practices 
                in the financial contracts market.
                    ``(C) Payment of dividends on claims.--The receiver 
                may, in the sole discretion of the receiver, pay from 
                the assets of the regulated entity dividends on proved 
                claims at any time, and no liability shall attach to 
                the Agency, by reason of any such payment, for failure 
                to pay dividends to a claimant whose claim is not 
                proved at the time of any such payment.
                    ``(D) Rulemaking authority of the director.--The 
                Director may prescribe such rules, including 
                definitions of terms, as the Director deems appropriate 
                to establish a single uniform interest rate for, or to 
                make payments of post-insolvency interest to creditors 
                holding proven claims against the receivership estates 
                of regulated entities following satisfaction by the 
                receiver of the principal amount of all creditor 
                claims.
            ``(10) Suspension of legal actions.--
                    ``(A) In general.--After the appointment of a 
                conservator or receiver for a regulated entity, the 
                conservator or receiver may, in any judicial action or 
                proceeding to which such regulated entity is or becomes 
                a party, request a stay for a period not to exceed--
                            ``(i) 45 days, in the case of any 
                        conservator; and
                            ``(ii) 90 days, in the case of any 
                        receiver.
                    ``(B) Grant of stay by all courts required.--Upon 
                receipt of a request by any conservator or receiver 
                under subparagraph (A) for a stay of any judicial 
                action or proceeding in any court with jurisdiction of 
                such action or proceeding, the court shall grant such 
                stay as to all parties.
            ``(11) Additional rights and duties.--
                    ``(A) Prior final adjudication.--The Agency shall 
                abide by any final unappealable judgment of any court 
                of competent jurisdiction which was rendered before the 
                appointment of the Agency as conservator or receiver.
                    ``(B) Rights and remedies of conservator or 
                receiver.--In the event of any appealable judgment, the 
                Agency as conservator or receiver shall--
                            ``(i) have all the rights and remedies 
                        available to the regulated entity (before the 
                        appointment of such conservator or receiver) 
                        and the Agency, including removal to Federal 
                        court and all appellate rights; and
                            ``(ii) not be required to post any bond in 
                        order to pursue such remedies.
                    ``(C) No attachment or execution.--No attachment or 
                execution may issue by any court upon assets in the 
                possession of the receiver.
                    ``(D) Limitation on judicial review.--Except as 
                otherwise provided in this subsection, no court shall 
                have jurisdiction over--
                            ``(i) any claim or action for payment from, 
                        or any action seeking a determination of rights 
                        with respect to, the assets of any regulated 
                        entity for which the Agency has been appointed 
                        receiver; or
                            ``(ii) any claim relating to any act or 
                        omission of such regulated entity or the Agency 
                        as receiver.
                    ``(E) Disposition of assets.--In exercising any 
                right, power, privilege, or authority as conservator or 
                receiver in connection with any sale or disposition of 
                assets of a regulated entity for which the Agency has 
                been appointed conservator or receiver, the Agency 
                shall conduct its operations in a manner which 
                maintains stability in the housing finance markets and, 
                to the extent consistent with that goal--
                            ``(i) maximizes the net present value 
                        return from the sale or disposition of such 
                        assets;
                            ``(ii) minimizes the amount of any loss 
                        realized in the resolution of cases; and
                            ``(iii) ensures adequate competition and 
                        fair and consistent treatment of offerors.
            ``(12) Statute of limitations for actions brought by 
        conservator or receiver.--
                    ``(A) In general.--Notwithstanding any provision of 
                any contract, the applicable statute of limitations 
                with regard to any action brought by the Agency as 
                conservator or receiver shall be--
                            ``(i) in the case of any contract claim, 
                        the longer of--
                                    ``(I) the 6-year period beginning 
                                on the date the claim accrues; or
                                    ``(II) the period applicable under 
                                State law; and
                            ``(ii) in the case of any tort claim, the 
                        longer of--
                                    ``(I) the 3-year period beginning 
                                on the date the claim accrues; or
                                    ``(II) the period applicable under 
                                State law.
                    ``(B) Determination of the date on which a claim 
                accrues.--For purposes of subparagraph (A), the date on 
                which the statute of limitations begins to run on any 
                claim described in such subparagraph shall be the later 
                of--
                            ``(i) the date of the appointment of the 
                        Agency as conservator or receiver; or
                            ``(ii) the date on which the cause of 
                        action accrues.
            ``(13) Revival of expired state causes of action.--
                    ``(A) In general.--In the case of any tort claim 
                described under subparagraph (B) for which the statute 
                of limitations applicable under State law with respect 
                to such claim has expired not more than 5 years before 
                the appointment of the Agency as conservator or 
                receiver, the Agency may bring an action as conservator 
                or receiver on such claim without regard to the 
                expiration of the statute of limitation applicable 
                under State law.
                    ``(B) Claims described.--A tort claim referred to 
                under subparagraph (A) is a claim arising from fraud, 
                intentional misconduct resulting in unjust enrichment, 
                or intentional misconduct resulting in substantial loss 
                to the regulated entity.
            ``(14) Accounting and recordkeeping requirements.--
                    ``(A) In general.--The Agency as conservator or 
                receiver shall, consistent with the accounting and 
                reporting practices and procedures established by the 
                Agency, maintain a full accounting of each 
                conservatorship and receivership or other disposition 
                of a regulated entity in default.
                    ``(B) Annual accounting or report.--With respect to 
                each conservatorship or receivership, the Agency shall 
                make an annual accounting or report available to the 
                Board, the Comptroller General of the United States, 
                the Committee on Banking, Housing, and Urban Affairs of 
                the Senate, and the Committee on Financial Services of 
                the House of Representatives.
                    ``(C) Availability of reports.--Any report prepared 
                under subparagraph (B) shall be made available by the 
                Agency upon request to any shareholder of a regulated 
                entity or any member of the public.
                    ``(D) Recordkeeping requirement.--After the end of 
                the 6-year period beginning on the date that the 
                conservatorship or receivership is terminated by the 
                Director, the Agency may destroy any records of such 
                regulated entity which the Agency, in the discretion of 
                the Agency, determines to be unnecessary unless 
                directed not to do so by a court of competent 
                jurisdiction or governmental agency, or prohibited by 
                law.
            ``(15) Fraudulent transfers.--
                    ``(A) In general.--The Agency, as conservator or 
                receiver, may avoid a transfer of any interest of a 
                regulated entity-affiliated party, or any person who 
                the conservator or receiver determines is a debtor of 
                the regulated entity, in property, or any obligation 
                incurred by such party or person, that was made within 
                5 years of the date on which the Agency was appointed 
                conservator or receiver, if such party or person 
                voluntarily or involuntarily made such transfer or 
                incurred such liability with the intent to hinder, 
                delay, or defraud the regulated entity, the Agency, the 
                conservator, or receiver.
                    ``(B) Right of recovery.--To the extent a transfer 
                is avoided under subparagraph (A), the conservator or 
                receiver may recover, for the benefit of the regulated 
                entity, the property transferred, or, if a court so 
                orders, the value of such property (at the time of such 
                transfer) from--
                            ``(i) the initial transferee of such 
                        transfer or the regulated entity-affiliated 
                        party or person for whose benefit such transfer 
                        was made; or
                            ``(ii) any immediate or mediate transferee 
                        of any such initial transferee.
                    ``(C) Rights of transferee or obligee.--The 
                conservator or receiver may not recover under 
                subparagraph (B) from--
                            ``(i) any transferee that takes for value, 
                        including satisfaction or securing of a present 
                        or antecedent debt, in good faith; or
                            ``(ii) any immediate or mediate good faith 
                        transferee of such transferee.
                    ``(D) Rights under this paragraph.--The rights 
                under this paragraph of the conservator or receiver 
                described under subparagraph (A) shall be superior to 
                any rights of a trustee or any other party (other than 
                any party which is a Federal agency) under title 11, 
                United States Code.
            ``(16) Attachment of assets and other injunctive relief.--
        Subject to paragraph (17), any court of competent jurisdiction 
        may, at the request of the conservator or receiver, issue an 
        order in accordance with Rule 65 of the Federal Rules of Civil 
        Procedure, including an order placing the assets of any person 
        designated by the Agency or such conservator under the control 
        of the court, and appointing a trustee to hold such assets.
            ``(17) Standards of proof.--Rule 65 of the Federal Rules of 
        Civil Procedure shall apply with respect to any proceeding 
        under paragraph (16) without regard to the requirement of such 
        rule that the applicant show that the injury, loss, or damage 
        is irreparable and immediate.
            ``(18) Treatment of claims arising from breach of contracts 
        executed by the receiver or conservator.--
                    ``(A) In general.--Notwithstanding any other 
                provision of this subsection, any final and 
                unappealable judgment for monetary damages entered 
                against a receiver or conservator for the breach of an 
                agreement executed or approved in writing by such 
                receiver or conservator after the date of its 
                appointment, shall be paid as an administrative expense 
                of the receiver or conservator.
                    ``(B) No limitation of power.--Nothing in this 
                paragraph shall be construed to limit the power of a 
                receiver or conservator to exercise any rights under 
                contract or law, including to terminate, breach, 
                cancel, or otherwise discontinue such agreement.
            ``(19) General exceptions.--
                    ``(A) Limitations.--The rights of a conservator or 
                receiver appointed under this section shall be subject 
                to the limitations on the powers of a receiver under 
                sections 402 through 407 of the Federal Deposit 
                Insurance Corporation Improvement Act of 1991 (12 
                U.S.C. 4402 through 4407).
                    ``(B) Mortgages held in trust.--
                            ``(i) In general.--Any mortgage, pool of 
                        mortgages, or interest in a pool of mortgages, 
                        held in trust, custodial, or agency capacity by 
                        a regulated entity for the benefit of persons 
                        other than the regulated entity shall not be 
                        available to satisfy the claims of creditors 
                        generally.
                            ``(ii) Holding of mortgages.--Any mortgage, 
                        pool of mortgages, or interest in a pool of 
                        mortgages, described under clause (i) shall be 
                        held by the conservator or receiver appointed 
                        under this section for the beneficial owners of 
                        such mortgage, pool of mortgages, or interest 
                        in a pool of mortgages in accordance with the 
                        terms of the agreement creating such trust, 
                        custodial, or other agency arrangement.
                            ``(iii) Liability of receiver.--The 
                        liability of a receiver appointed under this 
                        section for damages shall, in the case of any 
                        contingent or unliquidated claim relating to 
                        the mortgages held in trust, be estimated in 
                        accordance set forth in the regulations of the 
                        Director.
    ``(c) Priority of Expenses and Unsecured Claims.--
            ``(1) In general.--Unsecured claims against a regulated 
        entity, or a receiver, that are proven to the satisfaction of 
        the receiver shall have priority in the following order:
                    ``(A) Administrative expenses of the receiver.
                    ``(B) Any other general or senior liability of the 
                regulated entity and claims of other Federal home loan 
                banks arising from their payment obligations (including 
                joint and several payment obligations).
                    ``(C) Any obligation subordinated to general 
                creditors.
                    ``(D) Any obligation to shareholders or members 
                arising as a result of their status as shareholder or 
                members.
            ``(2) Creditors similarly situated.--All creditors that are 
        similarly situated under paragraph (1) shall be treated in a 
        similar manner, except that the Agency may make such other 
        payments to creditors necessary to maximize the present value 
        return from the sale or disposition or such regulated entity's 
        assets or to minimize the amount of any loss realized in the 
        resolution of cases so long as all creditors similarly situated 
        receive not less than the amount provided under subsection 
        (e)(2).
            ``(3) Definition.--The term `administrative expenses of the 
        receiver' shall include the actual, necessary costs and 
        expenses incurred by the receiver in preserving the assets of 
        the regulated entity or liquidating or otherwise resolving the 
        affairs of the regulated entity. Such expenses shall include 
        obligations that are incurred by the receiver after appointment 
        as receiver that the Director determines are necessary and 
        appropriate to facilitate the smooth and orderly liquidation or 
        other resolution of the regulated entity.
    ``(d) Provisions Relating to Contracts Entered Into Before 
Appointment of Conservator or Receiver.--
            ``(1) Authority to repudiate contracts.--In addition to any 
        other rights a conservator or receiver may have, the 
        conservator or receiver for any regulated entity may disaffirm 
        or repudiate any contract or lease--
                    ``(A) to which such regulated entity is a party;
                    ``(B) the performance of which the conservator or 
                receiver, in its sole discretion, determines to be 
                burdensome; and
                    ``(C) the disaffirmance or repudiation of which the 
                conservator or receiver determines, in its sole 
                discretion, will promote the orderly administration of 
                the affairs of the regulated entity.
            ``(2) Timing of repudiation.--The conservator or receiver 
        shall determine whether or not to exercise the rights of 
        repudiation under this subsection within a reasonable period 
        following such appointment.
            ``(3) Claims for damages for repudiation.--
                    ``(A) In general.--Except as otherwise provided 
                under subparagraph (C) and paragraphs (4), (5), and 
                (6), the liability of the conservator or receiver for 
                the disaffirmance or repudiation of any contract 
                pursuant to paragraph (1) shall be--
                            ``(i) limited to actual direct compensatory 
                        damages; and
                            ``(ii) determined as of--
                                    ``(I) the date of the appointment 
                                of the conservator or receiver; or
                                    ``(II) in the case of any contract 
                                or agreement referred to in paragraph 
                                (8), the date of the disaffirmance or 
                                repudiation of such contract or 
                                agreement.
                    ``(B) No liability for other damages.--For purposes 
                of subparagraph (A), the term `actual direct 
                compensatory damages' shall not include--
                            ``(i) punitive or exemplary damages;
                            ``(ii) damages for lost profits or 
                        opportunity; or
                            ``(iii) damages for pain and suffering.
                    ``(C) Measure of damages for repudiation of 
                financial contracts.--In the case of any qualified 
                financial contract or agreement to which paragraph (8) 
                applies, compensatory damages shall be--
                            ``(i) deemed to include normal and 
                        reasonable costs of cover or other reasonable 
                        measures of damages utilized in the industries 
                        for such contract and agreement claims; and
                            ``(ii) paid in accordance with this 
                        subsection and subsection (e), except as 
                        otherwise specifically provided in this 
                        section.
            ``(4) Leases under which the regulated entity is the 
        lessee.--
                    ``(A) In general.--If the conservator or receiver 
                disaffirms or repudiates a lease under which the 
                regulated entity was the lessee, the conservator or 
                receiver shall not be liable for any damages (other 
                than damages determined under subparagraph (B)) for the 
                disaffirmance or repudiation of such lease.
                    ``(B) Payments of rent.--Notwithstanding 
                subparagraph (A), the lessor under a lease to which 
                that subparagraph applies shall--
                            ``(i) be entitled to the contractual rent 
                        accruing before the later of the date--
                                    ``(I) the notice of disaffirmance 
                                or repudiation is mailed; or
                                    ``(II) the disaffirmance or 
                                repudiation becomes effective, unless 
                                the lessor is in default or breach of 
                                the terms of the lease;
                            ``(ii) have no claim for damages under any 
                        acceleration clause or other penalty provision 
                        in the lease; and
                            ``(iii) have a claim for any unpaid rent, 
                        subject to all appropriate offsets and 
                        defenses, due as of the date of the 
                        appointment, which shall be paid in accordance 
                        with this subsection and subsection (e).
            ``(5) Leases under which the regulated entity is the 
        lessor.--
                    ``(A) In general.--If the conservator or receiver 
                repudiates an unexpired written lease of real property 
                of the regulated entity under which the regulated 
                entity is the lessor and the lessee is not, as of the 
                date of such repudiation, in default, the lessee under 
                such lease may either--
                            ``(i) treat the lease as terminated by such 
                        repudiation; or
                            ``(ii) remain in possession of the 
                        leasehold interest for the balance of the term 
                        of the lease, unless the lessee defaults under 
                        the terms of the lease after the date of such 
                        repudiation.
                    ``(B) Provisions applicable to lessee remaining in 
                possession.--If any lessee under a lease described 
                under subparagraph (A) remains in possession of a 
                leasehold interest under clause (ii) of such 
                subparagraph--
                            ``(i) the lessee--
                                    ``(I) shall continue to pay the 
                                contractual rent pursuant to the terms 
                                of the lease after the date of the 
                                repudiation of such lease; and
                                    ``(II) may offset against any rent 
                                payment which accrues after the date of 
                                the repudiation of the lease, and any 
                                damages which accrue after such date 
                                due to the nonperformance of any 
                                obligation of the regulated entity 
                                under the lease after such date; and
                            ``(ii) the conservator or receiver shall 
                        not be liable to the lessee for any damages 
                        arising after such date as a result of the 
                        repudiation other than the amount of any offset 
                        allowed under clause (i)(II).
            ``(6) Contracts for the sale of real property.--
                    ``(A) In general.--If the conservator or receiver 
                repudiates any contract for the sale of real property 
                and the purchaser of such real property under such 
                contract is in possession, and is not, as of the date 
                of such repudiation, in default, such purchaser may 
                either--
                            ``(i) treat the contract as terminated by 
                        such repudiation; or
                            ``(ii) remain in possession of such real 
                        property.
                    ``(B) Provisions applicable to purchaser remaining 
                in possession.--If any purchaser of real property under 
                any contract described under subparagraph (A) remains 
                in possession of such property under clause (ii) of 
                such subparagraph--
                            ``(i) the purchaser--
                                    ``(I) shall continue to make all 
                                payments due under the contract after 
                                the date of the repudiation of the 
                                contract; and
                                    ``(II) may offset against any such 
                                payments any damages which accrue after 
                                such date due to the nonperformance 
                                (after such date) of any obligation of 
                                the regulated entity under the 
                                contract; and
                            ``(ii) the conservator or receiver shall--
                                    ``(I) not be liable to the 
                                purchaser for any damages arising after 
                                such date as a result of the 
                                repudiation other than the amount of 
                                any offset allowed under clause 
                                (i)(II);
                                    ``(II) deliver title to the 
                                purchaser in accordance with the 
                                provisions of the contract; and
                                    ``(III) have no obligation under 
                                the contract other than the performance 
                                required under subclause (II).
                    ``(C) Assignment and sale allowed.--
                            ``(i) In general.--No provision of this 
                        paragraph shall be construed as limiting the 
                        right of the conservator or receiver to assign 
                        the contract described under subparagraph (A), 
                        and sell the property subject to the contract 
                        and the provisions of this paragraph.
                            ``(ii) No liability after assignment and 
                        sale.--If an assignment and sale described 
                        under clause (i) is consummated, the 
                        conservator or receiver shall have no further 
                        liability under the contract described under 
                        subparagraph (A), or with respect to the real 
                        property which was the subject of such 
                        contract.
            ``(7) Provisions applicable to service contracts.--
                    ``(A) Services performed before appointment.--In 
                the case of any contract for services between any 
                person and any regulated entity for which the Agency 
                has been appointed conservator or receiver, any claim 
                of such person for services performed before the 
                appointment of the conservator or the receiver shall 
                be--
                            ``(i) a claim to be paid in accordance with 
                        subsections (b) and (e); and
                            ``(ii) deemed to have arisen as of the date 
                        the conservator or receiver was appointed.
                    ``(B) Services performed after appointment and 
                prior to repudiation.--If, in the case of any contract 
                for services described under subparagraph (A), the 
                conservator or receiver accepts performance by the 
                other person before the conservator or receiver makes 
                any determination to exercise the right of repudiation 
                of such contract under this section--
                            ``(i) the other party shall be paid under 
                        the terms of the contract for the services 
                        performed; and
                            ``(ii) the amount of such payment shall be 
                        treated as an administrative expense of the 
                        conservatorship or receivership.
                    ``(C) Acceptance of performance no bar to 
                subsequent repudiation.--The acceptance by any 
                conservator or receiver of services referred to under 
                subparagraph (B) in connection with a contract 
                described in such subparagraph shall not affect the 
                right of the conservator or receiver to repudiate such 
                contract under this section at any time after such 
                performance.
            ``(8) Certain qualified financial contracts.--
                    ``(A) Rights of parties to contracts.--Subject to 
                paragraphs (9) and (10) and notwithstanding any other 
                provision of this Act, any other Federal law, or the 
                law of any State, no person shall be stayed or 
                prohibited from exercising--
                            ``(i) any right such person has to cause 
                        the termination, liquidation, or acceleration 
                        of any qualified financial contract with a 
                        regulated entity that arises upon the 
                        appointment of the Agency as receiver for such 
                        regulated entity at any time after such 
                        appointment;
                            ``(ii) any right under any security 
                        agreement or arrangement or other credit 
                        enhancement relating to one or more qualified 
                        financial contracts described in clause (i); or
                            ``(iii) any right to offset or net out any 
                        termination value, payment amount, or other 
                        transfer obligation arising under or in 
                        connection with 1 or more contracts and 
                        agreements described in clause (i), including 
                        any master agreement for such contracts or 
                        agreements.
                    ``(B) Applicability of other provisions.--Paragraph 
                (10) of subsection (b) shall apply in the case of any 
                judicial action or proceeding brought against any 
                receiver referred to under subparagraph (A), or the 
                regulated entity for which such receiver was appointed, 
                by any party to a contract or agreement described under 
                subparagraph (A)(i) with such regulated entity.
                    ``(C) Certain transfers not avoidable.--
                            ``(i) In general.--Notwithstanding 
                        paragraph (11) or any other Federal or State 
                        laws relating to the avoidance of preferential 
                        or fraudulent transfers, the Agency, whether 
                        acting as such or as conservator or receiver of 
                        a regulated entity, may not avoid any transfer 
                        of money or other property in connection with 
                        any qualified financial contract with a 
                        regulated entity.
                            ``(ii) Exception for certain transfers.--
                        Clause (i) shall not apply to any transfer of 
                        money or other property in connection with any 
                        qualified financial contract with a regulated 
                        entity if the Agency determines that the 
                        transferee had actual intent to hinder, delay, 
                        or defraud such regulated entity, the creditors 
                        of such regulated entity, or any conservator or 
                        receiver appointed for such regulated entity.
                    ``(D) Certain contracts and agreements defined.--In 
                this subsection:
                            ``(i) Qualified financial contract.--The 
                        term `qualified financial contract' means any 
                        securities contract, commodity contract, 
                        forward contract, repurchase agreement, swap 
                        agreement, and any similar agreement that the 
                        Agency determines by regulation, resolution, or 
                        order to be a qualified financial contract for 
                        purposes of this paragraph.
                            ``(ii) Securities contract.--The term 
                        `securities contract'--
                                    ``(I) means a contract for the 
                                purchase, sale, or loan of a security, 
                                a certificate of deposit, a mortgage 
                                loan, or any interest in a mortgage 
                                loan, a group or index of securities, 
                                certificates of deposit, or mortgage 
                                loans or interests therein (including 
                                any interest therein or based on the 
                                value thereof) or any option on any of 
                                the foregoing, including any option to 
                                purchase or sell any such security, 
                                certificate of deposit, mortgage loan, 
                                interest, group or index, or option, 
                                and including any repurchase or reverse 
                                repurchase transaction on any such 
                                security, certificate of deposit, 
                                mortgage loan, interest, group or 
                                index, or option;
                                    ``(II) does not include any 
                                purchase, sale, or repurchase 
                                obligation under a participation in a 
                                commercial mortgage loan unless the 
                                Agency determines by regulation, 
                                resolution, or order to include any 
                                such agreement within the meaning of 
                                such term;
                                    ``(III) means any option entered 
                                into on a national securities exchange 
                                relating to foreign currencies;
                                    ``(IV) means the guarantee by or to 
                                any securities clearing agency of any 
                                settlement of cash, securities, 
                                certificates of deposit, mortgage loans 
                                or interests therein, group or index of 
                                securities, certificates of deposit, or 
                                mortgage loans or interests therein 
                                (including any interest therein or 
                                based on the value thereof) or option 
                                on any of the foregoing, including any 
                                option to purchase or sell any such 
                                security, certificate of deposit, 
                                mortgage loan, interest, group or 
                                index, or option;
                                    ``(V) means any margin loan;
                                    ``(VI) means any other agreement or 
                                transaction that is similar to any 
                                agreement or transaction referred to in 
                                this clause;
                                    ``(VII) means any combination of 
                                the agreements or transactions referred 
                                to in this clause;
                                    ``(VIII) means any option to enter 
                                into any agreement or transaction 
                                referred to in this clause;
                                    ``(IX) means a master agreement 
                                that provides for an agreement or 
                                transaction referred to in subclause 
                                (I), (III), (IV), (V), (VI), (VII), or 
                                (VIII), together with all supplements 
                                to any such master agreement, without 
                                regard to whether the master agreement 
                                provides for an agreement or 
                                transaction that is not a securities 
                                contract under this clause, except that 
                                the master agreement shall be 
                                considered to be a securities contract 
                                under this clause only with respect to 
                                each agreement or transaction under the 
                                master agreement that is referred to in 
                                subclause (I), (III), (IV), (V), (VI), 
                                (VII), or (VIII); and
                                    ``(X) means any security agreement 
                                or arrangement or other credit 
                                enhancement related to any agreement or 
                                transaction referred to in this clause, 
                                including any guarantee or 
                                reimbursement obligation in connection 
                                with any agreement or transaction 
                                referred to in this clause.
                            ``(iii) Commodity contract.--The term 
                        `commodity contract' means--
                                    ``(I) with respect to a futures 
                                commission merchant, a contract for the 
                                purchase or sale of a commodity for 
                                future delivery on, or subject to the 
                                rules of, a contract market or board of 
                                trade;
                                    ``(II) with respect to a foreign 
                                futures commission merchant, a foreign 
                                future;
                                    ``(III) with respect to a leverage 
                                transaction merchant, a leverage 
                                transaction;
                                    ``(IV) with respect to a clearing 
                                organization, a contract for the 
                                purchase or sale of a commodity for 
                                future delivery on, or subject to the 
                                rules of, a contract market or board of 
                                trade that is cleared by such clearing 
                                organization, or commodity option 
                                traded on, or subject to the rules of, 
                                a contract market or board of trade 
                                that is cleared by such clearing 
                                organization;
                                    ``(V) with respect to a commodity 
                                options dealer, a commodity option;
                                    ``(VI) any other agreement or 
                                transaction that is similar to any 
                                agreement or transaction referred to in 
                                this clause;
                                    ``(VII) any combination of the 
                                agreements or transactions referred to 
                                in this clause;
                                    ``(VIII) any option to enter into 
                                any agreement or transaction referred 
                                to in this clause;
                                    ``(IX) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in subclause 
                                (I), (II), (III), (IV), (V), (VI), 
                                (VII), or (VIII), together with all 
                                supplements to any such master 
                                agreement, without regard to whether 
                                the master agreement provides for an 
                                agreement or transaction that is not a 
                                commodity contract under this clause, 
                                except that the master agreement shall 
                                be considered to be a commodity 
                                contract under this clause only with 
                                respect to each agreement or 
                                transaction under the master agreement 
                                that is referred to in subclause (I), 
                                (II), (III), (IV), (V), (VI), (VII), or 
                                (VIII); or
                                    ``(X) any security agreement or 
                                arrangement or other credit enhancement 
                                related to any agreement or transaction 
                                referred to in this clause, including 
                                any guarantee or reimbursement 
                                obligation in connection with any 
                                agreement or transaction referred to in 
                                this clause.
                            ``(iv) Forward contract.--The term `forward 
                        contract' means--
                                    ``(I) a contract (other than a 
                                commodity contract) for the purchase, 
                                sale, or transfer of a commodity or any 
                                similar good, article, service, right, 
                                or interest which is presently or in 
                                the future becomes the subject of 
                                dealing in the forward contract trade, 
                                or product or byproduct thereof, with a 
                                maturity date more than 2 days after 
                                the date the contract is entered into, 
                                including, a repurchase transaction, 
                                reverse repurchase transaction, 
                                consignment, lease, swap, hedge 
                                transaction, deposit, loan, option, 
                                allocated transaction, unallocated 
                                transaction, or any other similar 
                                agreement;
                                    ``(II) any combination of 
                                agreements or transactions referred to 
                                in subclauses (I) and (III);
                                    ``(III) any option to enter into 
                                any agreement or transaction referred 
                                to in subclause (I) or (II);
                                    ``(IV) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in subclauses 
                                (I), (II), or (III), together with all 
                                supplements to any such master 
                                agreement, without regard to whether 
                                the master agreement provides for an 
                                agreement or transaction that is not a 
                                forward contract under this clause, 
                                except that the master agreement shall 
                                be considered to be a forward contract 
                                under this clause only with respect to 
                                each agreement or transaction under the 
                                master agreement that is referred to in 
                                subclause (I), (II), or (III); or
                                    ``(V) any security agreement or 
                                arrangement or other credit enhancement 
                                related to any agreement or transaction 
                                referred to in subclause (I), (II), 
                                (III), or (IV), including any guarantee 
                                or reimbursement obligation in 
                                connection with any agreement or 
                                transaction referred to in any such 
                                subclause.
                            ``(v) Repurchase agreement.--The term 
                        `repurchase agreement' (which definition also 
                        applies to a reverse repurchase agreement)--
                                    ``(I) means an agreement, including 
                                related terms, which provides for the 
                                transfer of one or more certificates of 
                                deposit, mortgage-related securities 
                                (as such term is defined in the 
                                Securities Exchange Act of 1934), 
                                mortgage loans, interests in mortgage-
                                related securities or mortgage loans, 
                                eligible bankers' acceptances, 
                                qualified foreign government securities 
                                or securities that are direct 
                                obligations of, or that are fully 
                                guaranteed by, the United States or any 
                                agency of the United States against the 
                                transfer of funds by the transferee of 
                                such certificates of deposit, eligible 
                                bankers' acceptances, securities, 
                                mortgage loans, or interests with a 
                                simultaneous agreement by such 
                                transferee to transfer to the 
                                transferor thereof certificates of 
                                deposit, eligible bankers' acceptances, 
                                securities, mortgage loans, or 
                                interests as described above, at a date 
                                certain not later than 1 year after 
                                such transfers or on demand, against 
                                the transfer of funds, or any other 
                                similar agreement;
                                    ``(II) does not include any 
                                repurchase obligation under a 
                                participation in a commercial mortgage 
                                loan unless the Agency determines by 
                                regulation, resolution, or order to 
                                include any such participation within 
                                the meaning of such term;
                                    ``(III) means any combination of 
                                agreements or transactions referred to 
                                in subclauses (I) and (IV);
                                    ``(IV) means any option to enter 
                                into any agreement or transaction 
                                referred to in subclause (I) or (III);
                                    ``(V) means a master agreement that 
                                provides for an agreement or 
                                transaction referred to in subclause 
                                (I), (III), or (IV), together with all 
                                supplements to any such master 
                                agreement, without regard to whether 
                                the master agreement provides for an 
                                agreement or transaction that is not a 
                                repurchase agreement under this clause, 
                                except that the master agreement shall 
                                be considered to be a repurchase 
                                agreement under this subclause only 
                                with respect to each agreement or 
                                transaction under the master agreement 
                                that is referred to in subclause (I), 
                                (III), or (IV); and
                                    ``(VI) means any security agreement 
                                or arrangement or other credit 
                                enhancement related to any agreement or 
                                transaction referred to in subclause 
                                (I), (III), (IV), or (V), including any 
                                guarantee or reimbursement obligation 
                                in connection with any agreement or 
                                transaction referred to in any such 
                                subclause.
                        For purposes of this clause, the term 
                        `qualified foreign government security' means a 
                        security that is a direct obligation of, or 
                        that is fully guaranteed by, the central 
                        government of a member of the Organization for 
                        Economic Cooperation and Development (as 
                        determined by regulation or order adopted by 
                        the appropriate Federal banking authority).
                            ``(vi) Swap agreement.--The term `swap 
                        agreement' means--
                                    ``(I) any agreement, including the 
                                terms and conditions incorporated by 
                                reference in any such agreement, which 
                                is an interest rate swap, option, 
                                future, or forward agreement, including 
                                a rate floor, rate cap, rate collar, 
                                cross-currency rate swap, and basis 
                                swap; a spot, same day-tomorrow, 
                                tomorrow-next, forward, or other 
                                foreign exchange or precious metals 
                                agreement; a currency swap, option, 
                                future, or forward agreement; an equity 
                                index or equity swap, option, future, 
                                or forward agreement; a debt index or 
                                debt swap, option, future, or forward 
                                agreement; a total return, credit 
                                spread or credit swap, option, future, 
                                or forward agreement; a commodity index 
                                or commodity swap, option, future, or 
                                forward agreement; or a weather swap, 
                                weather derivative, or weather option;
                                    ``(II) any agreement or transaction 
                                that is similar to any other agreement 
                                or transaction referred to in this 
                                clause and that is of a type that has 
                                been, is presently, or in the future 
                                becomes, the subject of recurrent 
                                dealings in the swap markets (including 
                                terms and conditions incorporated by 
                                reference in such agreement) and that 
                                is a forward, swap, future, or option 
                                on one or more rates, currencies, 
                                commodities, equity securities or other 
                                equity instruments, debt securities or 
                                other debt instruments, quantitative 
                                measures associated with an occurrence, 
                                extent of an occurrence, or contingency 
                                associated with a financial, 
                                commercial, or economic consequence, or 
                                economic or financial indices or 
                                measures of economic or financial risk 
                                or value;
                                    ``(III) any combination of 
                                agreements or transactions referred to 
                                in this clause;
                                    ``(IV) any option to enter into any 
                                agreement or transaction referred to in 
                                this clause;
                                    ``(V) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in subclause 
                                (I), (II), (III), or (IV), together 
                                with all supplements to any such master 
                                agreement, without regard to whether 
                                the master agreement contains an 
                                agreement or transaction that is not a 
                                swap agreement under this clause, 
                                except that the master agreement shall 
                                be considered to be a swap agreement 
                                under this clause only with respect to 
                                each agreement or transaction under the 
                                master agreement that is referred to in 
                                subclause (I), (II), (III), or (IV); 
                                and
                                    ``(VI) any security agreement or 
                                arrangement or other credit enhancement 
                                related to any agreements or 
                                transactions referred to in subclause 
                                (I), (II), (III), (IV), or (V), 
                                including any guarantee or 
                                reimbursement obligation in connection 
                                with any agreement or transaction 
                                referred to in any such subclause.
                        Such term is applicable for purposes of this 
                        subsection only and shall not be construed or 
                        applied so as to challenge or affect the 
                        characterization, definition, or treatment of 
                        any swap agreement under any other statute, 
                        regulation, or rule, including the Securities 
                        Act of 1933, the Securities Exchange Act of 
                        1934, the Public Utility Holding Company Act of 
                        1935, the Trust Indenture Act of 1939, the 
                        Investment Company Act of 1940, the Investment 
                        Advisers Act of 1940, the Securities Investor 
                        Protection Act of 1970, the Commodity Exchange 
                        Act, the Gramm-Leach-Bliley Act, and the Legal 
                        Certainty for Bank Products Act of 2000.
                            ``(vii) Treatment of master agreement as 
                        one agreement.--Any master agreement for any 
                        contract or agreement described in any 
                        preceding clause of this subparagraph (or any 
                        master agreement for such master agreement or 
                        agreements), together with all supplements to 
                        such master agreement, shall be treated as a 
                        single agreement and a single qualified 
                        financial contract. If a master agreement 
                        contains provisions relating to agreements or 
                        transactions that are not themselves qualified 
                        financial contracts, the master agreement shall 
                        be deemed to be a qualified financial contract 
                        only with respect to those transactions that 
                        are themselves qualified financial contracts.
                            ``(viii) Transfer.--The term `transfer' 
                        means every mode, direct or indirect, absolute 
                        or conditional, voluntary or involuntary, of 
                        disposing of or parting with property or with 
                        an interest in property, including retention of 
                        title as a security interest and foreclosure of 
                        the regulated entity's equity of redemption.
                    ``(E) Certain protections in event of appointment 
                of conservator.--Notwithstanding any other provision of 
                this Act (other than paragraph (13) of this 
                subsection), any other Federal law, or the law of any 
                State, no person shall be stayed or prohibited from 
                exercising--
                            ``(i) any right such person has to cause 
                        the termination, liquidation, or acceleration 
                        of any qualified financial contract with a 
                        regulated entity in a conservatorship based 
                        upon a default under such financial contract 
                        which is enforceable under applicable 
                        noninsolvency law;
                            ``(ii) any right under any security 
                        agreement or arrangement or other credit 
                        enhancement relating to one or more such 
                        qualified financial contracts; or
                            ``(iii) any right to offset or net out any 
                        termination values, payment amounts, or other 
                        transfer obligations arising under or in 
                        connection with such qualified financial 
                        contracts.
                    ``(F) Clarification.--No provision of law shall be 
                construed as limiting the right or power of the Agency, 
                or authorizing any court or agency to limit or delay, 
                in any manner, the right or power of the Agency to 
                transfer any qualified financial contract in accordance 
                with paragraphs (9) and (10) of this subsection or to 
                disaffirm or repudiate any such contract in accordance 
                with subsection (d)(1) of this section.
                    ``(G) Walkaway clauses not effective.--
                            ``(i) In general.--Notwithstanding the 
                        provisions of subparagraphs (A) and (E), and 
                        sections 403 and 404 of the Federal Deposit 
                        Insurance Corporation Improvement Act of 1991, 
                        no walkaway clause shall be enforceable in a 
                        qualified financial contract of a regulated 
                        entity in default.
                            ``(ii) Walkaway clause defined.--For 
                        purposes of this subparagraph, the term 
                        `walkaway clause' means a provision in a 
                        qualified financial contract that, after 
                        calculation of a value of a party's position or 
                        an amount due to or from 1 of the parties in 
                        accordance with its terms upon termination, 
                        liquidation, or acceleration of the qualified 
                        financial contract, either does not create a 
                        payment obligation of a party or extinguishes a 
                        payment obligation of a party in whole or in 
                        part solely because of such party's status as a 
                        nondefaulting party.
            ``(9) Transfer of qualified financial contracts.--In making 
        any transfer of assets or liabilities of a regulated entity in 
        default which includes any qualified financial contract, the 
        conservator or receiver for such regulated entity shall 
        either--
                    ``(A) transfer to 1 person--
                            ``(i) all qualified financial contracts 
                        between any person (or any affiliate of such 
                        person) and the regulated entity in default;
                            ``(ii) all claims of such person (or any 
                        affiliate of such person) against such 
                        regulated entity under any such contract (other 
                        than any claim which, under the terms of any 
                        such contract, is subordinated to the claims of 
                        general unsecured creditors of such regulated 
                        entity);
                            ``(iii) all claims of such regulated entity 
                        against such person (or any affiliate of such 
                        person) under any such contract; and
                            ``(iv) all property securing or any other 
                        credit enhancement for any contract described 
                        in clause (i) or any claim described in clause 
                        (ii) or (iii) under any such contract; or
                    ``(B) transfer none of the financial contracts, 
                claims, or property referred to under subparagraph (A) 
                (with respect to such person and any affiliate of such 
                person).
            ``(10) Notification of transfer.--
                    ``(A) In general.--If--
                            ``(i) the conservator or receiver for a 
                        regulated entity in default makes any transfer 
                        of the assets and liabilities of such regulated 
                        entity, and
                            ``(ii) the transfer includes any qualified 
                        financial contract,
                the conservator or receiver shall notify any person who 
                is a party to any such contract of such transfer by 
                5:00 p.m. (eastern time) on the business day following 
                the date of the appointment of the receiver in the case 
                of a receivership, or the business day following such 
                transfer in the case of a conservatorship.
                    ``(B) Certain rights not enforceable.--
                            ``(i) Receivership.--A person who is a 
                        party to a qualified financial contract with a 
                        regulated entity may not exercise any right 
                        that such person has to terminate, liquidate, 
                        or net such contract under paragraph (8)(A) of 
                        this subsection or section 403 or 404 of the 
                        Federal Deposit Insurance Corporation 
                        Improvement Act of 1991, solely by reason of or 
                        incidental to the appointment of a receiver for 
                        the regulated entity (or the insolvency or 
                        financial condition of the regulated entity for 
                        which the receiver has been appointed)--
                                    ``(I) until 5:00 p.m. (eastern 
                                time) on the business day following the 
                                date of the appointment of the 
                                receiver; or
                                    ``(II) after the person has 
                                received notice that the contract has 
                                been transferred pursuant to paragraph 
                                (9)(A).
                            ``(ii) Conservatorship.--A person who is a 
                        party to a qualified financial contract with a 
                        regulated entity may not exercise any right 
                        that such person has to terminate, liquidate, 
                        or net such contract under paragraph (8)(E) of 
                        this subsection or section 403 or 404 of the 
                        Federal Deposit Insurance Corporation 
                        Improvement Act of 1991, solely by reason of or 
                        incidental to the appointment of a conservator 
                        for the regulated entity (or the insolvency or 
                        financial condition of the regulated entity for 
                        which the conservator has been appointed).
                            ``(iii) Notice.--For purposes of this 
                        paragraph, the Agency as receiver or 
                        conservator of a regulated entity shall be 
                        deemed to have notified a person who is a party 
                        to a qualified financial contract with such 
                        regulated entity if the Agency has taken steps 
                        reasonably calculated to provide notice to such 
                        person by the time specified in subparagraph 
                        (A).
                    ``(C) Business day defined.--For purposes of this 
                paragraph, the term `business day' means any day other 
                than any Saturday, Sunday, or any day on which either 
                the New York Stock Exchange or the Federal Reserve Bank 
                of New York is closed.
            ``(11) Disaffirmance or repudiation of qualified financial 
        contracts.--In exercising the rights of disaffirmance or 
        repudiation of a conservator or receiver with respect to any 
        qualified financial contract to which a regulated entity is a 
        party, the conservator or receiver for such institution shall 
        either--
                    ``(A) disaffirm or repudiate all qualified 
                financial contracts between--
                            ``(i) any person or any affiliate of such 
                        person; and
                            ``(ii) the regulated entity in default; or
                    ``(B) disaffirm or repudiate none of the qualified 
                financial contracts referred to in subparagraph (A) 
                (with respect to such person or any affiliate of such 
                person).
            ``(12) Certain security interests not avoidable.--No 
        provision of this subsection shall be construed as permitting 
        the avoidance of any legally enforceable or perfected security 
        interest in any of the assets of any regulated entity, except 
        where such an interest is taken in contemplation of the 
        insolvency of the regulated entity, or with the intent to 
        hinder, delay, or defraud the regulated entity or the creditors 
        of such regulated entity.
            ``(13) Authority to enforce contracts.--
                    ``(A) In general.--Notwithstanding any provision of 
                a contract providing for termination, default, 
                acceleration, or exercise of rights upon, or solely by 
                reason of, insolvency or the appointment of a 
                conservator or receiver, the conservator or receiver 
                may enforce any contract or regulated entity bond 
                entered into by the regulated entity.
                    ``(B) Certain rights not affected.--No provision of 
                this paragraph may be construed as impairing or 
                affecting any right of the conservator or receiver to 
                enforce or recover under a director's or officer's 
                liability insurance contract or surety bond under other 
                applicable law.
                    ``(C) Consent requirement.--
                            ``(i) In general.--Except as otherwise 
                        provided under this section, no person may 
                        exercise any right or power to terminate, 
                        accelerate, or declare a default under any 
                        contract to which a regulated entity is a 
                        party, or to obtain possession of or exercise 
                        control over any property of the regulated 
                        entity, or affect any contractual rights of the 
                        regulated entity, without the consent of the 
                        conservator or receiver, as appropriate, for a 
                        period of--
                                    ``(I) 45 days after the date of 
                                appointment of a conservator; or
                                    ``(II) 90 days after the date of 
                                appointment of a receiver.
                            ``(ii) Exceptions.--This paragraph shall--
                                    ``(I) not apply to a director's or 
                                officer's liability insurance contract;
                                    ``(II) not apply to the rights of 
                                parties to any qualified financial 
                                contracts under subsection (d)(8); and
                                    ``(III) not be construed as 
                                permitting the conservator or receiver 
                                to fail to comply with otherwise 
                                enforceable provisions of such 
                                contracts.
            ``(14) Savings clause.--The meanings of terms used in this 
        subsection are applicable for purposes of this subsection only, 
        and shall not be construed or applied so as to challenge or 
        affect the characterization, definition, or treatment of any 
        similar terms under any other statute, regulation, or rule, 
        including the Gramm-Leach-Bliley Act, the Legal Certainty for 
        Bank Products Act of 2000, the securities laws (as that term is 
        defined in section 3(a)(47) of the Securities Exchange Act of 
        1934), and the Commodity Exchange Act.
            ``(15) Exception for federal reserve and federal home loan 
        banks.--No provision of this subsection shall apply with 
        respect to--
                    ``(A) any extension of credit from any Federal home 
                loan bank or Federal Reserve Bank to any regulated 
                entity; or
                    ``(B) any security interest in the assets of the 
                regulated entity securing any such extension of credit.
    ``(e) Valuation of Claims in Default.--
            ``(1) In general.--Notwithstanding any other provision of 
        Federal law or the law of any State, and regardless of the 
        method which the Agency determines to utilize with respect to a 
        regulated entity in default or in danger of default, including 
        transactions authorized under subsection (i), this subsection 
        shall govern the rights of the creditors of such regulated 
        entity.
            ``(2) Maximum liability.--The maximum liability of the 
        Agency, acting as receiver or in any other capacity, to any 
        person having a claim against the receiver or the regulated 
        entity for which such receiver is appointed shall equal the 
        lesser of--
                    ``(A) the amount such claimant would have received 
                if the Agency had liquidated the assets and liabilities 
                of such regulated entity without exercising the 
                authority of the Agency under subsection (i) of this 
                section; or
                    ``(B) the amount of proceeds realized from the 
                performance of contracts or sale of the assets of the 
                regulated entity.
    ``(f) Limitation on Court Action.--Except as provided in this 
section or at the request of the Director, no court may take any action 
to restrain or affect the exercise of powers or functions of the Agency 
as a conservator or a receiver.
    ``(g) Liability of Directors and Officers.--
            ``(1) In general.--A director or officer of a regulated 
        entity may be held personally liable for monetary damages in 
        any civil action by, on behalf of, or at the request or 
        direction of the Agency, which action is prosecuted wholly or 
        partially for the benefit of the Agency--
                    ``(A) acting as conservator or receiver of such 
                regulated entity, or
                    ``(B) acting based upon a suit, claim, or cause of 
                action purchased from, assigned by, or otherwise 
                conveyed by such receiver or conservator,
        for gross negligence, including any similar conduct or conduct 
        that demonstrates a greater disregard of a duty of care (than 
        gross negligence) including intentional tortious conduct, as 
        such terms are defined and determined under applicable State 
        law.
            ``(2) No limitation.--Nothing in this paragraph shall 
        impair or affect any right of the Agency under other applicable 
        law.
    ``(h) Damages.--In any proceeding related to any claim against a 
director, officer, employee, agent, attorney, accountant, appraiser, or 
any other party employed by or providing services to a regulated 
entity, recoverable damages determined to result from the improvident 
or otherwise improper use or investment of any assets of the regulated 
entity shall include principal losses and appropriate interest.
    ``(i) Limited-Life Regulated Entities.--
            ``(1) Organization.--
                    ``(A) Purpose.--If a regulated entity is in 
                default, or if the Agency anticipates that a regulated 
                entity will default, the Agency may organize a limited-
                life regulated entity with those powers and attributes 
                of the regulated entity in default or in danger of 
                default that the Director determines necessary, subject 
                to the provisions of this subsection. The Director 
                shall grant a temporary charter to the limited-life 
                regulated entity, and the limited-life regulated entity 
                shall operate subject to that charter.
                    ``(B) Authorities.--Upon the creation of a limited-
                life regulated entity under subparagraph (A), the 
                limited-life regulated entity may--
                            ``(i) assume such liabilities of the 
                        regulated entity that is in default or in 
                        danger of default as the Agency may, in its 
                        discretion, determine to be appropriate, 
                        provided that the liabilities assumed shall not 
                        exceed the amount of assets of the limited-life 
                        regulated entity;
                            ``(ii) purchase such assets of the 
                        regulated entity that is in default, or in 
                        danger of default, as the Agency may, in its 
                        discretion, determine to be appropriate; and
                            ``(iii) perform any other temporary 
                        function which the Agency may, in its 
                        discretion, prescribe in accordance with this 
                        section.
            ``(2) Charter.--
                    ``(A) Conditions.--The Agency may grant a temporary 
                charter if the Agency determines that the continued 
                operation of the regulated entity in default or in 
                danger of default is in the best interest of the 
                national economy and the housing markets.
                    ``(B) Treatment as being in default for certain 
                purposes.--A limited-life regulated entity shall be 
                treated as a regulated entity in default at such times 
                and for such purposes as the Agency may, in its 
                discretion, determine.
                    ``(C) Management.--A limited-life regulated entity, 
                upon the granting of its charter, shall be under the 
                management of a board of directors consisting of not 
                fewer than 5 nor more than 10 members appointed by the 
                Agency.
                    ``(D) Bylaws.--The board of directors of a limited-
                life regulated entity shall adopt such bylaws as may be 
                approved by the Agency.
            ``(3) Capital stock.--No capital stock need be paid into a 
        limited-life regulated entity by the Agency.
            ``(4) Investments.--Funds of a limited-life regulated 
        entity shall be kept on hand in cash, invested in obligations 
        of the United States or obligations guaranteed as to principal 
        and interest by the United States, or deposited with the 
        Agency, or any Federal Reserve bank.
            ``(5) Exempt status.--Notwithstanding any other provision 
        of Federal or State law, the limited-life regulated entity, its 
        franchise, property, and income shall be exempt from all 
        taxation now or hereafter imposed by the United States, by any 
        territory, dependency, or possession thereof, or by any State, 
        county, municipality, or local taxing authority.
            ``(6) Winding up.--
                    ``(A) In general.--Subject to subparagraph (B), 
                unless Congress authorizes the sale of the capital 
                stock of the limited-life regulated entity, not later 
                than 2 years after the date of its organization, the 
                Agency shall wind up the affairs of the limited-life 
                regulated entity.
                    ``(B) Extension.--The Director may, in the 
                discretion of the Director, extend the status of the 
                limited-life regulated entity for 3 additional 1-year 
                periods.
            ``(7) Transfer of assets and liabilities.--
                    ``(A) In general.--
                            ``(i) Transfer of assets and liabilities.--
                        The Agency, as receiver, may transfer any 
                        assets and liabilities of a regulated entity in 
                        default, or in danger of default, to the 
                        limited-life regulated entity in accordance 
                        with paragraph (1).
                            ``(ii) Subsequent transfers.--At any time 
                        after a charter is transferred to a limited-
                        life regulated entity, the Agency, as receiver, 
                        may transfer any assets and liabilities of such 
                        regulated entity in default, or in danger in 
                        default, as the Agency may, in its discretion, 
                        determine to be appropriate in accordance with 
                        paragraph (1).
                            ``(iii) Effective without approval.--The 
                        transfer of any assets or liabilities of a 
                        regulated entity in default, or in danger of 
                        default, transferred to a limited-life 
                        regulated entity shall be effective without any 
                        further approval under Federal or State law, 
                        assignment, or consent with respect thereto.
            ``(8) Proceeds.--To the extent that available proceeds from 
        the limited-life regulated entity exceed amounts required to 
        pay obligations, such proceeds may be paid to the regulated 
        entity in default, or in danger of default.
            ``(9) Powers.--
                    ``(A) In general.--Each limited-life regulated 
                entity created under this subsection shall have all 
                corporate powers of, and be subject to the same 
                provisions of law as, the regulated entity in default 
                or in danger of default to which it relates, except 
                that--
                            ``(i) the Agency may--
                                    ``(I) remove the directors of a 
                                limited-life regulated entity; and
                                    ``(II) fix the compensation of 
                                members of the board of directors and 
                                senior management, as determined by the 
                                Agency in its discretion, of a limited-
                                life regulated entity;
                            ``(ii) the Agency may indemnify the 
                        representatives for purposes of paragraph 
                        (1)(B), and the directors, officers, employees, 
                        and agents of a limited-life regulated entity 
                        on such terms as the Agency determines to be 
                        appropriate; and
                            ``(iii) the board of directors of a 
                        limited-life regulated entity--
                                    ``(I) shall elect a chairperson who 
                                may also serve in the position of chief 
                                executive officer, except that such 
                                person shall not serve either as 
                                chairperson or as chief executive 
                                officer without the prior approval of 
                                the Agency; and
                                    ``(II) may appoint a chief 
                                executive officer who is not also the 
                                chairperson, except that such person 
                                shall not serve as chief executive 
                                officer without the prior approval of 
                                the Agency.
                    ``(B) Stay of judicial action.--Any judicial action 
                to which a limited-life regulated entity becomes a 
                party by virtue of its acquisition of any assets or 
                assumption of any liabilities of a regulated entity in 
                default shall be stayed from further proceedings for a 
                period of up to 45 days at the request of the limited-
                life regulated entity. Such period may be modified upon 
                the consent of all parties.
            ``(10) Obtaining of credit and incurring of debt.--
                    ``(A) In general.--The limited-life regulated 
                entity may obtain unsecured credit and incur unsecured 
                debt in the ordinary course of business.
                    ``(B) Inability to obtain credit.--If the limited-
                life regulated entity is unable to obtain unsecured 
                credit the Director may authorize the obtaining of 
                credit or the incurring of debt--
                            ``(i) with priority over any or all 
                        administrative expenses;
                            ``(ii) secured by a lien on property that 
                        is not otherwise subject to a lien; or
                            ``(iii) secured by a junior lien on 
                        property that is subject to a lien.
                    ``(C) Limitations.--
                            ``(i) In general.--The Director, after 
                        notice and a hearing, may authorize the 
                        obtaining of credit or the incurring of debt 
                        secured by a senior or equal lien on property 
                        that is subject to a lien (other than mortgages 
                        that collateralize the mortgage-backed 
                        securities issued or guaranteed by the 
                        regulated entity) only if--
                                    ``(I) the limited-life regulated 
                                entity is unable to obtain such credit 
                                otherwise; and
                                    ``(II) there is adequate protection 
                                of the interest of the holder of the 
                                lien on the property which such senior 
                                or equal lien is proposed to be 
                                granted.
                            ``(ii) Burden of proof.--In any hearing 
                        under this subsection, the Director has the 
                        burden of proof on the issue of adequate 
                        protection.
                    ``(D) Effect on debts and liens.--The reversal or 
                modification on appeal of an authorization under this 
                paragraph to obtain credit or incur debt, or of a grant 
                under this section of a priority or a lien, does not 
                affect the validity of any debt so incurred, or any 
                priority or lien so granted, to an entity that extended 
                such credit in good faith, whether or not such entity 
                knew of the pendency of the appeal, unless such 
                authorization and the incurring of such debt, or the 
                granting of such priority or lien, were stayed pending 
                appeal.
            ``(11) Issuance of preferred debt.--A limited-life 
        regulated entity may, subject to the approval of the Director 
        and subject to such terms and conditions as the Director may 
        prescribe, issue notes, bonds, or other debt obligations of a 
        class to which all other debt obligations of the limited-life 
        regulated entity shall be subordinate in right and payment.
            ``(12) No federal status.--
                    ``(A) Agency status.--A limited-life regulated 
                entity is not an agency, establishment, or 
                instrumentality of the United States.
                    ``(B) Employee status.--Representatives for 
                purposes of paragraph (1)(B), interim directors, 
                directors, officers, employees, or agents of a limited-
                life regulated entity are not, solely by virtue of 
                service in any such capacity, officers or employees of 
                the United States. Any employee of the Agency or of any 
                Federal instrumentality who serves at the request of 
                the Agency as a representative for purposes of 
                paragraph (1)(B), interim director, director, officer, 
                employee, or agent of a limited-life regulated entity 
                shall not--
                            ``(i) solely by virtue of service in any 
                        such capacity lose any existing status as an 
                        officer or employee of the United States for 
                        purposes of title 5, United States Code, or any 
                        other provision of law; or
                            ``(ii) receive any salary or benefits for 
                        service in any such capacity with respect to a 
                        limited-life regulated entity in addition to 
                        such salary or benefits as are obtained through 
                        employment with the Agency or such Federal 
                        instrumentality.
            ``(13) Additional powers.--In addition to any other powers 
        granted under this subsection, a limited-life regulated entity 
        may--
                    ``(A) extend a maturity date or change in an 
                interest rate or other term of outstanding securities;
                    ``(B) issue securities of the limited-life 
                regulated entity, for cash, for property, for existing 
                securities, or in exchange for claims or interests, or 
                for any other appropriate purposes; and
                    ``(C) take any other action not inconsistent with 
                this section.
    ``(j) Other Exemptions.--When acting as a receiver, the following 
provisions shall apply with respect to the Agency:
            ``(1) Exemption from taxation.--The Agency, including its 
        franchise, its capital, reserves, and surplus, and its income, 
        shall be exempt from all taxation imposed by any State, 
        country, municipality, or local taxing authority, except that 
        any real property of the Agency shall be subject to State, 
        territorial, county, municipal, or local taxation to the same 
        extent according to its value as other real property is taxed, 
        except that, notwithstanding the failure of any person to 
        challenge an assessment under State law of the value of such 
        property, and the tax thereon, shall be determined as of the 
        period for which such tax is imposed.
            ``(2) Exemption from attachment and liens.--No property of 
        the Agency shall be subject to levy, attachment, garnishment, 
        foreclosure, or sale without the consent of the Agency, nor 
        shall any involuntary lien attach to the property of the 
        Agency.
            ``(3) Exemption from penalties and fines.--The Agency shall 
        not be liable for any amounts in the nature of penalties or 
        fines, including those arising from the failure of any person 
        to pay any real property, personal property, probate, or 
        recording tax or any recording or filing fees when due.
    ``(k) Prohibition of Charter Revocation.--In no case may a receiver 
appointed pursuant to this section revoke, annul, or terminate the 
charter of a regulated entity.''.
    (b) Conforming Amendments.--
            (1) Housing and community development act of 1992.--
        Subtitle B of title XIII of the Housing and Community 
        Development Act of 1992 is amended by striking sections 1369 
        (12 U.S.C. 4619), 1369A (12 U.S.C. 4620), and 1369B (12 U.S.C. 
        4621).
            (2) Federal home loan banks.--Section 25 of the Federal 
        Home Loan Bank Act (12 U.S.C. 1445) is amended to read as 
        follows:

``SEC. 25. SUCCESSION OF FEDERAL HOME LOAN BANKS.

    ``Each Federal Home Loan Bank shall have succession until it is 
voluntarily merged with another Bank under this Act, or until it is 
merged, reorganized, rehabilitated, liquidated, or otherwise wound up 
by the Director in accordance with the provisions of section 1367 of 
the Housing and Community Development Act of 1992, or by further Act of 
Congress.''.

SEC. 1049. CONFORMING AMENDMENTS.

    Title XIII of the Housing and Community Development Act of 1992, as 
amended by the preceding provisions of this title, is further amended--
            (1) in sections 1365 (12 U.S.C. 4615) through 1369D (12 
        U.S.C. 4623), but not including section 1367 (12 U.S.C. 4617) 
        as amended by section 1048 of this title--
                    (A) by striking ``An enterprise'' each place such 
                term appears and inserting ``A regulated entity'';
                    (B) by striking ``an enterprise'' each place such 
                term appears and inserting ``a regulated entity''; and
                    (C) by striking ``the enterprise'' each place such 
                term appears and inserting ``the regulated entity'';
            (2) in section 1366 (12 U.S.C. 4616)--
                    (A) in subsection (b)(7), by striking ``section 
                1369 (excluding subsection (a)(1) and (2))'' and 
                inserting ``section 1367''; and
                    (B) in subsection (d), by striking ``the 
                enterprises'' and inserting ``the regulated entities'';
            (3) in section 1368(d) (12 U.S.C. 4618(d)), by striking 
        ``Committee on Banking, Finance and Urban Affairs'' and 
        inserting ``Committee on Financial Services'';
            (4) in section 1369C (12 U.S.C. 4622)--
                    (A) in subsection (a)(4), by striking ``activities 
                (including existing and new programs)'' and inserting 
                ``activities, services, undertakings, and offerings 
                (including existing and new products (as such term is 
                defined in section 1321(f))''; and
                    (B) in subsection (c), by striking ``any 
                enterprise'' and inserting ``any regulated entity''; 
                and
            (5) in subsections (a) and (d) of section 1369D, by 
        striking ``section 1366 or 1367 or action under section 1369)'' 
        each place such phrase appears and inserting ``section 1367)''.

                     CHAPTER 4--ENFORCEMENT ACTIONS

SEC. 1051. CEASE-AND-DESIST PROCEEDINGS.

    Section 1371 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4631) is amended--
            (1) by striking subsections (a) and (b) and inserting the 
        following new subsections:
    ``(a) Issuance for Unsafe or Unsound Practices and Violations of 
Rules or Laws.--If, in the opinion of the Director, a regulated entity 
or any regulated entity-affiliated party is engaging or has engaged, or 
the Director has reasonable cause to believe that the regulated entity 
or any regulated entity-affiliated party is about to engage, in an 
unsafe or unsound practice in conducting the business of the regulated 
entity or is violating or has violated, or the Director has reasonable 
cause to believe that the regulated entity or any regulated entity-
affiliated party is about to violate, a law, rule, or regulation, or 
any condition imposed in writing by the Director in connection with the 
granting of any application or other request by the regulated entity or 
any written agreement entered into with the Director, the Director may 
issue and serve upon the regulated entity or such party a notice of 
charges in respect thereof. The Director may not, pursuant to this 
section, enforce compliance with any housing goal established under 
subpart B of part 2 of subtitle A of this title, with section 1336 of 
this title, with subsection (m) or (n) of section 309 of the Federal 
National Mortgage Association Charter Act (12 U.S.C. 1723a(m), (n)), 
with subsection (e) or (f) of section 307 of the Federal Home Loan 
Mortgage Corporation Act (12 U.S.C. 1456(e), (f)), or with paragraph 
(5) of section 10(j) of the Federal Home Loan Bank Act (12 U.S.C. 
1430(j)).
    ``(b) Issuance for Unsatisfactory Rating.--If a regulated entity 
receives, in its most recent report of examination, a less-than-
satisfactory rating for asset quality, management, earnings, or 
liquidity, the Director may (if the deficiency is not corrected) deem 
the regulated entity to be engaging in an unsafe or unsound practice 
for purposes of this subsection.'';
            (2) in subsection (c)(2), by striking ``enterprise, 
        executive officer, or director'' and inserting ``regulated 
        entity or regulated entity-affiliated party''; and
            (3) in subsection (d)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``enterprise, executive officer, or director'' 
                and inserting ``regulated entity or regulated entity-
                affiliated party'';
                    (B) in paragraph (1)--
                            (i) by striking ``an executive officer or a 
                        director'' and inserting ``a regulated entity 
                        affiliated party''; and
                            (ii) by inserting ``(including 
                        reimbursement of compensation under section 
                        1318)'' after ``reimbursement'';
                    (C) in paragraph (6), by striking ``and'' at the 
                end;
                    (D) by redesignating paragraph (7) as paragraph 
                (8); and
                    (E) by inserting after paragraph (6) the following 
                new paragraph:
            ``(7) to effect an attachment on a regulated entity or 
        regulated entity-affiliated party subject to an order under 
        this section or section 1372; and''.

SEC. 1052. TEMPORARY CEASE-AND-DESIST PROCEEDINGS.

    Section 1372 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4632) is amended--
            (1) by striking subsection (a) and inserting the following 
        new subsection:
    ``(a) Grounds for Issuance.--Whenever the Director determines that 
the violation or threatened violation or the unsafe or unsound practice 
or practices specified in the notice of charges served upon the 
regulated entity or any regulated entity-affiliated party pursuant to 
section 1371(a), or the continuation thereof, is likely to cause 
insolvency or significant dissipation of assets or earnings of the 
regulated entity, or is likely to weaken the condition of the regulated 
entity prior to the completion of the proceedings conducted pursuant to 
sections 1371 and 1373, the Director may issue a temporary order 
requiring the regulated entity or such party to cease and desist from 
any such violation or practice and to take affirmative action to 
prevent or remedy such insolvency, dissipation, condition, or prejudice 
pending completion of such proceedings. Such order may include any 
requirement authorized under section 1371(d).'';
            (2) in subsection (b), by striking ``enterprise, executive 
        officer, or director'' and inserting ``regulated entity or 
        regulated entity-affiliated party'';
            (3) in subsection (d)--
                    (A) by striking ``An enterprise, executive officer, 
                or director'' and inserting ``A regulated entity or 
                regulated entity-affiliated party''; and
                    (B) by striking ``the enterprise, executive 
                officer, or director'' and inserting ``the regulated 
                entity or regulated entity-affiliated party''; and
            (4) by striking subsection (e) and in inserting the 
        following new subsection:
    ``(e) Enforcement.--In the case of violation or threatened 
violation of, or failure to obey, a temporary cease-and-desist order 
issued pursuant to this section, the Director may apply to the United 
States District Court for the District of Columbia or the United States 
district court within the jurisdiction of which the headquarters of the 
regulated entity is located, for an injunction to enforce such order, 
and, if the court determines that there has been such violation or 
threatened violation or failure to obey, it shall be the duty of the 
court to issue such injunction.''.

SEC. 1053. PREJUDGMENT ATTACHMENT.

    The Housing and Community Development Act of 1992 is amended by 
inserting after section 1375 (12 U.S.C. 4635) the following new 
section:

``SEC. 1375A. PREJUDGMENT ATTACHMENT.

    ``(a) In General.--In any action brought pursuant to this title, or 
in actions brought in aid of, or to enforce an order in, any 
administrative or other civil action for money damages, restitution, or 
civil money penalties brought pursuant to this title, the court may, 
upon application of the Director or Attorney General, as applicable, 
issue a restraining order that--
            ``(1) prohibits any person subject to the proceeding from 
        withdrawing, transferring, removing, dissipating, or disposing 
        of any funds, assets or other property; and
            ``(2) appoints a person on a temporary basis to administer 
        the restraining order.
    ``(b) Standard.--
            ``(1) Showing.--Rule 65 of the Federal Rules of Civil 
        Procedure shall apply with respect to any proceeding under 
        subsection (a) without regard to the requirement of such rule 
        that the applicant show that the injury, loss, or damage is 
        irreparable and immediate.
            ``(2) State proceeding.--If, in the case of any proceeding 
        in a State court, the court determines that rules of civil 
        procedure available under the laws of such State provide 
        substantially similar protections to a party's right to due 
        process as Rule 65 (as modified with respect to such proceeding 
        by paragraph (1)), the relief sought under subsection (a) may 
        be requested under the laws of such State.''.

SEC. 1054. ENFORCEMENT AND JURISDICTION.

    Section 1375 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4635) is amended--
            (1) by striking subsection (a) and inserting the following 
        new subsection:
    ``(a) Enforcement.--The Director may, in the discretion of the 
Director, apply to the United States District Court for the District of 
Columbia, or the United States district court within the jurisdiction 
of which the headquarters of the regulated entity is located, for the 
enforcement of any effective and outstanding notice or order issued 
under this subtitle or subtitle B, or request that the Attorney General 
of the United States bring such an action. Such court shall have 
jurisdiction and power to order and require compliance with such notice 
or order.''; and
            (2) in subsection (b), by striking ``or 1376'' and 
        inserting ``1376, or 1377''.

SEC. 1055. CIVIL MONEY PENALTIES.

    Section 1376 of the Housing and Community Development Act of 1992 
(12 U.S.C. 4636) is amended--
            (1) in subsection (a)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``, or any executive officer or director'' and 
                inserting ``or any regulated-entity affiliated party''; 
                and
                    (B) in paragraph (1)--
                            (i) by striking ``the Federal National 
                        Mortgage Association Charter Act, the Federal 
                        Home Loan Mortgage Corporation Act'' and 
                        inserting ``any provision of any of the 
                        authorizing statutes'';
                            (ii) by striking ``or Act'' and inserting 
                        ``or statute'';
                            (iii) by striking ``or subsection'' and 
                        inserting ``, subsection''; and
                            (iv) by inserting ``, or paragraph (5) or 
                        (12) of section 10(j) of the Federal Home Loan 
                        Bank Act'' before the semicolon at the end;
            (2) by striking subsection (b) and inserting the following 
        new subsection:
    ``(b) Amount of Penalty.--
            ``(1) First tier.--Any regulated entity which, or any 
        regulated entity-affiliated party who--
                    ``(A) violates any provision of this title, any 
                provision of any of the authorizing statutes, or any 
                order, condition, rule, or regulation under any such 
                title or statute, except that the Director may not, 
                pursuant to this section, enforce compliance with any 
                housing goal established under subpart B of part 2 of 
                subtitle A of this title, with section 1336 of this 
                title, with subsection (m) or (n) of section 309 of the 
                Federal National Mortgage Association Charter Act (12 
                U.S.C. 1723a(m), (n)), with subsection (e) or (f) of 
                section 307 of the Federal Home Loan Mortgage 
                Corporation Act (12 U.S.C. 1456(e), (f)), or with 
                paragraph (5) or (12) of section 10(j) of the Federal 
                Home Loan Bank Act;
                    ``(B) violates any final or temporary order or 
                notice issued pursuant to this title;
                    ``(C) violates any condition imposed in writing by 
                the Director in connection with the grant of any 
                application or other request by such regulated entity; 
                or
                    ``(D) violates any written agreement between the 
                regulated entity and the Director,
        shall forfeit and pay a civil money penalty of not more than 
        $10,000 for each day during which such violation continues.
            ``(2) Second tier.--Notwithstanding paragraph (1)--
                    ``(A) if a regulated entity, or a regulated entity-
                affiliated party--
                            ``(i) commits any violation described in 
                        any subparagraph of paragraph (1);
                            ``(ii) recklessly engages in an unsafe or 
                        unsound practice in conducting the affairs of 
                        such regulated entity; or
                            ``(iii) breaches any fiduciary duty; and
                    ``(B) the violation, practice, or breach--
                            ``(i) is part of a pattern of misconduct;
                            ``(ii) causes or is likely to cause more 
                        than a minimal loss to such regulated entity; 
                        or
                            ``(iii) results in pecuniary gain or other 
                        benefit to such party,
        the regulated entity or regulated entity-affiliated party shall 
        forfeit and pay a civil penalty of not more than $50,000 for 
        each day during which such violation, practice, or breach 
        continues.
            ``(3) Third tier.--Notwithstanding paragraphs (1) and (2), 
        any regulated entity which, or any regulated entity-affiliated 
        party who--
                    ``(A) knowingly--
                            ``(i) commits any violation or engages in 
                        any conduct described in any subparagraph of 
                        paragraph (1);
                            ``(ii) engages in any unsafe or unsound 
                        practice in conducting the affairs of such 
                        regulated entity; or
                            ``(iii) breaches any fiduciary duty; and
                    ``(B) knowingly or recklessly causes a substantial 
                loss to such regulated entity or a substantial 
                pecuniary gain or other benefit to such party by reason 
                of such violation, practice, or breach,
        shall forfeit and pay a civil penalty in an amount not to 
        exceed the applicable maximum amount determined under paragraph 
        (4) for each day during which such violation, practice, or 
        breach continues.
            ``(4) Maximum amounts of penalties for any violation 
        described in paragraph (3).--The maximum daily amount of any 
        civil penalty which may be assessed pursuant to paragraph (3) 
        for any violation, practice, or breach described in such 
        paragraph is--
                    ``(A) in the case of any person other than a 
                regulated entity, an amount not to exceed $2,000,000; 
                and
                    ``(B) in the case of any regulated entity, 
                $2,000,000.'';
            (3) in subsection (c)(1)(B), by striking ``enterprise, 
        executive officer, or director'' and inserting ``regulated 
        entity or regulated entity-affiliated party'';
            (4) in subsection (d), by striking the first sentence and 
        inserting the following: ``If a regulated entity or regulated 
        entity-affiliated party fails to comply with an order of the 
        Director imposing a civil money penalty under this section, 
        after the order is no longer subject to review as provided 
        under subsection (c)(1) and section 1374, the Director may, in 
        the discretion of the Director, bring an action in the United 
        States District Court for the District of Columbia, or the 
        United States district court within the jurisdiction of which 
        the headquarters of the regulated entity is located, to obtain 
        a monetary judgment against the regulated entity or regulated 
        entity affiliated party and such other relief as may be 
        available, or request that the Attorney General of the United 
        States bring such an action.''; and
            (5) in subsection (g), by striking ``subsection (b)(3)'' 
        and inserting ``this section, unless authorized by the Director 
        by rule, regulation, or order''.

SEC. 1056. REMOVAL AND PROHIBITION AUTHORITY.

    (a) In General.--Subtitle C of title XIII of the Housing and 
Community Development Act of 1992 is amended--
            (1) by redesignating sections 1377, 1378, 1379, 1379A, and 
        1379B (12 U.S.C. 4637-41) as sections 1379, 1379A, 1379B, 
        1379C, and 1379D, respectively; and
            (2) by inserting after section 1376 (12 U.S.C. 4636) the 
        following new section:

``SEC. 1377. REMOVAL AND PROHIBITION AUTHORITY.

    ``(a) Authority To Issue Order.--Whenever the Director determines 
that--
            ``(1) any regulated entity-affiliated party has, directly 
        or indirectly--
                    ``(A) violated--
                            ``(i) any law or regulation;
                            ``(ii) any cease-and-desist order which has 
                        become final;
                            ``(iii) any condition imposed in writing by 
                        the Director in connection with the grant of 
                        any application or other request by such 
                        regulated entity; or
                            ``(iv) any written agreement between such 
                        regulated entity and the Director;
                    ``(B) engaged or participated in any unsafe or 
                unsound practice in connection with any regulated 
                entity; or
                    ``(C) committed or engaged in any act, omission, or 
                practice which constitutes a breach of such party's 
                fiduciary duty;
            ``(2) by reason of the violation, practice, or breach 
        described in any subparagraph of paragraph (1)--
                    ``(A) such regulated entity has suffered or will 
                probably suffer financial loss or other damage; or
                    ``(B) such party has received financial gain or 
                other benefit by reason of such violation, practice, or 
                breach; and
            ``(3) such violation, practice, or breach--
                    ``(A) involves personal dishonesty on the part of 
                such party; or
                    ``(B) demonstrates willful or continuing disregard 
                by such party for the safety or soundness of such 
                regulated entity, the Director may serve upon such 
                party a written notice of the Director's intention to 
                remove such party from office or to prohibit any 
                further participation by such party, in any manner, in 
                the conduct of the affairs of any regulated entity.
    ``(b) Suspension Order.--
            ``(1) Suspension or prohibition authority.--If the Director 
        serves written notice under subsection (a) to any regulated 
        entity-affiliated party of the Director's intention to issue an 
        order under such subsection, the Director may--
                    ``(A) suspend such party from office or prohibit 
                such party from further participation in any manner in 
                the conduct of the affairs of the regulated entity, if 
                the Director--
                            ``(i) determines that such action is 
                        necessary for the protection of the regulated 
                        entity; and
                            ``(ii) serves such party with written 
                        notice of the suspension order; and
                    ``(B) prohibit the regulated entity from releasing 
                to or on behalf of the regulated entity-affiliated 
                party any compensation or other payment of money or 
                other thing of current or potential value in connection 
                with any resignation, removal, retirement, or other 
                termination of employment or office of the party.
            ``(2) Effective period.--Any suspension order issued under 
        this subsection--
                    ``(A) shall become effective upon service; and
                    ``(B) unless a court issues a stay of such order 
                under subsection (g) of this section, shall remain in 
                effect and enforceable until--
                            ``(i) the date the Director dismisses the 
                        charges contained in the notice served under 
                        subsection (a) with respect to such party; or
                            ``(ii) the effective date of an order 
                        issued by the Director to such party under 
                        subsection (a).
            ``(3) Copy of order.--If the Director issues a suspension 
        order under this subsection to any regulated entity-affiliated 
        party, the Director shall serve a copy of such order on any 
        regulated entity with which such party is affiliated at the 
        time such order is issued.
    ``(c) Notice, Hearing, and Order.--A notice of intention to remove 
a regulated entity-affiliated party from office or to prohibit such 
party from participating in the conduct of the affairs of a regulated 
entity shall contain a statement of the facts constituting grounds for 
such action, and shall fix a time and place at which a hearing will be 
held on such action. Such hearing shall be fixed for a date not earlier 
than 30 days nor later than 60 days after the date of service of such 
notice, unless an earlier or a later date is set by the Director at the 
request of (1) such party, and for good cause shown, or (2) the 
Attorney General of the United States. Unless such party shall appear 
at the hearing in person or by a duly authorized representative, such 
party shall be deemed to have consented to the issuance of an order of 
such removal or prohibition. In the event of such consent, or if upon 
the record made at any such hearing the Director shall find that any of 
the grounds specified in such notice have been established, the 
Director may issue such orders of suspension or removal from office, or 
prohibition from participation in the conduct of the affairs of the 
regulated entity, as it may deem appropriate, together with an order 
prohibiting compensation described in subsection (b)(1)(B). Any such 
order shall become effective at the expiration of 30 days after service 
upon such regulated entity and such party (except in the case of an 
order issued upon consent, which shall become effective at the time 
specified therein). Such order shall remain effective and enforceable 
except to such extent as it is stayed, modified, terminated, or set 
aside by action of the Director or a reviewing court.
    ``(d) Prohibition of Certain Specific Activities.--Any person 
subject to an order issued under this section shall not--
            ``(1) participate in any manner in the conduct of the 
        affairs of any regulated entity;
            ``(2) solicit, procure, transfer, attempt to transfer, 
        vote, or attempt to vote any proxy, consent, or authorization 
        with respect to any voting rights in any regulated entity;
            ``(3) violate any voting agreement previously approved by 
        the Director; or
            ``(4) vote for a director, or serve or act as a regulated 
        entity-affiliated party.
    ``(e) Industry-Wide Prohibition.--
            ``(1) In general.--Except as provided in paragraph (2), any 
        person who, pursuant to an order issued under this section, has 
        been removed or suspended from office in a regulated entity or 
        prohibited from participating in the conduct of the affairs of 
        a regulated entity may not, while such order is in effect, 
        continue or commence to hold any office in, or participate in 
        any manner in the conduct of the affairs of, any regulated 
        entity.
            ``(2) Exception if director provides written consent.--If, 
        on or after the date an order is issued under this section 
        which removes or suspends from office any regulated entity-
        affiliated party or prohibits such party from participating in 
        the conduct of the affairs of a regulated entity, such party 
        receives the written consent of the Director, the order shall, 
        to the extent of such consent, cease to apply to such party 
        with respect to the regulated entity described in the written 
        consent. If the Director grants such a written consent, it 
        shall publicly disclose such consent.
            ``(3) Violation of paragraph (1) treated as violation of 
        order.--Any violation of paragraph (1) by any person who is 
        subject to an order described in such subsection shall be 
        treated as a violation of the order.
    ``(f) Applicability.--This section shall only apply to a person who 
is an individual, unless the Director specifically finds that it should 
apply to a corporation, firm, or other business enterprise.
    ``(g) Stay of Suspension and Prohibition of Regulated Entity-
Affiliated Party.--Within 10 days after any regulated entity-affiliated 
party has been suspended from office and/or prohibited from 
participation in the conduct of the affairs of a regulated entity under 
this section, such party may apply to the United States District Court 
for the District of Columbia, or the United States district court for 
the judicial district in which the headquarters of the regulated entity 
is located, for a stay of such suspension and/or prohibition and any 
prohibition under subsection (b)(1)(B) pending the completion of the 
administrative proceedings pursuant to the notice served upon such 
party under this section, and such court shall have jurisdiction to 
stay such suspension and/or prohibition.
    ``(h) Suspension or Removal of Regulated Entity-Affiliated Party 
Charged With Felony.--
            ``(1) Suspension or prohibition.--
                    ``(A) In general.--Whenever any regulated entity-
                affiliated party is charged in any information, 
                indictment, or complaint, with the commission of or 
                participation in a crime involving dishonesty or breach 
                of trust which is punishable by imprisonment for a term 
                exceeding one year under State or Federal law, the 
                Director may, if continued service or participation by 
                such party may pose a threat to the regulated entity or 
                impair public confidence in the regulated entity, by 
                written notice served upon such party--
                            ``(i) suspend such party from office or 
                        prohibit such party from further participation 
                        in any manner in the conduct of the affairs of 
                        any regulated entity; and
                            ``(ii) prohibit the regulated entity from 
                        releasing to or on behalf of the regulated 
                        entity-affiliated party any compensation or 
                        other payment of money or other thing of 
                        current or potential value in connection with 
                        the period of any such suspension or with any 
                        resignation, removal, retirement, or other 
                        termination of employment or office of the 
                        party.
                    ``(B) Provisions applicable to notice.--
                            ``(i) Copy.--A copy of any notice under 
                        paragraph (1)(A) shall also be served upon the 
                        regulated entity.
                            ``(ii) Effective period.--A suspension or 
                        prohibition under subparagraph (A) shall remain 
                        in effect until the information, indictment, or 
                        complaint referred to in such subparagraph is 
                        finally disposed of or until terminated by the 
                        Director.
            ``(2) Removal or prohibition.--
                    ``(A) In general.--If a judgment of conviction or 
                an agreement to enter a pretrial diversion or other 
                similar program is entered against a regulated entity-
                affiliated party in connection with a crime described 
                in paragraph (1)(A), at such time as such judgment is 
                not subject to further appellate review, the Director 
                may, if continued service or participation by such 
                party may pose a threat to the regulated entity or 
                impair public confidence in the regulated entity, issue 
                and serve upon such party an order that--
                            ``(i) removes such party from office or 
                        prohibits such party from further participation 
                        in any manner in the conduct of the affairs of 
                        the regulated entity without the prior written 
                        consent of the Director; and
                            ``(ii) prohibits the regulated entity from 
                        releasing to or on behalf of the regulated 
                        entity-affiliated party any compensation or 
                        other payment of money or other thing of 
                        current or potential value in connection with 
                        the termination of employment or office of the 
                        party.
                    ``(B) Provisions applicable to order.--
                            ``(i) Copy.--A copy of any order under 
                        paragraph (2)(A) shall also be served upon the 
                        regulated entity, whereupon the regulated 
                        entity-affiliated party who is subject to the 
                        order (if a director or an officer) shall cease 
                        to be a director or officer of such regulated 
                        entity.
                            ``(ii) Effect of acquittal.--A finding of 
                        not guilty or other disposition of the charge 
                        shall not preclude the Director from 
                        instituting proceedings after such finding or 
                        disposition to remove such party from office or 
                        to prohibit further participation in regulated 
                        entity affairs, and to prohibit compensation or 
                        other payment of money or other thing of 
                        current or potential value in connection with 
                        any resignation, removal, retirement, or other 
                        termination of employment or office of the 
                        party, pursuant to subsections (a), (d), or (e) 
                        of this section.
                            ``(iii) Effective period.--Any notice of 
                        suspension or order of removal issued under 
                        this subsection shall remain effective and 
                        outstanding until the completion of any hearing 
                        or appeal authorized under paragraph (4) unless 
                        terminated by the Director.
            ``(3) Authority of remaining board members.--If at any 
        time, because of the suspension of one or more directors 
        pursuant to this section, there shall be on the board of 
        directors of a regulated entity less than a quorum of directors 
        not so suspended, all powers and functions vested in or 
        exercisable by such board shall vest in and be exercisable by 
        the director or directors on the board not so suspended, until 
        such time as there shall be a quorum of the board of directors. 
        In the event all of the directors of a regulated entity are 
        suspended pursuant to this section, the Director shall appoint 
        persons to serve temporarily as directors in their place and 
        stead pending the termination of such suspensions, or until 
        such time as those who have been suspended cease to be 
        directors of the regulated entity and their respective 
        successors take office.
            ``(4) Hearing regarding continued participation.--Within 30 
        days from service of any notice of suspension or order of 
        removal issued pursuant to paragraph (1) or (2) of this 
        subsection, the regulated entity-affiliated party concerned may 
        request in writing an opportunity to appear before the Director 
        to show that the continued service to or participation in the 
        conduct of the affairs of the regulated entity by such party 
        does not, or is not likely to, pose a threat to the interests 
        of the regulated entity or threaten to impair public confidence 
        in the regulated entity. Upon receipt of any such request, the 
        Director shall fix a time (not more than 30 days after receipt 
        of such request, unless extended at the request of such party) 
        and place at which such party may appear, personally or through 
        counsel, before one or more members of the Director or 
        designated employees of the Director to submit written 
        materials (or, at the discretion of the Director, oral 
        testimony) and oral argument. Within 60 days of such hearing, 
        the Director shall notify such party whether the suspension or 
        prohibition from participation in any manner in the conduct of 
        the affairs of the regulated entity will be continued, 
        terminated, or otherwise modified, or whether the order 
        removing such party from office or prohibiting such party from 
        further participation in any manner in the conduct of the 
        affairs of the regulated entity, and prohibiting compensation 
        in connection with termination will be rescinded or otherwise 
        modified. Such notification shall contain a statement of the 
        basis for the Director's decision, if adverse to such party. 
        The Director is authorized to prescribe such rules as may be 
        necessary to effectuate the purposes of this subsection.
    ``(i) Hearings and Judicial Review.--
            ``(1) Venue and procedure.--Any hearing provided for in 
        this section shall be held in the District of Columbia or in 
        the Federal judicial district in which the headquarters of the 
        regulated entity is located, unless the party afforded the 
        hearing consents to another place, and shall be conducted in 
        accordance with the provisions of chapter 5 of title 5, United 
        States Code. After such hearing, and within 90 days after the 
        Director has notified the parties that the case has been 
        submitted to it for final decision, it shall render its 
        decision (which shall include findings of fact upon which its 
        decision is predicated) and shall issue and serve upon each 
        party to the proceeding an order or orders consistent with the 
        provisions of this section. Judicial review of any such order 
        shall be exclusively as provided in this subsection. Unless a 
        petition for review is timely filed in a court of appeals of 
        the United States, as provided in paragraph (2), and thereafter 
        until the record in the proceeding has been filed as so 
        provided, the Director may at any time, upon such notice and in 
        such manner as it shall deem proper, modify, terminate, or set 
        aside any such order. Upon such filing of the record, the 
        Director may modify, terminate, or set aside any such order 
        with permission of the court.
            ``(2) Review of order.--Any party to any proceeding under 
        paragraph (1) may obtain a review of any order served pursuant 
        to paragraph (1) (other than an order issued with the consent 
        of the regulated entity or the regulated entity-affiliated 
        party concerned, or an order issued under subsection (h) of 
        this section) by the filing in the United States Court of 
        Appeals for the District of Columbia Circuit or court of 
        appeals of the United States for the circuit in which the 
        headquarters of the regulated entity is located, within 30 days 
        after the date of service of such order, a written petition 
        praying that the order of the Director be modified, terminated, 
        or set aside. A copy of such petition shall be forthwith 
        transmitted by the clerk of the court to the Director, and 
        thereupon the Director shall file in the court the record in 
        the proceeding, as provided in section 2112 of title 28, United 
        States Code. Upon the filing of such petition, such court shall 
        have jurisdiction, which upon the filing of the record shall 
        (except as provided in the last sentence of paragraph (1)) be 
        exclusive, to affirm, modify, terminate, or set aside, in whole 
        or in part, the order of the Director. Review of such 
        proceedings shall be had as provided in chapter 7 of title 5, 
        United States Code. The judgment and decree of the court shall 
        be final, except that the same shall be subject to review by 
        the Supreme Court upon certiorari, as provided in section 1254 
        of title 28, United States Code.
            ``(3) Proceedings not treated as stay.--The commencement of 
        proceedings for judicial review under paragraph (2) shall not, 
        unless specifically ordered by the court, operate as a stay of 
        any order issued by the Director.''.
    (b) Conforming Amendments.--
            (1) 1992 act.--Section 1317(f) of the Housing and Community 
        Development Act of 1992 (12 U.S.C. 4517(f)) is amended by 
        striking ``section 1379B'' and inserting ``section 1379D''.
            (2) Fannie mae charter act.--The second sentence of 
        subsection (b) of section 308 of the Federal National Mortgage 
        Association Charter Act (12 U.S.C. 1723(b)) is amended by 
        striking ``The'' and inserting ``Except to the extent that 
        action under section 1377 of the Housing and Community 
        Development Act of 1992 temporarily results in a lesser number, 
        the''.
            (3) Freddie mac act.--The second sentence of subparagraph 
        (A) of section 303(a)(2) of the Federal Home Loan Mortgage 
        Corporation Act (12 U.S.C. 1452(a)(2)(A)) is amended by 
        striking ``The'' and inserting ``Except to the extent that 
        action under section 1377 of the Housing and Community 
        Development Act of 1992 temporarily results in a lesser number, 
        the''.

SEC. 1057. CRIMINAL PENALTY.

    Subtitle C of title XIII of the Housing and Community Development 
Act of 1992 (12 U.S.C. 4631 et seq.) is amended by inserting after 
section 1377 (as added by the preceding provisions of this title) the 
following new section:

``SEC. 1378. CRIMINAL PENALTY.

    ``Whoever, being subject to an order in effect under section 1377, 
without the prior written approval of the Director, knowingly 
participates, directly or indirectly, in any manner (including by 
engaging in an activity specifically prohibited in such an order) in 
the conduct of the affairs of any regulated entity shall, 
notwithstanding section 3571 of title 18, be fined not more than 
$1,000,000, imprisoned for not more than 5 years, or both.''.

SEC. 1058. SUBPOENA AUTHORITY.

    Section 1379D(c) of the Housing and Community Development Act of 
1992 (12 U.S.C. 4641(c)), as so redesignated by section 1056(a)(1) of 
this title, is further amended--
            (1) by striking ``request the Attorney General of the 
        United States to'' and inserting ``, in the discretion of the 
        Director,'';
            (2) by inserting ``or request that the Attorney General of 
        the United States bring such an action,'' after ``District of 
        Columbia,''; and
            (3) by striking ``or may, under the direction and control 
        of the Attorney General, bring such an action''.

SEC. 1059. CONFORMING AMENDMENTS.

    Subtitle C of title XIII of the Housing and Community Development 
Act of 1992 (12 U.S.C. 4631 et seq.), as amended by the preceding 
provisions of this title, is amended--
            (1) in section 1372(c)(1) (12 U.S.C. 4632(c)), by striking 
        ``that enterprise'' and inserting ``that regulated entity'';
            (2) in section 1379 (12 U.S.C. 4637), as so redesignated by 
        section 1056(a)(1) of this title--
                    (A) by inserting ``, or of a regulated entity-
                affiliated party,'' before ``shall not affect''; and
                    (B) by striking ``such director or executive 
                officer'' each place such term appears and inserting 
                ``such director, executive officer, or regulated 
                entity-affiliated party'';
            (3) in section 1379A (12 U.S.C. 4638), as so redesignated 
        by section 1056(a)(1) of this title, by inserting ``or against 
        a regulated entity-affiliated party,'' before ``or impair'';
            (4) by striking ``An enterprise'' each place such term 
        appears in such subtitle and inserting ``A regulated entity'';
            (5) by striking ``an enterprise'' each place such term 
        appears in such subtitle and inserting ``a regulated entity'';
            (6) by striking ``the enterprise'' each place such term 
        appears in such subtitle and inserting ``the regulated 
        entity''; and
            (7) by striking ``any enterprise'' each place such term 
        appears in such subtitle and inserting ``any regulated 
        entity''.

                     CHAPTER 5--GENERAL PROVISIONS

SEC. 1061. BOARDS OF ENTERPRISES.

    (a) Fannie Mae.--
            (1) In general.--Section 308(b) of the Federal National 
        Mortgage Association Charter Act (12 U.S.C. 1723(b)) is 
        amended--
                    (A) in the first sentence, by striking ``eighteen 
                persons, five of whom shall be appointed annually by 
                the President of the United States, and the remainder 
                of whom'' and inserting ``13 persons, or such other 
                number that the Director determines appropriate, who'';
                    (B) in the second sentence, by striking ``appointed 
                by the President'';
                    (C) in the third sentence--
                            (i) by striking ``appointed or''; and
                            (ii) by striking ``, except that any such 
                        appointed member may be removed from office by 
                        the President for good cause'';
                    (D) in the fourth sentence, by striking 
                ``elective''; and
                    (E) by striking the fifth sentence.
            (2) Transitional provision.--The amendments made by 
        paragraph (1) shall not apply to any appointed position of the 
        board of directors of the Federal National Mortgage Association 
        until the expiration of the annual term for such position 
        during which the effective date under section 1065 occurs.
    (b) Freddie Mac.--
            (1) In general.--Section 303(a)(2) of the Federal Home Loan 
        Mortgage Corporation Act (12 U.S.C. 1452(a)(2)) is amended--
                    (A) in subparagraph (A)--
                            (i) in the first sentence, by striking ``18 
                        persons, 5 of whom shall be appointed annually 
                        by the President of the United States and the 
                        remainder of whom'' and inserting ``13 persons, 
                        or such other number as the Director determines 
                        appropriate, who''; and
                            (ii) in the second sentence, by striking 
                        ``appointed by the President of the United 
                        States'';
                    (B) in subparagraph (B)--
                            (i) by striking ``such or''; and
                            (ii) by striking ``, except that any 
                        appointed member may be removed from office by 
                        the President for good cause''; and
                    (C) in subparagraph (C)--
                            (i) by striking the first sentence; and
                            (ii) by striking ``elective''.
            (2) Transitional provision.--The amendments made by 
        paragraph (1) shall not apply to any appointed position of the 
        board of directors of the Federal Home Loan Mortgage 
        Corporation until the expiration of the annual term for such 
        position during which the effective date under section 1065 
        occurs.

SEC. 1062. REPORT ON PORTFOLIO OPERATIONS, SAFETY AND SOUNDNESS, AND 
              MISSION OF ENTERPRISES.

    Not later than the expiration of the 12-month period beginning on 
the effective date under section 1065, the Director of the Federal 
Housing Finance Agency shall submit a report to the Congress which 
shall include--
            (1) a description of the portfolio holdings of the 
        enterprises (as such term is defined in section 1303 of the 
        Housing and Community Development Act of 1992 (12 U.S.C. 4502)) 
        in mortgages (including whole loans and mortgage-backed 
        securities), non-mortgages, and other assets;
            (2) a description of the risk implications for the 
        enterprises of such holdings and the consequent risk management 
        undertaken by the enterprises (including the use of derivatives 
        for hedging purposes), compared with off-balance sheet 
        liabilities of the enterprises (including mortgage-backed 
        securities guaranteed by the enterprises);
            (3) an analysis of portfolio holdings for safety and 
        soundness purposes;
            (4) an assessment of whether portfolio holdings fulfill the 
        mission purposes of the enterprises under the Federal National 
        Mortgage Association Charter Act and the Federal Home Loan 
        Mortgage Corporation Act; and
            (5) an analysis of the potential systemic risk implications 
        for the enterprises, the housing and capital markets, and the 
        financial system of portfolio holdings, and whether such 
        holdings should be limited or reduced over time.

SEC. 1063. CONFORMING AND TECHNICAL AMENDMENTS.

    (a) 1992 Act.--Title XIII of the Housing and Community Development 
Act of 1992 is amended by striking section 1383 (12 U.S.C. 1451 note).
    (b) Title 18, United States Code.--Section 1905 of title 18, United 
States Code, is amended by striking ``Office of Federal Housing 
Enterprise Oversight'' and inserting ``Federal Housing Finance 
Agency''.
    (c) Flood Disaster Protection Act of 1973.--Section 102(f)(3)(A) of 
the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(f)(3)(A)) is 
amended by striking ``Director of the Office of Federal Housing 
Enterprise Oversight of the Department of Housing and Urban 
Development'' and inserting ``Director of the Federal Housing Finance 
Agency''.
    (d) Department of Housing and Urban Development Act.--Section 5 of 
the Department of Housing and Urban Development Act (42 U.S.C. 3534) is 
amended by striking subsection (d).
    (e) Title 5, United States Code.--
            (1) Director's pay rate.--Section 5313 of title 5, United 
        States Code, is amended by striking the item relating to the 
        Director of the Office of Federal Housing Enterprise Oversight, 
        Department of Housing and Urban Development and inserting the 
        following new item:
            ``Director of the Federal Housing Finance Agency.''.
            (2) Exclusion from senior executive service.--Section 
        3132(a)(1)(D) of title 5, United States Code, is amended--
                    (A) by striking ``the Federal Housing Finance 
                Board,''; and
                    (B) by striking ``the Office of Federal Housing 
                Enterprise Oversight of the Department of Housing and 
                Urban Development'' and inserting ``the Federal Housing 
                Finance Agency''.
    (f) Inspector General Act of 1978.--Section 8G(a)(2) of the 
Inspector General Act of 1978 (5 U.S.C. App.) is amended by striking 
``Federal Housing Finance Board'' and inserting ``Federal Housing 
Finance Agency''.
    (g) Federal Deposit Insurance Act.--Section 11(t)(2)(A) of the 
Federal Deposit Insurance Act (12 U.S.C.1821(t)(2)(A)) is amended by 
adding at the end the following new clause:
                            ``(vii) The Federal Housing Finance 
                        Agency.''.
    (h) 1997 Emergency Supplemental Appropriations Act.--Section 10001 
of the 1997 Emergency Supplemental Appropriations Act for Recovery From 
Natural Disasters, and for Overseas Peacekeeping Efforts, Including 
Those In Bosnia (42 U.S.C. 3548) is amended--
            (1) by striking ``the Government National Mortgage 
        Association, and the Office of Federal Housing Enterprise 
        Oversight'' and inserting ``and the Government National 
        Mortgage Association''; and
            (2) by striking ``, the Government National Mortgage 
        Association, or the Office of Federal Housing Enterprise 
        Oversight'' and inserting ``or the Government National Mortgage 
        Association''.
    (i) National Homeownership Trust Act.--Section 302(b)(4) of the 
Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 
12851(b)(4)) is amended by striking ``the chairperson of the Federal 
Housing Finance Board'' and inserting ``the Director of the Federal 
Housing Finance Agency''.

SEC. 1064. STUDY OF ALTERNATIVE SECONDARY MARKET SYSTEMS.

    (a) In General.--The Director of the Federal Housing Finance 
Agency, in consultation with the Board of Governors of the Federal 
Reserve System, the Secretary of the Treasury, and the Secretary of 
Housing and Urban Development, shall conduct a comprehensive study of 
the effects on financial and housing finance markets of alternatives to 
the current secondary market system for housing finance, taking into 
consideration changes in the structure of financial and housing finance 
markets and institutions since the creation of the Federal National 
Mortgage Association and the Federal Home Loan Mortgage Corporation.
    (b) Contents.--The study under this section shall--
            (1) include, among the alternatives to the current 
        secondary market system analyzed--
                    (A) repeal of the chartering Acts for the Federal 
                National Mortgage Association and the Federal Home Loan 
                Mortgage Corporation;
                    (B) establishing bank-like mechanisms for granting 
                new charters for limited purposed mortgage 
                securitization entities;
                    (C) permitting the Director of the Federal Housing 
                Finance Agency to grant new charters for limited 
                purpose mortgage securitization entities, which shall 
                include analyzing the terms on which such charters 
                should be granted, including whether such charters 
                should be sold, or whether such charters and the 
                charters for the Federal National Mortgage Association 
                and the Federal Home Loan Mortgage Corporation should 
                be taxed or otherwise assessed a monetary price; and
                    (D) such other alternatives as the Director 
                considers appropriate;
            (2) examine all of the issues involved in making the 
        transition to a completely private secondary mortgage market 
        system;
            (3) examine the technological advancements the private 
        sector has made in providing liquidity in the secondary 
        mortgage market and how such advancements have affected 
        liquidity in the secondary mortgage market; and
            (4) examine how taxpayers would be impacted by each 
        alternative system, including the complete privatization of the 
        Federal National Mortgage Association and the Federal Home Loan 
        Mortgage Corporation.
    (c) Report.--The Director of the Federal Housing Finance Agency 
shall submit a report to the Congress on the study not later than the 
expiration of the 24-month period beginning on the effective date under 
section 1065.

SEC. 1065. EFFECTIVE DATE.

    Except as specifically provided otherwise in this subtitle, this 
subtitle shall take effect on and the amendments made by this subtitle 
shall take effect on, and shall apply beginning on, the expiration of 
the 6-month period beginning on the date of the enactment of this Act.

                  Subtitle B--Federal Home Loan Banks

SEC. 1071. DEFINITIONS.

    Section 2 of the Federal Home Loan Bank Act (12 U.S.C. 1422) is 
amended--
            (1) by striking paragraphs (1), (10), and (11);
            (2) by redesignating paragraphs (2) through (9) as 
        paragraphs (1) through (8), respectively;
            (3) by redesignating paragraphs (12) and (13) as paragraphs 
        (9) and (10), respectively; and
            (4) by adding at the end the following:
            ``(11) Director.--The term `Director' means the Director of 
        the Federal Housing Finance Agency.
            ``(12) Agency.--The term `Agency' means the Federal Housing 
        Finance Agency.''.

SEC. 1072. DIRECTORS.

    (a) Election.--Section 7 of the Federal Home Loan Bank Act (12 
U.S.C. 1427) is amended--
            (1) by striking subsection (a) and inserting the following:
    ``(a) Number; Election; Qualifications; Conflicts of Interest.--
            ``(1) In general.--The management of each Federal Home Loan 
        Bank shall be vested in a board of 13 directors, or such other 
        number as the Director determines appropriate, each of whom 
        shall be a citizen of the United States. All directors of a 
        Bank who are not independent directors pursuant to paragraph 
        (3) shall be elected by the members.
            ``(2) Member directors.--A majority of the directors of 
        each Bank shall be officers or directors of a member of such 
        Bank that is located in the district in which such Bank is 
        located.
            ``(3) Independent directors.--At least two-fifths of the 
        directors of each Bank shall be independent directors, who 
        shall be appointed by the Director of the Federal Housing 
        Finance Agency from a list of individuals recommended by the 
        Federal Housing Enterprise Board. The Federal Housing 
        Enterprise Board may recommend individuals who are identified 
        by the Board's own independent process or included on a list of 
        individuals recommended by the board of directors of the Bank 
        involved, which shall be submitted to the Federal Housing 
        Enterprise Board by such board of directors. The number of 
        individuals on any such list submitted by a Bank's board of 
        directors shall be equal to at least two times the number of 
        independent directorships to be filled. All independent 
        directors appointed shall meet the following criteria:
                    ``(A) In general.--Each independent director shall 
                be a bona fide resident of the district in which such 
                Bank is located.
                    ``(B) Public interest directors.--At least 2 of the 
                independent directors under this paragraph of each Bank 
                shall be representatives chosen from organizations with 
                more than a 2-year history of representing consumer or 
                community interests on banking services, credit needs, 
                housing, community development, economic development, 
                or financial consumer protections.
                    ``(C) Other directors.--
                            ``(i) Qualifications.--Each independent 
                        director that is not a public interest director 
                        under subparagraph (B) shall have demonstrated 
                        knowledge of, or experience in, financial 
                        management, auditing and accounting, risk 
                        management practices, derivatives, project 
                        development, or organizational management, or 
                        such other knowledge or expertise as the 
                        Director may provide by regulation.
                            ``(ii) Consultation with banks.--In 
                        appointing other directors to serve on the 
                        board of a Federal home loan bank, the Director 
                        of the Federal Housing Finance Agency may 
                        consult with each Federal home loan bank about 
                        the knowledge, skills, and expertise needed to 
                        assist the board in better fulfilling its 
                        responsibilities.
                    ``(D) Conflicts of interest.--Notwithstanding 
                subsection (f)(2), an independent director under this 
                paragraph of a Bank may not, during such director's 
                term of office, serve as an officer of any Federal Home 
                Loan Bank or as a director or officer of any member of 
                a Bank.
                    ``(E) Community demographics.--In appointing 
                independent directors of a Bank pursuant to this 
                paragraph, the Director shall take into consideration 
                the demographic makeup of the community most served by 
                the Affordable Housing Program of the Bank pursuant to 
                section 10(j).'';
            (2) in the first sentence of subsection (b), by striking 
        ``elective directorship'' and inserting ``member directorship 
        established pursuant to subsection (a)(2)'';
            (3) in subsection (c)--
                    (A) by striking ``elective'' each place such term 
                appears and inserting ``member'', except--
                            (i) in the second sentence, the second 
                        place such term appears; and
                            (ii) each place such term appears in the 
                        fifth sentence;
                    (B) in the first sentence, by inserting after 
                ``less than one'' the following: ``or two, as 
                determined by the board of directors of the appropriate 
                Federal home loan bank,''; and
                    (C) in the second sentence--
                            (i) by inserting ``(A) except as provided 
                        in clause (B) of this sentence,'' before ``if 
                        at any time''; and
                            (ii) by inserting before the period at the 
                        end the following: ``, and (B) clause (A) of 
                        this sentence shall not apply to the 
                        directorships of any Federal home loan bank 
                        resulting from the merger of any two or more 
                        such banks''; and
            (4) by striking ``elective'' each place such term appears 
        (except in subsections (c), (e), and (f)).
    (b) Terms.--
            (1) In general.--Section 7(d) of the Federal Home Loan Bank 
        Act (12 U.S.C. 1427(d)) is amended--
                    (A) in the first sentence, by striking ``3 years'' 
                and inserting ``4 years''; and
                    (B) in the second sentence--
                            (i) by striking ``Federal Home Loan Bank 
                        System Modernization Act of 1999'' and 
                        inserting ``Federal Housing Finance Reform Act 
                        of 2008''; and
                            (ii) by striking ``1/3'' and inserting ``1/
                        4''.
            (2) Savings provision.--The amendments made by paragraph 
        (1) shall not apply to the term of office of any director of a 
        Federal home loan bank who is serving as of the effective date 
        of this subtitle under section 1081, including any director 
        elected to fill a vacancy in any such office.
    (c) Continued Service of Independent Directors After Expiration of 
Term.--Section 7(f)(2) of the Federal Home Loan Bank Act (12 U.S.C. 
1427(f)(2)) is amended--
            (1) in the second sentence, by striking ``or the term of 
        such office expires, whichever occurs first'';
            (2) by adding at the end the following new sentence: ``An 
        independent Bank director may continue to serve as a director 
        after the expiration of the term of such director until a 
        successor is appointed.'';
            (3) in the paragraph heading, by striking ``Appointed'' and 
        inserting ``Independent''; and
            (4) by striking ``appointive'' each place such term appears 
        and inserting ``independent''.
    (d) Conforming Amendments.--Section 7(f)(3) of the Federal Home 
Loan Bank Act (12 U.S.C. 1427(f)(3)) is amended--
            (1) in the paragraph heading, by striking ``Elected'' and 
        inserting ``Member''; and
            (2) by striking ``elective'' each place such term appears 
        in the first and third sentences and inserting ``member''.
    (e) Compensation.--Subsection (i) of section 7 of the Federal Home 
Loan Bank Act (12 U.S.C. 1427(i)) is amended to read as follows:
    ``(i) Directors' Compensation.--
            ``(1) In general.--Each Federal home loan bank may pay the 
        directors on the board of directors for the bank reasonable and 
        appropriate compensation for the time required of such 
        directors, and reasonable and appropriate expenses incurred by 
        such directors, in connection with service on the board of 
        directors, in accordance with resolutions adopted by the board 
        of directors and subject to the approval of the Director.
            ``(2) Annual report by the board.--The Director shall 
        include, in the annual report submitted to the Congress 
        pursuant to section 1319B of the Federal Housing Enterprises 
        Financial Safety and Soundness Act of 1992, information 
        regarding the compensation and expenses paid by the Federal 
        home loan banks to the directors on the boards of directors of 
        the banks.''.
    (f) Transition Rule.--Any member of the board of directors of a 
Federal Home Loan Bank serving as of the effective date under section 
1081 may continue to serve as a member of such board of directors for 
the remainder of the term of such office as provided in section 7 of 
the Federal Home Loan Bank Act, as in effect before such effective 
date.

SEC. 1073. FEDERAL HOUSING FINANCE AGENCY OVERSIGHT OF FEDERAL HOME 
              LOAN BANKS.

    The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.), other than 
in provisions of that Act added or amended otherwise by this title, is 
amended--
            (1) by striking sections 2A and 2B (12 U.S.C. 1422a, 
        1422b);
            (2) in section 6 (12 U.S.C. 1426(b)(1))--
                    (A) in subsection (b)(1), in the matter preceding 
                subparagraph (A), by striking ``Finance Board 
                approval'' and inserting ``approval by the Director''; 
                and
                    (B) in each of subsections (c)(4)(B) and (d)(2), by 
                striking ``Finance Board regulations'' each place that 
                term appears and inserting ``regulations of the 
                Director'';
            (3) in section 8 (12 U.S.C. 1428), in the section heading, 
        by striking ``by the board'';
            (4) in section 10(b) (12 U.S.C. 1430(b)), by striking ``by 
        formal resolution'';
            (5) in section 10 (12 U.S.C. 1430), by adding at the end 
        the following new subsection:
    ``(k) Monitoring and Enforcing Compliance With Affordable Housing 
and Community Investment Program Requirements.--The requirements under 
subsection (i) and (j) that the Banks establish Community Investment 
and Affordable Housing Programs, respectively, and contribute to the 
Affordable Housing Program, shall be enforceable by the Director with 
respect to the Banks in the same manner and to the same extent as the 
housing goals under subpart B of part 2 of subtitle A of title XIII of 
the Housing and Community Development Act of 1992 (12 U.S.C. 4561 et 
seq.) are enforceable under section 1336 of such Act with respect to 
the Federal National Mortgage Association and the Federal Home Loan 
Mortgage Corporation.'';
            (6) in section 11 (12 U.S.C. 1431)--
                    (A) in subsection (b)--
                            (i) in the first sentence--
                                    (I) by striking ``The Board'' and 
                                inserting ``The Office of Finance, as 
                                agent for the Banks,''; and
                                    (II) by striking ``the Board'' and 
                                inserting ``such Office''; and
                            (ii) in the second and fourth sentences, by 
                        striking ``the Board'' each place such term 
                        appears and inserting ``the Office of 
                        Finance'';
                    (B) in subsection (c)--
                            (i) by striking ``the Board'' the first 
                        place such term appears and inserting ``the 
                        Office of Finance, as agent for the Banks,''; 
                        and
                            (ii) by striking ``the Board'' the second 
                        place such term appears and inserting ``such 
                        Office''; and
                    (C) in subsection (f)--
                            (i) by striking the two commas after 
                        ``permit'' and inserting ``or''; and
                            (ii) by striking the comma after 
                        ``require'';
            (7) in section 15 (12 U.S.C. 1435), by inserting ``or the 
        Director'' after ``the Board'';
            (8) in section 18 (12 U.S.C. 1438), by striking subsection 
        (b);
            (9) in section 21 (12 U.S.C. 1441)--
                    (A) in subsection (b)--
                            (i) in paragraph (5), by striking 
                        ``Chairperson of the Federal Housing Finance 
                        Board'' and inserting ``Director''; and
                            (ii) in the heading for paragraph (8), by 
                        striking ``federal housing finance board'' and 
                        inserting ``director''; and
                    (B) in subsection (i), in the heading for paragraph 
                (2), by striking ``Federal housing finance board'' and 
                inserting ``Director'';
            (10) in section 23 (12 U.S.C. 1443), by striking ``Board of 
        Directors of the Federal Housing Finance Board'' and inserting 
        ``Director'';
            (11) by striking ``the Board'' each place such term appears 
        in such Act (except in section 15 (12 U.S.C. 1435), section 
        21(f)(2) (12 U.S.C. 1441(f)(2)), subsections (a), (k)(2)(B)(i), 
        and (n)(6)(C)(ii) of section 21A (12 U.S.C. 1441a), subsections 
        (f)(2)(C), and (k)(7)(B)(ii) of section 21B (12 U.S.C. 1441b), 
        and the first two places such term appears in section 22 (12 
        U.S.C. 1442)) and inserting ``the Director'';
            (12) by striking ``The Board'' each place such term appears 
        in such Act (except in sections 7(e) (12 U.S.C. 1427(e)), and 
        11(b) (12 U.S.C. 1431(b))) and inserting ``The Director'';
            (13) by striking ``the Board's'' each place such term 
        appears in such Act and inserting ``the Director's'';
            (14) by striking ``The Board's'' each place such term 
        appears in such Act and inserting ``The Director's'';
            (15) by striking ``the Finance Board'' each place such term 
        appears in such Act and inserting ``the Director'';
            (16) by striking ``Federal Housing Finance Board'' each 
        place such term appears and inserting ``Director'';
            (17) in section 11(i) (12 U.S.C. 1431(i), by striking ``the 
        Chairperson of''; and
            (18) in section 21(e)(9) (12 U.S.C. 1441(e)(9)), by 
        striking ``Chairperson of the''.

SEC. 1074. JOINT ACTIVITIES OF BANKS.

    Section 11 of the Federal Home Loan Bank Act (12 U.S.C. 1431) is 
amended by adding at the end the following new subsection:
    ``(l) Joint Activities.--Subject to the regulation of the Director, 
any two or more Federal Home Loan Banks may establish a joint office 
for the purpose of performing functions for, or providing services to, 
the Banks on a common or collective basis, or may require that the 
Office of Finance perform such functions or services, but only if the 
Banks are otherwise authorized to perform such functions or services 
individually.''.

SEC. 1075. SHARING OF INFORMATION BETWEEN FEDERAL HOME LOAN BANKS.

    (a) In General.--The Federal Home Loan Bank Act is amended by 
inserting after section 20 (12 U.S.C. 1440) the following new section:

``SEC. 20A. SHARING OF INFORMATION BETWEEN FEDERAL HOME LOAN BANKS.

    ``(a) Regulatory Authority.--The Director shall prescribe such 
regulations as may be necessary to ensure that each Federal Home Loan 
Bank has access to information that the Bank needs to determine the 
nature and extent of its joint and several liability.
    ``(b) No Waiver of Privilege.--The Director shall not be deemed to 
have waived any privilege applicable to any information concerning a 
Federal Home Loan Bank by transferring, or permitting the transfer of, 
that information to any other Federal Home Loan Bank for the purpose of 
enabling the recipient to evaluate the nature and extent of its joint 
and several liability.''.
    (b) Regulations.--The regulations required under the amendment made 
by subsection (a) shall be issued in final form not later than 6 months 
after the effective date under section 1081 of this title.

SEC. 1076. REORGANIZATION OF BANKS AND VOLUNTARY MERGER.

    Section 26 of the Federal Home Loan Bank Act (12 U.S.C. 1446) is 
amended--
            (1) by inserting ``(a) Reorganization.--'' before 
        ``Whenever''; and
            (2) by striking ``liquidated or'' each place such phrase 
        appears;
            (3) by striking ``liquidation or''; and
            (4) by adding at the end the following new subsection:
    ``(b) Voluntary Mergers.--Any two or more Banks may, with the 
approval of the Director, and the approval of the boards of directors 
of the Banks involved, merge. The Director shall promulgate regulations 
establishing the conditions and procedures for the consideration and 
approval of any such voluntary merger, including the procedures for 
Bank member approval.''.

SEC. 1077. SECURITIES AND EXCHANGE COMMISSION DISCLOSURE.

    (a) In General.--The Federal Home Loan Banks shall be exempt from 
compliance with--
            (1) sections 13(e), 14(a), 14(c), and 17A of the Securities 
        Exchange Act of 1934 and related Commission regulations; and
            (2) section 15 of that Act and related Securities and 
        Exchange Commission regulations with respect to transactions in 
        capital stock of the Banks.
    (b) Member Exemption.--The members of the Federal Home Loan Banks 
shall be exempt from compliance with sections 13(d), 13(f), 13(g), 
14(d), and 16 of the Securities Exchange Act of 1934 and related 
Securities and Exchange Commission regulations with respect to their 
ownership of, or transactions in, capital stock of the Federal Home 
Loan Banks.
    (c) Exempted and Government Securities.--
            (1) Capital stock.--The capital stock issued by each of the 
        Federal Home Loan Banks under section 6 of the Federal Home 
        Loan Bank Act are--
                    (A) exempted securities within the meaning of 
                section 3(a)(2) of the Securities Act of 1933; and
                    (B) ``exempted securities'' within the meaning of 
                section 3(a)(12)(A) of the Securities Exchange Act of 
                1934.
            (2) Other obligations.--The debentures, bonds, and other 
        obligations issued under section 11 of the Federal Home Loan 
        Bank Act are--
                    (A) exempted securities within the meaning of 
                section 3(a)(2) of the Securities Act of 1933;
                    (B) ``government securities'' within the meaning of 
                section 3(a)(42) of the Securities Exchange Act of 
                1934;
                    (C) excluded from the definition of ``government 
                securities broker'' within section 3(a)(43) of the 
                Securities Exchange Act of 1934;
                    (D) excluded from the definition of ``government 
                securities dealer'' within section 3(a)(44) of the 
                Securities Exchange Act of 1934; and
                    (E) ``government securities'' within the meaning of 
                section 2(a)(16) of the Investment Company Act of 1940.
    (d) Exemption From Reporting Requirements.--The Federal Home Loan 
Banks shall be exempt from periodic reporting requirements pertaining 
to--
            (1) the disclosure of related party transactions that occur 
        in the ordinary course of business of the Banks with their 
        members; and
            (2) the disclosure of unregistered sales of equity 
        securities.
    (e) Tender Offers.--The Securities and Exchange Commission's rules 
relating to tender offers shall not apply in connection with 
transactions in capital stock of the Federal Home Loan Banks.
    (f) Regulations.--In issuing any final regulations to implement 
provisions of this section, the Securities and Exchange Commission 
shall consider the distinctive characteristics of the Federal Home Loan 
Banks when evaluating the accounting treatment with respect to the 
payment to Resolution Funding Corporation, the role of the combined 
financial statements of the twelve Banks, the accounting classification 
of redeemable capital stock, and the accounting treatment related to 
the joint and several nature of the obligations of the Banks.

SEC. 1078. COMMUNITY FINANCIAL INSTITUTION MEMBERS.

    (a) Total Asset Requirement.--Paragraph (10) of section 2 of the 
Federal Home Loan Bank Act (12 U.S.C. 1422(10)), as so redesignated by 
section 1071(3) of this title, is amended by striking ``$500,000,000'' 
each place such term appears and inserting ``$1,000,000,000''.
    (b) Use of Advances for Community Development Activities.--Section 
10(a) of the Federal Home Loan Bank Act (12 U.S.C. 1430(a)) is 
amended--
            (1) in paragraph (2)(B)--
                    (A) by striking ``and''; and
                    (B) by inserting ``, and community development 
                activities'' before the period at the end;
            (2) in paragraph (3)(E), by inserting ``or community 
        development activities'' after ``agriculture,''; and
            (3) in paragraph (6)--
                    (A) by striking ``and''; and
                    (B) by inserting ``, and `community development 
                activities''' before ``shall''.

SEC. 1079. TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Right to Financial Privacy Act of 1978.--Section 1113(o) of the 
Right to Financial Privacy Act of 1978 (12 U.S.C. 3413(o)) is amended--
            (1) by striking ``Federal Housing Finance Board'' and 
        inserting ``Federal Housing Finance Agency''; and
            (2) by striking ``Federal Housing Finance Board's'' and 
        inserting ``Federal Housing Finance Agency's''.
    (b) Riegle Community Development and Regulatory Improvement Act of 
1994.--Section 117(e) of the Riegle Community Development and 
Regulatory Improvement Act of 1994 (12 U.S.C. 4716(e)) is amended by 
striking ``Federal Housing Finance Board'' and inserting ``Federal 
Housing Finance Agency''.
    (c) Title 18, United States Code.--Title 18, United States Code, is 
amended by striking ``Federal Housing Finance Board'' each place such 
term appears in each of sections 212, 657, 1006, 1014, and inserting 
``Federal Housing Finance Agency''.
    (d) MARA Act of 1997.--Section 517(b)(4) of the Multifamily 
Assisted Housing Reform and Affordability Act of 1997 (42 U.S.C. 1437f 
note) is amended by striking ``Federal Housing Finance Board'' and 
inserting ``Federal Housing Finance Agency''.
    (e) Title 44, United States Code.--Section 3502(5) of title 44, 
United States Code, is amended by striking ``Federal Housing Finance 
Board'' and inserting ``Federal Housing Finance Agency''.
    (f) Access to Local TV Act of 2000.--Section 1004(d)(2)(D)(iii) of 
the Launching Our Communities' Access to Local Television Act of 2000 
(47 U.S.C. 1103(d)(2)(D)(iii)) is amended by striking ``Office of 
Federal Housing Enterprise Oversight, the Federal Housing Finance 
Board'' and inserting ``Federal Housing Finance Agency''.
    (g) Sarbanes-Oxley Act of 2002.--Section 105(b)(5)(B)(ii)(II) of 
the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7215(B)(5)(b)(ii)(II)) is 
amended by inserting ``and the Director of the Federal Housing Finance 
Agency'' after ``Commission,''.

SEC. 1080. STUDY OF AFFORDABLE HOUSING PROGRAM USE FOR LONG-TERM CARE 
              FACILITIES.

    The Comptroller General shall conduct a study of the use of 
affordable housing programs of the Federal home loan banks under 
section 10(j) of the Federal Home Loan Bank Act to determine how and 
the extent to which such programs are used to assist long-term care 
facilities for low- and moderate-income individuals, and the 
effectiveness and adequacy of such assistance in meeting the needs of 
affected communities. he Comptroller General shall submit a report to 
the Director of the Federal Housing Finance Agency and the Congress 
regarding the results of the study not later than the expiration of the 
1-year period beginning on the date of the enactment of this Act. This 
section shall take effect on the date of the enactment of this Act.

SEC. 1081. EFFECTIVE DATE.

    Except as specifically provided otherwise in this subtitle, this 
subtitle shall take effect on and the amendments made by this subtitle 
shall take effect on, and shall apply beginning on, the expiration of 
the 6-month period beginning on the date of the enactment of this Act.

Subtitle C--Transfer of Functions, Personnel, and Property of Office of 
 Federal Housing Enterprise Oversight, Federal Housing Finance Board, 
            and Department of Housing and Urban Development

       CHAPTER 1--OFFICE OF FEDERAL HOUSING ENTERPRISE OVERSIGHT

SEC. 1085. ABOLISHMENT OF OFHEO.

    (a) In General.--Effective at the end of the 6-month period 
beginning on the date of the enactment of this Act, the Office of 
Federal Housing Enterprise Oversight of the Department of Housing and 
Urban Development and the positions of the Director and Deputy Director 
of such Office are abolished.
    (b) Disposition of Affairs.--During the 6-month period beginning on 
the date of the enactment of this Act, the Director of the Office of 
Federal Housing Enterprise Oversight shall, for the purpose of winding 
up the affairs of the Office of Federal Housing Enterprise Oversight 
and in addition to carrying out its other responsibilities under law--
            (1) manage the employees of such Office and provide for the 
        payment of the compensation and benefits of any such employee 
        which accrue before the effective date of the transfer of such 
        employee pursuant to section 1087; and
            (2) may take any other action necessary for the purpose of 
        winding up the affairs of the Office.
    (c) Status of Employees Before Transfer.--The amendments made by 
title I and the abolishment of the Office of Federal Housing Enterprise 
Oversight under subsection (a) of this section may not be construed to 
affect the status of any employee of such Office as employees of an 
agency of the United States for purposes of any other provision of law 
before the effective date of the transfer of any such employee pursuant 
to section 1087.
    (d) Use of Property and Services.--
            (1) Property.--The Director of the Federal Housing Finance 
        Agency may use the property of the Office of Federal Housing 
        Enterprise Oversight to perform functions which have been 
        transferred to the Director of the Federal Housing Finance 
        Agency for such time as is reasonable to facilitate the orderly 
        transfer of functions transferred pursuant to any other 
        provision of this title or any amendment made by this title to 
        any other provision of law.
            (2) Agency services.--Any agency, department, or other 
        instrumentality of the United States, and any successor to any 
        such agency, department, or instrumentality, which was 
        providing supporting services to the Office of Federal Housing 
        Enterprise Oversight before the expiration of the period under 
        subsection (a) in connection with functions that are 
        transferred to the Director of the Federal Housing Finance 
        Agency shall--
                    (A) continue to provide such services, on a 
                reimbursable basis, until the transfer of such 
                functions is complete; and
                    (B) consult with any such agency to coordinate and 
                facilitate a prompt and reasonable transition.
    (e) Savings Provisions.--
            (1) Existing rights, duties, and obligations not 
        affected.--Subsection (a) shall not affect the validity of any 
        right, duty, or obligation of the United States, the Director 
        of the Office of Federal Housing Enterprise Oversight, or any 
        other person, which--
                    (A) arises under or pursuant to the title XIII of 
                the Housing and Community Development Act of 1992, the 
                Federal National Mortgage Association Charter Act, the 
                Federal Home Loan Mortgage Corporation Act, or any 
                other provision of law applicable with respect to such 
                Office; and
                    (B) existed on the day before the abolishment under 
                subsection (a) of this section.
            (2) Continuation of suits.--No action or other proceeding 
        commenced by or against the Director of the Office of Federal 
        Housing Enterprise Oversight in connection with functions that 
        are transferred to the Director of the Federal Housing Finance 
        Agency shall abate by reason of the enactment of this title, 
        except that the Director of the Federal Housing Finance Agency 
        shall be substituted for the Director of the Office of Federal 
        Housing Enterprise Oversight as a party to any such action or 
        proceeding.

SEC. 1086. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.

    All regulations, orders, determinations, and resolutions that--
            (1) were issued, made, prescribed, or allowed to become 
        effective by--
                    (A) the Office of Federal Housing Enterprise 
                Oversight; or
                    (B) a court of competent jurisdiction and that 
                relate to functions transferred by this subtitle; and
            (2) are in effect on the date of the abolishment under 
        section 1085(a) of this title, shall remain in effect according 
        to the terms of such regulations, orders, determinations, and 
        resolutions, and shall be enforceable by or against the 
        Director of the Federal Housing Finance Agency until modified, 
        terminated, set aside, or superseded in accordance with 
        applicable law by such Director, as the case may be, any court 
        of competent jurisdiction, or operation of law.

SEC. 1087. TRANSFER AND RIGHTS OF EMPLOYEES OF OFHEO.

    (a) Transfer.--Each employee of the Office of Federal Housing 
Enterprise Oversight shall be transferred to the Federal Housing 
Finance Agency for employment no later than the date of the abolishment 
under section 1085(a) of this title and such transfer shall be deemed a 
transfer of function for purposes of section 3503 of title 5, United 
States Code.
    (b) Guaranteed Positions.--Each employee transferred under 
subsection (a) shall be guaranteed a position with the same status, 
tenure, grade, and pay as that held on the day immediately preceding 
the transfer. Each such employee holding a permanent position shall not 
be involuntarily separated or reduced in grade or compensation for 12 
months after the date of transfer, except for cause or, if the employee 
is a temporary employee, separated in accordance with the terms of the 
appointment.
    (c) Appointment Authority for Excepted Service Employees.--
            (1) In general.--In the case of employees occupying 
        positions in the excepted service, any appointment authority 
        established pursuant to law or regulations of the Office of 
        Personnel Management for filling such positions shall be 
        transferred, subject to paragraph (2).
            (2) Decline of transfer.--The Director of the Federal 
        Housing Finance Agency may decline a transfer of authority 
        under paragraph (1) (and the employees appointed pursuant 
        thereto) to the extent that such authority relates to positions 
        excepted from the competitive service because of their 
        confidential, policy-making, policy-determining, or policy-
        advocating character.
    (d) Reorganization.--If the Director of the Federal Housing Finance 
Agency determines, after the end of the 1-year period beginning on the 
date of the abolishment under section 1085(a), that a reorganization of 
the combined work force is required, that reorganization shall be 
deemed a major reorganization for purposes of affording affected 
employees retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 
5, United States Code.
    (e) Employee Benefit Programs.--Any employee of the Office of 
Federal Housing Enterprise Oversight accepting employment with the 
Director of the Federal Housing Finance Agency as a result of a 
transfer under subsection (a) may retain for 12 months after the date 
such transfer occurs membership in any employee benefit program of the 
Federal Housing Finance Agency or the Office of Federal Housing 
Enterprise Oversight, as applicable, including insurance, to which such 
employee belongs on the date of the abolishment under section 1085(a) 
if--
            (1) the employee does not elect to give up the benefit or 
        membership in the program; and
            (2) the benefit or program is continued by the Director of 
        the Federal Housing Finance Agency,
The difference in the costs between the benefits which would have been 
provided by such agency and those provided by this section shall be 
paid by the Director of the Federal Housing Finance Agency. If any 
employee elects to give up membership in a health insurance program or 
the health insurance program is not continued by such Director, the 
employee shall be permitted to select an alternate Federal health 
insurance program within 30 days of such election or notice, without 
regard to any other regularly scheduled open season.

SEC. 1088. TRANSFER OF PROPERTY AND FACILITIES.

    Upon the abolishment under section 1085(a), all property of the 
Office of Federal Housing Enterprise Oversight shall transfer to the 
Director of the Federal Housing Finance Agency.

                CHAPTER 2--FEDERAL HOUSING FINANCE BOARD

SEC. 1091. ABOLISHMENT OF THE FEDERAL HOUSING FINANCE BOARD.

    (a) In General.--Effective at the end of the 6-month period 
beginning on the date of enactment of this Act, the Federal Housing 
Finance Board (in this subtitle referred to as the ``Board'') is 
abolished.
    (b) Disposition of Affairs.--During the 6-month period beginning on 
the date of enactment of this Act, the Board, for the purpose of 
winding up the affairs of the Board and in addition to carrying out its 
other responsibilities under law--
            (1) shall manage the employees of such Board and provide 
        for the payment of the compensation and benefits of any such 
        employee which accrue before the effective date of the transfer 
        of such employee under section 1093; and
            (2) may take any other action necessary for the purpose of 
        winding up the affairs of the Board.
    (c) Status of Employees Before Transfer.--The amendments made by 
titles I and II and the abolishment of the Board under subsection (a) 
may not be construed to affect the status of any employee of such Board 
as employees of an agency of the United States for purposes of any 
other provision of law before the effective date of the transfer of any 
such employee under section 1093.
    (d) Use of Property and Services.--
            (1) Property.--The Director of the Federal Housing Finance 
        Agency may use the property of the Board to perform functions 
        which have been transferred to the Director of the Federal 
        Housing Finance Agency for such time as is reasonable to 
        facilitate the orderly transfer of functions transferred under 
        any other provision of this title or any amendment made by this 
        title to any other provision of law.
            (2) Agency services.--Any agency, department, or other 
        instrumentality of the United States, and any successor to any 
        such agency, department, or instrumentality, which was 
        providing supporting services to the Board before the 
        expiration of the period under subsection (a) in connection 
        with functions that are transferred to the Director of the 
        Federal Housing Finance Agency shall--
                    (A) continue to provide such services, on a 
                reimbursable basis, until the transfer of such 
                functions is complete; and
                    (B) consult with any such agency to coordinate and 
                facilitate a prompt and reasonable transition.
    (e) Savings Provisions.--
            (1) Existing rights, duties, and obligations not 
        affected.--Subsection (a) shall not affect the validity of any 
        right, duty, or obligation of the United States, a member of 
        the Board, or any other person, which--
                    (A) arises under the Federal Home Loan Bank Act or 
                any other provision of law applicable with respect to 
                such Board; and
                    (B) existed on the day before the effective date of 
                the abolishment under subsection (a).
            (2) Continuation of suits.--No action or other proceeding 
        commenced by or against the Board in connection with functions 
        that are transferred to the Director of the Federal Housing 
        Finance Agency shall abate by reason of the enactment of this 
        title, except that the Director of the Federal Housing Finance 
        Agency shall be substituted for the Board or any member thereof 
        as a party to any such action or proceeding.

SEC. 1092. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.

    (a) In General.--All regulations, orders, determinations, and 
resolutions described under subsection (b) shall remain in effect 
according to the terms of such regulations, orders, determinations, and 
resolutions, and shall be enforceable by or against the Director of the 
Federal Housing Finance Agency until modified, terminated, set aside, 
or superseded in accordance with applicable law by such Director, any 
court of competent jurisdiction, or operation of law.
    (b) Applicability.--A regulation, order, determination, or 
resolution is described under this subsection if it--
            (1) was issued, made, prescribed, or allowed to become 
        effective by--
                    (A) the Board; or
                    (B) a court of competent jurisdiction and relates 
                to functions transferred by this subtitle; and
            (2) is in effect on the effective date of the abolishment 
        under section 1091(a).

SEC. 1093. TRANSFER AND RIGHTS OF EMPLOYEES OF THE FEDERAL HOUSING 
              FINANCE BOARD.

    (a) Transfer.--Each employee of the Board shall be transferred to 
the Federal Housing Finance Agency for employment not later than the 
effective date of the abolishment under section 1091(a), and such 
transfer shall be deemed a transfer of function for purposes of section 
3503 of title 5, United States Code.
    (b) Guaranteed Positions.--Each employee transferred under 
subsection (a) shall be guaranteed a position with the same status, 
tenure, grade, and pay as that held on the day immediately preceding 
the transfer. Each such employee holding a permanent position shall not 
be involuntarily separated or reduced in grade or compensation for 12 
months after the date of transfer, except for cause or, if the employee 
is a temporary employee, separated in accordance with the terms of the 
appointment.
    (c) Appointment Authority for Excepted and Senior Executive Service 
Employees.--
            (1) In general.--In the case of employees occupying 
        positions in the excepted service or the Senior Executive 
        Service, any appointment authority established under law or by 
        regulations of the Office of Personnel Management for filling 
        such positions shall be transferred, subject to paragraph (2).
            (2) Decline of transfer.--The Director of the Federal 
        Housing Finance Agency may decline a transfer of authority 
        under paragraph (1) to the extent that such authority relates 
        to positions excepted from the competitive service because of 
        their confidential, policymaking, policy-determining, or 
        policy-advocating character, and noncareer positions in the 
        Senior Executive Service (within the meaning of section 
        3132(a)(7) of title 5, United States Code).
    (d) Reorganization.--If the Director of the Federal Housing Finance 
Agency determines, after the end of the 1-year period beginning on the 
effective date of the abolishment under section 1091(a), that a 
reorganization of the combined workforce is required, that 
reorganization shall be deemed a major reorganization for purposes of 
affording affected employees retirement under section 8336(d)(2) or 
8414(b)(1)(B) of title 5, United States Code.
    (e) Employee Benefit Programs.--
            (1) In general.--Any employee of the Board accepting 
        employment with the Federal Housing Finance Agency as a result 
        of a transfer under subsection (a) may retain for 12 months 
        after the date on which such transfer occurs membership in any 
        employee benefit program of the Federal Housing Finance Agency 
        or the Board, as applicable, including insurance, to which such 
        employee belongs on the effective date of the abolishment under 
        section 1091(a) if--
                    (A) the employee does not elect to give up the 
                benefit or membership in the program; and
                    (B) the benefit or program is continued by the 
                Director of the Federal Housing Finance Agency.
            (2) Cost differential.--The difference in the costs between 
        the benefits which would have been provided by the Board and 
        those provided by this section shall be paid by the Director of 
        the Federal Housing Finance Agency. If any employee elects to 
        give up membership in a health insurance program or the health 
        insurance program is not continued by such Director, the 
        employee shall be permitted to select an alternate Federal 
        health insurance program within 30 days after such election or 
        notice, without regard to any other regularly scheduled open 
        season.

SEC. 1094. TRANSFER OF PROPERTY AND FACILITIES.

    Upon the effective date of the abolishment under section 1091(a), 
all property of the Board shall transfer to the Director of the Federal 
Housing Finance Agency.

         CHAPTER 3--DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

SEC. 1095. TERMINATION OF ENTERPRISE-RELATED FUNCTIONS.

    (a) Termination Date.--For purposes of this subtitle, the term 
``termination date'' means the date that occurs 6 months after the date 
of the enactment of this Act.
    (b) Determination of Transferred Functions and Employees.--
            (1) In general.--Not later than the expiration of the 3-
        month period beginning on the date of the enactment of this 
        Act, the Secretary, in consultation with the Director of the 
        Office of Federal Housing Enterprise Oversight, shall 
        determine--
                    (A) the functions, duties, and activities of the 
                Secretary of Housing and Urban Development regarding 
                oversight or regulation of the enterprises under or 
                pursuant to the authorizing statutes, title XIII of the 
                Housing and Community Development Act of 1992, and any 
                other provisions of law, as in effect before the date 
                of the enactment of this Act, but not including any 
                such functions, duties, and activities of the Director 
                of the Office of Federal Housing Enterprise Oversight 
                of the Department of Housing and Urban Development and 
                such Office; and
                    (B) the employees of the Department of Housing and 
                Urban Development necessary to perform such functions, 
                duties, and activities.
            (2) Enterprise-related functions.--For purposes of this 
        subtitle, the term ``enterprise-related functions of the 
        Department'' means the functions, duties, and activities of the 
        Department of Housing and Urban Development determined under 
        paragraph (1)(A).
            (3) Enterprise-related employees.--For purposes of this 
        subtitle, the term ``enterprise-related employees of the 
        Department'' means the employees of the Department of Housing 
        and Urban Development determined under paragraph (1)(B).
    (c) Disposition of Affairs.--During the 6-month period beginning on 
the date of enactment of this Act, the Secretary of Housing and Urban 
Development (in this subtitle referred to as the ``Secretary''), for 
the purpose of winding up the affairs of the Secretary regarding the 
enterprise-related functions of the Department of Housing and Urban 
Development (in this subtitle referred to as the ``Department'') and in 
addition to carrying out the Secretary's other responsibilities under 
law regarding such functions--
            (1) shall manage the enterprise-related employees of the 
        Department and provide for the payment of the compensation and 
        benefits of any such employee which accrue before the effective 
        date of the transfer of any such employee under section 1097; 
        and
            (2) may take any other action necessary for the purpose of 
        winding up the enterprise-related functions of the Department.
    (d) Status of Employees Before Transfer.--The amendments made by 
titles I and II and the termination of the enterprise-related functions 
of the Department under subsection (b) may not be construed to affect 
the status of any employee of the Department as employees of an agency 
of the United States for purposes of any other provision of law before 
the effective date of the transfer of any such employee under section 
1097.
    (e) Use of Property and Services.--
            (1) Property.--The Director of the Federal Housing Finance 
        Agency may use the property of the Secretary to perform 
        functions which have been transferred to the Director of the 
        Federal Housing Finance Agency for such time as is reasonable 
        to facilitate the orderly transfer of functions transferred 
        under any other provision of this title or any amendment made 
        by this title to any other provision of law.
            (2) Agency services.--Any agency, department, or other 
        instrumentality of the United States, and any successor to any 
        such agency, department, or instrumentality, which was 
        providing supporting services to the Secretary regarding 
        enterprise-related functions of the Department before the 
        termination date under subsection (a) in connection with such 
        functions that are transferred to the Director of the Federal 
        Housing Finance Agency shall--
                    (A) continue to provide such services, on a 
                reimbursable basis, until the transfer of such 
                functions is complete; and
                    (B) consult with any such agency to coordinate and 
                facilitate a prompt and reasonable transition.
    (f) Savings Provisions.--
            (1) Existing rights, duties, and obligations not 
        affected.--Subsection (a) shall not affect the validity of any 
        right, duty, or obligation of the United States, the Secretary, 
        or any other person, which--
                    (A) arises under the authorizing statutes, title 
                XIII of the Housing and Community Development Act of 
                1992, or any other provision of law applicable with 
                respect to the Secretary, in connection with the 
                enterprise-related functions of the Department; and
                    (B) existed on the day before the termination date 
                under subsection (a).
            (2) Continuation of suits.--No action or other proceeding 
        commenced by or against the Secretary in connection with the 
        enterprise-related functions of the Department shall abate by 
        reason of the enactment of this title, except that the Director 
        of the Federal Housing Finance Agency shall be substituted for 
        the Secretary or any member thereof as a party to any such 
        action or proceeding.

SEC. 1096. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.

    (a) In General.--All regulations, orders, and determinations 
described in subsection (b) shall remain in effect according to the 
terms of such regulations, orders, determinations, and resolutions, and 
shall be enforceable by or against the Director of the Federal Housing 
Finance Agency until modified, terminated, set aside, or superseded in 
accordance with applicable law by such Director, any court of competent 
jurisdiction, or operation of law.
    (b) Applicability.--A regulation, order, or determination is 
described under this subsection if it--
            (1) was issued, made, prescribed, or allowed to become 
        effective by--
                    (A) the Secretary; or
                    (B) a court of competent jurisdiction and that 
                relate to the enterprise-related functions of the 
                Department; and
            (2) is in effect on the termination date under section 
        1095(a).

SEC. 1097. TRANSFER AND RIGHTS OF EMPLOYEES OF DEPARTMENT OF HOUSING 
              AND URBAN DEVELOPMENT.

    (a) Transfer.--
            (1) In general.--Except as provided in paragraph (2), each 
        enterprise-related employee of the Department shall be 
        transferred to the Federal Housing Finance Agency for 
        employment not later than the termination date under section 
        1095(a) and such transfer shall be deemed a transfer of 
        function for purposes of section 3503 of title 5, United States 
        Code.
            (2) Authority to decline.--An enterprise-related employee 
        of the Department may, in the discretion of the employee, 
        decline transfer under paragraph (1) to a position in the 
        Federal Housing Finance Agency and shall be guaranteed a 
        position in the Department with the same status, tenure, grade, 
        and pay as that held on the day immediately preceding the date 
        that such declination was made. Each such employee holding a 
        permanent position shall not be involuntarily separated or 
        reduced in grade or compensation for 12 months after the date 
        that the transfer would otherwise have occurred, except for 
        cause or, if the employee is a temporary employee, separated in 
        accordance with the terms of the appointment.
    (b) Guaranteed Positions.--Each enterprise-related employee of the 
Department transferred under subsection (a) shall be guaranteed a 
position with the same status, tenure, grade, and pay as that held on 
the day immediately preceding the transfer. Each such employee holding 
a permanent position shall not be involuntarily separated or reduced in 
grade or compensation for 12 months after the date of transfer, except 
for cause or, if the employee is a temporary employee, separated in 
accordance with the terms of the appointment.
    (c) Appointment Authority for Excepted and Senior Executive Service 
Employees.--
            (1) In general.--In the case of employees occupying 
        positions in the excepted service or the Senior Executive 
        Service, any appointment authority established under law or by 
        regulations of the Office of Personnel Management for filling 
        such positions shall be transferred, subject to paragraph (2).
            (2) Decline of transfer.--The Director of the Federal 
        Housing Finance Agency may decline a transfer of authority 
        under paragraph (1) (and the employees appointed pursuant 
        thereto) to the extent that such authority relates to positions 
        excepted from the competitive service because of their 
        confidential, policymaking, policy-determining, or policy-
        advocating character, and noncareer positions in the Senior 
        Executive Service (within the meaning of section 3132(a)(7) of 
        title 5, United States Code).
    (d) Reorganization.--If the Director of the Federal Housing Finance 
Agency determines, after the end of the 1-year period beginning on the 
termination date under section 1095(a), that a reorganization of the 
combined workforce is required, that reorganization shall be deemed a 
major reorganization for purposes of affording affected employees 
retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United 
States Code.
    (e) Employee Benefit Programs.--
            (1) In general.--Any enterprise-related employee of the 
        Department accepting employment with the Federal Housing 
        Finance Agency as a result of a transfer under subsection (a) 
        may retain for 12 months after the date on which such transfer 
        occurs membership in any employee benefit program of the 
        Federal Housing Finance Agency or the Department, as 
        applicable, including insurance, to which such employee belongs 
        on the termination date under section 1095(a) if--
                    (A) the employee does not elect to give up the 
                benefit or membership in the program; and
                    (B) the benefit or program is continued by the 
                Director of the Federal Housing Finance Agency.
            (2) Cost differential.--The difference in the costs between 
        the benefits which would have been provided by the Department 
        and those provided by this section shall be paid by the 
        Director of the Federal Housing Finance Agency. If any employee 
        elects to give up membership in a health insurance program or 
        the health insurance program is not continued by such Director, 
        the employee shall be permitted to select an alternate Federal 
        health insurance program within 30 days after such election or 
        notice, without regard to any other regularly scheduled open 
        season.

SEC. 1098. TRANSFER OF APPROPRIATIONS, PROPERTY, AND FACILITIES.

    Upon the termination date under section 1095(a), all assets, 
liabilities, contracts, property, records, and unexpended balances of 
appropriations, authorizations, allocations, and other funds employed, 
held, used, arising from, available to, or to be made available to the 
Department in connection with enterprise-related functions of the 
Department shall transfer to the Director of the Federal Housing 
Finance Agency. Unexpended funds transferred by this section shall be 
used only for the purposes for which the funds were originally 
authorized and appropriated.
                                 <all>