[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 2452 Introduced in Senate (IS)]







110th CONGRESS
  1st Session
                                S. 2452

 To amend the Truth in Lending Act to provide protection to consumers 
    with respect to certain high-cost loans, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           December 12, 2007

    Mr. Reid (for Mr. Dodd (for himself, Mr. Reed, Mr. Schumer, Mr. 
Menendez, Mr. Akaka, Mr. Brown, Mr. Casey, Mr. Kennedy, Mr. Kerry, Mr. 
 Harkin, Ms. Mikulski, Mrs. Boxer, Mrs. McCaskill, Ms. Klobuchar, Mrs. 
 Feinstein, and Mr. Durbin)) introduced the following bill; which was 
read twice and referred to the Committee on Banking, Housing, and Urban 
                                Affairs

_______________________________________________________________________

                                 A BILL


 
 To amend the Truth in Lending Act to provide protection to consumers 
    with respect to certain high-cost loans, 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; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Home Ownership 
Preservation and Protection Act of 2007''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Effective date and regulations.
                      TITLE I--HIGH-COST MORTGAGES

Sec. 101. Definitions relating to high-cost mortgages.
Sec. 102. Additional protections for HOEPA loans.
  TITLE II--PROTECTIONS APPLICABLE TO SUBPRIME AND CERTAIN OTHER LOANS

Sec. 201. Truth in Lending Act amendments.
           TITLE III--PROTECTIONS FOR ALL HOME LOAN BORROWERS

Sec. 301. Mortgage protections.
          TITLE IV--GOOD FAITH AND FAIR DEALING IN APPRAISALS

Sec. 401. Duties of appraisers.
      TITLE V--GOOD FAITH AND FAIR DEALING IN HOME LOAN SERVICING

Sec. 501. Duties of lenders and loan servicers.
Sec. 502. Real estate settlement procedures.
Sec. 503. Effective date.
              TITLE VI--FORECLOSURE PREVENTION COUNSELING

Sec. 601. Foreclosure prevention counseling.
                  TITLE VII--REMEDIES AND ENFORCEMENT

Sec. 701. Material disclosures and violations.
Sec. 702. Right of rescission.
Sec. 703. Civil liability.
Sec. 704. Liability for monetary damages.
Sec. 705. Remedy in lieu of rescission for certain violations.
Sec. 706. Prohibition on mandatory arbitration.
Sec. 707. Lender liability.
               TITLE VIII--OTHER BANKING AGENCY AUTHORITY

Sec. 801. Inclusion of all banking agencies in the regulatory authority 
                            under the Federal Trade Commission Act with 
                            respect to depository institutions.
                        TITLE IX--MISCELLANEOUS

Sec. 901. Authorizations.

SEC. 2. DEFINITIONS.

    Section 103 of the Truth in Lending Act (15 U.S.C. 1602) is amended 
by adding at the end the following:
    ``(cc) Definitions Relating to Home Mortgage Loans.--
            ``(1) Home mortgage loan.--The term `home mortgage loan' 
        means a consumer credit transaction secured by a home, used or 
        intended to be used as a principal dwelling, regardless of 
        whether it is real or personal property, or whether the loan is 
        used to purchase the home.
            ``(2) Mortgage broker.--The term `mortgage broker' means a 
        person who, for compensation or in anticipation of 
        compensation, arranges or negotiates or attempts to arrange or 
        negotiate home mortgage loans or commitments for such loans, 
        refers applicants or prospective applicants to creditors, or 
        selects or offers to select creditors to whom requests for 
        credit may be made.
            ``(3) Mortgage originator.--The term `mortgage originator' 
        means any creditor or other person, including a mortgage 
        broker, who, for compensation or in anticipation of 
        compensation, engages either directly or indirectly in the 
        acceptance of applications for home mortgage loans, 
        solicitation of home mortgage loans on behalf of consumers, 
        negotiation of terms or conditions of home mortgage loans on 
        behalf of consumers or lenders, or negotiation of sales of 
        existing home mortgage loans to institutional or 
        noninstitutional lenders. It also includes any employee or 
        agent of such person.
            ``(4) Nontraditional mortgage loan.--The term 
        `nontraditional mortgage loan' means a home mortgage loan that 
        allows a consumer to defer payment of principal or interest.
            ``(5) Subprime mortgage loan.--
                    ``(A) In general.--The term `subprime mortgage 
                loan' means a home mortgage loan in which the annual 
                percentage rate exceeds the greater of the thresholds 
                determined under subparagraph (B) or (C), as 
                applicable.
                    ``(B) Treasury securities rate spread.--A home 
                mortgage loan is a subprime mortgage loan if the 
                difference between the annual percentage rate for the 
                loan and the yield on United States Treasury securities 
                having comparable periods of maturity is equal to or 
                greater than--
                            ``(i) 3 percentage points, if the loan is 
                        secured by a first lien mortgage or deed of 
                        trust; or
                            ``(ii) 5 percentage points, if the loan is 
                        secured by a subordinate lien mortgage or deed 
                        of trust.
                    ``(C) Conventional mortgage rate spread.--A home 
                mortgage loan is a subprime mortgage loan if the 
                difference between the annual percentage rate for the 
                loan and the annual yield on conventional mortgages, as 
                published by the Board of Governors of the Federal 
                Reserve System in statistical release H.15 (or any 
                successor publication thereto) is either equal to or 
                greater than--
                            ``(i) 1.75 percentage points, if the loan 
                        is secured by a first lien mortgage or deed of 
                        trust; or
                            ``(ii) 3.75 percentage points, if the loan 
                        is secured by a subordinate lien mortgage or 
                        deed of trust.
                    ``(D) Rule of construction.--For purposes of 
                subparagraph (B), the difference between the annual 
                percentage rate of a home mortgage loan and the yield 
                on United States Treasury securities having comparable 
                periods of maturity shall be determined using the same 
                procedures and calculation methods applicable to loans 
                that are subject to the reporting requirements of the 
                Federal Home Mortgage Disclosure Act, whether or not 
                such loan is subject to or reportable under the 
                provisions of that Act.''.

SEC. 3. EFFECTIVE DATE AND REGULATIONS.

    (a) Effective Date.--This Act and the amendments made by this Act 
shall become effective 6 months after the date of enactment of this 
Act, and shall apply to all transactions consummated on or after that 
effective date, except as otherwise specifically provided herein.
    (b) Regulations Required.--Not later than 6 months after the date 
of enactment of this Act, the Board of Governors of the Federal Reserve 
System shall issue in final form such regulations as are necessary to 
carry out this Act and the amendments made by this Act.

                      TITLE I--HIGH-COST MORTGAGES

SEC. 101. DEFINITIONS RELATING TO HIGH-COST MORTGAGES.

    (a) High-Cost Mortgage Defined.--Section 103(aa) of the Truth in 
Lending Act (15 U.S.C. 1602(aa)) is amended by striking all that 
precedes paragraph (2) and inserting the following:
    ``(aa) High-Cost Mortgage.--
            ``(1) Definition.--
                    ``(A) In general.--The term `high-cost mortgage', 
                and a mortgage referred to in this subsection, mean a 
                consumer credit transaction that is secured by the 
                principal dwelling of a consumer, other than a reverse 
                mortgage transaction, if--
                            ``(i) in the case of a loan secured--
                                    ``(I) by a first mortgage on such 
                                dwelling, the annual percentage rate at 
                                consummation of the transaction will 
                                exceed by more than 8 percentage points 
                                the yield on United States Treasury 
                                securities having comparable periods of 
                                maturity on the 15th day of the month 
                                immediately preceding the month in 
                                which the application for the extension 
                                of credit is received by the creditor; 
                                or
                                    ``(II) by a subordinate or junior 
                                mortgage on such dwelling, the annual 
                                percentage rate at consummation of the 
                                transaction will exceed by more than 10 
                                percentage points the yield on United 
                                States Treasury securities having 
                                comparable periods of maturity on the 
                                15th day of the month immediately 
                                preceding the month in which the 
                                application for the extension of credit 
                                is received by the creditor; or
                            ``(ii) the total points and fees payable in 
                        connection with the loan exceed--
                                    ``(I) in the case of a loan for 
                                $20,000 or more, 5 percent of the total 
                                loan amount; or
                                    ``(II) in the case of a loan for 
                                less than $20,000, the lesser of 8 
                                percent of the total loan amount or 
                                $1,000.
                    ``(B) Introductory rates taken into account.--For 
                purposes of subparagraph (A)(i), the annual percentage 
                rate shall be determined as--
                            ``(i) in the case of a fixed-rate loan in 
                        which the rate of interest will not vary during 
                        the term of the loan, the interest rate in 
                        effect on the date of consummation of the 
                        transaction;
                            ``(ii) in the case of a loan in which the 
                        rate of interest varies solely in accordance 
                        with an index, the interest rate determined by 
                        adding the index rate in effect on the date of 
                        consummation of the transaction to the maximum 
                        margin permitted at any time by the terms of 
                        the loan agreement; and
                            ``(iii) in the case of any other loan in 
                        which the rate may vary at any time during the 
                        term of the loan for any reason, the interest 
                        charged on the loan at the maximum rate that 
                        may be charged during the term of the loan.''.
    (b) Adjustment of Percentage Points.--Section 103(aa)(2) of the 
Truth in Lending Act (15 U.S.C. 1602(aa)(2)) is amended by striking 
subparagraph (B) and inserting the following:
    ``(B) An increase or decrease under subparagraph (A)--
            ``(i) may not result in the number of percentage points 
        referred to in paragraph (1)(A)(i)(I) being less than 6 
        percentage points or greater than 10 percentage points; and
            ``(ii) may not result in the number of percentage points 
        referred to in paragraph (1)(A)(i)(II) being less than 8 
        percentage points or greater than 12 percentage points.''.
    (c) Points and Fees Defined.--
            (1) In general.--Section 103(aa)(4) of the Truth in Lending 
        Act (15 U.S.C. 1602(aa)(4)) is amended--
                    (A) by striking ``(1)(B)'' and inserting 
                ``(1)(A)(ii)'';
                    (B) by striking subparagraph (B) and inserting the 
                following:
            ``(B) all compensation paid directly or indirectly by a 
        consumer or creditor to a mortgage broker or from any source, 
        including a mortgage broker that originates a loan in the name 
        of the broker in a table funded transaction;'';
                    (C) in subparagraph (C)(iii), by striking ``and'' 
                at the end;
                    (D) by redesignating subparagraph (D) as 
                subparagraph (G); and
                    (E) by inserting after subparagraph (C) the 
                following:
            ``(D) premiums or other charges payable at or before 
        consummation of the loan for any credit life, credit 
        disability, credit unemployment, or credit property insurance, 
        or any other accident, loss-of-income, life, or health 
        insurance, or any payments directly or indirectly for any debt 
        cancellation or suspension agreement or contract, except that 
        insurance premiums or debt cancellation or suspension fees 
        calculated and paid in full on a monthly basis shall not be 
        considered financed by the creditor;
            ``(E) the maximum prepayment fees and penalties which may 
        be charged or collected under the terms of the loan documents;
            ``(F) all prepayment fees or penalties that are incurred by 
        the customer, if the loan refinances a previous loan made or 
        currently held by the same creditor or an affiliate of the 
        creditor; and''.
            (2) Calculation of points and fees for open-end loans.--
        Section 103(aa) of the Truth in Lending Act (15 U.S.C. 
        1602(aa)) is amended--
                    (A) by redesignating paragraph (5) as paragraph 
                (7); and
                    (B) by inserting after paragraph (4) the following:
            ``(5) Calculation of points and fees for open-end loans.--
        In the case of a loan under an open-end credit plan, points and 
        fees shall be calculated, for purposes of this section and 
        section 129, by adding the total points and fees known at or 
        before closing, including the maximum prepayment penalties 
        which may be charged or collected under the terms of the loan 
        documents, plus the minimum additional fees that the consumer 
        would be required to pay to draw down an amount equal to the 
        total credit line.''.
    (d) High-Cost Mortgage Lender.--Section 103(f) of the Truth in 
Lending Act (15 U.S.C. 1602(f)) is amended by striking the last 
sentence and inserting the following: ``Any person who originates or 
brokers 2 or more mortgages referred to in subsection (aa) in any 12-
month period, any person who originates 1 or more such mortgages 
through a mortgage broker in any 12-month period or in connection with 
a table funded transaction involving such a mortgage, and any person to 
whom the obligation is initially assigned at or after settlement, shall 
be considered to be a creditor for purposes of this title.''.
    (e) Bona Fide Discount Loan Discount Points and Prepayment 
Penalties.--Section 103(aa) of the Truth in Lending Act (15 U.S.C. 
1602(aa)) is amended by inserting after paragraph (5), as added by this 
Act, the following:
            ``(6) Bona fide discount points.--
                    ``(A) In general.--For the purpose of determining 
                the amount of points and fees under this subsection--
                            ``(i) not more than 2 bona fide discount 
                        points payable by the consumer in connection 
                        with the mortgage shall be excluded, but only 
                        if the interest rate from which the interest 
                        rate on the mortgage will be discounted does 
                        not exceed by more than 1 percentage point the 
                        required net yield for a 90-day standard 
                        mandatory delivery commitment for a reasonably 
                        comparable loan from either the Federal 
                        National Mortgage Association or the Federal 
                        Home Loan Mortgage Corporation, whichever is 
                        greater; and
                            ``(ii) unless 2 bona fide discount points 
                        have been excluded under subparagraph (A), not 
                        more than 1 bona fide discount point payable by 
                        the consumer in connection with the mortgage 
                        shall be excluded, but only if the interest 
                        rate from which the interest rate on the 
                        mortgage will be discounted does not exceed by 
                        more than 2 percentage points the required net 
                        yield for a 90-day standard mandatory delivery 
                        commitment for a reasonably comparable loan 
                        from either the Federal National Mortgage 
                        Association or the Federal Home Loan Mortgage 
                        Corporation, whichever is greater.
                    ``(B) Definition.--For purposes of subparagraph 
                (A), the term `bona fide discount points' means loan 
                discount points which are knowingly paid by the 
                consumer for the purpose of reducing, and which in fact 
                result in a bona fide reduction of, the interest rate 
                or time-price differential applicable to the mortgage.
                    ``(C) Exception for interest rate reductions 
                inconsistent with industry norms.--Subparagraph (A) 
                shall not apply to discount points used to purchase an 
                interest rate reduction, unless the amount of the 
                interest rate reduction purchased is reasonably 
                consistent with established industry norms and 
                practices for secondary mortgage market 
                transactions.''.

SEC. 102. ADDITIONAL PROTECTIONS FOR HOEPA LOANS.

    (a) No Prepayment Penalties.--Section 129(c) of the Truth in 
Lending Act (15 U.S.C. 1639(c)) is amended--
            (1) by striking paragraph (2); and
            (2) in paragraph (1)--
                    (A) by striking ``(1) In general.--''; and
                    (B) by redesignating subparagraphs (A) and (B) as 
                paragraphs (1) and (2), respectively, and moving the 
                margins 2 ems to the left.
    (b) No Balloon Payments.--Section 129(e) of the Truth in Lending 
Act (15 U.S.C. 1639(e)) is amended to read as follows:
    ``(e) No Balloon Payments.--No high-cost mortgage may contain a 
scheduled payment that is more than twice as large as the average of 
any earlier required scheduled payments, except that this subsection 
shall not apply when the payment schedule is adjusted to the seasonal 
or irregular income of the consumer.''.
    (c) Other Prohibitions on High-Cost Mortgages.--Section 129 of the 
Truth in Lending Act (15 U.S.C. 1639) is amended by adding at the end 
the following:
    ``(m) No Yield Spread Premiums.--No person may provide, and no 
mortgage originator may receive, directly or indirectly, any 
compensation for originating a home mortgage loan that is more costly 
than that for which the consumer qualifies, or that is based on, or 
varies with, the terms of any home mortgage loan.
    ``(n) Acceleration of Debt.--No high-cost mortgage may contain a 
provision which permits the creditor, in its sole discretion, to 
accelerate the indebtedness, other than in any case in which repayment 
of the loan has been accelerated by default, pursuant to a due-on-sale 
provision, or for a breach of a material provision of the loan 
documents unrelated to the payment schedule.
    ``(o) Restriction on Financing Points and Fees.--No creditor may, 
directly or indirectly, finance, in connection with any high-cost 
mortgage--
            ``(1) any prepayment fee or penalty payable by the consumer 
        in a refinancing transaction, if the creditor or an affiliate 
        of the creditor is the noteholder of the note being refinanced; 
        or
            ``(2) any points or fees as defined in section 103(aa)(4).
    ``(p) Prohibition on Evasions, Structuring of Transactions, and 
Reciprocal Arrangements.--A creditor may not take any action in 
connection with a high-cost mortgage--
            ``(1) to structure a loan transaction as an open-end credit 
        plan or another form of loan for the purpose and with the 
        intent of evading the provisions of this title; or
            ``(2) to divide any loan transaction into separate parts 
        for the purpose and with the intent of evading the provisions 
        of this title.
    ``(q) Modification and Deferral Fees Prohibited.--A creditor may 
not charge a consumer any fee to modify, renew, extend, or amend a 
high-cost mortgage, or to defer any payment due under the terms of such 
mortgage, unless the modification, renewal, extension, or amendment 
results in a lower annual percentage rate on the mortgage for the 
consumer, and then only if the fee is bona fide and reasonable.
    ``(r) Net Tangible Benefit.--In accordance with regulations 
prescribed by the Board, no originator may make, provide, or arrange a 
high-cost mortgage loan that involves a refinancing of a prior existing 
home mortgage loan, unless the new loan will provide a net tangible 
benefit to the consumer.''.

  TITLE II--PROTECTIONS APPLICABLE TO SUBPRIME AND CERTAIN OTHER LOANS

SEC. 201. TRUTH IN LENDING ACT AMENDMENTS.

    The Truth in Lending Act (15 U.S.C. 1601 et seq.) is amended by 
inserting after section 129 the following new section:

``SEC. 129A. PROTECTIONS FOR SUBPRIME AND NONTRADITIONAL HOME LOANS.

    ``(a) Assessment of Ability To Pay.--
            ``(1) In general.--
                    ``(A) In general.--Before entering into or 
                otherwise facilitating a subprime or nontraditional 
                mortgage loan, each mortgage originator shall verify 
                the reasonable ability of the borrower to pay the 
                principal and interest on the loan and any real estate 
                taxes and homeowner insurance fees and premiums.
                    ``(B) Considerations.--A determination under 
                subparagraph (A) shall include consideration of--
                            ``(i) the income of the borrower;
                            ``(ii) the credit history of the borrower;
                            ``(iii) the current obligations and 
                        employment status of the borrower;
                            ``(iv) the debt-to-income ratio of the 
                        monthly gross income of the borrower, inclusive 
                        of all scheduled or otherwise significant debt 
                        payments and total monthly housing payments, 
                        including taxes, property and private mortgage 
                        insurance, any required homeowner or 
                        condominium fees, and any subordinate 
                        mortgages, including those that will be made 
                        contemporaneously to the same borrower;
                            ``(v) the residual income of the borrower; 
                        and
                            ``(vi) other available financial resources, 
                        other than the equity of the borrower in the 
                        principal dwelling that secures or would secure 
                        the loan.
            ``(2) Variable mortgage rates.--In the case of a subprime 
        or nontraditional mortgage loan, with respect to which the 
        applicable rate of interest may vary, for purposes of paragraph 
        (1), the ability to pay shall be determined based on the 
        monthly payment that could be due from the borrower, using as 
        assumptions--
                    ``(A) the fully indexed interest rate;
                    ``(B) a repayment schedule which achieves full 
                amortization over the life of the loan, assuming no 
                default by the borrower;
                    ``(C) for products that permit negative 
                amortization, the initial loan amount plus any balance 
                increase that may accrue from the negative amortization 
                provision;
                    ``(D) that the loan is to be repaid in 
                substantially equal monthly amortizing payments for 
                principal and interest over that period of time which 
                would be permitted after the consumer has made lower 
                payments, as permitted under the terms of the loan, and 
                which includes any additions to principal that will 
                result from such permitted lower payments, with no 
                balloon payment, unless the loan contract requires a 
                more rapid repayment schedule to be used in the 
                calculation; and
                    ``(E) the reasonably foreseeable capacity of the 
                borrower to make payments, assuming market changes as 
                to the contract index rate over the period of the loan, 
                using, to make such assessment, a credible market rate 
                determined according to regulations issued by the 
                Board, which regulations shall require reasonable 
                market expectations to be a factor.
            ``(3) Rebuttable presumption.--
                    ``(A) In general.--For purposes of this subsection 
                there is a rebuttable presumption that a mortgage was 
                made without regard to repayment ability if, at the 
                time at which the loan was consummated, the total 
                monthly debts of the borrower, including total monthly 
                housing payments, taxes, property, and private mortgage 
                insurance, any required homeowner or condominium fees, 
                and any subordinate mortgages, including those that 
                will be made contemporaneously to the same borrower, 
                exceed 45 percent of the monthly gross income of the 
                borrower.
                    ``(B) Rebuttal.--To rebut the presumption of 
                inability to repay under subparagraph (A) the creditor 
                shall, at minimum, determine and consider the residual 
                income of the borrower after payment of current 
                expenses and proposed home loan payments, except that 
                no presumption of ability to make the scheduled 
                payments to repay the obligation shall arise solely 
                from the fact that, at the time at which the loan is 
                consummated, the total monthly debts of the borrower 
                (including amounts owed under the loan) does not exceed 
                45 percent of the monthly gross income of the borrower.
    ``(b) Requirement of Tax and Insurance Escrows.--No subprime or 
nontraditional mortgage loan may be arranged, approved, or made without 
requiring escrow of tax and insurance installments calculated in 
accordance with the requirements of section 10 of the Real Estate 
Settlement Procedures Act of 1974, and regulations promulgated pursuant 
thereto, and mortgage insurance premiums, if any.
    ``(c) Prohibition on Prepayment Penalties.--No subprime or 
nontraditional mortgage loan may contain a provision that requires a 
consumer to pay a penalty for paying all or part of the principal 
before the date on which it is due.
    ``(d) Prohibition on Yield-Spread Premiums.--No person may provide, 
and no mortgage originator may receive, directly or indirectly, any 
compensation for originating a subprime or nontraditional mortgage loan 
that is more costly than that for which the consumer qualifies, or that 
is based on, or varies with, the terms (other than the amount of loan 
principal) of any home mortgage loan.
    ``(e) Net Tangible Benefit.--
            ``(1) In general.--In accordance with regulations 
        prescribed by the Board, no originator may make, provide, or 
        arrange a subprime or nontraditional mortgage loan that 
        involves a refinancing of a prior existing home mortgage loan, 
        unless the new loan will provide a net tangible benefit to the 
        consumer.
            ``(2) Certain loans providing no net tangible benefit.--For 
        purposes of paragraph (1), a mortgage loan that involves 
        refinancing of a prior existing mortgage loan shall not be 
        considered to provide a net tangible benefit to the borrower if 
        the costs of the refinanced loan, including points, fees, and 
        other charges, exceed the amount of any newly advanced 
        principal, less the points, fees, and other charges, without 
        any corresponding changes in the terms of the refinanced loan 
        that are advantageous to the borrower.''.

           TITLE III--PROTECTIONS FOR ALL HOME LOAN BORROWERS

SEC. 301. MORTGAGE PROTECTIONS.

    The Truth in Lending Act (15 U.S.C. 1601 et seq.) is amended by 
inserting after section 129A, as added by this Act, the following new 
section:

``SEC. 129B. PROTECTIONS FOR ALL HOME LOANS.

    ``(a) Duties of All Mortgage Originators.--Each mortgage originator 
shall, with respect to each home mortgage loan and, in addition to 
requirements under other applicable provisions of Federal or State 
law--
            ``(1) safeguard and account for any money handled for the 
        borrower;
            ``(2) follow reasonable and lawful instructions from the 
        borrower;
            ``(3) act with reasonable skill, care, and diligence;
            ``(4) act in good faith and with fair dealing in any 
        transaction, practice, or course of business in connection with 
        the originating of any home mortgage loan; and
            ``(5) make reasonable efforts to secure a home mortgage 
        loan that is appropriately advantageous to the borrower, 
        considering all of the circumstances, including the product 
        type, rates, charges, and repayment terms of the loan.
    ``(b) Duties of Mortgage Brokers.--Each mortgage broker shall with 
respect to each home mortgage loan be deemed to have a fiduciary 
relationship with the borrower, and, in addition to duties imposed by 
other applicable provisions of Federal or State law, shall--
            ``(1) act in the best interest of the borrower and in the 
        utmost good faith toward the borrower, and refrain from 
        compromising the rights or interests of the borrower in favor 
        of the rights or interests of another, including a right or 
        interest of the mortgage broker; and
            ``(2) clearly disclose to the borrower, not later than 3 
        days after receipt of the loan application, all material 
        information that might reasonably affect the rights, interests, 
        or ability of the borrower to receive the borrower's intended 
        benefit from the home mortgage loan, including total 
        compensation that the broker would receive from any of the loan 
        options that the broker presents to the borrower.
    ``(c) Prohibition on Steering.--
            ``(1) In general.--In connection with a home mortgage loan, 
        a mortgage originator may not steer, counsel, or direct a 
        consumer to a loan with rates, charges, principal amount, or 
        prepayment terms that are more costly than that for which the 
        consumer qualifies.
            ``(2) Duties to consumers.--If unable to suggest, offer, or 
        recommend to a consumer a home mortgage loan that is not more 
        expensive than that for which the consumer qualifies, a 
        mortgage originator shall disclose to the consumer--
                    ``(A) that the creditor does not offer a home 
                mortgage loan that is not more expensive than that for 
                which the consumer qualifies, but that other creditors 
                may offer such a loan; and
                    ``(B) the reasons that the products and services 
                offered by the mortgage originator are not available to 
                or reasonably advantageous for the consumer.
            ``(3) Prohibited conduct.--In connection with a home 
        mortgage loan, a mortgage originator may not--
                    ``(A) mischaracterize the credit history of a 
                consumer or the home loans available to a consumer;
                    ``(B) mischaracterize or suborn mischaracterization 
                of the appraised value of the property securing the 
                extension of credit; and
                    ``(C) if unable to suggest, offer, or recommend to 
                a consumer a loan that is not more expensive than that 
                for which the consumer qualifies, discourage a consumer 
                from seeking a home mortgage loan from another creditor 
                or with another mortgage originator.
    ``(d) Required Documentation.--
            ``(1) In general.--With respect to any home mortgage loan, 
        a mortgage originator shall base its determination of the 
        ability of a consumer to pay on--
                    ``(A) documentation of all sources of income 
                verified by tax returns, payroll receipts, bank 
                records, or the best and most appropriate form of 
                documentation available, subject to such requirements 
                and exceptions as determined appropriate by the Board; 
                and
                    ``(B) the debt-to-income ratio and the residual 
                income of the consumer after payment of current 
                expenses and proposed home loan payments.
            ``(2) Limitation.--A statement provided by a consumer of 
        the income and financial resources of the consumer, without 
        other documentation referred to in paragraph (1), is not 
        sufficient verification for purposes of assessing the ability 
        of the consumer to pay.
    ``(e) Limitations on Yield-Spread Premiums.--
            ``(1) In general.--Except as provided in paragraph (2), no 
        person may provide, and no mortgage originator may receive, 
        directly or indirectly, any compensation for originating a home 
        mortgage loan that is more costly than that for which the 
        consumer qualifies, or that is based on, or varies with, the 
        terms of any home mortgage loan (other than the amount of loan 
        principal).
            ``(2) Limited exception for no-cost loans.--Notwithstanding 
        paragraph (1), in a home mortgage loan, other than a high-cost 
        mortgage loan, a subprime mortgage loan, or a nontraditional 
        mortgage loan, a mortgage broker may receive compensation in 
        the form of an increased rate, but only if--
                    ``(A) the mortgage broker receives no other 
                compensation, however denominated, directly or 
                indirectly, from the consumer, creditor, or other 
                mortgage originator;
                    ``(B) the loan does not include discount points, 
                origination points, or rate reduction points, however 
                denominated, or any payment reduction fee, however 
                denominated;
                    ``(C) the loan does not include a prepayment 
                penalty; and
                    ``(D) there are no other closing costs associated 
                with the loan, except for fees to government officials 
                or amounts to fund escrow accounts for taxes and 
                insurance.
    ``(f) Recommended Default.--No creditor shall recommend or 
encourage default on an existing loan or other debt prior to and in 
connection with the closing or planned closing of a mortgage loan that 
refinances all or any portion of such existing loan or debt.
    ``(g) Effect of Foreclosure on Preexisting Lease.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, in the case of any foreclosure with respect to a home 
        mortgage loan entered into after the date of enactment of this 
        Act, any successor in interest in such property pursuant to the 
        foreclosure shall assume such interest subject to--
                    ``(A) the provision, by the successor in interest, 
                of a notice to vacate to any bona fide tenant at least 
                90 days before the effective date of the notice to 
                vacate; and
                    ``(B) the rights of any bona fide tenant, as of the 
                date of such notice of foreclosure--
                            ``(i) under any bona fide lease entered 
                        into before the notice of foreclosure to occupy 
                        the premises until the end of the remaining 
                        term of the lease; or
                            ``(ii) without a lease or with a lease 
                        terminable at will under State law, subject to 
                        the receipt by the tenant of the 90-day notice 
                        under subparagraph (A).
            ``(2) Bona fide lease or tenancy.--For purposes of this 
        section, a lease or tenancy shall be considered bona fide only 
        if--
                    ``(A) the mortgagor under the contract is not the 
                tenant;
                    ``(B) the lease or tenancy was the result of an 
                arms-length transaction; or
                    ``(C) the lease or tenancy requires the receipt of 
                rent that is not substantially less than fair market 
                rent for the property.''.

          TITLE IV--GOOD FAITH AND FAIR DEALING IN APPRAISALS

SEC. 401. DUTIES OF APPRAISERS.

    The Truth in Lending Act (15 U.S.C. 1601 et seq.) is amended by 
inserting after section 129B, as added by this Act, the following new 
section:

``SEC. 129C. DUTIES OF APPRAISERS.

    ``(a) Definitions.--In this section, the following definitions 
shall apply:
            ``(1) Appraiser.--The term `appraiser' means a person who--
                    ``(A) is certified or licensed by the State in 
                which the property to be appraised is located; and
                    ``(B) 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.
            ``(2) Qualifying bond.--The term `qualifying bond' means a 
        bond equal to not less than 1 percent of the aggregate value of 
        all homes appraised by an appraiser of real property in 
        connection with a home mortgage loan in the calendar year 
        preceding the date of the transaction, with respect to which--
                    ``(A) the bond shall inure first to the benefit of 
                the homeowners who have claims against the appraiser 
                under this title or any other applicable provision of 
                law, and second to the benefit of originating creditors 
                that complied with their duty of good faith and fair 
                dealing in accordance with this title; and
                    ``(B) any assignee or subsequent transferee or 
                trustee shall be a beneficiary of the bond, only if the 
                originating creditor qualified for such treatment.
    ``(b) Standard of Care.--Each appraiser shall, in addition to the 
duties imposed by otherwise applicable provisions of Federal or State 
law, with respect to each home mortgage loan in which the appraiser is 
involved--
            ``(1) act with reasonable skill, care, diligence, and in 
        accordance with the highest standards; and
            ``(2) act in good faith and with fair dealing in any 
        transaction, practice, or course of business associated with 
        the transaction.
    ``(c) Duties of Appraisers.--
            ``(1) Objective appraisals.--All appraisals carried out by 
        an appraiser shall be accurate and reasonable. An appraiser 
        shall have no direct or indirect interest in the property to be 
        appraised, the real estate transaction prompting such 
        appraisal, or the home loan involved in such transaction.
            ``(2) Bond requirement.--No appraiser may charge, seek, or 
        receive compensation for an appraisal unless the appraisal is 
        covered by a qualifying bond.
            ``(3) No target values.--No lender or loan servicer may, 
        with respect to a home mortgage loan, in any way--
                    ``(A) seek to influence an appraiser or otherwise 
                to encourage a targeted value in order to facilitate 
                the making or pricing of the home mortgage loan; or
                    ``(B) select an appraiser on the basis of an 
                expectation that such appraiser would provide a 
                targeted value in order to facilitate the making or 
                pricing of the home mortgage loan.
            ``(4) Prohibition on certain disclosures.--Neither the 
        appraisal order nor any other communication in any form by an 
        appraiser may include the requested loan amount or any estimate 
        of value for the property to serve as collateral, either 
        express or implied.
    ``(d) Appraisal Report.--In any case in which an appraisal is 
performed in connection with a home mortgage loan, the lender or loan 
servicer shall provide a copy of the appraisal report to an applicant 
for a home mortgage loan, whether credit is granted, denied, or the 
application was withdrawn. The first copy of this report shall be 
provided to the applicant without charge.
    ``(e) Remedies.--In addition to other remedies, in any action for a 
violation of this section, the following shall apply:
            ``(1) Required modification.--If a retrospective appraisal 
        determines that the appraisal upon which the home loan was 
        based exceeded the true market value by 10 percent or more, the 
        holder of the loan shall modify the loan and recast the loan ab 
        initio to a loan amount that is at the same loan-to-value which 
        the original loan purported to be. All payments made prior to 
        the recasting of such loan shall be applied to the reduced loan 
        amount.
            ``(2) Agency ability to modify true value tolerance 
        level.--If a consumer has a right of action or a defense 
        against the holder of the home loan when the appraisal upon 
        which the home loan was based exceeds the true market value of 
        the home by 10 percent or more, the regulatory agency which 
        oversees appraisers in the jurisdiction in which the collateral 
        is located has the authority to issue rules which permit the 10 
        percent tolerance level established in this paragraph to 
        deviate by no more than 2 percent where local conditions 
        warrant.
            ``(3) Collection from appraiser's qualifying bond.--A 
        consumer awarded remedies pursuant to this section shall have 
        the right to collect such remedies from the appraiser's 
        qualifying bond.
    ``(f) Civil Liability.--
            ``(1) In general.--Any appraiser who fails to comply with 
        any requirement of this section with respect to a borrower 
        designated in a home mortgage loan contract, is liable to such 
        borrower in an amount equal to the sum of--
                    ``(A) any actual damages sustained by such borrower 
                as a result of the failure;
                    ``(B) an amount not less than $5,000; or
                    ``(C) in the case of any successful action to 
                enforce the foregoing liability, the costs of the 
                action, together with a reasonable attorney's fee as 
                determined by the court.
            ``(2) Jurisdiction.--Any action by a borrower for a failure 
        to comply with the requirements of this section may be brought 
        in any United States district court, or in any other court of 
        competent jurisdiction, not later than 3 years from the date of 
        the occurrence of such violation. This subsection does not bar 
        a person from asserting a violation of this section in an 
        action to collect the debt owed on a home mortgage loan, or 
        foreclose upon the home securing a home mortgage loan, or to 
        stop a foreclosure upon that home, which was brought more than 
        3 years after the date of the occurrence of the violation as a 
        matter of defense by recoupment or set-off in such action. An 
        action under this section does not create an independent basis 
        for removal of an action to a United States district court.
            ``(3) State attorney general enforcement.--An action to 
        enforce a violation of this section may also be brought by the 
        appropriate State attorney general in any appropriate United 
        States district court, or any other court of competent 
        jurisdiction, not later than 3 years after the date on which 
        the violation occurs. An action under this section does not 
        create an independent basis for removal of an action to a 
        United States district court.''.

      TITLE V--GOOD FAITH AND FAIR DEALING IN HOME LOAN SERVICING

SEC. 501. DUTIES OF LENDERS AND LOAN SERVICERS.

    The Truth in Lending Act (15 U.S.C. 1601 et seq.) is amended by 
inserting after section 129C, as added by this Act, the following new 
section:

``SEC. 129D. DUTIES OF LENDERS AND LOAN SERVICERS.

    ``(a) Standard of Care.--
            ``(1) Agency relationship.--In the case of any home loan 
        serviced by a loan servicer on behalf of a lender, the loan 
        servicer shall be deemed an agent of that lender, and shall be 
        subject to all requirements of agents otherwise applicable 
        under Federal or State law.
            ``(2) Fair dealing.--Each lender and loan servicer shall, 
        in addition to the duties imposed by otherwise applicable 
        provisions of Federal or State law, with respect to each home 
        mortgage loan, including any home mortgage loan in default or 
        in which the homeowner has filed for bankruptcy--
                    ``(A) act with reasonable skill, care, diligence, 
                and in accordance with the highest standards; and
                    ``(B) act in good faith and with fair dealing in 
                any transaction, practice, or course of business 
                associated with the home mortgage loan.
    ``(b) Rules for Assessment of Fee.--
            ``(1) In general.--No home mortgage loan contract may 
        require, nor may any lender or loan servicer assess or receive, 
        any fees or charges other than interest, late fees as 
        specifically authorized in this section, or fees assessed for 
        nonsufficient funds, and charges allowed pursuant to subsection 
        (i)(1)(B), until the home mortgage loan is the subject of a 
        foreclosure proceeding and the debt on such loan has been 
        accelerated.
            ``(2) Fee limitations.--Any permissible fee or charge 
        described under paragraph (1) shall be--
                    ``(A) reasonable;
                    ``(B) for services actually rendered; and
                    ``(C) specifically authorized by the terms of the 
                home mortgage loan contract and State law.
            ``(3) Assessment and disclosure.--
                    ``(A) In general.--Any permissible fee or charge 
                described under paragraph (1) shall be--
                            ``(i) assessed not later than 30 days after 
                        the date on which the fee was accrued; and
                            ``(ii) explained clearly and conspicuously 
                        in the next monthly accounting statement 
                        provided to the borrower designated in the home 
                        mortgage loan contract.
                    ``(B) Failure to comply.--Failure by a lender or 
                loan servicer to comply with the requirements set forth 
                under subparagraph (A) shall result in the waiver of 
                the fee.
            ``(4) Required statements.--Each month a lender or loan 
        servicer shall provide to each borrower designated in a home 
        mortgage loan contract entered into by such lender or loan 
        servicer a periodic statement that clearly and in plain english 
        explains--
                    ``(A) the application of the prior month's payment 
                by the borrower, including the allocation of the 
                payment to interest, principal, escrow, and fees;
                    ``(B) the status of the escrow account held on 
                behalf of the borrower, including the payments into and 
                from the escrow account; and
                    ``(C) the assessment of fees accruing in the 
                previous month, including the reason that such fee 
                accrued and the date such fee accrued.
    ``(c) Maximum Allowable Late Fees Charged After Loan Closing.--
            ``(1) In general.--No lender or loan servicer may impose a 
        charge or fee for late payment of any amount due on a home 
        mortgage loan--
                    ``(A) unless the home mortgage loan contract 
                specifically authorizes the charge or fee;
                    ``(B) in an amount in excess of 5 percent of the 
                amount of the payment past due;
                    ``(C) before the end of the 15-day period after the 
                date the payment is due, or in the case of a home 
                mortgage loan on which interest on each installment is 
                paid in advance, before the end of the 30-day period 
                after the date the payment is due; or
                    ``(D) more than once with respect to a single late 
                payment.
            ``(2) Rule of construction.--For purposes of this 
        subsection, payments on any amount due on a home mortgage loan 
        shall be applied first to current installments, then to 
        delinquent payments, and then to delinquency charges.
            ``(3) Coordination with subsequent late fees.--If a home 
        loan mortgage payment is otherwise a full payment for the 
        applicable period and is paid on its due date or within an 
        applicable grace period, and the only delinquency or 
        insufficiency of payment is attributable to a late fee or 
        delinquency charge assessed on an earlier payment, no late fee 
        or delinquency charge may be imposed on such payment.
    ``(d) Prompt Crediting of Payments Required.--Each home loan 
mortgage payment amount received by a lender or a loan servicer shall 
be accepted and credited on the date received. Such payments shall be 
credited to interest and principal due on the home mortgage loan before 
crediting the payment to taxes, insurance, or fees.
    ``(e) Collateral Protection Insurance.--
            ``(1) In general.--A lender or loan servicer may not charge 
        any borrower designated in a home mortgage loan contract for 
        collateral protection insurance, unless--
                    ``(A) the home mortgage loan contract requires the 
                borrower to maintain insurance on the collateral and 
                clearly delineates--
                            ``(i) the terms and conditions for 
                        imposition of and payment of the collateral;
                            ``(ii) that such insurance may not protect 
                        the interests of the borrower and may be 
                        substantially more expensive than insurance 
                        that the borrower could purchase independently; 
                        and
                            ``(iii) that the borrower will be charged 
                        for the cost of the insurance;
                    ``(B) the lender or loan servicer makes every 
                effort to avoid the necessity of requiring collateral 
                protection insurance, including at least written notice 
                and telephone communications with the borrower and the 
                insurance agent of record regarding the--
                            ``(i) obligation of the borrower to 
                        maintain property insurance; and
                            ``(ii) additional cost to the borrower on a 
                        monthly basis if collateral protection 
                        insurance is required;
                    ``(C) clear notice is received by the borrower at 
                least 15 days in advance of the charge for collateral 
                protection insurance, including--
                            ``(i) notice that the--
                                    ``(I) placement of the insurance is 
                                imminent;
                                    ``(II) costs of the insurance will 
                                be paid by the borrower; and
                                    ``(III) the insurance will not 
                                protect the borrower from loss;
                            ``(ii) notice of the amount of the new 
                        monthly payment; and
                            ``(iii) instructions on the steps that the 
                        borrower may take to avoid such charge; and
                    ``(D) charges for such insurance are bona fide and 
                reasonable.
            ``(2) Prohibition.--In no event is collateral protection 
        insurance permitted when a lender or loan servicer is 
        collecting fees in escrow from the borrower for the payment of 
        property taxes and insurance, unless the borrower has had his 
        or her insurance cancelled for some reason other than non-
        payment of the premium.
            ``(3) Notice of charge.--After a charge for the purchase of 
        collateral protection insurance has been issued by a lender or 
        loan servicer, notice of the new monthly payment requirements 
        shall be delivered to the borrower at least 15 days prior to 
        the first increased payment--
                    ``(A) explaining the imposition of the new charges 
                for such insurance; and
                    ``(B) providing information on what the borrower 
                can do to obviate the need for such insurance.
    ``(f) Obligations of Lender or Loan Servicer To Handle Escrow 
Funds.--A lender or loan servicer shall make all payments from the 
escrow account held for the borrower designated in a home mortgage loan 
contract for insurance, taxes, and other charges with respect to the 
property secured by such contract in a timely manner to ensure that no 
late penalties are assessed and that no other negative consequences 
result, regardless of whether the loan is delinquent, unless--
            ``(1) there are not sufficient funds in the account of such 
        borrower to cover the payments; and
            ``(2) the lender or loan servicer has a reasonable basis to 
        believe that recovery of the funds will not be possible.
    ``(g) Information Exchange and Dispute Requirements.--
            ``(1) Mandatory response to borrowers' requests.--
                    ``(A) In general.--A lender or loan servicer shall 
                respond to any request for information about a home 
                mortgage loan or for resolution of any dispute 
                involving a home mortgage loan submitted by a borrower 
                designated in a home mortgage loan contract entered 
                into by such lender or loan servicer.
                    ``(B) Timing or response.--A response required 
                under subparagraph shall occur--
                            ``(i) without cost to the requesting 
                        borrower; and
                            ``(ii) not later than 10 days after the 
                        receipt of such request.
                    ``(C) Scope of obligation.--The scope of the 
                response requirement set forth in subparagraph (A), 
                includes--
                            ``(i) providing--
                                    ``(I) the status of the borrowers 
                                account, including whether the account 
                                is current, or if not, the date the 
                                account went into default;
                                    ``(II) the current balance due on 
                                the home mortgage loan of the borrower, 
                                including the principal due, an 
                                explanation of the escrow balance, and 
                                whether there are any escrow 
                                deficiencies or shortages;
                                    ``(III) a full payment history of 
                                the borrower, which shows in a clear 
                                and easily understandable manner all of 
                                the activity on the home mortgage loan 
                                of the borrower since the origination 
                                of the loan, including the escrow 
                                account and the application of 
                                payments; and
                                    ``(IV) a copy of the original note 
                                and security instrument;
                            ``(ii) correcting errors relating to the 
                        allocation of payments made by the borrower, 
                        final balances for purposes of paying off the 
                        loan or avoiding foreclosure, and other lender 
                        or loan servicer obligations;
                            ``(iii) providing the identity, address, 
                        and other relevant information about the owner 
                        or assignee of the home mortgage loan; and
                            ``(iv) providing a telephone number on each 
                        regular account statement that gives the 
                        borrower access to a live person with the 
                        information and authority to answer questions 
                        and resolve issues.
            ``(2) No sharing of information.--During the 90-day period 
        beginning on the date of the receipt of a request from a 
        borrower under paragraph (1), a lender or loan servicer may not 
        provide information to any reporting agency regarding any 
        overdue payment, or other default on the home mortgage loan, by 
        such borrower to any consumer reporting agency (as such term is 
        defined in section 603(f) of the Fair Credit Reporting Act).
            ``(3) Maintenance of records.--A lender or loan servicer 
        shall maintain written and electronic records of the handling 
        of any oral request made by a borrower under this subsection.
    ``(h) Mandatory Loss Mitigation.--
            ``(1) In general.--A lender or loan servicer shall not 
        initiate a foreclosure of a home mortgage loan unless that 
        lender or loan servicer has made a good faith review of the 
        financial situation of the borrower designated in such home 
        mortgage loan contract and has offered, whenever feasible, a 
        repayment plan, forbearance, loan modification, or other option 
        to assist the borrower in bringing his or her delinquent 
        account into arrears. In the event that such options are not 
        feasible, the lender or loan servicer shall refer the borrower 
        to a housing counseling agency approved by the Secretary of 
        Housing and Urban Development under section 106(d) of the 
        Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(d)).
            ``(2) Reports on loss mitigation activities.--
                    ``(A) In general.--Each servicer shall report to 
                the Board once every 3 months on the extent and results 
                of its loss mitigation activities.
                    ``(B) Form and content.--The Board shall prescribe, 
                by regulation, the form and content of the reports 
                required by this paragraph which shall include--
                            ``(i) categories of measures that result in 
                        modifications of loan provisions, including 
                        payment schedules, loan principle, and loan 
                        interest;
                            ``(ii) forebearance agreements;
                            ``(iii) acceptance of a reduced amount in 
                        satisfaction of the loan;
                            ``(iv) assumption of the loan;
                            ``(v) pre-foreclosure sales; and
                            ``(vi) deeds in lieu of foreclosure, and 
                        foreclosures.
                    ``(C) Basis.--Data required by this paragraph shall 
                be reported on a servicer and lender basis.
                    ``(D) Public availability.--The Board shall make 
                data received under this paragraph publicly available, 
                and shall annually report to Congress on servicer loss 
                mitigation activities.
            ``(3) Failure to comply.--Failure by a lender or loan 
        servicer to comply with the requirements under paragraph (1) 
        shall constitute a defense to any foreclosure.
    ``(i) Payoff Statements.--
            ``(1) Prohibition on fees.--
                    ``(A) In general.--No lender or loan servicer (or 
                any third party acting on behalf of such lender or loan 
                servicer) may charge a fee for transmitting to any 
                borrower the amount due to pay off the outstanding 
                balance on the home mortgage loan of such borrower.
                    ``(B) Exception.--After a lender or loan servicer 
                (or any third party acting on behalf of such lender or 
                loan servicer) has provided the information described 
                in subparagraph (A) without charge on 4 occasions 
                during a calendar year, the lender or loan servicer (or 
                any third party acting on behalf of such lender or loan 
                servicer) may thereafter charge a reasonable fee for 
                providing such information during the remainder of the 
                calendar year.
            ``(2) Timing.--The information described in subparagraph 
        (A) shall be provided to the borrower within a reasonable 
        period of time but in any event not more than 5 business days 
        after the receipt of the request by the lender or loan 
        servicer.
    ``(j) Civil Liability.--
            ``(1) In general.--Any lender or loan servicer who fails to 
        comply with any requirement of this section with respect to a 
        borrower designated in a home mortgage loan contract, is liable 
        to such borrower in an amount equal to the sum of--
                    ``(A) any actual damages sustained by such borrower 
                as a result of the failure;
                    ``(B) an amount not less than $5,000; or
                    ``(C) in the case of any successful action to 
                enforce the foregoing liability the costs of the 
                action, together with a reasonable attorney's fee as 
                determined by the court.
            ``(2) Jurisdiction.--Any action by a borrower for a failure 
        to comply with the requirements of this section may be brought 
        in any United States district court, or in any other court of 
        competent jurisdiction, not later than 3 years from the date of 
        the occurrence of such violation. This subsection does not bar 
        a person from asserting a violation of this section in an 
        action by a lender or loan servicer to collect the debt owed on 
        a home mortgage loan, or foreclose upon the home securing a 
        home mortgage loan, or to stop a foreclosure upon that home, 
        which was brought more than 3 years after the date of the 
        occurrence of the violation as a matter of defense by 
        recoupment or set-off in such action. An action under this 
        section does not create an independent basis for removal of an 
        action to a United States district court.
            ``(3) State attorney general enforcement.--An action to 
        enforce a violation of this section may also be brought by the 
        appropriate State attorney general in any appropriate United 
        States district court, or any other court of competent 
        jurisdiction, not later than 3 years after the date on which 
        the violation occurs. An action under this section does not 
        create an independent basis for removal of an action to a 
        United States district court.
    ``(k) Definitions.--In this section, the following definitions 
shall apply:
            ``(1) Lender.--The term `lender' has the same meaning as in 
        section 3500.2 of title 24, Code of Federal Regulations, as in 
        effect on the date of enactment of this section.
            ``(2) Loan servicer.--The term `loan servicer' has the same 
        meaning as the term `servicer' in section 6(i)(2) of the Real 
        Estate Settlement Procedures Act of 1974 (12 U.S.C. 
        2605(i)(2)).''.

SEC. 502. REAL ESTATE SETTLEMENT PROCEDURES.

    Section 6(b)(3) of the Real Estate Settlement Procedures Act of 
1974 (12 U.S.C. 2605(b)(3)) is amended by adding at the end the 
following new subparagraph:
                    ``(H) A statement explaining--
                            ``(i) whether the account of the borrower 
                        is current, or if the account is not current, 
                        an explanation of the reason and date the 
                        account went into default;
                            ``(ii) the current balance due on the loan, 
                        including the principal due, an explanation of 
                        the escrow balance, and whether there are any 
                        escrow deficiencies or shortages; and
                            ``(iii) a full payment history of the 
                        borrower which shows in a clear and easily 
                        understandable manner, all of the activity on 
                        the home mortgage loan since the origination of 
                        the loan or the prior transfer of servicing, 
                        including the escrow account, and the 
                        application of payments.''.

SEC. 503. EFFECTIVE DATE.

    This title and the amendments made by this title shall become 
effective 90 days after the date of enactment of this Act, and shall 
apply to loan servicers and loan servicing activities on and after that 
effective date.

              TITLE VI--FORECLOSURE PREVENTION COUNSELING

SEC. 601. FORECLOSURE PREVENTION COUNSELING.

    Section 106(d)(6) of the Housing and Urban Development Act of 1968 
(12 U.S.C. 1701x(d)(6)) is amended to read as follows:
            ``(6) Foreclosure prevention counseling.--
                    ``(A) Notification at time of settlement of 
                availability of counseling upon delinquency.--
                            ``(i) In general.--At the time of 
                        settlement of any real estate transaction 
                        involving a qualified mortgage, and together 
                        with the final signed loan documents, a lender 
                        or loan servicer shall provide to each eligible 
                        homeowner a plain language statement in 
                        conspicuous 16-point type or larger which shall 
                        include the following:
                                    ``(I) Counseling statement.--A 
                                counseling statement that reads as 
                                follows:
                        `If you are more than 30 days late on your 
                        mortgage payments, your lender or loan servicer 
                        shall notify you of housing counseling agencies 
                        approved by the Secretary of Housing and Urban 
                        Development that may be able to assist you. 
                        Before you miss another mortgage payment, you 
                        are strongly encouraged to contact your lender 
                        or loan servicer or 1 of these agencies for 
                        assistance. If you are more than 60 days late 
                        on your mortgage payments, your lender or loan 
                        servicer shall send you a second notification 
                        containing this information. In addition, if 
                        you are more than 60 days late on your mortgage 
                        payment, your lender or loan servicer shall 
                        notify an approved housing counseling agency so 
                        that such agency can contact you regarding any 
                        assistance it may be able to provide.
                        `You can also choose a housing counseling 
                        agency from the list provided with this 
                        statement to assist you. By calling 1 of these 
                        approved housing counseling agencies and 
                        signing an authorization form, your agency of 
                        choice will notify your lender or loan servicer 
                        of your decision.'.
                                    ``(II) Counseling agency listing.--
                                A listing of at least 5 national, State 
                                and local housing counseling agencies 
                                approved by the Secretary. It is the 
                                responsibility of the lender or loan 
                                servicer to ensure that--
                                            ``(aa) if fewer than 5 
                                        approved housing counseling 
                                        agencies serve the area where 
                                        the eligible homeowner is 
                                        located, all available housing 
                                        counseling agencies in that 
                                        area shall be listed; and
                                            ``(bb) the list shall 
                                        include options of housing 
                                        counseling agencies that 
                                        provide in-person counseling, 
                                        as well as telephone 
                                        counseling.
                            ``(ii) Notice.--Any notice required to be 
                        sent pursuant to this subparagraph shall be 
                        sent by first class mail to the last known 
                        address of the eligible homeowner and if 
                        different, to the residence which is the 
                        subject of the mortgage. The notice shall also 
                        be sent by registered or certified mail.
                    ``(B) Notification of availability of counseling 
                upon delinquency after 60 days.--
                            ``(i) In general.--Before a lender or loan 
                        servicer accelerates the maturity of a mortgage 
                        obligation, commences legal action, including 
                        mortgage foreclosure to recover under the 
                        obligation, or takes possession of a security 
                        of the mortgage debtor for the mortgage 
                        obligation, the lender or loan servicer is 
                        required to give notice to an eligible 
                        homeowner in conspicuous 16-point type or 
                        larger which shall include the following:
                                    ``(I) Housing counseling 
                                information in notice foreclosure 
                                statement.--A foreclosure notice that 
                                includes the following statement (blank 
                                lines to be filled in by the lender or 
                                loan servicer, as appropriate):
                        `This is an official notice that the mortgage 
                        on your home is in default, and the lender 
                        intends to foreclose in ___ days. The name, 
                        address, and phone number of housing counseling 
                        agencies approved by the Secretary of Housing 
                        and Urban Development serving your county are 
                        listed at the end of this notice.
                        `In addition, your lender or loan servicer 
                        shall notify such an approved housing 
                        counseling agency of your default so that such 
                        agency can contact you regarding any assistance 
                        it may be able to provide. You have the right 
                        to request that your lender or loan servicer 
                        not share your information with a housing 
                        counseling agency.
                        `You can also choose an approved housing 
                        counseling agency from the list provided with 
                        this notice to assist you. By calling one of 
                        these approved housing counseling agencies and 
                        signing an authorization form, your agency of 
                        choice will notify your lender or loan servicer 
                        of your decision.'.
                                    ``(II) Counseling agency listing.--
                                A listing of at least 5 State and local 
                                housing counseling agencies approved by 
                                the Secretary. It is the responsibility 
                                of the lender or loan servicer to 
                                ensure that--
                                            ``(aa) if fewer than 5 
                                        approved housing counseling 
                                        agencies serve the area where 
                                        the eligible homeowner is 
                                        located, all available housing 
                                        counseling agencies in that 
                                        area shall be listed; and
                                            ``(bb) the list shall 
                                        include options of housing 
                                        counseling agencies that 
                                        provide in-person counseling, 
                                        as well as telephone 
                                        counseling.
                            ``(ii) Notice.--Any notice required to be 
                        sent pursuant to this subparagraph shall be 
                        sent by first class mail to the last known 
                        address of the eligible homeowner and if 
                        different, to the residence which is the 
                        subject of the mortgage. The notice shall also 
                        be sent by registered or certified mail
                            ``(iii) Timing.--Any notice required to be 
                        sent pursuant to this subparagraph shall be 
                        sent at such time as the eligible homeowner is 
                        at least 60 days contractually delinquent in 
                        his or her mortgage payments or is in violation 
                        of other provisions of the mortgage.
                            ``(iv) Inclusion in all foreclosure 
                        mailings.--The foreclosure notice and 
                        counseling agency listing required under 
                        subclauses (I) and (II) of clause (i) shall be 
                        included with all foreclosure mailings sent to 
                        an eligible homeowner.
                    ``(C) No foreclosure if application for foreclosure 
                prevention services.--A lender or loan servicer shall 
                not initiate or continue a foreclosure--
                            ``(i) upon receipt of a written 
                        confirmation that an eligible homeowner has 
                        engaged a housing counseling agency approved by 
                        the Secretary for the purposes of receiving 
                        foreclosure prevention services and assistance; 
                        and
                            ``(ii) for the 45-day period beginning on 
                        the date of receipt of such written 
                        confirmation.
                    ``(D) Duties.--
                            ``(i) Duty of lender or servicer to forward 
                        information.--
                                    ``(I) In general.--Each lender or 
                                loan servicer shall forward the contact 
                                information of each eligible homeowner 
                                who has borrowed amounts from such 
                                lender or loan servicer for a qualified 
                                mortgage to a housing counseling agency 
                                approved by the Secretary in the event 
                                the mortgage payment of that homeowner 
                                is or becomes more than 60 days late so 
                                that the housing counseling agency can 
                                attempt to reach the homeowner.
                                    ``(II) Pre-existing relationship.--
                                In the case that an eligible homeowner 
                                has a pre-existing relationship with a 
                                housing counseling agency approved by 
                                the Secretary, or a preference for one 
                                agency over another, the homeowner may 
                                indicate as such--
                                            ``(aa) at the time of 
                                        settlement of the real estate 
                                        transaction involving a 
                                        qualified mortgage issued to 
                                        that homeowner;
                                            ``(bb) by providing written 
                                        correspondence to the lender or 
                                        loan servicer for such 
                                        qualified mortgage stating 
                                        which housing counseling agency 
                                        the homeowner would like to 
                                        work with in case the homeowner 
                                        should become delinquent in his 
                                        or her mortgage payments; or
                                            ``(cc) by signing an 
                                        authorization form at the 
                                        office of such housing 
                                        counseling agency of choice, 
                                        which form shall then be sent 
                                        to the lender or loan servicer.
                                    ``(III) Rules of construction.--In 
                                order to carry out the provisions of 
                                this paragraph, lenders and loan 
                                servicers may form relationships with 
                                housing counseling agencies approved by 
                                the Secretary to provide services to 
                                eligible homeowners. Notwithstanding 
                                the previous sentence, exclusive 
                                relationships between any such parties 
                                are strictly prohibited.
                            ``(ii) Agency representation of 
                        homeowner.--When a housing counseling agency 
                        provides a lender or loan servicer with a 
                        signed authorization form to represent an 
                        eligible homeowner, the lender or servicer 
                        shall respond to requests from that agency for 
                        information within 3 days, and to any workout 
                        proposals of that agency within 7 days. A 
                        lender or loan servicer may not refuse to work 
                        with a housing counselor from a housing 
                        counseling agency approved by the Secretary, if 
                        a signed authorization form an eligible 
                        homeowner has been received by that lender or 
                        loan servicer (faxed, scanned, and other 
                        electronically reproduced authorizations of 
                        such authorization form shall also be 
                        acceptable).
                            ``(iii) Required disclosures to 
                        homeowner.--Each eligible homeowner shall be 
                        informed at the time of settlement of the real 
                        estate transaction involving a qualified 
                        mortgage issued to that homeowner that under 
                        this paragraph a housing counseling agency may 
                        provide easier access to assistance in case the 
                        homeowner becomes delinquent on his or her 
                        mortgage payments and that no information that 
                        would make it possible to identify the 
                        homeowner will be given to any other entity for 
                        any reason without the prior approval of the 
                        homeowner.
                            ``(iv) Required resolutions.--A lender or 
                        loan servicer shall be required to consider all 
                        loss mitigation resolutions for each case of 
                        foreclosure initiated by the lender or loan 
                        servicer, including the modification of a 
                        qualified mortgage to a more permanent, 
                        affordable interest rate.
                            ``(v) Required disclosures to housing 
                        counseling agencies.--A lender or loan servicer 
                        shall disclose to any housing counseling agency 
                        approved by the Secretary and authorized to 
                        represent an eligible homeowner the name of the 
                        originator of the loans as stated in the 
                        Pooling and Servicing Agreement, and the name 
                        of the pool Trustee.
                    ``(E) Reimbursements for housing counseling 
                services.--
                            ``(i) In general.--A lender or loan 
                        servicer of a qualified mortgage made to an 
                        eligible homeowner shall reimburse the housing 
                        counseling agency that is authorized to 
                        represent the homeowner upon the rendering of 
                        services by such agency to the homeowner under 
                        this paragraph.
                            ``(ii) Reimbursement.--A lender or loan 
                        servicer shall seek reimbursement for the 
                        payment of housing counseling services as 
                        described under clause (i) from the Trust, if 
                        any, designated in the lender or servicer's 
                        Pooling and Servicing Agreement.
                    ``(F) Availability of waiver.--
                            ``(i) In general.--An eligible homeowner 
                        may choose not to receive information regarding 
                        State and local housing counseling agencies 
                        approved by the Secretary, or to have their 
                        information shared with State and local housing 
                        counseling agencies, or both, at any time after 
                        default. An eligible homeowner may also submit 
                        a signed letter to their lender or loan 
                        servicer at any time after default to waive 
                        their right to receive information regarding 
                        State and local housing counseling agencies.
                            ``(ii) Limitation on waiver.--The waiver 
                        described under clause (i) shall only apply to 
                        the receipt of information regarding housing 
                        counseling agencies located in the area where 
                        the homeowner is located or the sharing of the 
                        homeowner's personal information with such 
                        agencies. The waiver described under clause (i) 
                        shall not apply to the right of the homeowner 
                        to seek foreclosure prevention counseling, nor 
                        does it relieve the lender or loan servicer of 
                        the requirement to notify the homeowner of the 
                        availability of counseling as described in this 
                        section.
                    ``(G) Definitions.--In this paragraph, the 
                following definitions shall apply:
                            ``(i) Lender.--The term `lender' has the 
                        same meaning as in section 3500.2 of title 24, 
                        Code of Federal Regulations.
                            ``(ii) Loan servicer.--The term `loan 
                        servicer' has the same meaning as the term 
                        `servicer' as that term is defined in section 
                        6(i)(2) of the Real Estate Settlement 
                        Procedures Act (12 U.S.C. 2605(i)(2)).''.

                  TITLE VII--REMEDIES AND ENFORCEMENT

SEC. 701. MATERIAL DISCLOSURES AND VIOLATIONS.

    (a) Material Disclosures.--Section 103(u) of the Truth in Lending 
Act (15 U.S.C. 1602(u)) is amended by--
            (1) striking ``material disclosures'' and inserting 
        ``material disclosures or violations''; and
            (2) striking ``and the disclosures required by section 
        129(a)'' and inserting ``and the provisions of sections 129, 
        129A, and 129B.''.
    (b) Consequences of Failure To Comply.--Section 129(j) of the Truth 
in Lending Act (15 U.S.C. 1639(j)) is amended by striking ``contains a 
provision prohibited by'' and inserting ``violates a provision of''.

SEC. 702. RIGHT OF RESCISSION.

    (a) Time Limit for Exercise of Right.--Section 125(f) of the Truth 
in Lending Act (15 U.S.C. 1635(f)) is amended by striking ``An 
obligor's right of rescission shall expire three years after the date 
of consummation'' and inserting ``An obligor's right of rescission 
shall extend to 6 years from the date of consummation''.
    (b) Assertion of Right.--Section 130(e) of the Truth in Lending Act 
(15 U.S.C. 1640(e)) is amended by inserting after the second sentence 
the following new sentence: ``This subsection shall not bar a person 
from asserting a right to rescission under section 125 in an action to 
collect the debt or as a defense to a judicial foreclosure or to stop a 
nonjudicial foreclosure after the expiration of the time period set 
forth in section 125(f), but not exceed 10 years from the date of the 
consummation of the transaction.''.

SEC. 703. CIVIL LIABILITY.

    (a) In General.--Section 130 of the Truth in Lending Act (15 U.S.C. 
1640) is amended by--
            (1) striking ``creditor'' and inserting ``creditor or 
        mortgage broker'' in each place that term appears;
            (2) striking ``Creditor'' and inserting ``Creditor or 
        Mortgage Broker'' in each place that term appears; and
            (3) striking ``creditor's'' and inserting ``creditor's or 
        mortgage broker's'' in each place that term appears.
    (b) Statute of Limitations Extended for Section 129, 129A, or 129B 
Violations.--Section 130(e) of the Truth in Lending Act (15 U.S.C. 
1640(e)), as amended by section 702(b), is further amended--
            (1) in the first sentence, by striking ``Any action'' and 
        inserting ``Except as otherwise provided in this subsection, 
        any action'';
            (2) by inserting after the first sentence the following new 
        sentence: ``Any action under this section with respect to any 
        violation of section 129, 129A, or 129B may be brought in any 
        United States district court, or in any other court of 
        competent jurisdiction, within 3 years from the date of the 
        occurrence of the violation.''; and
            (3) in the fifth sentence (as so redesignated) by striking 
        ``violation of section 129'' and inserting ``violation of 
        section 129, 129A, or 129B''.
    (c) Enforcement by State Attorneys General.--An action to enforce a 
violation of section 129, 129A, or 129B of the Truth in Lending Act, as 
amended and added by this Act, may also be brought by the appropriate 
State attorney general in any appropriate United States district court, 
or any other court of competent jurisdiction, not later than 3 years 
after the date on which the violation occurs. An action under this 
subsection does not create an independent basis for removal of an 
action to a United States district court.
    (d) Other Changes to Civil Liability.--
            (1) Amount of award.--Section 130(a)(2) of the Truth in 
        Lending Act (15 U.S.C. 1640(a)(2)) is amended--
                    (A) in subparagraph (A)(iii), by--
                            (i) striking ``$200'' and inserting 
                        ``$500'';
                            (ii) striking ``$2,000'' and inserting 
                        ``$5,000''; and
                            (iii) adding before the semicolon at the 
                        end the following: ``, such amount to adjusted 
                        annually based on the consumer price index, to 
                        maintain current value.''; and
                    (B) in subparagraph (B), by striking ``500,000'' 
                and inserting ``$5,000,000''.
            (2) Failure to comply with section 129a.--Section 130(a)(4) 
        of the Truth in Lending Act (15 U.S.C. 1640(a)(4)) is amended 
        by inserting ``or 129A'' after ``129''.

SEC. 704. LIABILITY FOR MONETARY DAMAGES.

    Section 131 of the Truth in Lending Act (15 U.S.C. 1641) is amended 
by--
            (1) by redesignating subsection (f) as subsection (g); and
            (2) by inserting after subsection (e) the following new 
        subsection:
    ``(f) Liability of Assignees for Monetary Damages for Violations of 
Sections 129A and 129B.--
            ``(1) Subprime or nontraditional loans.--
                    ``(A) Individual actions.--Notwithstanding 
                subsections (a) and (e), any person who purchases, 
                holds, or is otherwise assigned a mortgage or similar 
                security interest in connection with a subprime or 
                nontraditional home mortgage loan, other than a loan 
                described under section 103(aa), shall be liable in an 
                individual action for remedies available under section 
                130 for violations of sections 129A and 129B that the 
                consumer could assert against the creditor or mortgage 
                originator originating that mortgage.
                    ``(B) Class actions.--Notwithstanding subsections 
                (a) and (e), any person who purchases, holds, or is 
                otherwise assigned a mortgage or similar security 
                interest in connection with a subprime or 
                nontraditional home mortgage loan, other than a loan 
                described under section 103(aa), shall be liable in a 
                class action for remedies available under section 130 
                for violations of section 129A that the consumer could 
                assert against the creditor or mortgage originator 
                originating that mortgage, unless such person 
                demonstrates, by a preponderance of the evidence, that 
                a reasonable person exercising ordinary and independent 
                due diligence could not determine that the home 
                mortgage loan was not in compliance with the 
                requirements of section 129A.
            ``(2) Other loans.--Notwithstanding subsections (a) and 
        (e), any person who purchases, holds, or is otherwise assigned 
        a mortgage or similar security interest in connection with home 
        mortgage loan other than a loan described under section 
        103(aa), a subprime, or a nontraditional loan, shall be liable 
        only in an individual action for remedies available under 
        section 130 for violations of section 129B that the consumer 
        could assert against the creditor or mortgage originator 
        originating that mortgage, provided that such liability is 
        limited to the amount of all remaining indebtedness and the 
        total amount paid in connection with the transaction plus 
        amounts required to recover costs, including reasonable 
        attorneys' fees.''.

SEC. 705. REMEDY IN LIEU OF RESCISSION FOR CERTAIN VIOLATIONS.

    Section 131 of the Truth in Lending Act (15 U.S.C. 1641) is further 
amended by adding at the end the following new subsection:
    ``(h) Remedy in Lieu of Rescission for Certain Violations.--At the 
election of a consumer entitled to rescind for violations of sections 
129, 129A, or 129B, any person (including a creditor) who holds, 
purchases, or is otherwise assigned a mortgage or similar security 
interest in connection with home mortgage loan--
            ``(1) may be required to make such adjustments to the 
        balance of the obligation as are required under section 125; 
        and
            ``(2) shall modify or refinance the loan, at no cost to the 
        consumer, the resulting balance of which shall provide terms 
        that would have satisfied the requirements of sections 129, 
        129A, or 129B at the origination of the loan and to pay costs 
        and reasonable attorneys fees.''.

SEC. 706. PROHIBITION ON MANDATORY ARBITRATION.

    Section 131 of the Truth in Lending Act (15 U.S.C. 1641) is further 
amended by adding at the end the following new subsection:
    ``(i) Rule of Construction.--No provision in a home mortgage loan 
shall be construed to bar a consumer from access to any judicial 
procedure, forum, or remedy through any court of competent jurisdiction 
under any provision of Federal or State law.''.

SEC. 707. LENDER LIABILITY.

    Section 130 of the Truth in Lending Act (15 U.S.C. 1640) is amended 
by adding at the end the following new subsection:
    ``(i) Lender Liability.--
            ``(1) Transitive liability for subprime loan.--In any case 
        in which a mortgage broker sells or delivers a high-cost 
        mortgage, a subprime mortgage, or a nontraditional mortgage, a 
        creditor shall be liable for the acts, omissions, and 
        representations made by the mortgage broker in connection with 
        such home mortgage loan.
            ``(2) Transitive liability for other loans.--In the case of 
        any other home mortgage loan not described under paragraph (1) 
        in which a mortgage broker has received a yield spread premium 
        or other compensation from a creditor, the creditor shall be 
        liable for the acts, omissions, and representations made by the 
        mortgage broker in connection with such home mortgage loan.''.

               TITLE VIII--OTHER BANKING AGENCY AUTHORITY

SEC. 801. INCLUSION OF ALL BANKING AGENCIES IN THE REGULATORY AUTHORITY 
              UNDER THE FEDERAL TRADE COMMISSION ACT WITH RESPECT TO 
              DEPOSITORY INSTITUTIONS.

    (a) In General.--Section 18(f) of the Federal Trade Commission Act 
(15 U.S.C. 57a(f)(1)) is amended--
            (1) in paragraph (1)--
                    (A) in the first sentenced--
                            (i) by striking ``banks or savings and loan 
                        institutions described in paragraph (3), each 
                        agency specified in paragraph (2) or (3) of 
                        this subsection shall establish'' and inserting 
                        ``depository institutions and Federal credit 
                        unions, the Federal banking agencies and the 
                        National Credit Union Administration Board 
                        shall each establish''; and
                            (ii) by striking ``banks or savings and 
                        loan institutions described in paragraph (3), 
                        subject to its jurisdiction'' and inserting 
                        ``depository institutions or Federal credit 
                        unions subject to the jurisdiction of such 
                        agency or Board'';
                    (B) in the second sentence, by striking ``The Board 
                of Governors of the Federal Reserve System (with 
                respect to banks) and the Federal Home Loan Bank Board 
                (with respect to savings and loan institutions 
                described in paragraph (3))'' and inserting ``Each 
                Federal banking agency (with respect to the depository 
                institutions each such agency supervises)'';
                    (C) in the third sentence--
                            (i) by striking ``each such Board'' and 
                        inserting ``each such banking agency and the 
                        National Credit Union Administration Board'';
                            (ii) by striking ``banks or savings and 
                        loan institutions described in paragraph (3)'' 
                        each place such term appears and inserting 
                        ``depository institutions subject to the 
                        jurisdiction of such agency'';
                            (iii) by striking ``(A) any such Board'' 
                        and inserting ``(A) any such Federal banking 
                        agency or the National Credit Union 
                        Administration Board''; and
                            (iv) by striking ``with respect to banks, 
                        savings and loan institutions'' and inserting 
                        ``with respect to depository institutions''; 
                        and
                    (D) by adding at the end the following: ``For 
                purposes of this subsection, the terms `Federal banking 
                agency' and `depository institution' have the same 
                meaning as in section 3 of the Federal Deposit 
                Insurance Act.'';
            (2) in paragraph (3), by inserting ``by the Director of the 
        Office of Thrift Supervision'' before the period at the end;
            (3) in paragraph (4), by inserting ``by the National Credit 
        Union Administration'' before the period at the end; and
            (4) by amending paragraph (5) to read as follows:
    ``(5) For the purpose of the exercise by the Federal banking 
agencies described in paragraphs (2) and (3) and the National Credit 
Union Administration Board described in paragraph (4) of its powers 
under any Act referred to in those paragraphs, a violation of any 
regulation prescribed under this subsection shall be considered a 
violation of a requirement imposed under that Act. In addition to its 
powers under any provision of law specifically referred to in 
paragraphs (2) through (4), each of the agencies or the Board referred 
to in those paragraphs may exercise, for the purpose of enforcing 
compliance with any regulation prescribed under this subsection, any 
other authority conferred on it by law.''.
    (b) Preemption.--Such section 18(f) is further amended by striking 
paragraph (6) and inserting the following:
    ``(6) Notwithstanding anything in this subsection or any other 
provision of law, including the National Bank Act (12 U.S.C. 38 et 
seq.) and the Home Owners' Loan Act (12 U.S.C. 1461 et seq.), 
regulations promulgated under this subsection shall be considered 
supplemental to State laws governing unfair and deceptive acts and 
practices and may not be construed to preempt any provision of State 
law that provides equal or greater protections.''.
    (c) Technical Amendment.--Such section 18(f) is further amended in 
paragraph (2)(C), by inserting ``than'' after ``(other''.

                        TITLE IX--MISCELLANEOUS

SEC. 901. AUTHORIZATIONS.

    For fiscal years 2008, 2009, 2010, 2011, and 2012, there are 
authorized to be appropriated to the Attorney General of the United 
States, a total of--
            (1) $31,250,000 to support the employment of 30 additional 
        agents of the Federal Bureau of Investigation and 2 additional 
        dedicated prosecutors at the Department of Justice to 
        coordinate prosecution of mortgage fraud efforts with the 
        offices of the United States Attorneys; and
            (2) $750,000 to support the operations of interagency task 
        forces of the Federal Bureau of Investigation in the areas with 
        the 15 highest concentrations of mortgage fraud.
                                 <all>