I 111th CONGRESS 2d Session H. R. 4854 IN THE HOUSE OF REPRESENTATIVES March 16, 2010 Mr. Clay introduced the following bill; which was referred to the Committee on Financial Services A BILL To require that any home inspection conducted in connection with a purchase of residential real property that involves a federally related mortgage loan be conducted by a State-licensed or State-certified home inspector to determine the existence of structural, mechanical, and electrical safety defects, and to require inclusion in the standard HUD–1 settlement statement of information regarding any home inspection conducted in connection with settlement.

1.

Short title

This Act may be cited as the Home Inspection Act of 2010.

2.

Home inspection requirement

(a)

Requirement

The Federal banking agencies (as such term is defined in section 103(cc) of the Truth in Lending Act (15 U.S.C. 1602(cc))), in consultation with the Secretary of Housing and Urban Development, the Federal Trade Commission, and any Federal agency or commission established by law to regulate the provision of consumer financial products or services, shall jointly prescribe regulations to prohibit any lender from making any federally related mortgage loan (as such term is defined in section 3 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2602)) under which a home inspection is conducted in connection with settlement of the mortgage loan unless such inspection is conducted by a home inspector who is licensed, certified, approved, or otherwise regulated by the home State of the inspector or the State in which the real property is located. (b)

Enforcement

Compliance with the requirements imposed pursuant to subsection (a) of this section shall be enforced in the same manner as provided under section 108 of the Truth in Lending Act (15 U.S.C. 1607) for enforcement of the requirements under such Act.

3.

Inclusion of home inspection information in HUD–1 settlement form

(a)

In general

Subsection (a) of section 4 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2603(a)) is amended— (1)by inserting (1) after (a); and (2)by adding at the end the following new paragraph: (2)The Secretary shall include in the standard form an item for identifying any home inspection conducted in connection with the settlement, when such inspection was or is to be completed, the cost of the inspection, whether the charge for such inspection is imposed on the borrower or the seller, and whether such charge has been paid before settlement and a copy of the receipt of payment for the inspection is included with the settlement documents. Such item shall be included in the form at the place where items relating to additional settlement charges (such as pest inspection charges) are located. . (b)

Regulations

Not later than the expiration of the —-day period beginning on the date of the enactment of this Act, the Secretary of Housing and Urban Development shall issue regulations implementing the amendments made by subsection (a) and revising the standard real estate settlement form required under section 4 of the Real Estate Settlement Procedures Act of 1974 in accordance with such amendments.