1.Short title and table of
contents
(a)This Act may be cited
as the Housing Disaster Area
Foreclosure Prevention Act of 2009
.
(b)The table of contents for this Act is as follows:
Sec. 1. Short title and table of contents.
Title I—Expansion of State foreclosure mitigation
programs
Sec. 101. Stabilization of the mortgage revenue bond
market.
Sec. 102. TARP assistance for refinancing underwater
mortgages.
Sec. 103. Interest rate buy-down for refinancing mortgages and
new mortgages for homes in areas served by State housing finance agency
foreclosure prevention programs.
Sec. 104. HUD action to increase access to mortgage insurance
by State housing finance agencies.
Sec. 105. State reports on use of refinancing bond
authority.
Title II—Housing tax incentives
Sec. 201. Temporary increase in volume cap for housing bonds
issued for areas most affected by foreclosure crisis.
Sec. 202. Extension of time for using increased volume cap for
housing bonds.
Sec. 203. Expansion of use of mortgage revenue bonds for
mortgage refinancing loans.
Sec. 204. Alternative minimum tax limitations not applicable to
refinancings of tax-exempt housing bonds.
Sec. 205. Clarification of applicability to high foreclosure
impact areas.
<enum>I</enum><header>Expansion of State
foreclosure mitigation programs</header>
<section id="H2E659A9F659C4E939E7230E79C2CE9BD" section-type="subsequent-section"><enum>101.</enum><header>Stabilization of the
mortgage revenue bond market</header><text display-inline="no-display-inline">The Secretary of the Treasury shall take all
necessary steps to support the mortgage revenue bond market, including the use
of amounts made available under title I of the Emergency Economic Stabilization
Act of 2008 to purchase mortgage revenue bonds (as defined in section 143 of
the Internal Revenue Code of 1986) at a rate of interest that makes the housing
programs carried out with the proceeds of such bonds economically
feasible.</text>
</section><section display-inline="no-display-inline" id="H61997691CF9949C500D7A49F3B7775CF"><enum>102.</enum><header>TARP assistance
for refinancing underwater mortgages</header>
<subsection id="H11E4F9D76D064BB7B850C6A2E06BBB0"><enum>(a)</enum><header>Authority</header><text>The
Secretary of the Treasury shall carry out a program to use amounts specified in
subsection (e) to reduce the outstanding debt on qualifying existing underwater
mortgages in connection with the refinancing of such mortgages.</text>
</subsection><subsection id="H4978AAE943824F489EE942B7B609F412"><enum>(b)</enum><header>Qualifying
existing underwater mortgages</header><text>For purposes of this section, the
term <quote>qualifying existing underwater mortgage</quote> means a mortgage or
mortgages on a 1- to 4-family owner-occupied residential property that has an
appraised value that is less than the outstanding obligation under such
mortgage or mortgages.</text>
</subsection><subsection id="H53985DD2B35B475C94554B00AFDFD738"><enum>(c)</enum><header>Terms of
refinancing mortgage</header><text display-inline="yes-display-inline">The
Secretary may use amounts under the program under this section only with
respect to qualifying existing underwater mortgages that are refinanced under a
mortgage that is eligible to be financed with the proceeds of a mortgage
revenue bond pursuant to section 143(k)(12) of the Internal Revenue Code of
1986.</text>
</subsection><subsection id="H9CB69571B6C54B60005F8E624326FD03"><enum>(d)</enum><header>Recapture of
assistance amounts</header><text display-inline="yes-display-inline">In making
assistance available under the program under this section with respect to a
qualifying existing underwater mortgage, the Secretary shall take such actions
and enter into such binding agreements as are necessary to provide for recovery
by the Secretary, upon any sale of the residential property subsequent to the
refinancing of the mortgage under such program, of the lesser of—</text>
<paragraph id="H591EC1520DC64591B21563DF00994B08"><enum>(1)</enum><text>an amount equal to
50 percent of any proceeds of the sale in excess of the amount necessary to
fully pay any outstanding obligations, including interest, under the refinanced
mortgage; or</text>
</paragraph><paragraph id="H55BFA0A6FF644F2EAD5F930179F6F7A8"><enum>(2)</enum><text>the amount of
assistance provided under the program with respect to such mortgage.</text>
</paragraph></subsection><subsection id="HB28F77820B794377A7A688A1A0002DBD"><enum>(e)</enum><header>Use of TARP
amounts</header><text display-inline="yes-display-inline">Of any amounts made
available under title I of the Emergency Economic Stabilization Act of 2008 (12
U.S.C. 5211 et seq.), the Secretary of the Treasury shall reserve for use only
under the program under this section, and shall use only under such program,
amounts sufficient to provide assistance under the program in connection with
any mortgage refinanced with the proceeds of a mortgage revenue bond pursuant
to section 143(k)(12) of the Internal Revenue Code of 1986.</text>
</subsection></section><section display-inline="no-display-inline" id="H53898702CC2541709EAF0500EAD189BE" section-type="subsequent-section"><enum>103.</enum><header>Interest rate
buy-down for refinancing mortgages and new mortgages for homes in areas served
by State housing finance agency foreclosure prevention programs</header>
<subsection id="HD3B2A61459004563868BC93C9F2EC77"><enum>(a)</enum><header>Authority</header><text display-inline="yes-display-inline">The Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation shall each carry out a program
under this section to purchase and securitize qualified refinancing mortgages
and qualified new mortgages on single-family housing, in accordance with this
section and policies and procedures that the Director of the Federal Housing
Finance Agency shall establish.</text>
</subsection><subsection id="H40B70665558141D5A31F1B57663D8EEC"><enum>(b)</enum><header>Purchase of
qualified mortgages</header>
<paragraph id="HD0CF6B1C57034FB800AFB5FF7FBA8BB"><enum>(1)</enum><header>Requirement to
purchase</header><text display-inline="yes-display-inline">If a lender proffers
to an enterprise, in accordance with requirements established by the Director,
a mortgage or mortgages for purchase under this section, the enterprise shall
make a determination of whether such mortgage or mortgages are qualified
mortgages. Subject to subsection (h), if the enterprise determines that such
mortgage or mortgages meet the requirements for qualified mortgages, the
enterprise shall make a commitment to purchase, and shall purchase, the
mortgage or mortgages.</text>
</paragraph><paragraph commented="no" id="HB964E80EC6334F9E802EF9CFAF4841"><enum>(2)</enum><header>Advance
commitments</header><text display-inline="yes-display-inline">The Director
shall require each enterprise to establish a procedure for approval of lenders
to receive commitments, in advance of the origination of qualified mortgages,
for purchase of such mortgages under this section by the enterprise.</text>
</paragraph></subsection><subsection id="HF27F8BB4EB844D0B9C09F2835DC5B2AA"><enum>(c)</enum><header>Qualified
mortgages</header>
<paragraph id="H9DDB15399F5C44F58CF1D9C851868F3E"><enum>(1)</enum><header>Qualified
mortgage</header><text>For purposes of this section, the term <quote>qualified
mortgage</quote> means a mortgage that is a qualified refinancing mortgage or a
qualified new mortgage.</text>
</paragraph><paragraph id="HA1818F310FA94946BBCE4FCC57DCBD00"><enum>(2)</enum><header>Qualified
refinancing mortgage</header><text display-inline="yes-display-inline">For
purposes of this section, the term <quote>qualified refinancing
mortgage</quote> means a mortgage that meets the following requirements:</text>
<subparagraph id="H79FCE19618CF4812B81B8EA8D2008C80"><enum>(A)</enum><header>Single-family
housing in housing distress areas served by State housing finance agency
foreclosure reduction programs</header><text>The property subject to the
mortgage shall be a residence as defined in section 143 of the Internal Revenue
Code of 1986 that is located within a qualified census tract or area of chronic
economic distress (within the meaning given such terms in section 143(j) of
such Code) that is located within a foreclosure crisis State (as such term is
defined in section 146(d)(6) of such Code).</text>
</subparagraph><subparagraph id="HCEF460EEE2C740F3A487BF55346E26CC"><enum>(B)</enum><header>Principal
residence</header><text>The mortgagor under the mortgage shall satisfy the
requirement in section 143(c)(1) of the Internal Revenue Code of 1986.</text>
</subparagraph><subparagraph id="H28F32FCEDF7B4A3EAE593444EFADE044"><enum>(C)</enum><header>Refinancing</header><text>The
principal loan amount repayment of which is secured by the mortgage shall be
used to satisfy all indebtedness under an existing first mortgage that—</text>
<clause id="H9A5DE3D342284BC394EFDEB91EA6C24B"><enum>(i)</enum><text>was
made for purchase of, or refinancing another first mortgage on, the same
property that is subject to the qualified refinancing mortgage; and</text>
</clause><clause id="H7F51D7055D1946849C732004600045C4"><enum>(ii)</enum><text>was
originated on or before January 1, 2008.</text>
</clause></subparagraph><subparagraph id="H6074D113607646409B44A65C78F1E9B1"><enum>(D)</enum><header>Interest rate;
term to maturity</header><text>The mortgage shall—</text>
<clause id="H9F1FD01D40D9415B99A3F3D682451787"><enum>(i)</enum><text>bear
interest at a single annual rate that is fixed for the entire term of the
mortgage, which shall not exceed the annual rate that is 100 basis points less
than the prevailing annual interest rate for mortgages of similar type and term
to maturity, as determined by the Director; and</text>
</clause><clause id="H4226CA7369BA42DAA4E578051FD8B00"><enum>(ii)</enum><text>have
a term to maturity of not less than 30 years and not more than 40 years from
the date of the beginning of the amortization of the mortgage.</text>
</clause></subparagraph><subparagraph id="HF7764AB95D3B49E9B183A4E0B921DCCE"><enum>(E)</enum><header>Underwriting
standards</header><text>The mortgage shall meet such underwriting standards as
the Director shall require.</text>
</subparagraph><subparagraph id="H6590CAC86AF84B66A244FDC399E9AD9"><enum>(F)</enum><header>Waiver of
prepayment penalties</header><text>All penalties for prepayment or refinancing
of the underlying mortgage refinanced by the mortgage, and all fees and
penalties related to the default or delinquency on such mortgage, shall have
been waived or forgiven.</text>
</subparagraph></paragraph><paragraph id="HEDA35B4E453C4B5CBA2DD08E2224624C"><enum>(3)</enum><header>Qualified new
mortgage</header><text display-inline="yes-display-inline">For purposes of this
section, the term <quote>qualified new mortgage</quote> means a mortgage that
meets the following requirements:</text>
<subparagraph id="H977F085FD12B4B54AB3B419226B331AB"><enum>(A)</enum><header>Terms</header><text>The
mortgage meets the requirements under subparagraphs (A), (B), (D), and (E) of
paragraph (2).</text>
</subparagraph><subparagraph id="H874A73B3EA79414D93D63F9E328583C9"><enum>(B)</enum><header>Home
purchase</header><text>The principal loan amount repayment of which is secured
by the mortgage shall be used to purchase the property that is subject to the
qualified new mortgage.</text>
</subparagraph><subparagraph id="HD1157108ABF347D094FAB4A5EC6908BE"><enum>(C)</enum><header>New
mortgages</header><text>The mortgage was originated on or after the date of the
enactment of this Act.</text>
</subparagraph></paragraph></subsection><subsection id="H82259F27B60E4DFE81F993D59986D01"><enum>(d)</enum><header>Exceptions to
underwriting standards</header><text>Each enterprise shall establish such
exceptions to the underwriting standards of the enterprise, including
downpayment and credit rating standards, that conform to the underwriting
standards established pursuant to subsection (c)(2)(E), as may be necessary to
allow the enterprise to purchase and securitize qualified refinancing mortgages
and qualified new mortgages under this section, in accordance with such
requirements as the Director shall establish.</text>
</subsection><subsection id="H9880B0B39D2442A3A8A4047000C32918"><enum>(e)</enum><header>Securitization</header>
<paragraph id="HDEA3C29942A549C38F5400F73110AC88"><enum>(1)</enum><header>Requirement</header><text display-inline="yes-display-inline">Each enterprise shall, upon such terms and
conditions as it may prescribe, set aside any qualified mortgages purchased by
it under this section and, upon approval of the Secretary of the Treasury,
issue and sell securities based upon such mortgages set aside.</text>
</paragraph><paragraph id="HE30E8C002E1F4D90912175CDA9CC2F5F"><enum>(2)</enum><header>Form</header><text>Securities
issued under this subsection may be in the form of debt obligations or trust
certificates of beneficial interest, or both.</text>
</paragraph><paragraph id="H877017E57A174B998597D8EB37DF8442"><enum>(3)</enum><header>Terms</header><text>Securities
issued under this subsection shall have such maturities and bear such rate or
rates of interest as may be determined by the enterprise with the approval of
the Secretary.</text>
</paragraph><paragraph commented="no" id="HC7310E063695400D8BDA6EE6E42177BD"><enum>(4)</enum><header>Exemption</header><text>Securities
issued by an enterprise under this subsection shall, to the same extent as
securities which are direct obligations of or obligations guaranteed as to
principal and interest by the United States, be deemed to be exempt securities
within the meaning of laws administered by the Securities and Exchange
Commission.</text>
</paragraph><paragraph id="HA150B025E8F64C56B02C41A1E9CBED2C"><enum>(5)</enum><header>Principal and
interest payments</header><text>Mortgages set aside pursuant to this
subsection shall at all times be adequate to enable the issuing enterprise to
make timely principal and interest payments on the securities issued and sold
pursuant to this subsection.</text>
</paragraph><paragraph commented="no" id="HD9641AFAE81344F99F6768EB5B32DE20"><enum>(6)</enum><header>Required
disclosure</header><text>Each enterprise shall insert appropriate language in
all of the securities issued under this subsection clearly indicating that such
securities, together with the interest thereon, are not guaranteed by the
United States and do not constitute a debt or obligation of the United States
or any agency or instrumentality thereof other than the enterprise.</text>
</paragraph></subsection><subsection id="H85F41DB9D89C43C390FD11A79E47D61"><enum>(f)</enum><header>Federal Reserve
financing facility</header><text>The Secretary of the Treasury shall establish
a credit facility of the Federal Reserve System to make credit available to the
enterprises at interest rates comparable to rates on securities issued by the
Secretary of the Treasury under chapter 31 of title 31, United States Code, and
having comparable terms, as determined by the Board.</text>
</subsection><subsection id="H35081167CE6843C4A29F403B636BB422"><enum>(g)</enum><header>Definitions</header><text>For
purposes of this Act, the following definitions shall apply:</text>
<paragraph id="H9A01B93EF7054219B12DBB1872C5C68"><enum>(1)</enum><header>Director</header><text>The
term <quote>Director</quote> means the Director of the Federal Housing Finance
Agency.</text>
</paragraph><paragraph id="H45718C0C50964D4EA5B151CB09FE1FD5"><enum>(2)</enum><header>Enterprise</header><text>The
term <quote>enterprise</quote> means the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation.</text>
</paragraph><paragraph id="HD54BDD6DDCB548D9B7AF2C0015118369"><enum>(3)</enum><header>Secretary</header><text>The
term <quote>Secretary</quote> means the Secretary of the Treasury.</text>
</paragraph></subsection><subsection commented="no" id="H583118B78A36435BB8118D00CE9288DF"><enum>(h)</enum><header>Termination</header><text display-inline="yes-display-inline">The requirement under subsection (b)(1) for
the enterprises to purchase mortgages shall not apply to any mortgage proffered
to an enterprise after December 31, 2010.</text>
</subsection></section><section display-inline="no-display-inline" id="H3AD8650677F346D4A5F5849EC23C33A0" section-type="subsequent-section"><enum>104.</enum><header>HUD action to
increase access to mortgage insurance by State housing finance
agencies</header><text display-inline="no-display-inline">The Secretary of
Housing and Urban Development shall take all necessary actions, in consultation
and coordination with State housing finance agencies, to increase access by
such agencies to mortgage insurance for the purpose of making such insurance
available in connection with mortgages financed by bonds issued by such
agencies pursuant to this Act and the amendments made by this Act.</text>
</section><section id="H378B8E2F87384AA2905156D8FF18E4C"><enum>105.</enum><header>State reports on
use of refinancing bond authority</header><text display-inline="no-display-inline">Not later than the expiration of the 6-month
period beginning upon the date of the enactment of this Act and every six
months thereafter until the refinancing bond authority provided by the
amendments made by title II of this Act has been exhausted, each State using
the refinancing authority provided by the amendments made by section 3021 of
the Housing and Economic Recovery Act of 2008 (Public Law 110–289; 122 Stat.
2892) shall submit a report to the Congress specifying—</text>
<paragraph id="HF4373F3DDD8548D784D8F1610038C2DA"><enum>(1)</enum><text>the amount of the
refinancing bond authority provided for the State under the amendments made by
such section 3021 and title II of this Act that remains;</text>
</paragraph><paragraph id="HF43BCCCAC082478B95292F00FAA37995"><enum>(2)</enum><text>the number of
homes that have been refinanced using such refinancing authority of the State;
and</text>
</paragraph><paragraph id="HA78E8A600FF04713A16B2F876EE7351"><enum>(3)</enum><text>the counties and
municipalities in the State in which homes are located that are subject to
mortgages refinanced using such refinancing authority and the amount of such
authority used with respect to each such county and municipality.</text>
</paragraph></section><enum>II</enum><header>Housing tax
incentives</header>
<section id="H3E241629A6464EFDA85900C7E7B1D464"><enum>201.</enum><header>Temporary
increase in volume cap for housing bonds issued for areas most affected by
foreclosure crisis</header>
<subsection id="H5D9BD7AAA329469EB36540E94DBE6842"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (d) of
section 146 of the Internal Revenue Code of 1986 is amended by adding at the
end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H25B7981EA3064997884D651F31D98406" style="OLC">
<paragraph id="H9802783685CB42DD9075C711E988BFBF"><enum>(6)</enum><header>Increase and set
aside for housing bonds for 2009</header>
<subparagraph id="H94812DF76D3D401699D8F47586AC3694"><enum>(A)</enum><header>Increase of
2009</header><text display-inline="yes-display-inline">In the case of calendar
year 2009, the State ceiling for each foreclosure crisis State shall be
increased by the sum of—</text>
<clause id="HC8E71ABBF85F4581A069742D0028AEF5"><enum>(i)</enum><text>an
amount equal to $10,000,000,000 multiplied by a fraction—</text>
<subclause id="H22E6D40087164BC1AC1FE9EB45756BD2"><enum>(I)</enum><text>the numerator of
which is the number of foreclosures in such State, and</text>
</subclause><subclause id="HC056C08C7F4F4B109FEE741646B6E23E"><enum>(II)</enum><text>the denominator
of which is the aggregate number of foreclosures in all foreclosure crisis
States, plus</text>
</subclause></clause><clause id="HAF468A83A4B34F53AC6F00BA87E04262"><enum>(ii)</enum><text>an amount equal
to $10,000,000,000 multiplied by a fraction—</text>
<subclause id="H2219166F82D44A82A5F47E48AF0076A0"><enum>(I)</enum><text>the numerator of
which is the number of single family residences in such State with mortgages
that are more than 30 days past due, and</text>
</subclause><subclause id="H00F5C2F68BF84AE080AA9B84C95DBAD4"><enum>(II)</enum><text>the denominator
of which is the aggregate number of single family residences in all foreclosure
crisis States with mortgages that more than 30 days past due.</text>
</subclause></clause></subparagraph><subparagraph id="H8813DFE04DBF4950B68B5218691311B4"><enum>(B)</enum><header>Set
aside</header><text>Any amount of the State ceiling for any foreclosure crisis
State which is attributable to an increase under this paragraph shall be
allocated solely for one or more qualified housing issues (as defined in
paragraph (5)). The State shall ensure that such issues (to the extent
attributable to an increase under this paragraph) are used to finance housing
in the counties and municipalities of the State which experience the highest
number of foreclosures, or have the highest number of residences with mortgages
that are more than 30 days past due, per capita.</text>
</subparagraph><subparagraph id="H80168756E14846F4841846D7F46791BB"><enum>(C)</enum><header>Foreclosure
crisis State</header><text display-inline="yes-display-inline">For purposes of
this paragraph, the term <quote>foreclosure crisis State</quote> means the 10
States determined by the Secretary as having been the most impacted by the
foreclosure crisis. In making such determination the Secretary shall take into
account the rate of foreclosures in the States, the rate of single family
residences in the States with mortgages that are more than 30 days past due,
and such other factors as the Secretary determines
appropriate.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H0E366D82E458438CA58E03265D80C8F0"><enum>(b)</enum><header>Carryforward of
unused limitations</header><text>Paragraph (6) of section 146(f) of the
Internal Revenue Code of 1986 is amended—</text>
<paragraph id="H81F05842D0DD4F69A8E277B7B379E006"><enum>(1)</enum><text>by striking
<quote>subsection (d)(5)</quote> in the text preceding subparagraph (A) and
inserting <quote>paragraph (5) or (6) of subsection (d)</quote>, and</text>
</paragraph><paragraph id="HBF5AD3EDD0614DD787F219CC67DB02AB"><enum>(2)</enum><text>by striking
<quote><header-in-text level="paragraph" style="OLC">increased volume cap under
subsection (d)(5)</header-in-text></quote> in the heading thereof and inserting
<quote><header-in-text level="paragraph" style="OLC">temporary increased volume
cap</header-in-text></quote>.</text>
</paragraph></subsection><subsection id="HB6762CF1F7924C46A60817B1A2BAA314"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to bonds
issued after the date of the enactment of this Act.</text>
</subsection></section><section id="H3F16DD2300E14236A85E5500A226EB0"><enum>202.</enum><header>Extension of
time for using increased volume cap for housing bonds</header>
<subsection id="H64DF19EC0A344F309083BAE2627B9EDC"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subparagraph (B) of
section 146(f)(6) of the Internal Revenue Code of 1986 is amended by striking
<quote>2010</quote> and inserting <quote>2011</quote>.</text>
</subsection><subsection id="HBABE3F8DF0F441C6A89655B42621E5F7"><enum>(b)</enum><header>Report</header><text>Not
later than December 31, 2010, the Secretary of the Treasury shall submit a
written report to Congress regarding whether or not, considering the stability
of the housing markets, the liberalization of the tax-exempt housing bond rules
included in sections 146(d)(5), 146(d)(6), and 143(k)(12) of the Internal
Revenue Code of 1986 should be extended beyond December 31, 2011.</text>
</subsection></section><section id="H4382F73C985F47319C33E875C55B4F7C"><enum>203.</enum><header>Expansion of
use of mortgage revenue bonds for mortgage refinancing loans</header>
<subsection id="H5CBE5B3468E946598DEADFAD6808DDC"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subparagraph (C) of
section 143(k)(12) of the Internal Revenue Code of 1986 is amended by striking
<quote>adjustable rate</quote>.</text>
</subsection><subsection id="H7A9896FE37EF49D7937E50EE4BF5B059"><enum>(b)</enum><header>Extension of
program</header><text>Subparagraph (D) of section 143(k)(12) of such Code is
amended by striking <quote>December 31, 2010</quote> and inserting
<quote>December 31, 2011</quote>.</text>
</subsection><subsection id="H73EB13E7EFFE4F498DF4516540EE70E2"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to bonds
issued after the date of the enactment of this Act.</text>
</subsection></section><section id="H333474BDA94F4756B399E89CC0CB0288"><enum>204.</enum><header>Alternative
minimum tax limitations not applicable to refinancings of tax-exempt housing
bonds</header>
<subsection id="HA20B33D3518043D6AFA0783C46632D92"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Clause (iii) of
section 57(a)(5)(C) of the Internal Revenue Code of 1986 is amended by striking
the last sentence thereof.</text>
</subsection><subsection id="H1929D885668B4E7ABBCDB780E1FABDEF"><enum>(b)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendment made by
this section shall apply to refunding bonds issued after the date of the
enactment of this Act.</text>
</subsection></section><section id="H57065D075CD349F29001005FF9400053"><enum>205.</enum><header>Clarification
of applicability to high foreclosure impact areas</header>
<subsection id="H4E0C96455865407293BECF3537D3BC43"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (j) of
section 143 of the Internal Revenue Code of 1986 is amended—</text>
<paragraph id="H329F84E832BA41B08FF931D3512D8D7E"><enum>(1)</enum><text>in paragraph
(1)—</text>
<subparagraph id="H7BF122EE1CFC44A282815030DE2FA146"><enum>(A)</enum><text>in subparagraph
(A), by striking <quote>or</quote>,</text>
</subparagraph><subparagraph id="H1E6202886ACE4EB4A67C23E3867144A7"><enum>(B)</enum><text>in subparagraph
(B), by striking the period at the end and inserting <quote>, or</quote>,
and</text>
</subparagraph><subparagraph id="H0A0847FDE39B42AF9F45BFC1AFCD02C9"><enum>(C)</enum><text>by adding at the
end the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="HA4A39247A8154558AD426860886500A7" style="OLC">
<subparagraph id="HE96F338C125846E58706CDD8D0AADCD"><enum>(C)</enum><text display-inline="yes-display-inline">a high foreclosure
area.</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="H64A5C056CC884D18A8A9ABD02B3FE39D"><enum>(2)</enum><text>by adding at the
end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H6D51444D8C5D4C10A208896B1CBB394B" style="OLC">
<paragraph id="HC2B30159A7F94BD6B5073069C9B28300"><enum>(4)</enum><header>High foreclosure
area</header>
<subparagraph id="HED944D7C6C40490EB45E069D47BDC8A"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">For purposes of
paragraph (1), the term <quote>high foreclosure area</quote> means an area for
which the rate of—</text>
<clause id="HB5A6EF0D4D63451ABD44D586A59068D7"><enum>(i)</enum><text>foreclosures on
mortgages on residences occurring during the preceding 12 months, and</text>
</clause><clause id="H312B5DB92F8640B88BCF5EF2F36BD300"><enum>(ii)</enum><text display-inline="yes-display-inline">notices provided to mortgagors during the
preceding calendar quarter, specifying that payment of amounts due under a
mortgage on a residence is at least 30 days past due,</text>
</clause><continuation-text continuation-text-level="subparagraph">exceeds
150 percent of the national rate.</continuation-text></subparagraph><subparagraph id="H875F1586EAF04050AC00B1C68BCA9893"><enum>(B)</enum><header>Date
used</header><text>The determination under subparagraph (A) shall be made on
the basis of the best data available to a State on a quarterly
basis.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="HDF391A8BF7F645E288D4E4ECDA1FAE5"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to bonds
issued after the date of the enactment of this Act.</text>
</subsection></section>