[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5301 Introduced in House (IH)]

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114th CONGRESS
  2d Session
                                H. R. 5301

 To exempt small seller financers from certain licensing requirements 
        and debt-to-income requirements for qualified mortgages.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 19, 2016

Mr. Williams (for himself, Mr. Mulvaney, Mr. Rush, Mr. Cuellar, and Mr. 
 Neugebauer) introduced the following bill; which was referred to the 
                    Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
 To exempt small seller financers from certain licensing requirements 
        and debt-to-income requirements for qualified mortgages.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Seller Finance Enhancement Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Real-estate seller financing is a transaction in which 
        the owner of a real estate property provides financing for the 
        buyer of that property and the buyer makes some form of a down 
        payment to the seller and then makes installment payments to 
        the seller over a defined period of time.
            (2) Seller financers provide financing in lieu of the buyer 
        choosing to obtain a loan from a bank.
            (3) The seller finance industry consists of small business 
        owners who own real estate and provide financing on those 
        properties to underserved borrowers who cannot or would prefer 
        not to obtain traditional financing.

SEC. 3. EXEMPTIONS FOR SELLER FINANCERS.

    (a) Loan Originator License or Registration Requirements.--Section 
1504 of the S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 5103) is 
amended by adding at the end the following:
    ``(c) Exception for Seller Financers.--The requirements of this 
title shall not apply to any person (other than a depository 
institution) who--
            ``(1) originates not more than 24 residential mortgage 
        loans in a 12-month period; and
            ``(2) only originates residential mortgage loans that are 
        with respect to property that is owned by such person.''.
    (b) Debt-to-Income Ratios Under Qualified Mortgages.--Section 
129C(b)(2)(A) of the Truth in Lending Act (15 U.S.C. 1639c(b)(2)(A)) is 
amended by inserting at the end the following flush-left text:
                ``In determining whether a residential mortgage loan is 
                a qualified mortgage, guidelines and regulations issued 
                pursuant to clause (vi) shall not apply to a loan 
                originated by a person (other than a depository 
                institution (as defined under section 3 of the Federal 
                Deposit Insurance Act) or a credit union) who 
                originates not more than 24 residential mortgage loans 
                in a 12-month period and only originates residential 
                mortgage loans that are with respect to property that 
                is owned by such person.''.

SEC. 4. REPORT ON SELLER FINANCING.

    (a) Study.--The Secretary of Housing and Urban Development and the 
Secretary of the Treasury shall jointly carry out a study on--
            (1) the number of homes bought for under $150,000 or 60 
        percent of the median home value in a given community, 
        whichever is lower, in the United States by utilizing seller 
        financing;
            (2) the number of homes described under paragraph (1) sold 
        by licensed mortgage brokers;
            (3) the potential number of homes described under paragraph 
        (1) which could be sold but aren't, because seller financiers 
        are unwilling, or from a practical standpoint unable, to comply 
        with mortgage broker rules; and
            (4) the potential benefit to home values and wealth 
        creation if more homes are able to be sold utilizing seller 
        finance.
    (b) Report.--Not later than the end of the 1-year period beginning 
on the date of the enactment of this Act, the Secretary of Housing and 
Urban Development and the Secretary of the Treasury shall jointly issue 
a report to the Committee on Financial Services of the House of 
Representatives and the Committee on Banking, Housing, and Urban 
Affairs of the Senate containing--
            (1) all findings and determinations made in carrying out 
        the study required under subsection (a); and
            (2) data on the number of transactions utilizing seller 
        financing 20 years, 15 years, 10 years, and 5 years prior to 
        the date of the enactment of this Act.
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