[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 4260 Introduced in Senate (IS)]

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116th CONGRESS
  2d Session
                                S. 4260

 To promote access to mortgage credit during the COVID-19 pandemic by 
preventing restrictions on providing Federal backing for single-family 
         mortgage loans in forbearance, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 22, 2020

 Mr. Menendez introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
 To promote access to mortgage credit during the COVID-19 pandemic by 
preventing restrictions on providing Federal backing for single-family 
         mortgage loans in forbearance, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Promoting Access to Credit for 
Homebuyers Act of 2020''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Covered period.--The term ``covered period'' means, 
        with respect to a Federally backed mortgage loan, the period of 
        time during which the borrower under the loan may request 
        forbearance on the loan under section 4022(b) of the CARES Act 
        (15 U.S.C. 9056(b)).
            (2) COVID-19 emergency.--The term ``COVID-19 emergency'' 
        has the meaning given the term in section 4022 of the CARES Act 
        (15 U.S.C. 9056).
            (3) Director.--The term ``Director'' means the Director of 
        the Federal Housing Finance Agency.
            (4) Enterprise.--The term ``enterprise'' has the meaning 
        given the term in section 1303 of the Housing and Community 
        Development Act of 1992 (12 U.S.C. 4502).
            (5) Federally backed mortgage loan.--The term ``Federally 
        backed mortgage loan'' has the meaning given the term in 
        section 4022 of the CARES Act (15 U.S.C. 9056).

SEC. 3. FANNIE MAE AND FREDDIE MAC.

    (a) Purchase Requirements.--During the period beginning on the date 
that is 5 days after the date of enactment of this Act and ending on 
the date that is 60 days after the end of the covered period with 
respect to the mortgage, notwithstanding any other provision of law, an 
enterprise may not refuse to purchase any single-family mortgage 
originated on or after February 1, 2020, that otherwise would have been 
eligible for purchase by such enterprise, solely due to the fact that 
the borrower has, for the borrower's previous mortgage or on the 
mortgage being purchased--
            (1) entered into forbearance as a result of a financial 
        hardship due, directly or indirectly, to the COVID-19 
        emergency;
            (2) requested forbearance as a result of a financial 
        hardship due, directly or indirectly, to the COVID-19 
        emergency; or
            (3) inquired as to options related to forbearance as a 
        result of a financial hardship due, directly or indirectly, to 
        the COVID-19 emergency.
    (b) Prohibition on Restrictions.--With respect to purchase of 
single-family mortgages described in subsection (a) and specified in 
any of paragraphs (1) through (3) of such subsection, an enterprise may 
not--
            (1) establish additional restrictions that are not 
        applicable to similarly situated mortgages under which the 
        borrower is not in forbearance;
            (2) charge a higher guarantee fee (within the meaning 
        provided the term in section 1327 of the Housing and Community 
        Development Act of 1992 (12 U.S.C. 4547)), or loan level 
        pricing adjustment, or otherwise alter pricing for those 
        mortgages, relative to similarly situated mortgages under which 
        the borrower is not in forbearance;
            (3) apply repurchase requirements to those mortgages that 
        are more restrictive than repurchase requirements applicable to 
        similarly situated mortgages under which the borrower is not in 
        forbearance; or
            (4) require lender indemnification of those mortgages, 
        solely due to the fact that the borrower is in forbearance.
    (c) Fraud Detection.--
            (1) In general.--Nothing in this section may be construed 
        to prevent an enterprise from conducting oversight and review 
        of single-family mortgages purchased when a borrower is in 
        forbearance on the borrower's previous mortgage, or on the 
        mortgage being purchased, for purposes of detecting fraud.
            (2) Requirement to report.--An enterprise shall report any 
        fraud detected as described in paragraph (1) to the Director.
    (d) Enterprise Capital.--During the period beginning on the date 
that is 5 days after the date of enactment of this Act and ending on 
the date that is 60 days after the end of the covered period with 
respect to the mortgage, notwithstanding any other provision of law, a 
forbearance on the mortgage shall not be considered to be a delinquency 
under the mortgage for purposes of calculating capital of an enterprise 
for any purpose under title XIII of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4501 et seq.).
    (e) Rules of Construction.--
            (1) Purchase parameters.--Nothing in this section may be 
        construed to require an enterprise to purchase single-family 
        mortgages that do not meet existing or amended purchase 
        parameters, other than parameters related to borrower 
        forbearance, established by the enterprise.
            (2) Employment; income.--Nothing in this section may be 
        construed to prevent an enterprise from establishing additional 
        requirements to ensure that a borrower has not lost their job 
        or income prior to a mortgage closing.
    (f) Implementation.--The Director may issue any guidance, orders, 
and regulations necessary to carry out this section.

SEC. 4. FHA.

    (a) Prohibition on Restrictions.--During the period beginning on 
the date that is 5 days after the date of enactment of this Act and 
ending on the date that is 60 days after the end of the covered period 
with respect to the mortgage, notwithstanding any other provision of 
law, the Secretary of Housing and Urban Development may not deny the 
provision of mortgage insurance for a single-family mortgage originated 
on or after February 1, 2020, may not implement additional premiums or 
otherwise alter pricing for such a mortgage, may not require mortgagee 
indemnification, and may not establish additional restrictions on such 
a mortgagor, solely due to the fact that the borrower has--
            (1) entered into forbearance as a result of a financial 
        hardship due, directly or indirectly, to the COVID-19 
        emergency;
            (2) requested forbearance as a result of a financial 
        hardship due, directly or indirectly, to the COVID-19 
        emergency; or
            (3) inquired as to options related to forbearance as a 
        result of a financial hardship due, directly or indirectly, to 
        the COVID-19 emergency.
    (b) Rules of Construction.--
            (1) Insurance.--Nothing in this section may be construed to 
        require the Secretary of Housing and Urban Development to 
        provide insurance on single-family mortgages that do not meet 
        existing or amended insurance parameters, other than parameters 
        related to borrower forbearance, established by the Secretary 
        of Housing and Urban Development.
            (2) Employment; income.--Nothing in this section may be 
        construed to prevent the Secretary of Housing and Urban 
        Development from establishing additional requirements regarding 
        insurance on single-family mortgages to ensure that a borrower 
        has not lost their job or income prior to a mortgage closing.

SEC. 5. REPORTING REQUIREMENTS.

    (a) FHFA Actions.--During the COVID-19 emergency, the Director may 
not increase guarantee fees, loan level pricing adjustments, or any 
other fees or implement any restrictions on access to credit unless the 
Director provides 48-hour advance notice of such increase or 
restrictions to the Committee on Banking, Housing, and Urban Affairs of 
the Senate and the Committee on Financial Services of the House of 
Representatives together with a detailed report of the policy rationale 
for the decision, including any and all data considered in making such 
decision.
    (b) Quarterly Reports by Enterprises and FHA.--
            (1) Requirement.--Each enterprise and the Secretary of 
        Housing and Urban Development, with respect to the mortgage 
        insurance programs of the Federal Housing Administration, shall 
        provide reports to the Congress, and make such reports publicly 
        available, not less frequently than quarterly regarding the 
        impact of COVID-19 pandemic on the such enterprises' and 
        program's ability to meet their charter requirements, civil 
        rights responsibilities, mandates under the CARES Act (Public 
        Law 116-136), and other laws enacted in response to the COVID-
        19 pandemic, and other requirements under law.
            (2) Deadlines.--The first report required under paragraph 
        (1) shall be submitted not later than 3 months after the date 
        of enactment of this Act and the requirement under paragraph 
        (1) to submit those reports shall terminate on the date that is 
        2 years after the date on which the COVID-19 emergency 
        terminates.
            (3) Content.--Each report required under paragraph (1) 
        shall include the following information for the most recent 
        quarter for which data is available:
                    (A) Enterprises.--For each report required by an 
                enterprise:
                            (i) The number of single-family and multi-
                        family residential mortgage loans purchased by 
                        the enterprise and the unpaid principal balance 
                        of those mortgage loans purchased, 
                        disaggregated by--
                                    (I) mortgage loans made to low- and 
                                moderate-income borrowers;
                                    (II) mortgage loans made for 
                                properties in low- and moderate-income 
                                census tracts; and
                                    (III) mortgage loans made for 
                                properties in central cities, rural 
                                areas, and underserved areas.
                            (ii) In the single-family residential 
                        mortgage market--
                                    (I) the total number, unpaid 
                                principal balance, and length of 
                                forbearances provided to borrowers, 
                                including whether or not the 
                                forbearance was requested by the 
                                borrower;
                                    (II) a detailed breakdown of the 
                                loan modifications offered to borrowers 
                                and whether the borrowers accepted the 
                                offer, including the total number and 
                                unpaid principal balance of loan 
                                modifications ultimately made to 
                                borrowers;
                                    (III) a detailed breakdown of the 
                                home retention options offered to 
                                borrowers and whether the borrowers 
                                accepted the offer, including the total 
                                number and unpaid principal balance of 
                                other home retention options ultimately 
                                made to borrowers; and
                                    (IV) the total number of outcomes 
                                that included short-sales, deed-in-lieu 
                                of foreclosure, and foreclosure sales.
                            (iii) A description of any efforts by the 
                        enterprise to provide assistance and support to 
                        consumers who are not proficient in English.
                            (iv) A description of any other efforts by 
                        the enterprise to provide assistance to low- 
                        and moderate-income communities, central 
                        cities, rural areas, and other underserved 
                        areas, such as financial literacy and education 
                        or support of fair housing and housing 
                        counseling agencies.
                            (v) A description of any other assistance 
                        provided by the enterprise to consumers in 
                        response to the COVID-19 pandemic.
                    (B) FHA.--For each report required with respect to 
                the mortgage insurance programs of the Federal Housing 
                Administration:
                            (i) The number and unpaid principal balance 
                        for all residential mortgage loans, 
                        disaggregated by type, insured under those 
                        programs.
                            (ii) The total number, unpaid principal 
                        balance, and length of forbearances provided to 
                        borrowers, including whether or not the 
                        forbearance was requested by the borrower.
                            (iii) A detailed breakdown of the loan 
                        modifications offered to borrowers and whether 
                        the borrowers accepted the offer, including the 
                        total number and unpaid principal balance of 
                        loan modifications ultimately made to 
                        borrowers.
                            (iv) A detailed breakdown of the home 
                        retention options offered to borrowers and 
                        whether the borrowers accepted the offer, 
                        including the total number and unpaid principal 
                        balance of other home retention options 
                        ultimately made to borrowers.
                            (v) A description of any efforts under 
                        those programs to provide assistance and 
                        support to consumers who are not proficient in 
                        English.
                            (vi) A description of any other efforts 
                        under those programs to provide assistance to 
                        low- and moderate-income communities, central 
                        cities, rural areas, and other underserved 
                        areas, such as financial literacy and education 
                        or support of fair housing and housing 
                        counseling agencies.
                            (vii) A description of any other assistance 
                        provided under those programs to consumers in 
                        response to the COVID-19 pandemic.
                    (C) Provisions to be included in all reports.--Each 
                report required under paragraph (1) shall include, to 
                the degree reasonably possible, the following 
                information:
                            (i) An analysis of all loan level data 
                        required by subparagraphs (A) and (B) 
                        disaggregated by race, national origin, gender, 
                        disability status, whether or not the borrower 
                        seeking or obtaining assistance speaks English 
                        as a second language, the preferred language of 
                        the borrower, debt-to-income level of the 
                        borrower, loan-to-value ratio of the loan, and 
                        credit score of the borrower.
                            (ii) A geographical analysis at the census 
                        tract level, but if information is not 
                        available at the census tract level for any of 
                        the items required by subparagraphs (A) and 
                        (B), the geographical analysis shall be 
                        provided at the zip code level for the item for 
                        which a census tract analysis was not possible.
                            (iii) A description of any policy changes 
                        made by the enterprise or Secretary of Housing 
                        and Urban Development, as appropriate, in 
                        response to the COVID-19 pandemic and analysis 
                        of actions taken to ensure that those policy 
                        changes were in compliance with all relevant 
                        civil rights responsibilities, including the 
                        Fair Housing Act (42 U.S.C. 3601 et seq.), 
                        including the Affirmatively Furthering Fair 
                        Housing provision, the Equal Credit Opportunity 
                        Act (15 U.S.C. 1691 et seq.), the Community 
                        Reinvestment Act of 1977 (12 U.S.C. 2901 et 
                        seq.), the Federal Housing Enterprises 
                        Financial Safety and Soundness Act of 1992 (12 
                        U.S.C. 4501 et seq.), the Housing and Economic 
                        Recovery Act of 2008 (Public Law 110-289; 122 
                        Stat. 2654), the Federal Home Loan Bank Act (12 
                        U.S.C. 1421 et seq.), Executive Orders 11063 
                        and 12892, the Federal National Mortgage 
                        Association Charter Act (12 U.S.C. 1716 et 
                        seq.), and the Federal Home Loan Mortgage 
                        Corporation Act (12 U.S.C. 1451 et seq.).
    (c) Report by GAO.--Not later than 120 days after the date on which 
the COVID-19 emergency terminates, the Comptroller General of the 
United States shall submit to Congress and make publicly available a 
report on--
            (1) the extent to which the enterprises and the mortgage 
        insurance programs of the Federal Housing Administration 
        provided loan products, forbearances, loan modifications, and 
        COVID-19-related assistance to consumers;
            (2) the availability and type of any such assistance 
        provided post-forbearance; and
            (3) the overall ability of the enterprises and the mortgage 
        insurance programs to successfully meet their charter 
        requirements, civil rights responsibilities, and other 
        requirements under law.
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