117 HR 3861 IH: Making FHA Work for Borrowers with Student Debt Act of 2021 U.S. House of Representatives 2021-06-14 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I117th CONGRESS1st SessionH. R. 3861IN THE HOUSE OF REPRESENTATIVESJune 14, 2021Mr. Meeks (for himself and Ms. Williams of Georgia) introduced the following bill; which was referred to the Committee on Financial ServicesA BILLTo amend the National Housing Act to revise the treatment of student loan debt in the underwriting of FHA loans, and for other purposes.

1.

Short title

This Act may be cited as the Making FHA Work for Borrowers with Student Debt Act of 2021.

2.

Treatment of student loan debt being repaid

Section 203 of the National Housing Act (12 U.S.C. 1709) is amended by inserting after subsection (r) the following new subsection:(s)

Treatment of student loan debt being repaid

(1)

In general

In determining eligibility of single-family mortgages, and mortgagors under such mortgages, for insurance under this title, for purposes of any calculation of the amount of liabilities of a mortgagor, or comparison of the amount of such liabilities to the income of the mortgagor, the Secretary shall consider a covered educational liability to be—(A)except as provided in subparagraph (B), in the same monthly amount as the amount that the mortgagor is actually required to pay on a monthly basis in connection with such liability; or(B)in the case of a mortgagor whose required monthly payment under such liability is $0, the amount equal to 0.5 percent of the outstanding balance of the loan in connection with such liability.(2)

Covered educational liability

For purposes of this subsection, the term covered educational liability means a liability—(A)that is a student loan incurred for educational purposes;(B)that is required to be repaid through payments made on a regular basis; and(C)for which documentation has been provided that is sufficient, in the determination of the Secretary, to demonstrate that the liability complies with the requirements under subparagraphs (A) and (B). .