[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3564 Referred in Senate (RFS)]

<DOC>
118th CONGRESS
  1st Session
                                H. R. 3564


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 10, 2023

Received; read twice and referred to the Committee on Banking, Housing, 
                           and Urban Affairs

_______________________________________________________________________

                                 AN ACT


 
To cancel recent changes made by the Federal Housing Finance Agency to 
 the up-front loan level pricing adjustments charged by Fannie Mae and 
  Freddie Mac for guarantee of single-family mortgages, 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 ``Middle Class Borrower Protection Act 
of 2023''.

SEC. 2. REPEAL OF RECALIBRATED SINGLE-FAMILY PRICING FRAMEWORK.

     Not later than the expiration of the 60-day period beginning on 
the date of the enactment of this Act, the Director of the Federal 
Housing Finance Agency shall revise the recalibrated single-family 
pricing framework charged by the enterprises for guarantee of mortgages 
on single-family housing so that such fees are identical to the fees of 
the standard single-family pricing framework in effect immediately 
before May 1, 2023.

SEC. 3. RESTRICTIONS ON FHFA ADJUSTMENTS TO SINGLE-FAMILY PRICING 
              FRAMEWORK.

    (a) Temporary Prohibition on Further Adjustments to Single-family 
Pricing Framework.--During the period beginning upon the date of the 
revision of the recalibrated single-family pricing framework pursuant 
to section 2 and ending 90 days after the submission to the Congress of 
the report required under section 5, the Director may not further 
revise the single-family pricing framework from such framework in 
effect pursuant to the revision required by section 2.
    (b) Administrative Procedures for Adoption of Adjustments to the 
Single-family Pricing Framework.--After expiration of the period 
referred to in subsection (a), when proposing adjustments to the 
single-family pricing framework, the Director shall follow procedures 
that are as close as practicable to those requirements for a Federal 
agency issuing a rule under chapter 5 of title 5, United States Code 
(commonly referred to as the ``Administrative Procedure Act'').
    (c) FHFA Requirement for the Use of Risk-based Pricing.--Section 
1367(b)(2) of the Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992 (12 U.S.C. 4617(b)(2)) is amended by adding at 
the end the following new subparagraph:
                    ``(L) Additional powers as conservator.--The Agency 
                shall, as conservator for an enterprise, to the 
                greatest extent feasible require that any 
                modifications, including increases, decreases, or 
                eliminations, approved to a loan-level pricing 
                adjustment fee, as such term is defined in section 6 of 
                the Middle Class Borrower Protection Act of 2023, 
                charged by an enterprise shall be based on the risk 
                posed by the mortgage loan to the enterprise.''.

SEC. 4. PROHIBITION OF LOAN-LEVEL PRICE ADJUSTMENTS BASED ON DEBT-TO-
              INCOME RATIO.

     The Director and the enterprises shall not impose any loan-level 
pricing adjustment fee that is based on the ratio of the debt of the 
mortgagor to the income of the mortgagor.

SEC. 5. GAO STUDY.

    (a) Study.--The Comptroller General of the United States shall 
conduct a study of the revisions made by the Federal Housing Finance 
Agency to the standard single-family pricing framework under the 
recalibrated single-family pricing framework to--
            (1) analyze--
                    (A) the methodology, policy considerations, and any 
                other objectives used by the Federal Housing Finance 
                Agency as the basis for such revisions, including the 
                authority cited by the Director under the Federal 
                Housing Enterprises Financial Safety and Soundness Act 
                of 1992 (12 U.S.C. 4501 et seq.) to require such 
                revisions;
                    (B) the data, econometric modeling, and other 
                inputs supplied by the enterprises during the revisions 
                process;
                    (C) the extent to which such revisions comply with 
                the objectives of the Enterprise Regulatory Capital 
                Framework, including the interaction with and treatment 
                of any private mortgage insurance required in 
                connection with a residential mortgage transaction; and
                    (D) the economic impact of such revisions on 
                various classes of lenders and borrowers affected by 
                such revisions;
            (2) determine the extent to which such revisions--
                    (A) were conducted on the basis of, and how they 
                might deviate from, the principle of risk-based 
                pricing;
                    (B) deviate from the data, econometric modeling, 
                and other inputs supplied by the enterprises during the 
                revisions process;
                    (C) achieve the objectives of the Enterprise 
                Regulatory Capital Framework, including if such 
                revisions have resulted in either a negative 
                profitability gap or negative rate of return on the 
                targeted rate of return on capital for any business 
                segment under the recalibrated single-family pricing 
                framework;
                    (D) represent any increased risks to the safety and 
                soundness of the enterprises; and
            (3) assess the benefits that would accrue to first-time, 
        low-income homebuyers based on the recalibrated single-family 
        pricing framework taking effect.
            (4) assess the impacts that the recalibrated single-family 
        pricing framework taking effect would have on affordable 
        housing preservation, rural housing, and manufactured housing.
    (b) Report.--The Comptroller General shall submit a report to the 
Congress setting forth the findings and conclusions of the study, and 
make the report publicly available online on a website of the 
Department, not later than the expiration of the 14-month period 
beginning on the date of the enactment of this Act.

SEC. 6. DEFINITIONS.

    In this Act:
            (1) Director.--The term ``Director'' means the Director of 
        the Federal Housing Finance Agency.
            (2) Enterprise.--The term ``enterprise'' has the meaning 
        given such term in section 1303 of the Federal Housing 
        Enterprises Financial Safety and Soundness Act of 1992 (12 
        U.S.C. 4502).
            (3) Loan-level pricing adjustment fee.--The term ``loan-
        level pricing adjustment fee'' means an up-front fee paid by 
        lenders when a mortgage loan is acquired by an enterprise.
            (4) Recalibrated single-family pricing framework.--The term 
        ``recalibrated single-family pricing framework'' means the 
        loan-level pricing adjustment fee structure as referred to in 
        the announcement of the Federal Housing Finance Agency on 
        January 19, 2023, relating to ``Updates to the Enterprises' 
        Single-Family Pricing Framework'', and set forth in Federal 
        National Mortgage Association Lender Letter LL-2023-01 and 
        Federal Home Loan Mortgage Corporation Bulletin 2023-1.
            (5) Risk-based pricing.--The term ``risk-based pricing'' 
        means the calibration of fees based on the expected credit 
        losses to an enterprise of each single-family mortgage category 
        as defined by an enterprise based on the credit score and loan-
        to-value ratio characteristics of a mortgage.
            (6) Standard single-family pricing framework.--The term 
        ``standard single-family pricing framework'' means the loan-
        level pricing adjustment fee structure in effect on April 30, 
        2023.

SEC. 7. ENTERPRISE GUARANTEE FEES.

    Subsection (f) of section 1327 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4547(f)) is 
amended by striking ``October 1, 2032'' and inserting ``October 1, 
2033''.

            Passed the House of Representatives June 23, 2023.

            Attest:

                                             CHERYL L. JOHNSON,

                                                                 Clerk.