[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 2295 Introduced in Senate (IS)]

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118th CONGRESS
  1st Session
                                S. 2295

To establish a program to provide low- and moderate-income first-time, 
 first-generation homebuyers with access to affordable and sustainable 
                      wealth-building home loans.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 13, 2023

 Mr. Warner (for himself, Mr. Kaine, Mr. Warnock, Mr. Ossoff, and Mr. 
  Van Hollen) introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
To establish a program to provide low- and moderate-income first-time, 
 first-generation homebuyers with access to affordable and sustainable 
                      wealth-building home loans.

    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 ``Low-Income First-Time Homebuyers Act 
of 2023'' or the ``LIFT Homebuyers Act of 2023''.

SEC. 2. WEALTH-BUILDING HOME LOAN PROGRAM.

    (a) Establishment of LIFT HOME Funds.--
            (1) In general.--There is established in each Loan 
        Guarantee Agency a fund to be known as the LIFT HOME Fund, into 
        which amounts made available under this section shall be 
        deposited and which shall be used by each Department for 
        carrying out the purposes of this section.
            (2) Management of fund.--The LIFT HOME Fund of each Loan 
        Guarantee Agency shall be administered and managed by the 
        respective Secretary, who shall establish reasonable and 
        prudent criteria for the management and operation of any 
        amounts in the Fund.
    (b) Use of Funds.--
            (1) Transfer of amounts to treasury.--Such portions of the 
        amount made available to the Secretary of Housing and Urban 
        Development under this section shall be transferred by the 
        Secretary of Housing and Urban Development to the Department of 
        the Treasury in an amount equal to, as determined by the 
        Secretary of the Treasury, in consultation with the Secretary 
        of Housing and Urban Development--
                    (A) the amount the Secretary of the Treasury 
                estimates to be necessary for the purchase of 
                securities under the Program during the period for 
                which the funds are intended to be available;
                    (B) the difference between--
                            (i) the Secretary of the Treasury's 
                        receipts from the sale or other disposition of 
                        securities acquired under the Program; and
                            (ii) the Secretary of the Treasury's costs 
                        in purchasing such securities; and
                    (C) the Department of the Treasury's administrative 
                expenses related to the Program.
            (2) Credit subsidy.--Such portion of the amount made 
        available to each Secretary under this section as may be 
        necessary may be used for the cost to the respective Loan 
        Guarantee Agency of guaranteed loans under this section. Such 
        costs, including the costs of modifying such loans, shall be as 
        defined in section 502 of the Congressional Budget Act of 1974 
        (2 U.S.C. 661a).
    (c) Establishment of the LIFT HOME Program.--Each Secretary shall 
establish, and carry out, with respect to any mortgage with a case 
number issued on or before December 31, 2025, that is subsequently 
insured or guaranteed by such Secretary, a program to make covered 
mortgage loans available to eligible homebuyers to purchase a single-
family residence for use as their principal residence (referred to in 
this section as the ``Program''), under which--
            (1) the Secretary of the Treasury--
                    (A) shall act as a purchaser, on behalf of the 
                Secretary of Housing and Urban Development, of 
                securities that are secured by covered mortgage loans;
                    (B) may designate financial institutions, including 
                banks, savings associations, trust companies, security 
                brokers or dealers, asset managers, investment 
                advisers, and other institutions and such institutions 
                shall--
                            (i) perform all reasonable duties related 
                        to this section as a financial agent of the 
                        United States as may be required; and
                            (ii) be paid for such duties using 
                        appropriations available to the Secretary of 
                        the Treasury to reimburse financial 
                        institutions in their capacity as financial 
                        agents of the United States;
                    (C) may use the services of any agency or 
                instrumentality of the United States or component 
                thereof on a reimbursable basis, and any such agency or 
                instrumentality or component thereof is authorized to 
                provide services as requested by the Secretary using 
                all authorities vested in or delegated to that agency, 
                instrumentality, or component;
                    (D) may manage, and exercise any rights received in 
                connection with, any financial instruments or assets 
                purchased or acquired pursuant to the authorities 
                granted under this section;
                    (E) may establish and use vehicles to purchase, 
                hold, and sell financial instruments and other assets; 
                and
                    (F) may issue such regulations and other guidance 
                as may be necessary or appropriate to carry out the 
                authorities or purposes of this section;
            (2) each Secretary of a Loan Guarantee Agency shall--
                    (A) establish pricing terms for covered mortgage 
                loans such that the covered mortgage loans carry a 
                monthly mortgage payment of principal and interest that 
                is not more than 110 percent and not less than 100 
                percent of the monthly payment of principal, interest, 
                and periodic mortgage insurance premium or loan 
                guarantee fee associated with a newly originated 30-
                year mortgage loan with the same loan balance insured 
                or guaranteed by the Loan Guarantee Agency as 
                determined by each Secretary, or such pricing terms as 
                are determined by each Secretary to be necessary to 
                develop liquidity for securities backed by covered 
                mortgage loans and expand Program participation by 
                eligible homebuyers; and
                    (B) establish an outreach and counseling program to 
                increase stakeholder awareness of the Program; and
            (3) the Secretary of Housing and Urban Development shall--
                    (A) in consultation with the Secretary of the 
                Treasury, establish the pricing terms for the purchase 
                of securities guaranteed by the Association secured by 
                covered mortgage loans such that the covered mortgage 
                loans carry a monthly mortgage payment of principal and 
                interest that is not more than 110 percent and not less 
                than 100 percent of the monthly payment of principal, 
                interest, and periodic mortgage insurance premium or 
                loan guarantee fee associated with a newly originated 
                30-year mortgage loan with the same loan balance 
                insured or guaranteed by the Loan Guarantee Agency, or 
                such pricing terms as are determined by the Secretaries 
                to be necessary to develop liquidity for securities 
                backed by covered mortgage loans and expand Program 
                participation by eligible homebuyers;
                    (B) have the authority to designate mortgage 
                bankers, financial institutions, including banks, 
                savings associations, trust companies, security brokers 
                or dealers, asset managers, investment advisers, and 
                other institutions and such institutions shall--
                            (i) perform all reasonable duties related 
                        to this section as an agent of the United 
                        States as may be required; and
                            (ii) be paid for such duties using 
                        appropriations available under this section to 
                        the Secretary of Housing and Urban Development 
                        to reimburse these entities in their capacity 
                        as agents of the United States;
                    (C) have the authority to use the services of any 
                agency or instrumentality of the United States or 
                component thereof on a reimbursable basis, and any such 
                agency or instrumentality or component thereof is 
                authorized to provide services as requested by the 
                Secretary of Housing and Urban Development using all 
                authorities vested in or delegated to that agency, 
                instrumentality, or component;
                    (D) operate the Program in coordination with the 
                Association, the Federal Housing Administration, the 
                Rural Housing Service, and the Secretary of the 
                Treasury so as to demonstrate feasibility and 
                workability to market participants, including--
                            (i) originators and servicers of mortgages;
                            (ii) issuers of mortgage-backed securities; 
                        and
                            (iii) investors; and
                    (E) gain price discovery experience by instructing 
                the Secretary of the Treasury, following consultation 
                with the Secretary of the Treasury to sell acquired 
                securities described in subparagraph (A) as soon as 
                practicable, thereby hastening the development of 
                liquidity for securities backed by covered mortgage 
                loans.
            (4) GNMA guarantee authority.--To carry out the purposes of 
        this section, the Association may enter into new commitments to 
        issue guarantees of securities based on or backed by mortgages 
        insured under this section.
            (5) GNMA guaranty fee.--To carry out the purposes of this 
        section, the Association may collect guaranty fees consistent 
        with section 306(g)(1) of the National Housing Act (12 U.S.C. 
        1721(g)(1)) that are paid at securitization.
    (d) Definitions.--In this section:
            (1) Association.--The term ``Association'' means the 
        Government National Mortgage Association.
            (2) Covered mortgage loan.--
                    (A) In general.--The term ``covered mortgage loan'' 
                means, for purposes of the Program established by the 
                Secretary of Housing and Urban Development, a mortgage 
                loan that--
                            (i) is insured or guaranteed by the Federal 
                        Housing Administration pursuant to section 
                        203(b) of the National Housing Act (12 U.S.C. 
                        1709(b)), subject to the eligibility criteria 
                        set forth in this subsection, and has a case 
                        number issued on or before December 31, 2025;
                            (ii) is made for an original term of 20 
                        years or for an original term determined by the 
                        Secretary to be necessary to develop liquidity 
                        for securities backed by covered mortgage loans 
                        and expand Program participation by eligible 
                        homebuyers;
                            (iii) subject to subparagraph (C) of this 
                        paragraph and notwithstanding section 
                        203(b)(2)(C) of the National Housing Act (12 
                        U.S.C. 1709(b)(2)(C)), has a mortgage insurance 
                        premium of not more than 4 percent of the loan 
                        balance that is paid at closing, financed into 
                        the principal balance of the loan, paid through 
                        an annual premium, or a combination thereof;
                            (iv) involves a rate of interest that is 
                        fixed over the term of the mortgage loan; and
                            (v) is secured by a single-family residence 
                        that is the principal residence of an eligible 
                        homebuyer.
                    (B) The term ``covered mortgage loan'' means, for 
                purposes of the Program established by the Secretary of 
                Agriculture, a loan guaranteed under section 502(h) of 
                the Housing Act of 1949 (42 U.S.C. 1472(h)) that--
                            (i) notwithstanding section 502(h)(7)(A) of 
                        the Housing Act of 1949 (42 U.S.C. 
                        1472(h)(7)(A)), is made for an original term of 
                        20 years or for an original term determined by 
                        the Secretary to be necessary to develop 
                        liquidity for securities backed by covered 
                        mortgage loans and expand Program participation 
                        by eligible homebuyers; and
                            (ii) subject to subparagraph (C) of this 
                        paragraph and notwithstanding section 
                        502(h)(8)(A) of the Housing Act of 1949 (42 
                        U.S.C. 1472(h)(8)(A)), has a loan guarantee fee 
                        of not more than 4 percent of the principal 
                        obligation of the loan.
                    (C) Waiver of mortgage insurance premium 
                requirement.--Each Secretary, in consultation with the 
                Secretary of the Treasury, and notwithstanding section 
                502(h)(8)(A) of the Housing Act of 1949 (42 U.S.C. 
                1472(h)(8)(A)) for purposes of the Program established 
                by the Secretary of Agriculture, may waive the mortgage 
                insurance premium cap or loan guarantee fee cap under 
                subparagraphs (A)(iii) and (B)(ii) with respect to 
                covered mortgage loans insured or guaranteed by the 
                Loan Guarantee Agency of which that Secretary is the 
                head if necessary to protect the solvency of the 
                associated insurance fund.
            (3) Department.--Unless otherwise specified, the term 
        ``Department'' means the Department of Housing and Urban 
        Development or the Department of Agriculture, as appropriate.
            (4) Eligible homebuyer.--The term ``eligible homebuyer'' 
        means an individual who--
                    (A) for purposes of the Program established by the 
                Secretary of Housing and Urban Development--
                            (i) has an annual household income that is 
                        less than or equal to--
                                    (I) 120 percent of median income 
                                for the area, as determined by the 
                                Secretary of Housing and Urban 
                                Development for--
                                            (aa) the area in which the 
                                        home to be acquired using such 
                                        assistance is located; or
                                            (bb) the area in which the 
                                        place of residence of the 
                                        homebuyer is located; or
                                    (II) if the homebuyer is acquiring 
                                an eligible home that is located in a 
                                high-cost area, 140 percent of the 
                                median income, as determined by the 
                                Secretary, for the area within which 
                                the eligible home to be acquired using 
                                assistance provided under this section 
                                is located;
                            (ii) is a first-time homebuyer, as defined 
                        in paragraph (6) of this subsection; and
                            (iii) is a first-generation homebuyer as 
                        defined in paragraph (5) of this subsection;
                    (B) for purposes of the Program established by the 
                Secretary of Agriculture--
                            (i) meets the applicable requirements in 
                        section 502(h) of the Housing Act of 1949 (42 
                        U.S.C. 1472(h)); and
                            (ii) is a first-time homebuyer as defined 
                        in paragraph (6) of this subsection and a 
                        first-generation homebuyer as defined in 
                        paragraph (5) of this subsection.
            (5) First-generation homebuyer.--The term ``first-
        generation homebuyer'' means a homebuyer that, as attested by 
        the homebuyer, is--
                    (A) an individual--
                            (i) whose living parents or legal guardians 
                        do not, to the best of the individual's 
                        knowledge, have any present fee simple 
                        ownership interest in a principal residence in 
                        any State, excluding ownership of heir 
                        property;
                            (ii) if no parents or legal guardians are 
                        living upon acquisition of the eligible home to 
                        be acquired using such assistance, to the best 
                        of the individual's knowledge, whose parents or 
                        legal guardians did not have any ownership 
                        interest in a principal residence in any State 
                        at the time of their death, excluding ownership 
                        of heir property; and
                            (iii) whose spouse, or domestic partner has 
                        not, during the 3-year period ending upon 
                        acquisition of the eligible home to be acquired 
                        using such assistance, had any present 
                        ownership interest in a principal residence in 
                        any State, excluding ownership of heir 
                        property, whether the individual is a co-
                        borrower on the loan or not; or
                    (B) an individual who has at any time been placed 
                in foster care or institutional care whose spouse or 
                domestic partner has not, during the 3-year period 
                ending upon acquisition of the eligible home to be 
                acquired using such assistance, had any ownership 
                interest in a principal residence in any State, 
                excluding ownership of heir property, whether such 
                individuals are co-borrowers on the loan or not.
            (6) First-time homebuyer.--The term ``first-time 
        homebuyer'' means a homebuyer as defined in section 104 of the 
        Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 
        12704), except that ownership of heir property shall not be 
        treated as owning a home for purposes of determining whether a 
        borrower qualifies as a first-time homebuyer.
            (7) Heir property.--The term ``heir property'' means 
        residential property for which title passed by operation of law 
        through intestacy and is held by 2 or more heirs as tenants in 
        common.
            (8) Loan guarantee agency.--Unless otherwise specified, the 
        term ``Loan Guarantee Agency'' means the Federal Housing 
        Administration of the Department of Housing and Urban 
        Development or the Rural Housing Service of the Department of 
        Agriculture, as appropriate.
            (9) Secretary.--Unless otherwise specified, the term 
        ``Secretary'' means the Secretary of Housing and Urban 
        Development or the Secretary of Agriculture, as appropriate.
    (e) Reliance on Borrower Attestations.--No additional documentation 
beyond the borrower's attestation shall be required to demonstrate 
eligibility under paragraph (4) of subsection (d) and no State, 
eligible entity, or creditor shall be subject to liability, including 
monetary penalties or requirements to indemnify a Federal agency or 
repurchase a loan that has been sold or securitized, based on the 
provision of assistance under this section to a borrower who does not 
meet the eligibility requirements under paragraph (4) of subsection (d) 
if the creditor does so in good faith reliance on borrower attestations 
of eligibility required under such paragraph.
    (f) Implementation.--The Secretary of Housing and Urban 
Development, the Secretary of Agriculture, and the Secretary of the 
Treasury shall have authority to issue such regulations or other 
notices, guidance, forms, instructions, and publications as may be 
necessary or appropriate to carry out the programs, projects, or 
activities authorized under this section, including to ensure that such 
programs, projects, or activities are completed in a timely and 
effective manner.
    (g) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary of Housing and Urban Development and the 
Secretary of Agriculture such sums as may be necessary to carry out the 
LIFT HOME Program.
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