Congressional Record, Volume 153 Issue 138 (Tuesday, September 18, 2007)

[Congressional Record Volume 153, Number 138 (Tuesday, September 18, 2007)]
[House]
[Pages H10447-H10481]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

EXPANDING AMERICAN HOMEOWNERSHIP ACT OF 2007

The SPEAKER pro tempore. Pursuant to House Resolution 650 and rule
XVIII, the Chair declares the House in the Committee of the Whole House
on the state of the Union for the consideration of the bill, H.R. 1852.

{time} 1147

In the Committee of the Whole

Accordingly, the House resolved itself into the Committee of the
Whole House on the state of the Union for the consideration of the bill
(H.R. 1852) to modernize and update the National Housing Act and enable
the Federal Housing Administration to use risk-based pricing to more
effectively reach underserved borrowers, and for other purposes, with
Mrs. Jones of Ohio in the chair.
The Clerk read the title of the bill.
The CHAIRMAN. Pursuant to the rule, the bill is considered read the
first time.
The gentlewoman from California (Ms. Waters) and the gentlewoman from
Illinois (Mrs. Biggert) each will control 30 minutes.
The Chair recognizes the gentlewoman from California.
Ms. WATERS. Madam Chairman, I yield myself such time as I may
consume.
I rise in support of H.R. 1852, the Expanded American Homeownership
Act of 2007. As you know, I introduced H.R. 1852 on March 29, 2007, and
I want to take this time to thank Chairman Frank for his original
cosponsorship. I also want to acknowledge each of my colleagues both on
the Committee on Financial Services and in the House who have joined
with me to see that this important legislation passes the House.
It has been a little over 4 months since the Committee on Financial
Services considered this measure to revitalize the Federal Housing
Administration, or FHA. On May 3, 2007, the

[[Page H10448]]

Expanding American Homeownership Act passed the Committee on Financial
Services by a vote of 45-19.
The ensuing period has only made the need to enact H.R. 1852 clearer.
We are all aware of the turmoil in the mortgage markets with the
dramatic rise in foreclosures. Some predict as many as 2 million
mortgage loan defaults by year's end. Equally troubling is the widening
impact that the mortgage crisis is having within the domestic and
global economy. We still don't know the full scope of that impact, but
it is clear that we must take prudent steps to address the underlying
issues in the housing markets.
H.R. 1852 is a necessary step in that direction. To be clear, this
legislation will not by itself resolve the crisis. Indeed, later this
week the Committee on Financial Services will hold a hearing to discuss
the major players in government and the markets' other strategies to
address this multi-faceted problem.
Revitalizing FHA, however, is an essential element of a comprehensive
strategy. FHA is a federally insured loan program that for over 60
years has been a reliable source of affordable fixed-rate mortgage
loans, especially for first-time home buyers.
At the end of funding year 2006, FHA had $338.6 billion of insurance
in force on about 3.9 million loans. From 1934 through the end of
funding year 2006, FHA had insured about $33.9 million home loans at a
mortgage volume of about $1.9 trillion.
Once the preeminent provider of mortgage insurance to low- and
moderate-income home buyers, FHA has seen a precipitous drop in its
market share in recent years. In 1991, FHA loans accounted for about 11
percent of the market. By 2004, that share had dropped to about 3
percent.
Borrowers have increasingly turned to the private subprime market for
loans, many of which contained adjustable rates that are now resetting,
or will do so in the near future. In the absence of significant
appreciation in the values of their homes, many of these borrowers will
be unable to refinance to ensure affordable monthly payments into the
future.
H.R. 1852 will enable FHA to serve more subprime borrowers at
affordable rates and terms, recapture borrowers that have turned to
problematic subprime loans in recent years, and offer refinancing loan
opportunities to borrowers struggling to meet their mortgage payments
in the midst of the current home price and mortgage market turbulence.
Specifically, this bill would authorize zero and lower down payment
loans for borrowers that can afford mortgage payments but lack the cash
for required down payment, a major reason that many low-income
borrowers turn to private subprime markets rather than FHA-insured
loans. It will increase loan limits to make FHA relevant in high-cost
markets, direct FHA to provide mortgage loans to high-risk, but
qualified, buyers; it will enhance the FHA reverse mortgage loan
program, promote the sale of foreclosed FHA rental housing, loans to
localities so that affordable housing can be maintained in local
communities, authorize up to $300 million a year for the next 5 fiscal
years from the bill's excess profits for an affordable housing fund
instead of returning such funds to the general treasury.
Notably, H.R. 1852 also includes a number of important changes to the
FHA bill that passed the House last year. First, it eliminates the fee
increases from last year's bill for borrowers that continue to make a
down payment, scaling back the maximum upfront fee from 3 percent to
2.5, and the maximum annual fee from 2 percent to .55 percent.
These reductions would reduce FHA closing costs premiums for a
hypothetical family buying a $300,000 home by $2,250, and annual fees
over a 5-year period by over $20,000 compared to last year's bill.
This bill also includes a provision authorizing loan limit increases
for FHA rental housing loans in high-cost areas where current FHA loans
do not keep pace with local construction costs. In this way we are
ensuring that FHA contributes to the full range of affordable housing
stock we so desperately need in this country, from homeownership to
rental housing.
In that vein, H.R. 1852 also differs from H.R. 1752 in a final,
absolutely critical respect. This bill recognizes the full scope of the
affordable housing crisis facing the Nation by targeting up to $300
million annually for the next 5 years to an affordable housing fund for
grants to provide affordable rental housing and homeownership
opportunities for low-income families.
This measure is clearly needed. We can thank Barney Frank for all of
the work and all of the attention and time that he put into making sure
that this was a part of this bill. Simply put, this country faces an
affordable housing crisis of epic proportions. According to Harvard
University's State of the Nation's Housing in 2007 report, 17 million
renters and homeowners are paying more than half their incomes in
housing costs. There just isn't enough affordable housing stock to go
around.
With that, and in closing, I have said for many years that there is
an affordable housing crisis in America. In recent months that crisis
has exploded beyond the poorest renters and homeowners, to threaten the
domestic economy. H.R. 1852 is a necessary step, though not in itself a
sufficient one, in walking us back from the brink and the direction of
meeting the housing needs of all Americans.
Madam Chairman, I reserve the balance of my time.
Mrs. BIGGERT. Madam Chairman, I yield to the gentleman from Alabama
(Mr. Bachus), the ranking member of the Financial Services Committee,
for 7 minutes.
Mr. BACHUS. Madam Chairman, the Federal Housing Administration, which
we today call FHA, was created in 1934; and it is a very important
source of support for first-time home buyers and for low- and middle-
income borrowers. FHA provides mortgage insurance that protects lenders
against losses when homeowners default on their mortgage obligations,
as many of them are doing today. It also allows the lenders to offer
their customers, American homeowners, low interest rates and low
closing costs.
Since its inception, the FHA has insured nearly 35 million loans.
That makes it the largest insurer of mortgages in the world. FHA's
share of the mortgage market, however, has been steadily declining in
recent years, falling from almost 20 percent 10 years ago, of the total
mortgage market in America, to 5 percent today.
This sharp drop in FHA's market share resulted largely from the
growing popularity of subprime mortgages, as more borrowers opted for
loans featuring zero down payments and introductory teaser rates far
lower than what was available from FHA.
The difficulties we are experiencing today by many subprime borrowers
is as their initial low interest rates reset at a much higher level, it
offers FHA an opportunity to reestablish its standing in the
marketplace as a safe, low-cost alternative for American homeowners. It
is also another reason that we should be here today reforming FHA, to
ensure that that happens.
For that to happen, Congress does need to pass the reforms that we
are considering today. I want to say that right upfront. There are
important reforms in this bill. These same reforms were contained in
legislation that Ranking Member Biggert of the Housing Committee and
myself and others in a bipartisan way introduced in the 109th Congress.
In fact, that legislation, Comprehensive FHA Reform, and that is in
this bill today, and is very good provisions, passed with over 400
votes on the House floor, only to die in the Senate. I am sorry that
happened.
Earlier this year, Congresswoman Biggert and I reintroduced
legislation identical to that legislation. However, and I am sorry to
say that rather than embracing last year's bipartisan approach, the
majority has chosen to go in a different direction. I think they do
that from honest philosophical reasons. We disagree with those reasons.
They have included provisions which we believe will divert surpluses
generated by the FHA program to a new affordable housing fund
established in separate legislation which this House and our committee
passed earlier this year.
While a strong bipartisan consensus exists regarding the need for FHA
reform, the reforms in this bill, the majority is insistent on linking
the enactment of these reforms to the creation of yet a new multi-
billion dollar housing fund has caused many of us on this

[[Page H10449]]

side of the aisle to hesitate from strongly supporting this
legislation.

{time} 1200

I admit, most of our Members are in a quandary. We like the reforms
in this bill. We know that those reforms will go a long way towards
addressing the crisis that we face today, the Affordable Housing Fund.
And we realize at the same time that there is legitimate purpose behind
Chairman Frank's Affordable Housing Fund, and one of those is to offer
affordable low income rental property for Americans. And we understand
that he honestly believes, and we have an honest disagreement as to the
need for this.
We simply believe that a better approach is to dedicate the FHA
surplus to shoring up the financial solvency of the FHA mortgage
program, which was only recently removed from GAO's list of government
programs at high risk for waste, fraud and abuse.
A portion of that surplus could also be returned to beneficiaries of
the program. Who are they? They are the many people who have taken out
FHA-insured reverse mortgages, many of them senior citizens, and we
could do that in the form of lower insurance premiums for all Americans
who have FHA mortgages.
Madam Chairman, the key reforms included in this legislation,
lowering down payment requirements, increasing loan limits and
mortgages that FHA is authorized to ensure, giving FHA more pricing
flexibility, command broad consensus among Republicans, Democrats, the
Bush administration, consumer groups and the industry, the realtors,
the home builders and others. Indeed, in announcing several of these
initiatives last month designed to contain the damage caused by the
problem in subprime, President Bush stressed the critical role that FHA
can play in assisting homeowners facing sharply higher mortgage
payments and possibly foreclosure in reaffirming the administration's
support for the FHA modernization legislation and many of the
provisions contained in this bill.
However, the administration, as have many on our side of the aisle,
also is strongly opposed to using FHA surplus as seed money for an
untested, unrelated government housing program, one that is estimated
to cost $3 billion or more.
Thus, by insisting that this bill carry that controversial provision,
we feel like the majority is delaying, if not jeopardizing, the
enforcement of important reforms that we need now to provide a lifeline
for seeking to refinance out of high cost subprime loans.
Madam Chairman, accordingly, I urge my colleagues to support
Republicans' amendments to strike the extraneous Affordable Housing
Fund provisions opposed by the administration and allow us to move
forward quickly with badly needed and long overdue reforms in the FHA
program. If we are not successful in those amendments, many of the
Members will vote for this underlying legislation, some will not. But,
again, I want to acknowledge the sincerity and the good faith that the
majority has worked throughout this process with the minority; and,
Chairman Waters and Chairman Frank, we very much appreciate that. We
appreciate the many fine provisions in this bill.
Ms. WATERS. I yield to the chairman as much time as he may consume.
Mr. FRANK of Massachusetts. I thank the gentlewoman, the Chair of the
Housing Subcommittee who has worked so hard all year on a number of
very important pieces of legislation. And I appreciate the kind words
of the ranking member. I congratulate him on the newest addition to his
extended family. And he correctly says, there is a lot in this bill
that we agree with; there are some things that we disagree.
Now, the ranking member of the subcommittee, the gentlewoman from
Illinois, the ranking member of the full committee. I should note, the
gentlewoman from Illinois is no longer the ranking member of this
subcommittee, she was recently moved, but she was during the pendency
of this bill. They noted that last year a bill passed the House by 400
to a handful on the FHA, and that is true. And the reason is, that is
the difference between us and them.
Last year, when they were in the majority, they came out with a bill
that had some things in it that we liked, a couple things that we
didn't like, so we were reasonable and conciliatory and voted for it.
And now we are in the majority. And it is an odd argument to say that
the bill that they passed when they were in the majority, having
defeated some of our amendments, somehow now, because we were
conciliatory last year and supported it, we are obligated to do the
same thing.
The principle of deja vu all over again is not to be found in
Jefferson's Manual. It is not binding. We built on what we agreed to
last year and we added some things. Let me talk about where we
disagree.
Oddly, the administration insists that when we do mortgage insurance
for lower income people, we agree, that going forward, and even in fact
in helping in the current crisis, FHA mortgage insurance should be
available for people with weaker credit who are in the subprime
category, now, if they can refinance at a steady rate in the future so
they can go there in the first place.
But what the administration says is this: If you are a woman making
$48,000 a year and your credit isn't great for a variety of reasons and
you get mortgage insurance from the FHA, this administration and the
approach of my Republican colleagues is to charge her more than any
Member of this House would be charged for the same mortgage insurance,
because what they say is, we will extend it to people with weaker
credit, but we will charge them more, because people with weaker credit
are likely to default. It is true people with weaker credit are
likelier to default, but should everybody be penalized financially
because some people with weaker credit will default?
What we say is, if you are in that higher risk category and you go
forward and make your payments on time, you should be refunded that
money after 5 years automatically, 3 years at the discretion of HUD.
So I reject the notion that we should make the person in the lower
credit category who conscientiously makes her payments be the one who
has to bear the cost of a loan loss rate that is higher for people like
her. That is not her fault.
Secondly, we have in here tougher restrictions than last year on the
ability of HUD to raise FHA rates. Members will note, the FHA has been
making a surplus recently, and the administration likes that and they
can use that to put into the general budget so Housing and the FHA
subsidize the rest of the budget. And a couple of times on a fully
bipartisan basis, through the appropriators and through our committee,
we have written to HUD saying, no, don't do that. Don't raise FHA fees
when you are already making a profit.
This bill, in fact, reduces the ability of HUD to raise fees unless
they can document that they are going to go in the red, and that is one
of the differences. If you vote for a substitute, you will be voting
for a weaker set of restrictions on HUD's ability to raise FHA fees.
That is why the home builders and the realtors have generally been
supportive of the approach that we are taking, because we don't want
HUD to have the freedom to raise the fees just to make a surplus for
the rest of the government and make homeowners do that initial surplus.
In addition, by the way, we take the cap off home equity mortgages,
and that is what generates the money. We don't generate the money for
the affordable housing fund here by raising fees on mortgage insurance
in general; in fact, we restrict HUD's ability to do that. We do take
the cap off mortgage insurance. So what we are saying is, there will be
more home equity mortgages granted. And, in fact, we put a restriction
on the fee that can be charged by those who originate them. Not in the
minority's substitute, I believe. And we say that extra money that
comes not from raising anybody's fees but increasing the volume is what
we can use for affordable housing. We also say that you should raise
the limit.
Now, the administration had been opposed to it and they are parading
it some but I believe not enough. We now have a situation in which the
market is telling us that they will not do mortgages if they go above
the FHA-GSE limit. And what this bill does is, A, to raise the limit
based on the regional variation in house prices, but, in addition, says
to the Secretary of HUD: If

[[Page H10450]]

the market freezes up as it now does, you have discretion, the
discretion of the Secretary of HUD, to do a temporary increase in the
limits. And I think that is a reasonable approach.
Finally, the Affordable Housing Trust Fund. Be very clear. Look at
the bill. Not a penny can go to the Affordable Housing Trust Fund under
the legislation before us today until the Secretary of HUD certifies
that the FHA fund is fully solvent. That is, there is no way under this
bill that a penny can go to the Affordable Housing Trust Fund if it
would in any way cause an increase in FHA mortgage insurance or in any
way jeopardize the fund.
The question is, if there is a surplus generated by the mortgage
insurance rates, and remember, we are saying to HUD you can't charge as
much as you want to. So at the lower rate we impose and with the
increase in the volume of home equity mortgages that generates a
surplus, does it go into the Treasury to do as they wish or can we set
it aside for an affordable housing program? And for the first time,
because you do not have now a lot, there are a lot of HUD programs, but
there aren't any now that help build family affordable housing. We have
some for the elderly; HUD tries to cut it. We have some for the
disabled; HUD tries to cut it. We do not have a general program for
helping to build affordable family housing, and that is what this bill
would do. But only if by raising revenue. And, by the way, when we
increased it, there was an odd statement in which they said don't raise
the upper limit, have the program be focused on the lower income
people. They are not competitive.
In fact, raising the upper limit makes money for the FHA. CBO has
told us that when you raise the limit, that is a profit for FHA. In
fact, raising the limit at the top is one of the reasons why we can
avoid charging the people with weaker credit more, which the FHA wants
to do, because we recycle some of that profit that they will make from
right in the upper end into helping offset the higher loan loss rate
from people at the lower end.
So the notion that in any way we are deteriorating our ability to
help the moderate people is just nonsense. It is literal nonsense.
Because raising the upper limit, all it does is provide more funds
which can be used, because the alternative, and again this is in the
Bush administration's approach: Yes, we will extend credit to people
with weaker credit, but we will charge those individuals more than
somebody who is richer even if that individual is making the payment. I
don't think that is appropriate for the Federal Government.
There has been a lot of bipartisan cooperation on this bill. There
were a couple amendments offered. One amendment is jointly offered by
myself and the gentleman from California (Mr. Miller). There are
amendments offered by the gentleman from Ohio (Mr. Tiberi) which we
think is a good idea. Mr. Miller has another one dealing with down
payment assistance. Mr. Tiberi's deals with the question of counseling.
We are supportive of those. There is a great deal of bipartisanship
here.
The realtors and home builders, two of the private sector groups
strongly committed to helping with homeownership and home building,
support this bill and support our versions of it. All the consumer
groups, the people who advocate for low income housing do. I hope that
the bill is adopted. There are some amendments that would kill it. I
will say there is an amendment to strike the funds for the Affordable
Housing Fund. Members might want to check. A virtually identical
amendment was offered during the appropriations bill to prohibit any
FHA money from going there. It was defeated by 2-1. It was a very large
vote on this side, obviously, but a significant vote on the other side.
We have debated all these issues. I hope by the end of the day we will
send the FHA bill through.

And let me just close by saying I welcome what the administration
did. We are moving closer. I hope by the end of today we will have sent
this bill to the Senate, along with the GSE bill. And I have spoken to
Secretary Paulson and I have spoken with Members of the Senate. If the
Senate will then take up the GSE bills and the FHA bills, I know there
are differences, we want a signature on both bills. We will have a
genuine three-sided conference; ourselves, both parties; the Senate,
both parties; the Secretary of Treasury, the Secretary of HUD. And I
believe if the Senate will act well before Thanksgiving, we can have a
good package in which the GSEs and FHA are made sounder and more solid
and better able to serve the people.
Mrs. BIGGERT. Madam Chairman, I yield 45 seconds to Ranking Member
Bachus.
Mr. BACHUS. Madam Chairman, I would like to thank the chairman of the
full committee. And I want to make it perfectly clear that this was a
grandson, not a son or daughter who was born to Linda and I. So when
you said proud addition, I just didn't want a rumor back home that we
had had a child.
But I also want to acknowledge what you said. There are many
important reforms in this bill. In fact, from last year's bill, much of
what the chairman has said, I think we have worked together, groups
have worked together, and as a result of the subprime crisis we have
got an even better bill, and I acknowledge all that. There are many
good things about this bill, and I commend him for his knowledge of the
subject and his fine work. Thank you.
Ms. WATERS. Madam Chairman, may I inquire as to how much time we have
left?
The CHAIRMAN. Ms. Waters has 13\1/2\ minutes, and Mrs. Biggert 21\1/
2\ minutes.
Ms. WATERS. Madam Chairman, I yield 2 minutes to the gentleman from
Texas (Mr. Green).
Mr. AL GREEN of Texas. I want to thank you and the chairman of the
full committee for this brilliant and well thought-out legislation. I
absolutely support it. I am convinced that this bill, had it been in
place, would have helped many borrowers to avoid the subprime market
and many of those who also went into the predatory lending areas,
because it would provide reasonable rates without prepayment penalties.
But this bill also has the Affordable Housing Fund, and I support it
wholeheartedly. There is no question that there is a need to build,
preserve, and renovate, rehabilitate affordable housing in this
country. This bill gives us the means by which it can be done.
I also would like to point out that the bill has an amendment that we
introduced to deal with the mortgage brokers.

{time} 1215

This bill requires mortgage brokers and correspondent lenders to
safeguard and account for a borrower's money. It is actually codified
into law. It would require them to follow reasonable and lawful
instructions of the borrower and to act with reasonable skill, care,
and diligence in handling the money of borrowers and the business of
borrowers. It allows the Secretary of HUD to deny a violator the
privilege of originating loans. It's a good amendment. I beg that my
colleagues would support it.
Finally, I want to talk about the alternative credit amendment that
was added that we introduced, which is a pilot program to establish an
automated process using alternative credit such as rent, utilities,
phone bills.
Many persons are credit worthy, but they don't have the traditional
credit necessary to purchase a home. This bill will establish an
alternative system so that they too may enter the marketplace and
purchase a home.
After 4 years, the GAO is to give Congress a report on the bill. I
support all of what is in this bill, and I beg that my colleagues do so
as well.
Again, I commend the Chair and the ranking members for what they have
done as well.
Mrs. BIGGERT. Madam Chairman, I yield myself 5 minutes.
Madam Chairman, I'd like to start out on a positive note, but I guess
I must say that I'm disappointed about the bill, the way it is as we're
considering it today.
While the bill has improved since its introduction, I had hoped that
we could take up the same bipartisan FHA Modernization Bill, H.R. 5121,
that passed House last year. And since we've been talking about it, I
might say it was cosponsored by 54 Republicans and 51 Democrats and one
Independent, so it was a good bill and a bipartisan compromise that was
agreed to by Chairman Waters, Chairman Frank, and then Chairman Mike
Oxley.

[[Page H10451]]

And given the overwhelming vote, and the exact number was 415-7 for
last year's bill, I had hoped that we could take it up and move it
quickly to the floor. But instead we have two bills this year. We have
the bill, H.R. 1752, which I introduced, which was identical to last
year's bipartisan bill, and we have Chairman Waters' bill. And so I
think we're today considering a new bill with new provisions that are
not bipartisan, and I think it has delayed the FHA modernization and
will serve fewer borrowers than last year's bill. But it's an important
bill.
There are some key differences between these bills. There is one that
has caused the greatest concern for me and many of my colleagues, and
that is the inclusion of a provision in H.R. 1852 that creates a
funding placeholder and siphons off FHA funds to a brand-new government
trust fund. And it's admirable, affordable housing. We all want
affordable housing in all forms, whether it's section 8, whether it's
public housing, whether it's FHA modernization. But I think that taking
the funds out of FHA and using them for a purpose unrelated to its core
mission of the FHA would threaten the solvency of the FHA fund and its
ability to pay off the insurance claims. And we are reaching a crisis
there, where we are going to have to have some credit influx into the
FHA fund. So we'll hear more discussion on that during the
consideration of Mr. Hensarling's amendment during this debate.
So it's my hope that we can work together to address Members'
concerns through the amendment process so that a modernized FHA bill
can help assist more low- and moderate-income Americans in buying and
keeping their homes.
I'd like to just briefly talk about and thank Chairman Waters for
offering a specific provision in this manager's amendment. The
chairwoman's original draft only permitted first-time home buyers to
participate in new low- and no down payment loan programs. But the
amendment under consideration corrects that and mirrors the provision
in the FHA modernization bill that allows any FHA qualified borrower to
participate in the new FHA low and no down payment loan program. So
clearly, the FHA has a role to play in the solution to this country's
rising foreclosure rate.
And as I think I said on April 19, during our first committee hearing
on this, this bill, one of the most important things that Congress can
do, as we search for ways to help those that have been harmed by the
subprime market, is to give FHA the tools it needs to be a viable
alternative for the first-time and low-income borrowers.
And then I'd like to address an issue that Chairman Frank did bring
up, and even though he's not on the floor. But the legislation that I
have included another bipartisan agreement last year, and that was the
automatic reduction of annual premiums in FHA to no more than 55 basis
points for loans that remain active after 5 years. And automatic
premium reductions can be a good thing. They can reduce refinancing and
perhaps some defaults and foreclosures as well.
In contrast, I think that the Franks-Waters bill requires the refund
of excess upfront premiums charged to higher-risk borrowers, those with
FICO scores under 560. So I'm concerned that this provision would have
the unintended consequences of limiting the number of borrowers that
could be served by the FHA program because it requires initial premiums
to be even higher. And I think that the refund provision would also be
very difficult to implement.
This is an insurance program. And when you have car insurance, you
don't get a refund if you don't have an accident. You might have your
rate lowered, which is what was in the former bill. So I think that
that is an issue that he talked about that I wanted to clarify.
Madam Chairman, I reserve the balance of my time.
Ms. WATERS. Madam Chairman, I yield myself 30 seconds to make sure
that my colleague on the opposite side of the aisle, Mrs. Biggert, whom
I've worked with so closely and enjoy working with so much, is clear on
the fact that the housing trust fund does not take money from FHA. And
I think Mr. Frank made it very clear before he left that HUD would have
to certify that it is solvent before any of that money goes into the
trust fund. I think that's very important.
Madam Chairman, I yield 2\1/2\ minutes to the gentleman from Texas
(Mr. Hinojosa).
Mr. HINOJOSA. Madam Chairman, I rise in strong support of H.R. 1852,
the Expanding American Homeownership Act of 2007, introduced by
Congresswoman Maxine Waters, who has worked so hard on this
legislation.
I want to commend my good friend from California for introducing such
an important piece of legislation and for helping me and the
Congressional Rural Housing Coalition find ways to provide housing for
all Americans, including those in rural America. She has found numerous
ways to improve the availability, affordability and quality of housing;
and this legislation advances that cause.
Madam Chairman, this legislation, H.R. 1852, will modernize and
update the National Housing Act and enable the Federal Housing
Administration to use risk-based pricing to more effectively reach
underserved borrowers. It will also provide a safe alternative for
potential home buyers with less than perfect credit, thus helping them
avoid the pitfalls of certain subprime lending and, hopefully, reduce a
large portion of predatory lending.
This legislation is very important to working families. Hundreds of
thousands of American families are concerned about losing their homes
as their mortgage payments increase because of subprime loans with
adjustable interest rates. With strong efforts to assist them, up to
the 40 percent of families with subprime loans could qualify for more
affordable fixed-rate loans so they can keep their homes.
As co-chair and co-founder of the Financial and Economic Literacy
Caucus, I am particularly pleased that the legislation contains a
housing counseling provision. It is a long time coming.
I want to express my sincere appreciation to Chairwoman Maxine Waters
for introducing such important legislation.
Madam Chairman, I submit for the Record letters from the American
Bankers Association and the National Association of Home Builders in
support of H.R. 1852.
For these reasons, I strongly urge my colleagues to vote ``yes.''

September 18, 2007.
To: Members of the U.S. House of Representatives.
From: Floyd Stoner, Executive Director, Congressional
Relations & Public Policy, ABA.
Re Support for H.R. 1852, the Expanding American
Homeownership Act of 2007.

I am writing to you on behalf of the members of the
American Bankers Association (ABA) to express our support for
H.R. 1852, the Expanding American Homeownership Act of 2007,
scheduled for House consideration today. This legislation
reforming the Federal Housing Administration (FHA) will make
the FHA a strong, relevant tool to help banks and other
lenders to bring homeownership to more Americans for years to
come. These reforms are more necessary now than ever, as FHA
can play an important role in addressing current problems in
the mortgage markets.
The FHA was created in 1934 to serve as an innovator in the
mortgage market. Since then, FHA, in a public/private
partnership with banks and others in the lending community,
has assisted nearly 35 million Americans become homeowners.
Unfortunately, statutory limitations and lack of flexibility
caused FHA to become less relevant to the industry. The
legislation before the House of Representatives makes
necessary changes to improve the efficiency of the FHA,
increase the nation's homeownership rate, increase
competition in the lending market, and provide borrowers with
a much needed option in the current tight credit market.
Specifically, ABA supports provisions that: (1) simplify
the downpayment process and offer borrowers flexible
downpayment options; (2) extend the mortgage term of an FHA
insured loan to 40 years; (3) increase the FHA loan limits;
and (4) modernize the Home Equity Conversion Mortgage
Program. These changes will again make the FHA an important
partner with the private market and will help to ensure that
more borrowers are able to benefit from FHA insurance.
We urge you to support this reform of FHA to better serve
homebuyers by supporting H.R. 1852 when it comes to the House
floor.
____

National Association

of Home Builders,

Washington, DC, September 17, 2007.
Hon. Nancy Pelosi,
Speaker, House of Representatives,
The Capitol, Washington, DC.
Dear Speaker Pelosi: On behalf of the 235,000 members of
the National Association of Home Builders (NAHB), I am
writing to

[[Page H10452]]

express the building industry's support for H.R. 1852, the
Expanding American Homeownership Act of 2007. NAHB urges you
to support this bill, which modernizes the Federal Housing
Administration (FHA), when it comes to the House floor next
week. Because of the importance of this issue to our
industry, we are designating the vote on passage of H.R. 1852
as a KEY VOTE.
NAHB also supports the Frank/Miller/Cardoza amendment that
will further enable home buyers the ability to purchase an
FHA-insured home in many high-cost areas. Currently, the FHA
loan limit is too low to enable many deserving home buyer to
purchase a home in high-cost areas.
Since its creation in 1934, and for much of its existence,
the FHA has been viewed as a housing finance innovator by
insuring millions of mortgage loans, which have made it
possible for America's families to achieve homeownership.
FHA's single family mortgage insurance programs have served
home buyers in all parts of the country during all types of
economic conditions. Moreover, FHA has done this without any
cost to America's taxpayers.
Unfortunately, over the past two decades, the popularity
and relevance of FHA's single family mortgage insurance
programs have waned as FHA's programs have failed to keep
pace with competing conventional mortgage loan programs.
Faced with a deepening constriction in the availability and
affordability of housing credit, Congress now has the
opportunity to modernize the FHA and enable it to play a key
role in stabilizing the mortgage markets, while offering
borrowers a safe and fair mortgage alternative. Recently,
President Bush outlined a plan to help American homeowners
weather the current difficulties in mortgage markets, which
included asking Congress to send him an FHA reform bill as
soon as possible.
To address the problems in today's housing finance market,
I urge your support for H.R. 1852 on the House floor this
week. Again, NAHB will KEY VOTE the vote on passage of H.R.
1852. Thank you for considering the views of the home
building industry.
Sincerely,
Joseph M. Stanton,
Chief Lobbyist.

Mrs. BIGGERT. Madam Chairman, I would just like to thank the
gentleman from Texas (Mr. Hinojosa) for all his hard work on our
Financial Literacy and Education Caucus. I really enjoy working with
him, and the counseling really fits right into the purview of financial
literacy, so again I thank the gentleman.
Madam Chairman, I yield 5 minutes to my friend, the gentleman from
California (Mr. Gary G. Miller).
Mr. GARY G. MILLER of California. Madam Chairman, I rise in strong
support of this bill. I'd like to commend Chairman Barney Frank and
Ranking Member Bachus and Subcommittee Chairman Maxine Waters and
Ranking Member Judy Biggert for their hard work. This has been a long
time coming.
If you watch what the Federal Reserve is doing today, they're
injecting short-term dollars into the marketplace trying to stabilize
the marketplace. But what the marketplace and housing needs today is
long-term dollars and revenues to ensure that people can own a home and
get a long-term loan and pay that back.
When I talk to brokers and lenders in my district, it is clear that
the FHA program as currently structured has not kept pace. In the past,
moderate-income home buyers who could not qualify for conventional
loans because of high loan to value ratios or high payment to income
ratios could still achieve the dream of homeownership through the FHA
program.
Today, the FHA program is no longer a useful product to home buyers.
Instead, working families are faced with a situation where they are
either unable to own a home, or they're forced to resort to a risky
loan product that might make their ability to keep the home difficult.
With all this occurring in the subprime market, FHA reform is more
critical today than ever. The need for this legislation is immediate.
Many times exotic products such as interest-only loans, negative
amortizations are the only options available to working families to
achieve homeownership. This is because the FHA program became virtually
irrelevant for many home buyers.
Not only can the bill before us today provide a viable alternative
for families seeking to purchase a home, but it can also help families
facing uncertainty about being able to keep their current home.
The bottom line is to make the FHA program a viable mortgage option,
we must ensure that the program's products are available across the
country and they meet the needs of borrowers. This includes not only
eliminating the geographic barriers to utilization of the program in
high-cost areas, but also facilitating the purchase of entry-level
homes, including condos and manufactured housing.
These forms of housing are an affordable option for entry-level home
buyers, and they should be included under this program if we truly want
to help families climb the first rung on the ladder of homeownership.
In addition to reforming what can be purchased under the program, we
must also improve the competitiveness of the FHA product among the
mortgage options available. In other words, we must address the
problems in FHA programs that cause it not to be utilized when it is an
available mortgage product for the potential home buyer.
The answer is that the program in flexibility and burdensome
processes have left many in the industry hesitant or, in the case of
mortgage brokers, unable to offer FHA products.
The legislation before us today includes a number of reforms to make
the FHA program relevant in today's marketplace. For example, today's
mortgage brokers originate the majority of mortgage loans and,
therefore, provide HUD with the most available and efficient
distribution channel to bring the FHA loan products to the marketplace.
While mortgage brokers originate the majority of loans, many are not
able to offer FHA products because of the cost-prohibitive and time-
consuming financial audit and net worth requirements. This effectively
leaves subprime loan products as the only option for many borrowers who
would otherwise qualify for an FHA.
Now, let me say the subprime market is extremely beneficial and it
needs to be relevant. But today you have many predators in that
marketplace that are making loans to people that they know they cannot
repay. The bill before us today includes language to replace FHA's net
worth and audit requirement with a surety bond to allow more mortgage
brokers to offer FHA products. This will ensure that the home buyers
are given the option of a FHA product when they seek the services of a
mortgage broker.
I would like to say a word about the affordable housing fund included
in this bill. While I opposed a similar fund when it was attached to
the GSE reform bill, I want my colleagues to know that I support this
fund because an amendment I offered at the markup was accepted by
Chairman Frank to essentially say, and these are arguments that have
been made against this, that the HUD must ensure that FHA insurance
premiums are, one, as low as possible; two, that the insurance fund is
solvent; and, three, that any FHA needs are met before excess dollars
are sent to the housing fund. Virtually it says that FHA has the
dollars, they will use the dollars, and when it's not needed, then
those dollars will be forwarded to the fund.

{time} 1230

After that I firmly believe that the FHA funds should be dedicated to
housing. We do this for the highway fund when we charge a gas tax.
Those taxes are dedicated to repairing our roads and highways in this
country. We should do this with the FHA too. The FHA money we are
talking about is money that currently is going to the treasury.
Now more than ever Congress must pass FHA legislation so that we can
remove the impediments to the utilization of the FHA and ensure that it
once again helps working families across the country so that they have
an opportunity to achieve and maintain homeownership. This is an
important reform that will help many families avoid foreclosures.
Most of the people, and I would say, all the organizations in the
industry who are looking to help people who are in trouble today
support this bill. They also support the GSE reform bill that we put
forward because it does one thing: It provides long-term stability and
liquidity to the marketplace. The goal of this bill is to ease the
burdensome problems people are facing today. They are looking at losing
their homes. We are saying let's provide long-term liquidity and help
them maintain their homes.
Ms. WATERS. Madam Chairman, I yield 2 minutes to the gentlewoman

[[Page H10453]]

from New York (Mrs. Maloney), Financial Institutions and Consumer
Credit Subcommittee Chair.
Mrs. MALONEY of New York. Madam Chairman, I thank the gentlewoman for
her extraordinary leadership, really creative leadership, along with
Barney Frank and others.
I rise in support of the bill, which will revitalize the FHA and will
ultimately assist low- and modern-income families seeking the American
Dream of homeownership and providing much-needed stability and
liquidity in the markets with the subprime crisis.
I thank the gentlewoman for accepting an amendment that I authored
that would expand affordable and available daycare by giving an
incentive to build or include licensed child care facilities in FHA-
insured properties.
This bill does many things that are very important. It builds on the
President's recent announcement that FHA will work with homeowners who
are having a difficult time paying their mortgage due to a reset in
this interest rate. This will help with the subprime crisis by, number
one, increasing the loan limits in high-cost areas of the country like
New York City where FHA has been driven from the market, forcing many
borrowers to turn to high-cost financing. It will, secondly, authorize
zero down and lower down payment FHA loans for home buyers who could
not otherwise make these payments. It directs FHA to underwrite to
borrowers with higher credit risks than FHA currently serves. And it
permanently eliminates the current statutory volume cap on FHA reverse
mortgage loans to permit this program to meet the growing needs of home
equity-rich, cash-poor senior citizens and, very importantly,
reinvesting the increased profits created into an affordable housing
fund.
With all the great things in this bill, I am concerned that we may be
loosening the reins a bit too much by allowing mortgage brokers to
bypass the current audit and net worth requirements and instead posting
a surety bond to participate in FHA. I have been very concerned with
the role the largely unregulated mortgage broker industry has played in
the current subprime mortgage crisis.
I do support this bill, and I hope we can work to ensure the safety
and soundness of FHA and we are expanding affordable and available
housing. And congratulations to Chairman Waters.
Mrs. BIGGERT. Madam Chairman, at this time I would like to yield 3
minutes to the gentlewoman from West Virginia (Mrs. Capito), who is now
going to assume the role as the ranking member of the Housing
Subcommittee.
Mrs. CAPITO. Madam Chairman, I would like to first thank my good
friend the gentlewoman from Illinois for yielding to me and also for
her leadership as the ranking member on the Housing Subcommittee. She
has left big shoes for me to fill, but I know she is not going to be
too far away on the committee, so I can lean on her for help.
I also look forward to working with Chairwoman Waters on this
committee. I know we will work well together as you all have set up a
great pattern of bipartisanship on the Housing Subcommittee. So thank
you very much for your leadership.
The legislation we are considering today is an important step towards
stabilizing a housing market that has been in a steady decline over
this past year. While many of us were working in our districts over the
recess period, our financial systems were experiencing a bit of a
credit crunch, due in part to the problems in the subprime housing
markets.
Many of the problems we are facing in the housing market are due to
individuals with credit challenges and inexperienced first-time home
buyers utilizing very complex and creative financing tools to allow
them to purchase a home which they would otherwise not be able to do.
Homeownership is something that we all aspire to, and I am proud to
say that my State of West Virginia has some of the highest
homeownership in the country, over 70 percent, because with
homeownership comes solid community involvement, comes better economic
health, and also better socialization and education levels.
The use of interest-only and adjustable-rate mortgages is now causing
problems as these mortgages is now resetting at much higher rates,
frequently unaffordable rates causing an increase in foreclosures.
The reforms to the FHA will help provide stability in the housing
market by providing greater assistance to new and riskier home buyers.
Some of the reforms I would like to highlight are the extension of the
maximum length for an FHA loan from 35 to 40 years; directing the FHA
to serve high-risk home buyers while lowering upfront fees for high-
risk buyers; allowing for a zero down payment for first-time home
buyers, and I'm hearing today also for those who are FHA qualified; and
authorizing an increase in FHA loan limits for both rural and urban
areas.
The final component is especially important because in many areas the
current loan limits are outpriced by many larger metropolitan areas.
These expanded limits will help many buyers access stable and secure
loans so they can achieve the goal of homeownership.
Each of these reforms has bipartisan support, and we must continue to
work together in order to provide much-needed assistance to our
struggling homeowners.
Again, I would like to thank Chairwoman Waters and Ranking Member
Biggert for their hard work on this critical legislation.
Ms. WATERS. Madam Chairman, I yield 2 minutes to the gentleman from
Minnesota (Mr. Ellison), who is focused on predatory lending.
Mr. ELLISON. Madam Chairman, I would like to thank Chairwoman Waters
and Chairman Frank for bringing this bill to the floor today before the
body.
H.R. 1852 makes significant improvements to the current Federal
Housing Administration policy at a time that is crucial to American
working families and to our Nation's economy. It comes before us at a
time when the unstable housing market has brought disruption to our
economy, world financial markets, but, most importantly, in our
neighborhoods. By expanding the availability of FHA loans and using the
new revenue to create an Affordable Housing Trust Fund, we are helping
to make the dream of homeownership not just an illusion but a real
possibility. Once again, I want to thank the sponsors of this
legislation and urge support of the bill.
I would also like to point out that the mortgage foreclosure crisis
in America continues to get worse. Mortgage foreclosures are now at a
level previously seen only at the height of the Great Depression, and
it is only predicted to get worse going into the fall and winter. In
August, foreclosures nationwide were up 115 percent from 2006.
Hopefully, this important piece of legislation will help make the
American Dream of homeownership not just an illusion but a real
possibility.
Mrs. BIGGERT. Madam Chairman, I have no further requests for time,
and I reserve the balance of my time.
Ms. WATERS. Madam Chairman, I yield 1\1/2\ minutes to the gentlewoman
from California, Ms. Barbara Lee.
Ms. LEE. Madam Chairman, I rise today in strong support of the
Expanding American Homeownership Act of 2007. I want to thank Chairman
Frank and Chairwoman Waters for their leadership and their commitment
to revitalize the FHA and provide critical assistance to those who have
been affected by this crisis, which is, unfortunately, reverberating
across our country and the entire world.
Many hardworking Americans that may otherwise not have been able to
qualify for a loan were lured into a fantasy universe of low rates and
even lower payments by unscrupulous lenders. However, reality has
kicked in, and those most affected are the elderly, single parents, and
members of minority populations.
This bill is a critical first step to help those who have been caught
up in this nightmare. For instance, current FHA rules prevent the FHA
from making loans beyond the local median home price. This bill will
increase loan limits to make FHA relevant in those areas. This is a
crucial fix which will provide assistance in high markets like mine in
California in the Ninth Congressional District in Northern California.
This bill also increases funding for housing counseling, which helps
to ensure that those who achieve the American Dream of owning a home
can keep

[[Page H10454]]

it. With a good job and good credit, this bill will allow, for
instance, those who want to deal with down-payment assistance to
qualify for a loan by providing that down-payment assistance. It
addresses authorizing a zero or lower down payment on loans for
borrowers.
I want to thank Congresswoman Waters and Mr. Frank for making housing
an important national priority.
Mrs. BIGGERT. Madam Chairman, I reserve the balance of my time.
Ms. WATERS. Madam Chairman, I yield 1\1/2\ minutes to the gentleman
from Maryland, Congressman Cummings.
Mr. CUMMINGS. Madam Chairman, I want to thank Ms. Waters for this
absolutely brilliant legislation, very comprehensive, and I also want
to thank Chairman Barney Frank.
Madam Chairman, later today the Fed is expected to lower interest
rates for the first time in 4 years to protect the economy in hopes of
making homes less expensive for people to finance certain credit card
debt and for homeowners to take out popular home equity lines of
credit, which often are used to pay for education, home improvements,
or medical bills.
The Fed's actions today will have a positive impact on homeownership,
as will our consideration of H.R. 1852. This legislation will allow FHA
to carry out its function of assisting creditworthy, low-income and
credit-risk citizens in becoming homeowners. Most importantly, the FHA
will be able to steer these people away from the predatory practices of
the subprime mortgage industry.
Some of the most important features of H.R. 1852 include raising the
program's loan limit to $417,000; providing refinancing opportunities
to borrowers struggling to meet their mortgage payments; authorizing
zero and lower down-payment loans for qualified borrowers; and
enhancing FHA's reverse mortgage program to help seniors pay for health
and other expenses, by removing the loan cap to avoid program shutdowns
and raising loan limits.
Again, I applaud Chairman Waters for her outstanding leadership in
this area, and I urge all of my colleagues to vote in favor of the
bill.
Mrs. BIGGERT. Madam Chairman, I yield myself such time as I may
consume.
In closing, I would really like to thank Subcommittee Chairwoman
Waters for her work on this bill. I am pleased that the FHA
modernization bill is moving forward, and I think that the bill that we
will vote on today is much improved from the original draft as a result
of constructive input from Members from both sides of the aisle. It
contains many bipartisan provisions that I support and still contains a
few provisions that I do not support. But it is my hope that the
provision siphoning money away from the fund will be struck and that
true risk-based pricing will be implemented so that FHA can serve the
maximum number of borrowers possible. But those arguments have been
made and have been rejected by the majority, so it is my sincere hope
that we can further improve the bill as it continues to move through
the legislative process.
As I understand it, the Senate Banking Committee is scheduled to mark
up its version of FHA reform tomorrow. So unlike last year, it appears
that FHA reform is gaining traction in the Senate, and I hope that we
can move this bill beyond the House during this Congress and that the
Senate and the administration will work with us to reform this
important program.

{time} 1245

I think American families deserve a 21st-century FHA program to have
a safe and secure mortgage product as an alternative to the dangerous
products offered by predatory lenders. Qualified American families
looking to keep their homes and refinance their bad mortgages, many of
which are currently in default, deserve to do so through a modernized
FHA.
Again, I look forward to our continued work. And I would like to
thank Chairman Waters so much. You know, as I leave as ranking member
of this subcommittee and go over to the financial institutions, I do
with some remorse. I really have enjoyed working with the subcommittee
chairman on this committee, and the times that we have spent. I will
still be on the committee, but won't have the opportunity to sit
together and make some decisions. And I really have enjoyed every
minute of it, the trip to New Orleans and Mississippi, as well as
working on these bills with her. So I thank you so much. I also thank
Chairman Frank. I think he has worked so hard on this committee.
I kind of think I will miss it because it certainly has been the most
active committee I think in Congress this year. Never did I dream that
we would have at least three hearings a week and two markups and all
the things that have gone on. But I think you've made great progress in
the housing field, and I appreciate both of you for your concern and
your passion for housing and making sure that low-income families will
be able to meet their American Dream.
With that, Madam Chair, I yield back the balance of my time.
Ms. WATERS. May I inquire as to how much time I have remaining.
The CHAIRMAN. The gentlewoman from California has 2 minutes
remaining.
Ms. WATERS. Madam Chairman and Members of the House, first I would
like to tell the subcommittee ranking member how sad I am that we're
not going to be working as closely together on this Subcommittee on
Housing. I have truly enjoyed working with her. And even though she
will remain on the committee, we perhaps won't have an opportunity to
sit together and chat and not only make decisions, but just make fun of
some people from time to time.
Mr. FRANK of Massachusetts. Will the gentlewoman yield?
Ms. WATERS. I yield to the gentleman.
Mr. FRANK of Massachusetts. I would say that I really am very proud
that on our committee, and the gentlewoman is right, there are some
areas of disagreement, I think we have shown how you can have
legitimate disagreements of governmental philosophy within a framework
of some agreement and be able to deal with them so that the
disagreements can be reasonably debated and don't spill over and don't
interfere.
And the gentlewoman is right, we have been very active; but we could
not have been active in a very constructive way if it hadn't been for
that spirit, and I thank her for it. And obviously we will still be
working with her, but we do want to acknowledge how helpful she was and
how constructive in her role as the ranking minority member.
Ms. WATERS. I would also like to thank Mr. Bachus and Mr. Miller; Mr.
Bachus, who has been so good to work with; Mr. Miller, who is an
expert. We have been able to talk about things, to work out
differences, and to move forward.
This is a very productive overall Financial Services Committee, a
very productive Subcommittee on Housing and Community Development. With
people working together on both sides of the aisle, we're getting
things done.
This may be one of the most important pieces of legislation to pass
this House in this session. We will be able to help people with
refinancing. We will be able to help people stay out of foreclosure. We
will be able to revitalize FHA, that really knows and understands how
to provide insurance for moderate- and low-income folks who are
desperate to be homeowners. And I am just delighted that I've had an
opportunity to play a role.
Madam Chairman, I yield back the balance of my time.
Mrs. BIGGERT. Madam Chairman, I ask unanimous consent to reclaim my
time.
The CHAIRMAN. Is there objection to the request of the gentlewoman
from Illinois?
There was no objection.
Mrs. BIGGERT. In all my thanking, I forgot to thank the staff, which
I would really like to do, the staff of the subcommittee, Cindy Chetti,
Tallman Johnson, Nicole Austin, Robert Gordon and Jim Clinger for all
the work that they've done on the minority side of the aisle. And also,
to thank, on the other side of the aisle, the Democrat staff who have
been so helpful to us: Scott Olson, Gail Lester, Jonathan Harwitz,
Kellie Larkin, Tom Duncan and Himay Lazarga. I thank all of them for
all the work that they've put into this bill. And also, one of our new
members on this side, Jason Britt, one of our new members of the staff.
Thank you so much.

[[Page H10455]]

Mr. BACA. Madam Chairman, I rise to express my strong support for
H.R. 1852, the Expanding American Homeownership Act of 2007. This bill
updates the FHA program so it can provide better mortgage options to
low and moderate income families and minorities. This is important
because the FHA program has not kept up with the needs of underserved
communities, especially those in high cost areas like California. As a
result, many families have turned to high cost and riskier subprime
loans.
Because of the high number of subprime loans granted in the last few
years--our Nation is now in a home foreclosure crisis. The Inland
Empire has the fourth highest rate of foreclosure filings in the Nation
and comprised the hardest hit area in California through the first half
of 2007. According to the Neighborhood Housing Services of the Inland
Empire, in San Bernardino County alone there were over 19,000
foreclosure filings in the first half of 2007. The current median home
price in San Bernardino County is only affordable for 2 out of every 10
families.
H.R. 1852 will raise the FHA loan limit so that these hard-working
families get a fair chance at getting a better deal for their home. The
reforms in H.R. 1852 will allow the FHA program to reach into these
underserved communities to provide low and moderate-income buyers a
better deal at a fair price.
Again, Madam Chairman, I express my full support of this bill and
urge my fellow colleagues to adopt its final passage.
Ms. CASTOR. Madam Chairman, I would like to express my support of
H.R. 1852, the Expanding American Homeownership Act.
I would like to thank Chairwoman Waters and Chairman Frank for their
hard work on behalf of American families. I am proud to support their
effort to make the dream of homeownership reachable for hard-working
families throughout our country.
H.R. 1852 accomplishes many goals. It will expand the capacity of the
FHA to ultimately help more homebuyers receive better loans. Currently
subprime borrowers are not eligible to receive FHA loans. Under H.R.
1852, FHA loans will become available to subprime borrowers and help to
keep them from becoming victims of predatory lending practices when
buying their first homes.
Families who are currently homeowners, but were placed into mortgages
that they were unable to afford will be eligible under H.R. 1852 to
refinance their mortgages with the FHA. This will help families to
recover from the hardship that so many have experienced during this
difficult period in the mortgage market.
One of the great provisions of the Expanding American Homeownership
Act is that it will authorize up to $300 million per year to be put
into the Affordable Housing Trust Fund, to assist in building more
affordable housing for working families. This fund will work alongside
of an effort in my home state of Florida by Governor Charlie Crist to
increase funding for initiatives to build affordable housing and to
provide added assistance to first-time home buyers.
In my district in the Tampa Bay area, 10,173 of my neighbors found
that their homes fell into foreclosure within the first six months of
this year. The Tampa Bay area is ranked 24th in home foreclosures among
the largest 100 metropolitan areas in the country.
On Monday, members of my community gathered to hear the story of
Isaline Wyatte. Isaline's lender told her last month that her house was
going to be auctioned off. Isaline was facing foreclosure. Fortunately,
Isaline was proactive and was able to take the needed steps to finding
assistance to restructure her loan and keep her home. Isaline's journey
was a struggle, but with the passage of H.R. 1852, homeowners like
Isaline will have an added place to turn before foreclosure threatens
to leave their families without a home.
Madam Chairman, there are thousands of children, seniors and veterans
that are living in fear that soon they will lose their homes. This is a
crisis and H.R. 1852 is an excellent step toward helping not only
first-time homebuyers, but also to help homeowners in trouble to get
back onto their feet. Families will have a greater opportunity to find
a home and stay in that home.
Mrs. CHRISTENSEN. Madam Chairman, homeownership is the key to
achieving financial independence. Yet, there is still a persistent gap
in homeownership between minorities and non-minorities. According to
HUD, despite increases in minorities who become homeowners, the census
figures show that large differences in rates between minority and white
household ownerships remain and have narrowed only slightly.
If this gap is to be narrowed or eliminated all together, we must
break down the barriers faced my minority families and lower and middle
income families that make it difficult for them to obtain the American
dream of homeownership. These barriers include but are not limited to
lack of capital for the down payment and closing costs, lack of access
to credit and poor credit history, lack of understanding and
information about home buying program and continued housing
discrimination. Not to mention, the recent mortgage crisis caused by
sub-prime lenders and predatory lenders.
This is why I strongly support H.R. 1852, a bill that would modernize
the National Housing Act and enable the Federal Housing Administration
to use risk-based pricing to more effectively reach underserved
borrowers and make other needed changes to offer a better product.
Increasing the FHA loan limits will allow homebuyers in high cost areas
like the District of Columbia and my district, the US Virgin Islands,
to benefit from the FHA advantages that users in less costly parts of
the country enjoy. The bill would also provide FHA with the flexibility
to offer varying down payment terms thereby eliminating the barrier of
down payment and settlement costs for more aspiring homebuyers. Most
importantly, H.R. 1852 would provide American homeowners with a safe
and affordable mortgage alternatives. This is greatly needed at time
when home buyers. Most importantly, H.R. 1852 would provide American
homeowners with a safe and affordable mortgage alternatives. This is
greatly needed at time when homebuyers are being lured by the
attractive but misguided terms offered by the subprime and predatory
lenders.
H.R. 1852 will bring a much needed stability to the mortgage market.
It is supported by my local realtors and the National Association of
Realtors, as well as many other organizations. I commend Congresswoman
Maxine Waters for her work on this bill and urge my colleagues to
support its passage.
Mr. SIRES. Madam Chairman, I rise in opposition to this amendment. I
keep hearing time and time again from my constituents that they cannot
afford a safe home for their children. I know this is a problem for
many Americans across the country. In fact, recent research has
indicated that in order to afford a modest two-bedroom apartment paying
no more than 30 percent of their income for housing and working full
time, a New Jersey family would need to earn over $20.00 an hour. Wages
are simply not increasing fast enough to allow many families to even
come close to this affordable housing wage.
Families need help. That is why I am so supportive of the Affordable
Housing Trust Fund and the revenues that H.R. 1852 will provide to the
Fund. This fund will increase home ownership and increase mortgage
funding in areas of chronic economic distress. By increasing the level
of home ownership, we will then increase the supply of rental housing
for families. And where needed, we will increase our investment in
affordable housing infrastructure to make a safe and affordable home a
reality for every hardworking American.
I urge my colleagues to vote against this amendment that would strike
the affordable housing trust fund and I urge everyone to vote in
support of final passage the Expanding American Home Ownership Act of
2007.
Mrs. JONES of Ohio. Madam Chairman, I rise today in support of H.R.
1852, the Expanding American Homeownership Act of 2007. I commend the
chairman of the Financial Services Committee, Barney Frank and
Congresswoman Maxine Waters, the author of this bill, for their
leadership on this issue.
The meltdown of the mortgage industry, predatory lending practices
and excessive foreclosures is an opportunity for the Federal Housing
Administration (FHA) to reassert its traditional role of meeting unmet
mortgage market needs. H.R. 1852 is intended to increase the market
share of mortgages insured by Federal Housing Administration (FHA), and
to encourage greater stability in the mortgage market in coming years.
It raises loan limits for FHA-backed loans, boosts loan limits in high-
cost areas, allows the agency to vary the premiums it charges borrowers
based on their credit risk, modifies disclosure requirements to provide
more information concerning mortgage choices, and allows for lower
monthly payments for borrowers who make on-time payments for the first
5 years of a loan. It also extends the maximum loan term on FHA single-
family loans to 40 years from 35 years.
Predatory lending is a leading cause of foreclosures across this
country. It compromises the opportunity to own a home and hinders
economic stability, creating greater disparities in wealth. In my home
State of Ohio, new foreclosure cases grew by 24 percent in one year.
Cuyahoga County led the State in new cases with 13,610 new filings last
year. This ranking has attracted national attention with Ohio's
foreclosure rate currently at 18 percent which is higher than the
national average of 17 percent.
Subprime lending provides affordable mortgage credit to borrowers
with less than perfect credit histories, but who are still
creditworthy. Predatory lending occurs when lenders impose excessive
rates and fees, prepayment penalties, and reset terms that can result
in exorbitant interest rate increases. I believe that FHA could serve
subprime borrowers at more attractive rates and provide fairer mortgage
opportunities than predatory lenders.

[[Page H10456]]

I applaud provisions in the bill that require FHA to provide
``payment incentives'' for borrowers that make on-time payments for at
least the first 5 years of a loan. The measure authorizes the
department to offer these incentives to borrowers after a period of 3
years of on-time payments.
I am especially pleased and support provision in the bill which
authorizes funds from FHA profits, to be used for an affordable housing
fund. This fund is key because it would provide grants to support
affordable rental housing and homeownership opportunities for low-
income families.
Over the past 2 weeks, I have participated in home preservation
workshops, where I have had an opportunity to meet with various
organizations and lenders in my congressional district to discuss loss
mitigation plans for homeowners that are in loans set to readjust to
higher rates as well as those that are facing foreclosure.
Representatives of lenders, servicers, housing counseling agencies, and
State, county and Federal housing officials have been on site to meet
with individuals to discuss their personal situations.
To help stem the tide of growing foreclosures, I have reintroduced
the Predatory Lending Practice Reduction Act, H.R. 2061. This
legislation calls for Federal certification of mortgage brokers and
agents and stiffer penalties for violation of Federal law.
Additionally, it will authorize funding for Community Development
Corporations to provide training and counseling on the home buying
process. Not all subprime lenders are predatory, but most predatory
loans are subprime loans. This legislation would work to weed out the
bad actors that are responsible for equity stripping and other
predatory practices.
I am pleased that the Financial Services Committee brought this bill
to House floor for a vote today. It is a great piece of legislation
which I support wholeheartedly. I look forward to working with the
Financial Services Committtee to advance my legislation, H.R. 2061
which would protect borrowers from unscrupulous lending practices.
One of the first steps toward creating wealth is homeownership and I
want to make sure that everyone is given the opportunity to not only
attain but retain that goal.
Mrs. BIGGERT. Madam Chairman, I yield back the balance of my time.
The CHAIRMAN. All time for general debate has expired.
Pursuant to the rule, the amendment in the nature of a substitute
printed in the bill, modified by the amendment printed in part A of
House Report 110-330, is adopted. The bill, as amended, shall be
considered as an original bill for the purpose of further amendment
under the 5-minute rule and shall be considered read.
The text of the bill, as amended, is as follows:

H.R. 1852

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

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Expanding
American Homeownership Act of 2007''.
(b) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title and table of contents.
Sec. 2. Findings and purposes.
Sec. 3. Maximum principal loan obligation.
Sec. 4. Extension of mortgage term.
Sec. 5. Downpayment simplification.
Sec. 6. Mortgage insurance premiums for zero- and lower-
downpayment borrowers.
Sec. 7. Mortgage insurance premiums for standard and
higher-risk borrowers.
Sec. 8. Risk-based mortgage insurance premiums.
Sec. 9. Payment incentives.
Sec. 10. Borrower protections for higher risk mortgages.
Sec. 11. Annual reports on new programs and loss
mitigation.
Sec. 12. Insurance for single family homes with licensed
child care facilities.
Sec. 13. Rehabilitation loans.
Sec. 14. Discretionary action.
Sec. 15. Insurance of condominiums and manufactured
housing.
Sec. 16. Mutual Mortgage Insurance Fund.
Sec. 17. Hawaiian home lands and Indian reservations.
Sec. 18. Conforming and technical amendments.
Sec. 19. Home equity conversion mortgages.
Sec. 20. Participation of mortgage brokers and
correspondent lenders.
Sec. 21. Conforming loan limit in disaster areas.
Sec. 22. Failure to pay amounts from escrow accounts for
single family mortgages.
Sec. 23. Acceptable identification for FHA mortgagors.
Sec. 24. Pilot program for automated process for borrowers
without sufficient credit history.
Sec. 25. Sense of Congress regarding technology for
financial systems.
Sec. 26. Multifamily housing mortgage limits in high cost
areas.
Sec. 27. Valuation of multifamily properties in
noncompetitive sales by HUD to States and localities.
Sec. 28. Clarification of disposition of certain
properties.
Sec. 29. Use of FHA savings for costs of mortgage
insurance, housing counseling, FHA technologies,
procedures, and processes, and for affordable housing
grant fund, and study.
Sec. 30. Limitation on mortgage insurance premium
increases.
Sec. 31. Savings provision.
Sec. 32. Implementation.

SEC. 2. FINDINGS AND PURPOSES.

(a) Findings.--The Congress finds that--
(1) one of the primary missions of the Federal Housing
Administration (FHA) single family mortgage insurance program
is to reach borrowers who are underserved, or not served, by
the existing conventional mortgage marketplace;
(2) the FHA program has a long history of innovation, which
includes pioneering the 30-year self-amortizing mortgage and
a safe-to-seniors reverse mortgage product, both of which
were once thought too risky to private lenders;
(3) the FHA single family mortgage insurance program
traditionally has been a major provider of mortgage insurance
for home purchases;
(4) the FHA mortgage insurance premium structure, as well
as FHA's product offerings, should be revised to reflect
FHA's enhanced ability to determine risk at the loan level
and to allow FHA to better respond to changes in the mortgage
market;
(5) during past recessions, including the oil-patch
downturns in the mid-1980s, FHA remained a viable credit
enhancer and was therefore instrumental in preventing a more
catastrophic collapse in housing markets and a greater loss
of homeowner equity; and
(6) as housing price appreciation slows and interest rates
rise, many homeowners and prospective homebuyers will need
the less-expensive, safer financing alternative that FHA
mortgage insurance provides.
(b) Purposes.--The purposes of this Act are--
(1) to provide flexibility to FHA to allow for the
insurance of housing loans for low- and moderate-income
homebuyers during all economic cycles in the mortgage market;
(2) to modernize the FHA single family mortgage insurance
program by making it more reflective of enhancements to loan-
level risk assessments and changes to the mortgage market;
and
(3) to adjust the loan limits for the single family
mortgage insurance program to reflect rising house prices and
the increased costs associated with new construction.

SEC. 3. MAXIMUM PRINCIPAL LOAN OBLIGATION.

Section 203(b)(2) of the National Housing Act (12 U.S.C.
1709(b)(2)) is amended by striking subparagraph (A) and
inserting the following new subparagraph:
``(A) not to exceed the lesser of--
``(i) in the case of a 1-family residence, the median 1-
family house price in the area, as determined by the
Secretary; and in the case of a 2-, 3-, or 4-family
residence, the percentage of such median price that bears the
same ratio to such median price as the dollar amount
limitation in effect under section 305(a)(2) of the Federal
Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) for
a 2-, 3-, or 4-family residence, respectively, bears to the
dollar amount limitation in effect under such section for a
1-family residence; or
``(ii) the dollar amount limitation determined under such
section 305(a)(2) for a residence of the applicable size;

except that the dollar amount limitation in effect for any
area under this subparagraph may not be less than the greater
of (I) the dollar amount limitation in effect under this
section for the area on October 21, 1998, or (II) 65 percent
of the dollar limitation determined under such section
305(a)(2) for a residence of the applicable size; and''.

SEC. 4. EXTENSION OF MORTGAGE TERM.

Paragraph (3) of section 203(b) of the National Housing Act
(12 U.S.C. 1709(b)(3)) is amended--
(1) by striking ``thirty-five years'' and inserting ``forty
years''; and
(2) by striking ``(or thirty years if such mortgage is not
approved for insurance prior to construction)''.

SEC. 5. DOWNPAYMENT SIMPLIFICATION.

Section 203(b) of the National Housing Act (12 U.S.C.
1709(b)) is amended--
(1) in paragraph (2)--
(A) by striking subparagraph (B) and inserting the
following new subparagraph:
``(B) not to exceed an amount equal to the sum of--
``(i) the amount of the mortgage premium paid at the time
the mortgage is insured; and
``(ii)(I) except as provided in subclause (II), 97.75
percent of the appraised value of the property; or
``(II) in the case only of a mortgage described in
subsection (c)(3), the appraised value of the property, plus
any initial service charges, appraisal, inspection, and other
fees in connection with the mortgage as approved by the
Secretary.'';
(B) in the matter after and below subparagraph (B), by
striking the second sentence (relating to a definition of
``average closing cost'') and all that follows through
``title 38, United States Code.''; and
(C) by striking the last undesignated paragraph (relating
to counseling with respect to the responsibilities and
financial management involved in homeownership); and
(2) in paragraph (9), by striking the paragraph designation
and all that follows through ``Provided further, That for''
and inserting the following:
``(9) Except in the case of a mortgage described in
subsection (c)(3), be executed by a

[[Page H10457]]

mortgagor who shall have paid on account of the property, in
cash or its equivalent, at least 3 percent of the Secretary's
estimate of the cost of acquisition (excluding the mortgage
insurance premium paid at the time the mortgage is insured).
For''.

SEC. 6. MORTGAGE INSURANCE PREMIUMS FOR ZERO- AND LOWER-
DOWNPAYMENT BORROWERS.

Section 203(c) of the National Housing Act (12 U.S.C.
1709(c) is amended by adding at the end the following new
paragraph:
``(3) Zero- and lower-downpayment borrowers.--
``(A) Applicability.--This paragraph shall apply to any
mortgage that--
``(i) is secured by a 1- to 4-family dwelling that will be
occupied by the mortgagor as his or her principal residence.
``(ii)(I) is an obligation of the Mutual Mortgage Insurance
Fund or of the General Insurance Fund pursuant to subsection
(v) of this section; or
``(II) is insured under subsection (k) of this section or
section 234(c);
``(iii)(I) is executed by a mortgagor who has not had any
present ownership interest in a principal residence, and
whose spouse has not had any such interest, during 12-month
period ending upon purchase of the residence with the
mortgage to which this paragraph applies, except that this
subclause shall be considered a program to assist first-time
homebuyers for purposes of section 956 of the Cranston-
Gonzalez National Affordable Housing Act (42 U.S.C. 12713);
or
``(II)(aa) is made to pay or prepay, and fully extinguish,
the outstanding obligations under an existing mortgage or
mortgages on the same property; and
``(bb) involves a principal obligation not exceedign the
amount necessary to fully pay or prepay such outstanding
obligations under the existing mortgage or mortgages, plus
any charges and fees involved in such transaction and any
charges and fees in connection with the payment or prepayment
of such outstanding obligations; and
``(iv)(I) involves a principal obligation that does not
comply with subclause (I) of subsection (b)(2)(B)(ii)
(relating to loan-to-value ratio); or
``(II) is executed by a mortgagor who has not paid on
account of the property, in cash or its equivalent, at least
3 percent of the Secretary's estimate of the cost of
acquisition (excluding the mortgage insurance premium paid at
the time the mortgage is insured).
``(B) Up-front premiums.--The amount of any single premium
payment collected at the time of insurance may not exceed 3.0
percent of the amount of the original insured principal
obligation of the mortgage.
``(C) Annual premiums.--Except as provided in subparagraph
(D), the amount of any annual premium payment collected may
not exceed 0.75 percent of the remaining insured principal
obligation of the mortgage.
``(D) Annual redetermination of premium rate.--The
Secretary shall redetermine the rates of premiums not less
than once every 12 months.''.

SEC. 7. MORTGAGE INSURANCE PREMIUMS FOR STANDARD AND HIGHER-
RISK BORROWERS.

Paragraph (2) of section 203(c) of the National Housing Act
(12 U.S.C. 1709(c)(2)) is amended--
(1) by striking the matter that precedes subparagraph (A)
and inserting the following:
``(2) Standard-risk mortgages.--In the case of any mortgage
that is secured by a 1- to 4-family dwelling, is an
obligation of the Mutual Mortgage Insurance Fund or of the
General Insurance Fund pursuant to subsection (v) of this
section or is insured under subsection (k) of this section or
section 234(c), for which the mortgagor has paid on account
of the property, in cash or its equivalent, at least 3
percent of the Secretary's estimate of the cost of
acquisition (excluding the mortgage insurance premium paid at
the time the mortgage is insured), and that involves a
principal obligation that complies with subclause (I) of
subsection (b)(2)(B)(ii), the following requirements shall
apply:''; and
(2) by adding at the end the following new subparagraph:
``(C) Higher-risk borrowers.--The Secretary shall establish
underwriting standards that provide for insurance under this
section of mortgages described in the matter in this
paragraph preceding subparagraph (A) for which the mortgagor
has a credit score equivalent to a FICO score of less than
560, and may insure, and make commitments to insure, such
mortgages. Such underwriting standards shall include
establishing and collecting premium payments that comply with
the requirements of this paragraph, except that
notwithstanding subparagraph (A), the single premium payment
collected at the time of insurance may be established in an
amount that does not exceed 3.0 percent of the amount of the
original insured principal obligation of the mortgage.''.

SEC. 8. RISK-BASED MORTGAGE INSURANCE PREMIUMS.

Section 203(c) of the National Housing Act (12 U.S.C.
1709(c)), as amended by the preceding provisions of this Act,
is further amended by adding at the end the following new
paragraphs:
``(4) Flexible risk-based premiums.--In the case of a
mortgage referred to in paragraph (2)(C) or (3)(A) for which
the loan application is received by the mortgagee on or after
October 1, 2007:
``(A) In general.--The Secretary may establish a mortgage
insurance premium structure involving a single premium
payment collected prior to the insurance of the mortgage or
annual payments (which may be collected on a periodic basis),
or both, subject to the requirements of subparagraph (B) and
paragraph (5). Under such structure, the rate of premiums for
such a mortgage may vary according to the credit risk
associated with the mortgage and the rate of any annual
premium for such a mortgage may vary during the mortgage term
as long as the basis for determining the variable rate is
established before the execution of the mortgage. The
Secretary may change a premium structure established under
this subclause but only to the extent that such change is not
applied to any mortgage already executed.
``(B) Establishment and alteration of premium structure.--A
premium structure shall be established or changed under
subparagraph (A) only by providing notice to mortgagees and
to the Congress, at least 30 days before the premium
structure is established or changed.
``(C) Annual report regarding premiums.--The Secretary
shall submit a report to the Congress annually setting forth
the rate structures and rates established and altered
pursuant to this paragraph during the preceding 12-month
period and describing how such rates were determined.
``(5) Considerations for premium structure.--When
establishing premiums for mortgages referred to in paragraph
(2)(C), establishing premiums pursuant to paragraph (3),
establishing a premium structure under paragraph (4), and
when changing such a premium structure, the Secretary shall
consider the following:
``(A) The effect of the proposed premiums or structure on
the Secretary's ability to meet the operational goals of the
Mutual Mortgage Insurance Fund as provided in section 202(a).
``(B) Underwriting variables.
``(C) The extent to which new pricing under the proposed
premiums or structure has potential for acceptance in the
private market.
``(D) The administrative capability of the Secretary to
administer the proposed premiums or structure.
``(E) The effect of the proposed premiums or structure on
the Secretary's ability to maintain the availability of
mortgage credit and provide stability to mortgage markets.
``(6) Authority to base premium prices on product risk.--
``(A) Authority.--In establishing premium rates under
paragraphs (2), (3), and (4), the Secretary may provide for
variations in such rates according to the credit risk
associated with the type of mortgage product that is being
insured under this title, which may include providing that
premium rates differ between fixed-rate mortgages and
adjustable-rate mortgages insured pursuant to section 251,
between mortgages insured pursuant to section 203(b) and
mortgages for condominiums insured pursuant to section 234,
and between such other products as the Secretary considers
appropriate.
``(B) Limitation.--Subparagraph (A) may not be construed to
authorize the Secretary to establish, for any mortgage
product, any mortgage insurance premium rate that does not
comply with the requirements and limitations under paragraphs
(2) through (5).''.

SEC. 9. PAYMENT INCENTIVES.

Section 203(c) of the National Housing Act (12 U.S.C.
1709(c)), as amended by the preceding provisions of this Act,
is further amended by adding at the end the following new
paragraph:
``(7) Payment incentives.--
``(A) Authority.--With respect to mortgages referred to in
paragraph (2)(C) or (3):
``(i) Discretionary 3-year payment incentive.--The
Secretary may provide, in the discretion of the Secretary,
that the payment incentive under subparagraph (B) shall apply
upon the expiration of the 3-year period beginning upon the
time of insurance of such a mortgage.
``(ii) Mandatory 5-year payment incentive.--The Secretary
shall provide that the payment incentive under subparagraph
(B) applies upon the expiration of the 5-year period
beginning upon the time of insurance of such a mortgage.
``(B) Payment incentive.--In the case of any mortgage to
which the payment incentive under this subparagraph applies,
if, during the period referred to in clause (i) or (ii) of
subparagraph (A), as applicable, all mortgage insurance
premiums for such mortgage have been paid on a timely basis,
upon the expiration of such period the Secretary shall--
``(i) reduce the amount of the annual premium payments
otherwise due thereafter under such mortgage--
``(I) in the case of a mortgage referred to in paragraph
(3), to an amount that does not exceed the amount of the
maximum annual premium allowable under paragraph (2)(B); and
``(II) in the case of a mortgage referred to in paragraph
(2)(C), to an amount that does not exceed the amount of the
annual premium payable at the time of insurance of the
mortgage on a mortgage of the same product type having the
same terms, but for which the mortgagor has a credit score
equivalent to a FICO score of 560 or more; and
``(ii) in the case only of a mortgage referred to in
paragraph (2)(C), refund to the mortgagor, upon payment in
full of the obligation of the mortgage, any amount by which
the single premium payment for such mortgage collected at the
time of insurance exceeded the amount of the single premium
payment chargeable under paragraph (2)(A) at the time of
insurance for a mortgage of the same product type having the
same terms, but for which the mortgagor has a credit score
equivalent to a FICO score of 560 or more.''.

SEC. 10. BORROWER PROTECTIONS FOR HIGHER RISK MORTGAGES.

Section 203(b) of the National Housing Act (12 U.S.C.
1709(b)) is amended by adding at the end the following new
paragraph:
``(10) Borrower protections for certain mortgages.--Except
as otherwise specifically provided in this paragraph, in the
case of any mortgage referred to in paragraph (2)(C) or (3)

[[Page H10458]]

of subsection (c), the following requirements shall apply:
``(A) Disclosures.--
``(i) Required disclosures.--In addition to any disclosures
that are otherwise required by law or by the Secretary for
single family mortgages, the mortgagee shall disclose to the
mortgagor the following information:

``(I) At application.--At the time of application for the
loan involved in the mortgage--

``(aa) a list of counseling agencies approved by the
Secretary in the area of the applicant; and
``(bb) if the mortgagor is not provided counseling in
accordance with subparagraph (B), the information required
under subclauses (I), (II), and (III) of subparagraph
(B)(iii) to be provided to the mortgagor.

``(II) At execution.--At the time of entering into the
mortgage--

``(aa) the terms of the mandatory 5-year payment incentive
required under subsection (c)(7)(A)(ii); and
``(bb) a statement that the mortgagor has a right under
contract to loss mitigation.

``(III) Other information.--Any other additional
information that the Secretary determines is appropriate to
ensure that the mortgagor has received timely and accurate
information about the program under paragraph (2)(C) or (3)
of subsection (c), as applicable.

``(ii) Penalties for failure to provide required
disclosures.--The Secretary may establish and impose
appropriate penalties for failure of a mortgagee to provide
any disclosure required under clause (i).
``(iii) No private right of action.--This subparagraph
shall not create any private right of action on behalf of the
mortgagor.
``(B) Counseling.--
``(i) Allowable requirement.--The Secretary may, in the
discretion of the Secretary, require that the mortgagor shall
have received counseling that complies with the requirements
of this subparagraph.
``(ii) Terms of counseling.--Counseling under this
subparagraph shall be provided--

``(I) prior to application for the loan involved in the
mortgage;
``(II) by a third party (other than the mortgagee) who is
approved by the Secretary, with respect to the
responsibilities and financial management involved in
homeownership;
``(III) on an individual basis to the mortgagor by a
representative of the approved third-party counseling entity;
and
``(IV) in person, to the maximum extent possible.

``(iii) Topics.--In the case only of a mortgage referred to
in subsection (c)(3), counseling under this subparagraph
shall include providing to, and discussing with, the
mortgagor--

``(I) information regarding homeownership options other
than a mortgage that is subject to this paragraph, other
zero- or low-downpayment mortgage options that are or may
become available to the mortgagor, the financial implications
of entering into a mortgage (including a mortgage subject to
this paragraph), and any other information that the Secretary
may require;
``(II) a written disclosure that sets forth the amount and
the percentage by which a property with a mortgage that is
subject to this paragraph must appreciate for the mortgagor
to recover the principal amount of the mortgage, the costs
financed under the mortgage, and the estimated costs involved
in selling the property, if the mortgagor were to sell the
property on each of the second, fifth, and tenth
anniversaries of the mortgage; and
``(III) a written disclosure, as the Secretary shall
require, that specifies the effective cost to a mortgagor of
borrowing the amount by which the maximum amount that could
be borrowed under a mortgage that is referred to in
subsection (c)(3) exceeds the maximum amount that could be
borrowed under a mortgage insured under this subsection that
is not a mortgage referred to in such subsection, based on
average closing costs with respect to such amount, as
determined by the Secretary; such cost shall be expressed as
an annual interest rate over the first 5 years of a mortgage;
the disclosure required under this subclause may be provided
in conjunction with the notice required under subsection (f).

``(iv) 2- and 3-family residences.--In the case of a
mortgage involving a 2- or 3-family residence, counseling
under this subparagraph shall include (in addition to the
information required under clause (iii)) information
regarding real estate property management.
``(C) Notice of foreclosure prevention counseling
availability.--
``(i) Written agreement.--To be eligible for insurance
under this subsection, the mortgagee shall provide the
mortgagor, at the time of the execution of the mortgage, a
written agreement which shall be signed by the mortgagor and
under which the mortgagee shall provide notice described in
clause (ii) to a housing counseling entity that has agreed to
provide the notice and counseling required under clause (iii)
and is approved by the Secretary.
``(ii) Notice to counseling agency.--The notice described
in this clause, with respect to a mortgage, is notice,
provided at the earliest time practicable after the mortgagor
becomes 60 days delinquent with respect to any payment due
under the mortgage, that the mortgagor is so delinquent and
of how to contact the mortgagor. Such notice may only be
provided once with respect to each delinquency period for a
mortgage.
``(iii) Notice to mortgagor.--Upon notice from a mortgagee
that a mortgagor is 60 days delinquent with respect to
payments due under the mortgage, the housing counseling
entity shall at the earliest time practicable notify the
mortgagor of such delinquency, that the entity makes
available foreclosure prevention counseling that may assist
the mortgagor in resolving the delinquency, and of how to
contact the entity to arrange for such counseling.
``(iv) Ability to cure.--Failure to provide the written
agreement required under clause (i) may be corrected by
sending such agreement to the mortgagor not later than the
earliest time practicable after the mortgagor first becomes
60 days delinquent with respect to payments due under the
mortgage. Insurance provided under this subsection may not be
terminated and penalties for such failure may not be
prospectively or retroactively imposed if such failure is
corrected in accordance with this clause.
``(v) Penalties for failure to provide agreement.--The
Secretary may establish and impose appropriate penalties for
failure of a mortgagee to provide the written agreement
required under clause (i).
``(vi) Limitation on liability of mortgagee.--A mortgagee
shall not incur any liability or penalties for any failure of
a housing counseling entity to provide notice under clause
(iii).
``(vii) No private right of action.--This subparagraph
shall not create any private right of action on behalf of the
mortgagor.
``(viii) Delinquency period.--For purposes of this
subparagraph, the term `delinquency period' means, with
respect to a mortgage, a period that begins upon the
mortgagor becoming delinquent with respect to payments due
under the mortgage and ends upon the first subsequent
occurrence of such payments under the mortgage becoming
current or the property subject to the mortgage being
foreclosed or otherwise disposed of.''.

SEC. 11. REFINANCING MORTGAGES.

Section 203 of the National Housing Act (12 U.S.C. 1709) is
amended by inserting after subsection (k) the following new
subsection:
``(l) Refinancing Mortgages.--
``(1) Establishment of underwriting standards.--The
Secretary shall establish underwriting standards that provide
for insurance under this title of mortgage loans, and take
actions to facilitate the availability of mortgage loans
insured under this title, for qualified borrowers that are
made for the purpose of paying or prepaying outstanding
obligations under existing mortgages for borrowers that--
``(A) have existing mortgages with adverse terms or rates,
or
``(B) do not have access to mortgages at reasonable rates
and terms for such refinancings due to adverse market
conditions.
``(2) Insurance of mortgages, the Secretary may issue
mortgages to borrowers in default or at risk of default.--In
facilitating insurance for such mortgages, the Secretary may
issue mortgages to borrowers who are, currently in default or
at imminent risk of being in default, but only if such loans
meet reasonable underwriting standards established by the
Secretary.''.

SEC. 12. ANNUAL REPORTS ON NEW PROGRAMS AND LOSS MITIGATION.

Section 540(b)(2) of the National Housing Act (12 U.S.C.
1735f-18(b)(2)) is amended, by adding at the end the
following new subparagraphs:
``(C) The rates of default and foreclosure for the
applicable collection period for mortgages insured pursuant
to the programs for mortgage insurance under paragraphs
(2)(C) and (3) of section 203(c).
``(D) Actions taken by the Secretary during the applicable
collection period with respect to loss mitigation on
mortgages insured pursuant to section 203.''.

SEC. 13. INSURANCE FOR SINGLE FAMILY HOMES WITH LICENSED
CHILD CARE FACILITIES.

(a) Definition of Child Care Facility.--Section 201 of the
National Housing Act (12 U.S.C. 1707) is amended by adding at
the end the following new subsection:
``(g) The term `child care facility' means a facility
that--
``(A) has as its purpose the care of children who are less
than 12 years of age; and
``(B) is licensed or regulated by the State in which it is
located (or, if there is no State law providing for such
licensing and regulation by the State, by the municipality or
other political subdivision in which the facility is
located).

Such term does not include facilities for school-age children
primarily for use during normal school hours.''.
(b) Increase in Maximum Mortgage Amount Limitation.--
Paragraph (2) of section 203(b) of the National Housing Act
(12 U.S.C. 1709(b)(2)), as amended by the preceding
provisions of this Act, is further amended by adding at end
the following new undesignated paragraph:
``Notwithstanding any other provision of this paragraph,
the amount that may be insured under this section may be
increased by up to 25 percent if such increase is necessary
to account for the increased cost of the residence due to an
increased need of space in the residence for locating and
operating a child care facility (as such term is defined in
section 201) within the residence, but only if a valid
license or certificate of compliance with regulations
described in section 201(g)(2) has been issued for such
facility as of the date of the execution of the mortgage, and
only if such increase in the amount insured is proportional
to the amount of space of such residence that will be used
for such facility.''.

SEC. 14. REHABILITATION LOANS.

Subsection (k) of section 203 of the National Housing Act
(12 U.S.C. 1709(k)) is amended--
(1) in paragraph (1), by striking ``on'' and all that
follows through ``1978''; and
(2) in paragraph (5)--
(A) by striking ``General Insurance Fund'' the first place
it appears and inserting ``Mutual Mortgage Insurance Fund'';
and
(B) in the second sentence, by striking the comma and all
that follows through ``General Insurance Fund''.

[[Page H10459]]

SEC. 15. DISCRETIONARY ACTION.

The National Housing Act is amended--
(1) in subsection (e) of section 202 (12 U.S.C. 1708(e))--
(A) in paragraph (3)(B), by striking ``section 202(e) of
the National Housing Act'' and inserting ``this subsection'';
and
(B) by redesignating such subsection as subsection (f);
(2) by striking paragraph (4) of section 203(s) (12 U.S.C.
1709(s)(4)) and inserting the following new paragraph:
``(4) the Secretary of Agriculture;''; and
(3) by transferring subsection (s) of section 203 (as
amended by paragraph (2) of this section) to section 202,
inserting such subsection after subsection (d) of section
202, and redesignating such subsection as subsection (e).

SEC. 16. INSURANCE OF CONDOMINIUMS AND MANUFACTURED HOUSING.

(a) In General.--Section 234 of the National Housing Act
(12 U.S.C. 1715y) is amended--
(1) in subsection (c)--
(A) in the first sentence--
(i) by striking ``and'' before ``(2)''; and
(ii) by inserting before the period at the end the
following: ``, and (3) the project has a blanket mortgage
insured by the Secretary under subsection (d)''; and
(B) in clause (B) of the third sentence, by striking
``thirty-five years'' and inserting ``forty years''; and
(2) in subsection (g), by striking ``, except that'' and
all that follows and inserting a period.
(b) Definition of Mortgage.--Section 201(a) of the National
Housing Act (12 U.S.C. 1707(a)) is amended--
(1) before `` a first mortgage'' insert ``(A)'';
(2) by striking ``or on a leasehold (1)'' and inserting
``(B) a first mortgage on a leasehold on real estate (i)'';
(3) by striking ``or (2)'' and inserting ``, or (ii)''; and
(4) by inserting before the semicolon the following: ``, or
(C) a first mortgage given to secure the unpaid purchase
price of a fee interest in, or long-term leasehold interest
in, real estate consisting of a one-family unit in a
multifamily project, including a project in which the
dwelling units are attached, or are manufactured housing
units, semi-detached, or detached, and an undivided interest
in the common areas and facilities which serve the project''.
(c) Definition of Real Estate.--Section 201 of the National
Housing Act (12 U.S.C. 1707), as amended by the preceding
provisions of this Act, is further amended by adding at the
end the following new subsection:
``(h) The term `real estate' means land and all natural
resources and structures permanently affixed to the land,
including residential buildings and stationary manufactured
housing. The Secretary may not require, for treatment of any
land or other property as real estate for purposes of this
title, that such land or property be treated as real estate
for purposes of State taxation.''.

SEC. 17. MUTUAL MORTGAGE INSURANCE FUND.

The first quarterly report under this paragraph shall be
submitted on the last day of the first quarter of fiscal year
2008, or upon the expiration of the 90-day period beginning
on the date of the enactment of the Expanding American
Homeownership Act of 2007, whichever is later.
``(6) Adjustment of premiums.--If, pursuant to the
independent actuarial study of the Fund required under
paragraph (5), the Secretary determines that the Fund is not
meeting the operational goals established under paragraph (8)
or there is a substantial probability that the Fund will not
maintain its established target subsidy rate, the Secretary
may either make programmatic adjustments under section 203 as
necessary to reduce the risk to the Fund, or make appropriate
premium adjustments.
``(7) Operational goals.--The operational goals for the
Fund are--
``(A) to charge borrowers under loans that are obligations
of the Fund an appropriate premium for the risk that such
loans pose to the Fund;
``(B) to minimize the default risk to the Fund and to
homeowners;
``(C) to curtail the impact of adverse selection on the
Fund; and
``(D) to meet the housing needs of the borrowers that the
single family mortgage insurance program under this title is
designed to serve.''.
(b) Obligations of Fund.--The National Housing Act is
amended as follows:
(1) Homeownership voucher program mortgages.--In section
203(v) (12 U.S.C. 1709(v))--
(A) by striking ``Notwithstanding section 202 of this
title, the'' and inserting ``The''; and
(B) by striking ``General Insurance Fund'' the first place
such term appears and all that follows and inserting ``Mutual
Mortgage Insurance Fund.''.
(2) Home equity conversion mortgages.--Section 255(i)(2)(A)
of the National Housing Act (12 U.S.C. 1715z-20(i)(2)(A)) is
amended by striking ``General Insurance Fund'' and inserting
``Mutual Mortgage Insurance Fund''.
(c) Conforming Amendments.--The National Housing Act is
amended--
(1) in section 205 (12 U.S.C. 1711), by striking
subsections (g) and (h); and
(2) in section 519(e) (12 U.S.C. 1735c(e)), by striking
``203(b)'' and all that follows through ``203(i)'' and
inserting ``203, except as determined by the Secretary''.

SEC. 18. HAWAIIAN HOME LANDS AND INDIAN RESERVATIONS.

(a) Hawaiian Home Lands.--Section 247(c) of the National
Housing Act (12 U.S.C. 1715z-12) is amended--
(1) by striking ``General Insurance Fund established in
section 519'' and inserting ``Mutual Mortgage Insurance
Fund''; and
(2) in the second sentence, by striking ``(1) all
references'' and all that follows through ``and (2)''.
(b) Indian Reservations.--Section 248(f) of the National
Housing Act (12 U.S.C. 1715z-13) is amended--
(1) by striking ``General Insurance Fund'' the first place
it appears and all that follows through ``519'' and inserting
``Mutual Mortgage Insurance Fund''; and
(2) in the second sentence, by striking ``(1) all
references'' and all that follows through ``and (2)''.

SEC. 19. CONFORMING AND TECHNICAL AMENDMENTS.

(a) Repeals.--The following provisions of the National
Housing Act are repealed:
(1) Subsection (i) of section 203 (12 U.S.C. 1709(i)).
(2) Subsection (o) of section 203 (12 U.S.C. 1709(o)).
(3) Subsection (p) of section 203 (12 U.S.C. 1709(p)).
(4) Subsection (q) of section 203 (12 U.S.C. 1709(q)).
(5) Section 222 (12 U.S.C. 1715m).
(6) Section 237 (12 U.S.C. 1715z-2).
(7) Section 245 (12 U.S.C. 1715z-10).
(b) Definition of Area.--Section 203(u)(2)(A) of the
National Housing Act (12 U.S.C. 1709(u)(2)(A)) is amended by
striking ``shall'' and all that follows and inserting ``means
a metropolitan statistical area as established by the Office
of Management and Budget;''.
(c) Definition of State.--Section 201(d) of the National
Housing Act (12 U.S.C. 1707(d)) is amended by striking ``the
Trust Territory of the Pacific Islands'' and inserting ``the
Commonwealth of the Northern Mariana Islands''.

SEC. 20. HOME EQUITY CONVERSION MORTGAGES.

(a) In General.--Section 255 of the National Housing Act
(12 U.S.C. 1715z-20) is amended--
(1) in subsection (b)(2), insert `` `real estate,' '' after
`` `mortgagor','';
(2) in subsection (g)--
(A) by striking the first sentence; and
(B) by striking ``established under section 203(b)(2)'' and
all that follows through ``located'' and inserting
``limitation established under section 305(a)(2) of the
Federal Home Loan Mortgage Corporation Act for a 1-family
residence'';
(3) in subsection (i)(1)(C), by striking ``limitations''
and inserting ``limitation''; and
(4) by adding at the end the following new subsection:
``(o) Authority To Insure Home Purchase Mortgage.--
``(1) In general.--Notwithstanding any other provision in
this section, the Secretary may insure, upon application by a
mortgagee, a home equity conversion mortgage upon such terms
and conditions as the Secretary may prescribe, when the
primary purpose of the home equity conversion mortgage is to
enable an elderly mortgagor to purchase a 1- to 4-family
dwelling in which the mortgagor will occupy or occupies one
of the units.
``(2) Limitation on principal obligation.--A home equity
conversion mortgage insured pursuant to paragraph (1) shall
involve a principal obligation that does not exceed the
dollar

[[Page H10460]]

amount limitation determined under section 305(a)(2) of the
Federal Home Loan Mortgage Corporation Act for a residence of
the applicable size.''.
(b) Mortgages for Cooperatives.--Subsection (b) of section
255 of the National Housing Act (12 U.S.C. 1715z-20(b)) is
amended--
(1) in paragraph (4)--
(A) by inserting ``a first or subordinate mortgage or
lien'' before ``on all stock'';
(B) by inserting ``unit'' after ``dwelling''; and
(C) by inserting ``a first mortgage or first lien'' before
``on a leasehold''; and
(2) in paragraph (5), by inserting ``a first or subordinate
lien on'' before ``all stock''.
(c) Limitation on Origination Fees.--Section 255 of the
National Housing Act (12 U.S.C. 1715z-20), as amended by the
preceding provisions of this section, is further amended--
(1) by redesignating subsections (k), (l), and (m) as
subsections (l), (m), and (n), respectively; and
(2) by inserting after subsection (j) the following new
subsection:
``(k) Limitation on Origination Fees.--The Secretary shall
establish limits on the origination fee that may be charged
to a mortgagor under a mortgage insured under this section,
which limitations shall--
``(1) equal to 1.5 percent of the maximum claim amount of
the mortgage, except that the Secretary may adjust the
limitation under this paragraph on the basis of an analysis
of (A) costs to mortgagors, and (B) the impact on the reverse
mortgage market;
``(2) be subject to a minimum allowable amount;
``(3) provide that the origination fee may be fully
financed with the mortgage;
``(4) include any fees paid to correspondent mortgagees
approved by the Secretary or to mortgage brokers; and
``(5) apply beginning upon the date that the maximum dollar
amount limitation on the benefits of insurance under this
section is first increased pursuant to the amendments made by
section 19(a)(2) of the Expanding American Homeownership Act
of 2007.''.
(d) Study Regarding Mortgage Insurance Premiums.--The
Secretary of Housing and Urban Development shall conduct a
study regarding mortgage insurance premiums charged under the
program under section 255 of the National Housing Act (12
U.S.C. 1715z-20) for insurance of home equity conversion
mortgages to analyze and determine the effects of reducing
the amounts of such premiums from the amounts charged as of
the date of the enactment of this Act on (1) costs to
mortgagors, and (2) the financial soundness of the program.
Not later than the expiration of the 12-month period
beginning on the date of the enactment of this Act, the
Secretary shall submit a report to the Congress setting forth
the results and conclusions of the study.

SEC. 21. PARTICIPATION OF MORTGAGE BROKERS AND CORRESPONDENT
LENDERS.

(a) In General.--
(1) Definitions.--
(A) In general.--Section 201 of the National Housing Act
(12 U.S.C. 1707), as amended by the preceding provisions of
this Act, is further amended--
(i) by striking ``As used in section 203 of this title--''
and inserting ``As used in this title and for purposes of
participation in insurance programs under this title, except
as specifically provided otherwise, the following definitions
shall apply:'';
(ii) by striking subsection (b) and inserting the
following:
``(2) The term `mortgagee' means any of the following
entities, and its successors and assigns, to the extent such
entity is approved by the Secretary:
``(A) Qualification by audit and net worth.--A lender who--
``(i) closes a mortgage in its name and underwrites the
mortgage, services the mortgage, or both underwrites and
services the mortgage;
``(ii) submits to the Secretary such financial audits
performed in accordance with the standards for financial
audits of the Government Auditing Standards issued by the
Comptroller General of the United States;
``(iii) meet the minimum net worth requirement that the
Secretary shall establish;
``(iv) is licensed, under the laws of the State in which
the property that is subject to the mortgage is located, to
act as a lender in such State; and
``(v) complies with such other requirements as the
Secretary may establish.
``(B) Qualification of correspondent lenders by surety
bond.--Except as provided in subparagraph (D), a
correspondent lender who--
``(i) closes a mortgage in its name, but does not
underwrite and does not service the mortgage;
``(ii) is licensed, under the laws of the State in which
the property that is subject to the mortgage is located, to
act as a correspondent lender in such State;
``(iii) posts a surety bond, in lieu of any requirement to
provide audited financial statements or meet a minimum net
worth requirement, that--

``(I) is in a form satisfactory to the Secretary;
``(II) is in an aggregate amount, to be determined by the
Secretary based on the aggregate principal amount of single-
family mortgages insured under this title that are placed in
a calendar year, which shall not be less than $50,000 or more
than $100,000, as such amount is adjusted annually by the
Secretary (as determined by the Secretary) by the change for
such year in the Consumer Price Index for All Urban Consumers
published monthly by the Bureau of Labor Statistics of the
Department of Labor;
``(III) guarantees payment of any liability of the
correspondent lender arising from its participation in the
program, up to the penal sum of the surety bond; without
regard to the number of years the bond remains in effect, the
number of claims or claimants, and the number of premiums
paid, in no event shall the aggregate liability of the surety
exceed the penal sum of the bond; and
``(IV) may be cancelled by the surety as to future
liability by giving 30 days notice in writing to the
Secretary, except that any such cancellation shall not alter
the liability of the surety for actions of the correspondent
lender prior to the effective date of teh cancellation; and

``(iv) complies with such other requirements as the
Secretary may establish, except that the Secretary shall not
require any minimum net worth or certified financial
statements.
``(C) Qualification of brokers by surety bond.--Except as
provided in subparagraph (D), a mortgage broker who--
``(i) closes the mortgage in the name of the lender, and
does not underwrite and does not service the mortgage;
``(ii) is licensed, under the laws of the State in which
the property that is subject to the mortgage is located, to
act as a mortgage broker in such State;
``(iii) posts a surety bond in accordance with the
requirements of subparagraph (B)(ii); and
``(iv) complies with such other requirements as the
Secretary may establish, except that the Secretary shall not
require any minimum net worth or certified financial
statement.
``(D) Conditions for continued applicability.--(i)
Subparagraphs (B) and (C) shall continue to apply after the
expiration of the 5-year period beginning on the date of the
enactment of the Expanding American Homeownership Act of 2007
only if, after the expiration of the 4-year period beginning
upon such date of enactment and taking into consideration the
report submitted in accordance with section 19(b) of such
Act, the Secretary--
``(I) makes a determination that such subparagraphs provide
protection to mortgage insurance funds for mortgages insured
under this title that are comparable to the protection
provided by the requirements for mortgagees under this title
as in effect immediately before the enactment of such Act;
and
``(II) publishes in the Federal Register a notice of such
determination and an order extending the applicability of
such subparagraphs.
``(ii) If, taking into consideration such report, the
Secretary makes a determination after the expiration of such
4-year period that subparagraphs (B) and (C) do not provide
protection as referred to in clause (i) of this subparagraph,
the Secretary may, by order published in the Federal
Register, provide for the participation, after the expiration
of the 5-year period referred to in clause (i), of
correspondent lenders and mortgage brokers as mortgagees in
the insurance programs under this title in accordance with
subparagraphs (B) and (C) as modified by the Secretary as the
Secretary considers appropriate to provide such protection.
``(E) Additional mortgage broker requirements.--
``(i) In addition to the requirements under subparagraphs
(A) and (C) and to duties imposed under other statutes or
common law, to be eligible as a mortgagee under this section,
a broker shall--

``(I) safeguard and account for any money handled for the
borrower;
``(II) follow reasonable and lawful instructions from the
borrower; and
``(III) act with reasonable skill, care, and diligence.

``(ii) For purposes of this subparagraph, a loan
correspondent shall be considered to be a mortgage broker.
``(iii) The duties and standards of care created in this
subparagraph shall not be waived or modified.
``(iv) Any broker found by the Secretary to have violated
the requirements of this subparagraph may not originate
mortgage loans insured under this title.
``(3) The term `mortgagor' includes the original borrower
under a mortgage and the successors and assigns of the
original borrower.''; and
(iii) by redesignating subsections (a), (c), (d), (e), (f),
(g), and (h) as paragraphs (1), (4), (5), (6), (7), (8), and
(9), respectively, and indenting such paragraphs two ems so
as to align the left margins of such paragraphs with the left
margins of paragraphs (2) and (3) (as added by clause (ii) of
this subparagraph).
(B) Mortgagee review.--Section 202(c)(7) of the National
Housing Act (12 U.S.C. 1708(c)(7)) is amended--
(i) in subparagraph (A), by inserting ``, as defined in
section 201,'' after ``mortgagee'';
(ii) by striking subparagraph (B); and
(iii) by redesignating subparagraphs (C) and (D) as
subparagraphs (B) and (C), respectively.
(C) Multifamily rental housing insurance.--Section
207(a)(2) of the National Housing Act (12 U.S.C. 1713(a)(2))
is amended by striking ``means the original lender under a
mortgage, and its successors and assigns, and'' and inserting
``has the meaning given such term in section 201, except that
such term also''.
(D) War housing insurance.--Section 601(b) of the National
Housing Act (12 U.S.C. 1736(b)) is amended by striking
``includes the original lender under a mortgage, and his
successors and assigns approved by the Secretary'' and
inserting ``has the meaning given such term in section 201''.
(E) Armed services housing mortgage insurance.--Section
801(b) of the National Housing Act (12 U.S.C. 1748(b)) is
amended by striking ``includes the original lender under a
mortgage, and his successors and assigns approved by the
Secretary'' and inserting ``has the meaning given such term
in section 201''.
(F) Group practice facilities mortgage insurance.--Section
1106(8) of the National Housing Act (12 U.S.C. 1749aaa-5(8))
is amended by striking ``means the original lender under a
mortgage, and his or its successors and assigns,

[[Page H10461]]

and'' and inserting ``has the meaning given such term in
section 201, except that such term also''.
(2) Eligibility for insurance.--
(A) Title i.--Paragraph (1) of section 8(b) of the National
Housing Act (12 U.S.C. 1706c(b)(1)) is amended--
(i) by striking ``, and be held by,''; and
(ii) by striking ``as responsible and able to service the
mortgage properly''.
(B) Single family housing mortgage insurance.--Paragraph
(1) of section 203(b) of the National Housing Act (12 U.S.C.
1709(b)(1)) is amended--
(i) by striking ``, and be held by,''; and
(ii) by striking ``as responsible and able to service the
mortgage properly''.
(C) Section 221 mortgage insurance.--Paragraph (1) of
section 221(d) of the National Housing Act (12 U.S.C.
1715l(d)(1)) is amended--
(i) by striking ``and be held by''; and
(ii) by striking ``as responsible and able to service the
mortgage properly''.
(D) Home equity conversion mortgage insurance.--Paragraph
(1) of section 255(d) of the National Housing Act (12 U.S.C.
1715z-20(d)(1)) is amended by striking ``as responsible and
able to service the mortgage properly''.
(E) War housing mortgage insurance.--Paragraph (1) of
section 603(b) of the National Housing Act (12 U.S.C.
1738(b)(1)) is amended--
(i) by striking ``, and be held by,''; and
(ii) by striking ``as responsible and able to service the
mortgage properly''.
(F) War housing mortgage insurance for large-scale housing
projects.--Paragraph (1) of section 611(b) of the National
Housing Act (12 U.S.C. 1746(b)(1)) is amended--
(i) by striking ``and be held by''; and
(ii) by striking ``as responsible and able to service the
mortgage properly''.
(G) Group practice facility mortgage insurance.--Section
1101(b)(2) of the National Housing Act (12 U.S.C.
1749aaa(b)(2)) is amended--
(i) by striking ``and held by''; and
(ii) by striking ``as responsible and able to service the
mortgage properly''.
(H) National defense housing insurance.--Paragraph (1) of
section 903(b) of the National Housing Act (12 U.S.C.
1750b(b)(1)) is amended--
(i) by striking ``, and be held by,''; and
(ii) by striking ``as responsible and able to service the
mortgage properly''.
(I) Contingent repeal.--Unless there is published in the
Federal Register, before the expiration of the 5-year period
beginning on the date of the enactment of this Act, an order
under clause (i) or (ii) of section 201(2)(D) of the National
Housing Act (12 U.S.C. 1707(2)(D)), as added by paragraph
(1)(A)(2) of this subsection, upon the expiration of such
period the provisions of such Act amended by this paragraph
are amended to read as such provisions would be in effect
upon such expiration if this Act had not been enacted (taking
into consideration any amendments, after such date of
enactment, to such provisions other than under this Act).
(b) GAO Study and Report.--
(1) Study.--The Comptroller General of the United States
shall conduct a study, upon the expiration of the 42-month
period beginning on the date of the enactment of this Act,
regarding the effect of the amendments made by subsection
(a), which shall analyze and determine--
(A) the extent to which such amendments have resulted in
increased participation, by mortgage brokers and
correspondent lenders, in the mortgage insurance programs
under the National Housing Act, as measured by the number and
amounts of such insured mortgages, disaggregated by the
States in which the properties subject to such mortgages are
located;
(B) with respect to mortgages insured under such Act, a
comparison in the numbers and rate of defaults, foreclosures,
and mortgage insurance claims on such mortgages originated by
mortgage brokers and correspondent lenders authorized to
participate in the programs under such Act pursuant to the
amendments made by subsection (a) to such numbers and rates
on such mortgages originated by lenders who would be
authorized to participate in such programs notwithstanding
such amendments;
(C) any impact of such amendments on the costs to the
Secretary of Housing and Urban Development of administering
the mortgage insurance programs under such title; and
(D) the extent and effectiveness of the supervision and
enforcement, by the Secretary, of the additional authority
provided under the amendments made by subsection (a).
(2) Report.--Not later than the expiration of 4-year period
beginning on the date of the enactment of this Act, the
Comptroller General shall submit a report to the Congress and
the Secretary of Housing and Urban Development setting forth
the results and conclusions of the study conducted pursuant
to paragraph (1).

SEC. 22. CONFORMING LOAN LIMIT IN DISASTER AREAS.

Section 203(h) of the National Housing Act (12 U.S.C. 1709)
is amended--
(1) by inserting after ``property'' the following: ``plus
any initial service charges, appraisal, inspection and other
fees in connection with the mortgage as approved by the
Secretary,'';
(2) by striking the second sentence (as added by chapter 7
of the Emergency Supplemental Appropriations Act of 1994
(Public Law 103-211; 108 Stat. 12)); and
(3) by adding at the end the following new sentence: ``In
any case in which the single family residence to be insured
under this subsection is within a jurisdiction in which the
President has declared a major disaster to have occurred, the
Secretary is authorized, for a temporary period not to exceed
36 months from the date of such Presidential declaration, to
enter into agreements to insure a mortgage which involves a
principal obligation of up to 100 percent of the dollar
limitation determined under section 305(a)(2) of the Federal
Home Loan Mortgage Corporation Act for a single family
residence, and not in excess of 100 percent of the appraised
value of the property plus any initial service charges,
appraisal, inspection and other fees in connection with the
mortgage as approved by the Secretary.''.

SEC. 23. FAILURE TO PAY AMOUNTS FROM ESCROW ACCOUNTS FOR
SINGLE FAMILY MORTGAGES.

(a) Penalties.--Section 536 of the National Housing Act (12
U.S.C. 1735f-14) is amended--
(1) in subsection (a)(1), by inserting ``servicers
(including escrow account servicers),'' after
``appraisers,'';
(2) in subsection (b)(1)--
(A) in the matter preceding subparagraph (A), by inserting
``or other participant referred to in subsection (a),'' after
``lender,'' ; and
(B) by inserting at the end the following new
subparagraphs:
``(K) In the case of a mortgage for a 1- to 4-family
residence insured under title II that requires the mortgagor
to make payments to the mortgagee or other servicer of the
mortgage for deposit into an escrow account for the purpose
of assuring payment of taxes, insurance premiums, and other
charges with respect to the property, failure on the part of
the servicer to make any such payment from the escrow account
by the deadline to avoid a penalty with respect to such
payment provided for in the mortgage, unless the servicer was
not provided notice of such deadline.
``(L) In the case of any failure to make any payment as
described in subparagraph (K), submitting any information to
a consumer reporting agency (as such term is defined in
section 603(f) of the Fair Credit Reporting Act (15 U.S.C.
1681a(f))) regarding such failure that is adverse to the
credit rating or interest of the mortgagor.''; and
(3) in subsection (c)(3), by adding at the end the
following: ``In the case of any failure to make a payment
described in subsection (b)(1)(K) for which the servicer
fails to reimburse the mortgagor (A) before the expiration of
the 60-day period beginning on the deadline to avoid a
penalty with respect to such payment, in the sum of the
amount not paid from the escrow account by such deadline and
the amount of any penalties accruing to the mortgagor that
are attributable to such failure, or (B) in the amount of any
attorneys fees incurred by the mortgagor and attributable to
such failure, the Secretary shall increase the amount of the
penalty under subsection (a) for any such failure to
reimburse, unless the Secretary determines there are
mitigating circumstances.''.
(b) Prohibition on Submission of Information by HUD.--Title
II of the National Housing Act (12 U.S.C. 1707 et seq.) is
amended by adding at the end the following new section:

``SEC. 257. PROHIBITION REGARDING FAILURE ON PART OF SERVICER
TO MAKE ESCROW PAYMENTS.

``In the case of any failure to make any payment as
described in section 536(b)(1)(K), the Secretary may not
submit any information to a consumer reporting agency (as
such term is defined in section 603(f) of the Fair Credit
Reporting Act (15 U.S.C. 1681a(f))) regarding such failure
that is adverse to the credit rating or interest of the
mortgagor.''.

SEC. 24. ACCEPTABLE IDENTIFICATION FOR FHA MORTGAGORS.

(a) In General.--Title II of the National Housing Act is
amended by inserting after section 209 (12 U.S.C. 1715) the
following new section:

``SEC. 210. FORMS OF ACCEPTABLE IDENTIFICATION.

``The Secretary may not insure a mortgage under any
provision of this title unless the mortgagor under the
mortgage provides personal identification in one of the
following forms:
``(1) Social security card with photo identification card
or real id act identification.--
``(A) A social security card accompanied by a photo
identification card issued by the Federal Government or a
State Government; or
``(B) A driver's license or identification card issued by a
State in the case of a State that is in compliance with title
II of the REAL ID Act of 2005 (title II of division B of
Public Law 109-13; 49 U.S.C. 30301 note).
``(2) Passport.--A passport issued by the United States or
a foreign government.
``(3) USCIS photo identification card.--A photo
identification card issued by the Secretary of Homeland
Security (acting through the Director of the United States
Citizenship and Immigration Services).''.
(b) Effective Date.--The requirements of section 210 of the
National Housing Act (as added by subsection (a) of this
section) shall take effect six months after the date of the
enactment of this Act.

SEC. 25. PILOT PROGRAM FOR AUTOMATED PROCESS FOR BORROWERS
WITHOUT SUFFICIENT CREDIT HISTORY.

(a) Establishment.--Title II of the National Housing Act
(12 U.S.C. 1707 et seq.), as amended by the preceding
provisions of this Act, is further amended by adding at the
end the following new section:

``SEC. 258. PILOT PROGRAM FOR AUTOMATED PROCESS FOR BORROWERS
WITHOUT SUFFICIENT CREDIT HISTORY.

``(a) Establishment.--The Secretary shall carry out a pilot
program to establish, and make available to mortgagees, an
automated process for providing alternative credit rating
information for mortgagors and prospective mortgagors under
mortgages on 1- to 4-family residences to be insured under
this title who have insufficient

[[Page H10462]]

credit histories for determining their creditworthiness. Such
alternative credit rating information may include rent,
utilities, and insurance payment histories, and such other
information as the Secretary considers appropriate.
``(b) Scope.--The Secretary may carry out the pilot program
under this section on a limited basis or scope, and may
consider limiting the program--
``(1) to first-time homebuyers; or
``(2) metropolitan statistical areas significantly impacted
by subprime lending.
``(c) Limitation.--In any fiscal year, the aggregate number
of mortgages insured pursuant to the automated process
established under this section may not exceed 5 percent of
the aggregate number of mortgages for 1- to 4-family
residences insured by the Secretary under this title during
the preceding fiscal year.
``(d) Sunset.--After the expiration of the 5-year period
beginning on the date of the enactment of the Expanding
American Homeownership Act of 2007, the Secretary may not
enter into any new commitment to insure any mortgage, or
newly insure any mortgage, pursuant to the automated process
established under this section.''.
(b) GAO Report.--Not later than the expiration of the four-
year period beginning on the date that the Secretary of
Housing and Urban Development first insures any mortgage
pursuant to the automated process established under pilot
program under section 258 of the National Housing Act (as
added by the amendment made by subsection (a) of this
section). Such automated process and the impact of such
process and the insurance of mortgages pursuant to such
process on the safety and soundness of the insurance funds
under the National Housing Act of which such mortgages are
obligations.

SEC. 26. SENSE OF CONGRESS REGARDING TECHNOLOGY FOR FINANCIAL
SYSTEMS.

(a) Congressional Findings.--The Congress finds the
following:
(1) The Government Accountability Office has cited the FHA
single family housing mortgage insurance program as a ``high-
risk'' program, with a primary reason being non-integrated
and out-dated financial management systems.
(2) The ``Audit of the Federal Housing Administration's
Financial Statements for Fiscal Years 2004 and 2003'',
conducted by the Inspector General of the Department of
Housing and Urban Development reported as a material weakness
that ``HUD/FHA's automated data processing [ADP] system
environment must be enhanced to more effectively support
FHA's business and budget processes''.
(3) Existing technology systems for the FHA program have
not been updated to meet the latest standards of the Mortgage
Industry Standards Maintenance Organization and have numerous
deficiencies that lenders have outlined.
(4) Improvements to technology used in the FHA program
will--
(A) allow the FHA program to improve the management of the
FHA portfolio, garner greater efficiencies in its operations,
and lower costs across the program;
(B) result in efficiencies and lower costs for lenders
participating in the program, allowing them to better use the
FHA products in extending homeownership opportunities to
higher credit risk or lower-income families, in a sound
manner.
(5) The Mutual Mortgage Insurance Fund operates without
cost to the taxpayers and generates revenues for the Federal
Government.
(b) Sense of Congress.--It is the sense of the Congress
that--
(1) the Secretary of Housing and Urban Development should
use a portion of the funds received from premiums paid for
FHA single family housing mortgage insurance that are in
excess of the amounts paid out in claims to substantially
increase the funding for technology used in such FHA program;
(2) the goal of this investment should be to bring the
technology used in such FHA program to the level and
sophistication of the technology used in the conventional
mortgage lending market, or to exceed such level; and
(3) the Secretary of Housing and Urban Development should
report to the Congress not later than 180 days after the date
of the enactment of this Act regarding the progress the
Department is making toward such goal and if progress is not
sufficient, the resources needed to make greater progress.

SEC. 27. MULTIFAMILY HOUSING MORTGAGE LIMITS IN HIGH COST
AREAS.

The National Housing Act is amended--
(1) in sections 207(c)(3), 213(b)(2)(B)(i),
221(d)(3)(ii)(II), 221(d)(4)(ii)(II), 231(c)(2)(B), and
234(e)(3)(B) (12 U.S.C. 1713(c)(3), 1715e(b)(2)(B)(i),
1715l(d)(3)(ii)(II), 1715l(d)(4)(ii)(II), 1715v(c)(2)(B), and
1715y(e)(3)(B))--
(A) by striking ``140 percent'' each place such term
appears and inserting ``170 percent''; and
(B) by striking ``170 percent in high cost areas'' each
place such term appears and inserting ``215 percent in high
cost areas''; and
(2) in section 220(d)(3)(B)(iii)(III) (12 U.S.C.
1715k(d)(3)(B)(iii)(III)) by striking ``206A'' and all that
follows through ``project-by-project basis'' and inserting
the following: ``206A of this Act) by not to exceed 170
percent in any geographical area where the Secretary finds
that cost levels so require and by not to exceed 170 percent,
or 215 percent in high cost areas, where the Secretary
determines it necessary on a project-by-project basis''.

SEC. 28. DISCOUNT SALES OF MULTIFAMILY PROPERTIES.

There is authorized to be appropriated, for discount sales
of multifamily real properties under section 207(1) or 246 of
the National housing Act (12 U.S.C. 1713(1), 1715z-11),
section 203 of the Housing and Community Development
Amendments of 1978 (12 U.S.C. 1701z-11), or section 204 of
the Departments of Veterans Affairs and Housing and Urban
Development, and Independent Agencies Appropriations Act,
1997 (12 U.S.C. 1715z-11a), and for discount loan sales under
section 207(k) of the National Housing Act (12 U.S.C.
1713(k)), section 203 of the Housing and Community
Development Amendments of 1978 (12 U.S.C. 1701z-11(k)), or
section 204(a) of the Departments of Veterans Affairs and
Housing and Urban Development, and Independent Agencies
Appropriations Act, 1997 (12 U.S.C. 1715z-11a(a)),
$5,000,000, for fiscal year 2008.

SEC. 29. CLARIFICATION OF DISPOSITION OF CERTAIN PROPERTIES.

Notwithstanding any other provision of law, subtitle A of
title II of the Deficit Reduction Act of 2005 (12 U.S.C.
1701z-11 note) and the amendments made by such title shall
not apply to any transaction regarding a multifamily real
property for which--
(1) the Secretary of Housing and Urban Development has
received, before the date of the enactment of such Act,
written expressions of interest in purchasing the property
from both a city government and the housing commission of
such city;
(2) after such receipt, the Secretary acquires title to the
property at a foreclosure sale; and
(3) such city government and housing commission have
resolved a previous disagreement with respect to the
disposition of the property.

SEC. 30. NONCOMPETITIVE SALES BY HUD TO STATES AND
LOCALITIES.

Subtitle A of title II of the Deficit Reduction Act of 2005
(Public Law 109-171; 120 Stat. 7) is amended by adding at the
end the following new section:

SEC. 2004. NONCOMPETITIVE SALES IN FISCAL YEAR 2011.

``Notwithstanding any other provision of law, the Secretary
may not sell any multifamily real property through any
discount sale during fiscal year 2011 under the provisions of
law referred to in section 2002(a) or any multifamily loan
through any discount loan sale during such fiscal year under
the provisions referred to in section 2002(b), unless the
property or loan is sold for an amount that is equal to or
greater than 60 percent of the property market value or loan
market value, respectively.''.

SEC. 31. USE OF FHA SAVINGS FOR COSTS OF MORTGAGE INSURANCE,
HOUSING COUNSELING, FHA TECHNOLOGIES,
PROCEDURES, AND PROCESSES, AND FOR AFFORDABLE
HOUSING GRANT FUND, AND STUDY.

(a) In General.--Subject to subsection (c), there is
authorized to be appropriated for each fiscal year an amount
equal to the net increase for such fiscal year in, except as
provided in subsection (b), the negative credit subsidy for
the mortgage insurance programs under title II of the
National Housing Act resulting from this Act and the
amendments made by this Act, for the following purposes in
the following amounts:
(1) Single family housing mortgage insurance.--For each
fiscal year, for costs (as such term is defined in section
502 of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a))
of mortgage insurance provided pursuant to section 203(b) of
the National Housing Act (12 U.S.C. 1709(b)), the additional
amount (not including any costs of such mortgage insurance
resulting from this Act or the amendments made by this Act),
if any, necessary to ensure that the credit subsidy cost of
such mortgage insurance for such fiscal year is $0.
(2) Housing counseling.--For each of fiscal years 2008
through 2012, the amount needed to increase funding, for the
housing counseling program under section 106 of the Housing
and Urban Development Act of 1968 (12 U.S.C. 1701x), in
connection with homebuyers and homeowners with mortgages
insured under title II of the National Housing Act, from the
amount appropriated for the preceding fiscal year to
$100,000,000.
(3) Mortgage insurance technology, procedures, processes,
program performance, and salaries.--For each of fiscal years
2008 through 2012, $25,000,000 for increasing funding for the
purpose of improving technology, procedures, processes, and
program performance, and salaries in connection with the
mortgage insurance programs under title II of the National
Housing Act.
(4) Affordable housing fund.--For each fiscal year, for an
affordable housing fund available for use only for grants to
provide affordable rental housing and affordable
homeownership opportunities for low-income families, the
amount remaining under this section after amounts are made
available for such fiscal year in accordance with paragraphs
(1), (2), and (3).
(b) Exclusion of Earnings From the Single Family Mortgage
Insurance Program.--With respect to a fiscal year, the
negative credit subsidy determined under subsection (a) shall
not include the negative credit subsidy cost for such fiscal
year, if any, for mortgage insurance provided pursuant to
section 203(b) of the National Housing Act.
(c) Certification.--Subsection (a) shall not be effective
for a fiscal year unless the Secretary of Housing and Urban
Development has, by rule making in accordance with section
553 of title 5, United States Code (notwithstanding
subsections (a)(2), (b)(B), and (d)(3) of such section), made
a determination that premiums being, or to be, charged during
such fiscal year for mortgage insurance under title II of the
National Housing Act are established at the minimum amount
sufficient to comply with the requirements of section 205(f)
of such Act (relating to required capital ratio for the
Mutual Mortgage Insurance Fund) and ensure the safety and
soundness of the other mortgage insurance funds under such
Act, and any negative credit subsidy for such fiscal year
resulting from such mortgage insurance programs adequately
ensures the efficient delivery and availability of such
programs.

[[Page H10463]]

(d) Study and Report.--The Secretary of Housing and Urban
Development shall conduct a study to obtain recommendations
from participants in the private residential mortgage lending
business and the secondary market for such mortgages on how
best to update and upgrade procedures, processes, and
technologies for the mortgage insurance programs under title
II of the National Housing Act so that the policies and
procedures for originating, insuring, and servicing of such
mortgages conform with those customarily used by secondary
market purchasers of residential mortgage loans. Not later
than the expiration of the 12-month period beginning on the
date of the enactment of this Act, the Secretary shall submit
a report to the Congress describing the progress made and to
be made toward updating and upgrading such procedures,
processes, and technology, and providing appropriate staffing
for such mortgage insurance programs.

SEC. 32. LIMITATION ON MORTGAGE INSURANCE PREMIUM INCREASES.

Notwithstanding any other provision of law, including any
provision of this Act and any amendment made by this Act--
(1) the premiums charged for mortgage insurance under any
program under the National Housing Act may not be increased
above the premium amounts in effect under such program on
October 1, 2006, unless the Secretary of Housing and Urban
Development determines that, absent such increase, insurance
of additional mortgages under such program would, under the
Federal Credit Reform Act of 1990, require the appropriation
of new budget authority to cover the costs (as such term is
defined in section 502 of the Federal Credit Reform Act of
1990 (2 U.S.C. 661a) of such insurance; and
(2) a premium increase pursuant to paragraph (1) may be
made only by rule making in accordance with the procedures
under section 553 of title 5, United States Code
(notwithstanding subsections (a)(2), (b)(B), and (d)(3) of
such section).

SEC. 33. CIVIL MONEY PENALITIES FOR IMPROPERLY INFLUENCING
APPRAISALS.

Paragraph (2) of section 536(b) of the National Housing Act
(12 U.S.C. 1735f-14(b)(2)) is amended--
(1) in subparagraph (B), by striking ``or'' at the end;
(2) in subparagraph (C), by striking the period at the end
and inserting ``; or''; and
(3) by adding at the end the following new subparagraph:
``(D) in the case of an insured mortgage under title II for
a 1- to 4-family residence, compensating, instructing,
inducing, coercing, or intimidating any person who conducts
an appraisal of the property in connection with such
mortgage, or attempting to compensate, instruct, induce,
coerce, or intimidate such a person, for the purpose of
causing the appraised value assigned to the property under
the appraisal to be based on any other factor other than the
independent judgment of such person exercised in accordance
with applicable professional standards.''.

SEC. 34. SAVINGS PROVISION.

Any mortgage insured under title II of the National Housing
Act before the date of enactment of this title shall continue
to be governed by the laws, regulations, orders, and terms
and conditions to which it was subject on the day before the
date of the enactment of this Act.

SEC. 35. IMPLEMENTATION.

Except as provided in section 23(b), the Secretary of
Housing and Urban Development shall by notice establish any
additional requirements that may be necessary to immediately
carry out the provisions of this Act. The notice shall take
effect upon issuance.
The CHAIRMAN. No further amendment to the bill, as amended, is in
order except those printed in part B of the report. Each further
amendment may be offered only in the order printed in the report,
except for amendment No. 2, which may be offered out of sequence, by a
Member designated in the report, shall be considered read, shall be
debatable for the time specified in the report, equally divided and
controlled by the proponent and an opponent, shall not be subject to
amendment, and shall not be subject to a demand for division of the
question.

Amendment No. 2 Offered by Mr. Cardoza

The CHAIRMAN. It is now in order to consider amendment No. 2 printed
in part B of House Report 110-330.
Mr. CARDOZA. Madam Chairman, I offer an amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:

Amendment No. 2 offered by Mr. Cardoza:
Strike line 19 on page 4 and all that follows through page
5, line 22, and insert the following:

SEC. 3. MAXIMUM PRINCIPAL LOAN OBLIGATION.

Section 203(b)(2) of the National Housing Act (12 U.S.C.
1709(b)(2)(A)) is amended by striking subparagraph (A) and
inserting the following new subparagraph:
``(A) not to exceed the lesser of--
``(i) in the case of a 1-family residence, 125 percent of
the median 1-family house price in the area, as determined by
the Secretary; and in the case of a 2-, 3-, or 4-family
residence, the percentage of such median price that bears the
same ratio to such median price as the dollar amount
limitation in effect for 2007 under section 305(a)(2) of the
Federal Home Loan Mortgage Corporation Act (12 U.S.C.
1454(a)(2)) for a 2-, 3-, or 4-family residence,
respectively, bears to the dollar amount limitation in effect
for 2007 under such section for a 1-family residence; or
``(ii) 175 percent of the dollar amount limitation in
effect for 2007 under such section 305(a)(2) for a residence
of the applicable size (without regard to any authority to
increase such limitations with respect to properties located
in Alaska, Guam, Hawaii, or the Virgin Islands), except that
each such maximum dollar amount shall be adjusted effective
January 1 of each year beginning with 2008, by adding to or
subtracting from each such amount (as it may have been
previously adjusted) a percentage thereof equal to the
percentage increase or decrease, during the most recently
completed 12-month or 4-quarter period ending before the time
of determining such annual adjustment, in an housing price
index developed or selected by the Secretary for purposes of
adjustments under this clause;
except that the dollar amount limitation in effect under this
subparagraph for any size residence for any area may not be
less than the greater of (I) the dollar amount limitation in
effect under this section for the area on October 21, 1998,
or (II) 65 percent of the dollar amount limitation in effect
for 2007 under such section 305(a)(2) for a residence of the
applicable size, as such limitation is adjusted by any
subsequent percentage adjustments determined under clause
(ii) of this subparagraph; and except that, if the Secretary
determines that market conditions warrant such an increase,
the Secretary may, for such period as the Secretary considers
appropriate, increase the maximum dollar amount limitation
determined pursuant to the preceding provisions of this
subparagraph with respect to any particular size or sizes of
residences, or with respect to residences located in any
particular area or areas, to an amount that does not exceed
the maximum dollar amount then otherwise in effect pursuant
to the preceding provisions of this subparagraph for such
size residence, or for such area (if applicable), by not more
than $100,000; and''.

The CHAIRMAN. Pursuant to House Resolution 650, the gentleman from
California (Mr. Cardoza) and a Member opposed each will control 5
minutes.
The Chair recognizes the gentleman from California.
Mr. CARDOZA. Madam Chairman, I yield myself 2\1/2\ minutes.
I rise in support of this amendment, Madam Chairman. And I wish to
begin by thanking Chairman Frank for bringing this much-needed
legislation to the floor, and for all his efforts to help the reeling
housing industry in my area, and the country in general.
As we have heard from countless media reports, we are facing a
growing mortgage crisis. Sadly, I represent an area that is
particularly hard hit by this crisis. The community of Stockton has
acquired the distinction of having the highest foreclosure rate of any
U.S. city in the country, and there one in 20 households are in
jeopardy of foreclosure at this time. In fact, Stockton has had 8,000
foreclosures so far in 2007.
This morning, the Modesto Bee reported that central California and
central valley homeowners were six times more likely to be in mortgage
default for last year than the national average. In addition, home
values have plunged 15 to 20 percent so far this year.
This amendment will address this problem and help ameliorate the
harsh effects of the credit crunch. First, the amendment raises the FHA
loan limit to the lower of, A, 125 percent of the local median home
price or, B, 175 percent of the national GSE conforming loan limit.
The biggest impact of this will be to make FHA loans available in
low- and moderately income priced home markets. By raising the local
loan limit up to 125 percent of the local median home price, FHA will
be able to serve currently neglected populations and ensure loans in
this vast and middle-market area. In addition, the amendment will have
the effect of serving high-cost areas as well. By raising this
artificial cap to 175 percent of the GSE conforming loan limit, the
amendment will allow FHA to serve high-cost areas.
California has some of the highest priced real estate anywhere in the
country. This amendment, by expanding FHA's reach to high-priced areas,
will finally bring the benefits of FHA to millions of deserving
Californians.
In addition, there are other areas of the country where this will
have a monumental impact. Massachusetts, New York, Connecticut and
other areas are all high-cost areas and will benefit tremendously from
raising the loan limit. Raising loan limits and enhancing the ability
of FHA to serve currently neglected populations will have the effect of
generating more liquidity

[[Page H10464]]

in the market and enhancing lender confidence. This will enable more
borrowers who are facing loan resets to refinance their mortgages on
more favorable terms.
This amendment has strong support of the National Association of
Realtors, the National Association of Home Builders, and others on the
front lines of the housing industry. They know the needs of this
industry, and they know that this bill will help.
Mrs. BIGGERT. Madam Chairman, I rise in opposition to the amendment.
The CHAIRMAN. The gentlewoman from Illinois is recognized for 5
minutes.
Mrs. BIGGERT. With that, I yield 4 minutes to the gentleman from
California (Mr. Gary G. Miller).
Mr. GARY G. MILLER of California. Madam Chairman, I'm rising asking
for strong support of this amendment, so it's not really in opposition
to the amendment.
This bill, and this amendment, particularly, is to encourage the FHA
program and products and make sure they're available across this
country to help working families to achieve and maintain homeownership
through the FHA program.
The bill we are considering here today reforms the FHA single-family
mortgage insurance program so that we can reach working families it was
created to serve. I don't think there is any question that the FHA
program, as currently structured, has not kept pace.
Today, FHA is no longer a useful product to prospective home buyers.
The problem is that statutory limitations preclude the FHA from
adopting a rapidly changing marketplace that we experience today.
As the private sector mortgage markets become more efficient, the FHA
program's inflexible rules and requirements left it virtually
irrelevant as a financing option. Under the current limitations, FHA
products are not available for home buyers in high-cost areas of the
country because the maximum loan limits are so much lower than the
median home prices in that area.
We did something very similar to this when we did the GSE in the
high-cost areas. And the only people arguing against raising this
conforming loan limit to high-cost areas were those whose home median
prices fell far lower than the median amount they were able to loan on.
If your median home area is 200,000 and it isn't 435, you don't care.
But in California and other areas, it is quite the opposite.
Now California's drop in FHA volumes have been nothing short of
stunning. In 2000, FHA insured 109,074 mortgages in California, but
last year it only insured 5,137. In my district, FHA insured 7,000
mortgages in 2000 and only 80 mortgages in 2005. These figures
represent a 99 percent drop in what FHA is able to loan in these high-
cost areas. That in and of itself states that there is a huge problem
that this amendment is trying to cover and create the shortfall that
currently exists in the program. Arguably, working families in high-
cost areas of the country are just the kind of underserved populations
the FHA program was originally intended to serve.
If we want to ensure that FHA is relevant for all those who need it,
we must reform the program so it is available to low- and moderate-
income families across the country, even those in high-cost areas.
On August 31, the President announced his goal to help an estimated
240,000 families avoid foreclosures by enhancing the FHA program. Under
the President's plan, FHA will allow families with strong credit
histories who have been making timely mortgage payments before their
loan reset, but are now in default, to qualify for refinancing.
Unfortunately, without an increase in the loan limits, this program
will not help families in high-cost areas.
This amendment, supported by Mr. Frank, Mr. Cardoza and myself, would
make sure that families can refinance in the FHA products by raising
the FHA single-family loan limits in each local area to the lower of
125 percent of the area median home price, or 175 percent of the
national GSE conforming loan amendments.
The amendment also gives HUD authority to raise these loan limit
amounts by up to $100,000 ``if market conditions warrant.''
The NAHB, National Association of Home Builders, has written a very
strong letter in support of what we are trying to do. Many builders are
selling homes today, and the problem they have is the person buying
their home cannot find financing to sell their home. And this will help
those people who are looking for financing and dealing with liquidity
shortages in the marketplace.
The National Association of Realtors has also written a very strong
letter supporting what we're trying to do today. The problem they're
facing today with people in the mortgage bracket that we're trying to
deal with in this amendment, this will go a long way to providing
liquidity and competition in the marketplace to ensure that American
home buyers and families have the best and most opportunities that can
be achieved through the marketplace through this amendment. So this is
a very good amendment, and I would ask for an ``aye'' vote.
Mr. CARDOZA. Madam Speaker, I want to thank my colleague, Mr. Miller,
for his kind and accurate comments. And I would like to now yield 1
minute to my colleague from California (Ms. Waters).
Ms. WATERS. I appreciate Mr. Cardoza's amendment so much because it
does have an important impact on high-cost markets like our home State
of California. The FHA statute creates an artificial cap on the maximum
home price, meaning that FHA does almost no loan business in certain
high-cost markets. Now, this will put FHA back in the business of
insuring loans in high-cost areas, not only in California, New York,
Connecticut, Massachusetts, and other areas with a limited FHA
presence. This amendment also puts FHA in a better position to help
subprime borrowers and address temporary dislocations.
Even before the recent mortgage crisis developed, there was a
bipartisan consensus shared by the administration that reformed H.R.
1852 would help get FHA back in the business of making loans at good
terms and conditions to borrowers that turned to predatory loans in
recent years. This amendment expands the extent to which this objective
can be achieved. This is absolutely a great amendment, and I support
it.

{time} 1300

Mrs. BIGGERT. Madam Chairman, I recognize myself for 1 minute.
I really believe in the concept of this. I think that there are a lot
of high-cost areas that will really benefit from this. I hope that this
will not hurt some of the low-cost areas; in other words, I think that
the administration has said something about the fact that some of the
areas across the country would be hurt and would lower, go below the
$419,000 limit. So I hope that that will be addressed. I see Mr. Frank
getting up. Maybe he would like to comment on that.
Madam Chairman, I yield back the balance of my time.
Mr. CARDOZA. I yield 1 minute to the chairman of the committee, Mr.
Frank.
Mr. FRANK of Massachusetts. Madam Chairman, I thank the gentleman,
and I thank the gentlewoman from Illinois. She is absolutely right. If
I thought this would in any way impinge on our ability to help middle-
and lower-income people, I would be opposed to it. In fact, if this
works as we believe it will work, it will be the opposite. Because CBO
has consistently scored, we haven't had this particular amendment
scored, but prior amendments that have raised the limit at which the
FHA can operate have been scored by CBO as generating a surplus, a
positive number. That is some of the money that we are going to use. As
the gentlewoman knows, while there is some controversy about this
thing, we significantly increase in this bill the amount for
counseling, because if there had been proper counseling, a lot of
people wouldn't have been stuck at pre-prime. The counseling is aimed
at people in the lower brackets. This is part of the money for it.
I would be willing, when we get to conference, to say, if, in any
way, this would appear to be impinging on the ability to do the rest of
the mission, we would cut it off. But the way it is going to work, it
will, in fact, generate a surplus which we intend to use to help
precisely the people whom the gentlewoman refers to.

[[Page H10465]]

I thank the gentleman. I appreciate his advocacy of this. He has been
one of those who, from California, has been most vigorous in reminding
us of the need to do it.
Mr. CARDOZA. Madam Chairman, in the short period of time we have
remaining, I just want to thank the chairman of the Financial Services
Committee for his leadership, my colleagues on the Republican side for
their support, particularly Mr. Gary G. Miller. This is important
legislation for our country when you live in an area where the housing
prices have declined precipitously by 20 percent less in a year, where
you see foreclosures rampant. In my district alone, there are probably
over 20,000 such foreclosures. It is having real impacts on real
families in my district and across America. We need to change these
regulations and bring help to these citizens in need.
The CHAIRMAN. The question is on the amendment offered by the
gentleman from California (Mr. Cardoza).
The amendment was agreed to.

Amendment No. 1 Offered by Mr. Tierney

The CHAIRMAN. It is now in order to consider amendment No. 1 printed
in part B of House Report 110-330.
Mr. TIERNEY. Madam Chairman, I offer an amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:

Amendment No. 1 offered by Mr. Tierney:
Page 66, after line 25, insert the following new section:

SEC. 31. MORTGAGE INSURANCE PREMIUM REFUNDS.

(a) Authority.--The Secretary of Housing and Urban
Development shall, to the extent that amounts are made
available pursuant to subsection (c), provide refunds of
unearned premium charges paid, at the time of insurance, for
mortgage insurance under title II of the National Housing Act
(12 U.S.C. 1707 et seq.) to or on behalf of mortgagors under
mortgages described in subsection (b).
(b) Eligible Mortgages.--A mortgage described in this
section is a mortgage on a one- to four-family dwelling
that--
(1) was insured under title II of the National Housing Act
(12 U.S.C. 1707 et seq.);
(2) is otherwise eligible, under the last sentence of
subparagraph (A) of section 203(c)(2) of such Act (12 U.S.C.
1709(c)(2)(A)), for a refund of all unearned premium charges
paid on the mortgage pursuant to such subparagraph, except
that the mortgage--
(A) was closed before December 8, 2004; and
(B) was endorsed on or after such date.
(c) Authorization of Appropriations.--There is authorized
to be appropriated for each fiscal year such sums as may be
necessary to provide refunds of unearned mortgage insurance
premiums pursuant to this section.

The CHAIRMAN. Pursuant to House Resolution 650, the gentleman from
Massachusetts (Mr. Tierney) and a Member opposed each will control 5
minutes.
The Chair recognizes the gentleman from Massachusetts.
Mr. TIERNEY. Madam Chairman, this amendment seeks to assist those
individuals who are eligible borrowers that have been unfairly impacted
by a statutory change to HUD's upfront mortgage insurance premium
refund policy.
Under the HUD program, borrowers pay an upfront mortgage insurance of
1.5 percent of their FHA loan amount, and if they repay that loan, the
borrowers may be due refunds of the prepaid insurance.
However, back in 2005 when Congress passed a Consolidated
Appropriations Act, it included language directing that, for mortgages
endorsed for insurance on or after the date of enactment, which was
December 8 of 2004, borrowers would not be eligible for refunds on
their prepaid insurance.
I have heard from constituents in my district, and I am sure there
are constituents in other districts as well, who closed on their
mortgage prior to December 8, 2004, but regrettably have been prevented
from receiving their refund because HUD did not endorse their loan
until after December 2004. These constituents reportedly were not
adequately informed by their lender about the potential revisions to
the refund policy because the lenders themselves were not informed by
HUD of the change until January of 2005.
I have heard from one family, for instance, who is seeking to buy a
home in Gloucester, Massachusetts, and found themselves harmed by this
provision. Although they seemed to do everything right in their own
front, they were closing on their loan in November 2004, the family was
prevented from receiving a refund that totaled almost as much as $5,000
because HUD endorsed their mortgage on December 10, 2004, and their
lender never informed them of that consequence because, as I mentioned,
the lender didn't learn it until December 2005. It certainly seems that
it was an unintended consequence of the provisions in the Consolidated
Appropriations Act of 2005.
Also worth noting is that in response to a letter that was sent by
Chairman Frank and me to the HUD Secretary, Alphonso Jackson, it was
indicated in his letter that he did not support the changes to the
refund policy in their Consolidated Appropriations Act of 2005.
This amendment makes a meaningful first step toward helping certain
eligible borrowers, many of whom are low-income families who have
played by the rules in pursuing their dreams of homeownership.
Madam Chairman, I urge my colleagues to support this amendment.
I yield back the balance of my time.
The CHAIRMAN. The question is on the amendment offered by the
gentleman from Massachusetts (Mr. Tierney).
The amendment was agreed to.

Amendment 3 Offered by Mr. Gary G. Miller of California

The CHAIRMAN. It is now in order to consider amendment No. 3 printed
in part B of House Report 110-330.
Mr. GARY G. MILLER of California. Madam Chairman, I offer an
amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:

Amendment No. 3 offered by Mr. Gary G. Miller of
California:
Page 7, strike line 10 and insert the following:
(2) in paragraph (9)--
(A) by striking the paragraph
Page 7, line 19, strike the last period and insert ``;
and''.
Page 7, after line 19, insert the following:
(B) by inserting after the period at the end the following:
``For purposes of this paragraph, the Secretary shall
consider as cash or its equivalent any amounts gifted by a
family member (as such term is defined in section 201), the
mortgagor's employer or labor union, or a qualified
homeownership assistance entity, but only if there is no
obligation on the part of the mortgagor to repay the gift:
For purposes of the preceding sentence, the term `qualified
homeownership assistance entity' means any governmental
agency or charity that has a program to provide homeownership
assistance to low- and moderate-income families or first-time
home buyers, or any private nonprofit organization that has
such a program and evidences sufficient fiscal soundness to
protect the fiscal integrity of the Mutual Mortgage Insurance
Fund by maintaining a minimum net worth of $4,000,000 of
acceptable assets.''.

The CHAIRMAN. Pursuant to House Resolution 650, the gentleman from
California (Mr. Gary G. Miller) and a Member opposed each will control
5 minutes.
The Chair recognizes the gentleman from California.
Mr. GARY G. MILLER of California. I rise to offer an amendment to
H.R. 1852, the Expanding American Homeownership Act of 2007.
My amendment would allow qualified down payment assistance providers
to participate in the FHA program if certain conditions are satisfied
to ensure that the down payment assistance program is legitimate and
that the gift that is provided to the homeowner and the home buyer is
truly a gift.
One of the primary barriers for many Americans to achieving the dream
of homeownership is the lack of accumulated wealth and disposable
income required to come up with the down payment and closing costs
needed to purchase a home. While they can afford monthly payments, some
families have not been able to accumulate enough to cover down payment
and closing costs.
Fortunately, some charitable organizations have developed programs to
help provide down payments to families that would qualify for the
mortgage for the FHA program but for the lack of cash for a down
payment. These down payment assistance programs have been successful in
expanding homeownership opportunity for millions of families. The
private sector has been working without government intervention to
assist individuals and families who lack the necessary funds for down
payments and other related costs become home buyers. In fact, Congress
looked at the success of these

[[Page H10466]]

programs when it created the American Dream Downpayment Act, a
government program passed in 2003 to provide up to $10,000 in down
payment and closing cost assistance to first-time home buyers.
Similarly, H.R. 1852, the bill you are reviewing today, authorizes
HUD to allow zero down payment FHA loans for home buyers who could not
otherwise make the down payment required under the FHA rule.
In the past, HUD has permitted the use of charitable down payment
assistance programs in conjunction with FHA insured loans. Recently,
however, HUD issued a proposed rule that would effectively eliminate
many legitimate down payment assistance providers from assisting in FHA
programs.
We are hearing that just last week HUD sent a rule over to OMB for
final approval. I am very concerned about the impact of this proposed
rule on homeownership in our country.
Rather than going too far by eliminating all down payment assistance
providers, all that is really needed is a reasonable and fair criteria
by which these programs can continue to operate while also protecting
the FHA insurance fund. If there are legitimate problems that have been
identified by HUD, then we should absolutely fix these problems. In
fact, the full House has agreed that we should strengthen the rules for
down payment assistance providers rather than eliminate them completely
from the FHA program.
In July, the House unanimously passed an amendment I offered with
Housing and Community Opportunity Subcommittee Chairman Waters and
Representative Al Green to the Transportation-HUD appropriations bill,
which prohibited HUD from taking any action to issue its final rule or
otherwise implement all or any part of the proposed rule.
The amendment prevented HUD from finalizing or implementing the rule
to end participation of down payment assistance providers in the FHA
program. Our argument, then, was that HUD's proposal was too harsh a
step and we would work to include language in the FHA bill to fix the
problems that HUD has identified with some down payment assistance
providers.
This is what my amendment before you today seeks to do. The amendment
I offer today is a followup on our work during the THUD bill to put the
brakes on the HUD rule and instead address the problem HUD has
identified with certain down payment assistance providers. This
amendment would put the controls in place to weed out the bad actors
while allowing those who help millions become homeowners continue to do
the good work they are doing. Unlike the HUD rule, my amendment would
preserve the down payment assistance programs' participation in FHA
while ensuring they are legitimate and helpful to the home buyers.
As you know, H.R. 1582 already includes language to end the practice
of inflated appraisals, which was a key argument HUD used against the
down payment assistance programs. My amendment builds on this provision
and says that down payment assistance providers may participate in FHA
so long as the down payment they are offering is truly a gift; in other
words, that it reduces the amount owed on the home. My amendment also
imposes a net worth requirement on such providers to alleviate the
quality and quantity involved within the activity. This provision
specifically responds to HUD's complaints regarding the plethora of
small, fly-by-night operators that open up and that close down on a
regular basis to avoid regulatory scrutiny. Many of these groups are
starting business one day, getting involved in things they should not,
and closing down immediately.
These three improvements to the current situation, number one,
prohibiting inflated appraisals; two, ensuring DPA providers offer an
actual gift; and three, imposing a net worth requirement, will weed out
the bad actors while not prohibiting all down payment assistance
providers from participating in FHA, as the HUD proposal would have
done.
With limited resources at the Federal level, Congress viewed the
American Dream Downpayment Act as a complement, rather than a
replacement, to the tremendous work down payment assistance providers
were already doing to help build communities. There are simply not
enough resources at the Federal level to do this alone.
To address HUD's concerns, we should implement the same underwriting
criteria that would be used on the new zero down payment program within
FHA and what HUD already uses on the American Dream Downpayment Act.
If we have come up with a reasonable system of underwriting to give
Federal dollars to assist a family in buying a home, then we can
certainly use the same criteria to allow the private sector to put
forth people and moneys in these programs to allow people to own their
homes.
If FHA can offer a zero down payment loan under a given underwriting
criteria, as proposed by this bill, then the private sector down
payment assistance programs should also certainly be subject to this
same criteria.
To eliminate the possibility for a million families to own a home
through down payment assistance providers but allow them to use the
Federal Government for a down payment grant seems contradictory. If it
works for the Federal program, then it should work for the private
sector alternative, as well.
My amendment addresses the problems with certain down payment
assistance providers that HUD has identified. Rather than eliminating
all providers, as the HUD rule attempts to do, it puts the protections
in place to ensure the home buyers are getting a legitimate helping
hand from these charitable entities.
Madam Chairman, I ask for an ``aye'' vote on the amendment.
I reserve the balance of my time.
Mr. FRANK of Massachusetts. Madam Chairman, I rise to seek the time
to discuss this, with a certain ambiguity as to my position.
The CHAIRMAN. Is the gentleman opposed to the amendment?
Mr. FRANK of Massachusetts. To two aspects of it, yes, Madam Chair.
The CHAIRMAN. The gentleman is recognized for 5 minutes.
Mr. FRANK of Massachusetts. I yield to the gentlewoman from
California such time as she may consume.

{time} 1315

Ms. WATERS. Madam Chairman, I hope that our chairman didn't confuse
you with that convoluted definition of what the time is that we are
claiming.
Madam Chairman, I am in strong support of this amendment. As a matter
of fact, I would like to take this moment to commend and thank my
colleague, Mr. Miller, for the work that he has done in helping other
Members to understand what this is all about.
I can recall when we had the hearing and everybody said, well, this
is such a wonderful idea. As a matter of fact, all of us voted for the
American Dream Down Payment Act on both sides of the aisle. We can't
understand why there would be any questions or any problems about the
way that there is assistance being given to would-be homeowners by
organizations such as the ones who were presented to us on that day of
the hearing. So because of his expertise and his understanding and his
appreciation, he has helped us all to come together, and it has support
on both sides of the aisle.
As was mentioned, the amendment would allow qualified down payment
assistance providers to participate in an FHA program if certain
conditions are satisfied, that is, no obligation for the mortgagor to
repay and net worth requirement.
The Secretary shall consider as cash or its equivalent any amounts
gifted by a family member, the mortgagor's employer or labor union, or
a qualified homeownership assistance entity, but only if there is no
obligation on the part of the mortgagor to repay the gift.
I rise in support of this amendment. It is a major step in the
direction of capturing the benefits of down payment assistance programs
to over 1 million households since 1999, many of them FHA-insured
borrowers, while safeguarding against bad actors in the field. The
minimum capitalization requirement will protect borrowers from fly-by-
night operations, which the explicit prohibition against requiring
repayment of such assistance by the borrower will ensure that the
benefit is indeed a gift.
Equally important, the additional measures to ensure the legitimacy
of

[[Page H10467]]

appraisals in FHA-insured transactions contained in H.R. 1852 and the
manager's amendment to the bill will help safeguard the entire
progress. Inflated appraisals undercut the legitimacy of seller-
financed down payment assistance.
Down payment assistance that is repaid from a seller's proceeds that
derive from a borrower's ability to get a loan based on an inflated
appraisal is no gift at all to the borrower. H.R. 1852 cracks down on
such schemes, while preserving the field for legitimate down payment
programs. Accordingly, I urge my colleagues to support this amendment.
Mr. GARY G. MILLER of California. Madam Chairman, I want to thank
Maxine Waters for her kind comments. I remember when we were debating
the American Dream Down Payment Assistance Act, and we used the private
sector down payment assistance program as the tool and the argument to
expand upon and have government also get involved. These private sector
groups have put over 1 million people in homes that could not otherwise
be in homes.
This continues a program that has worked very well and eliminates the
bad actors that HUD is talking about. I think if this is implemented,
this bill will be a very strong bill, and I ask for an ``aye'' vote.
Madam Chairman, I yield back the balance of my time.
Mr. FRANK of Massachusetts. Madam Chairman, I claimed the time in
opposition, but having listened to my two very persuasive colleagues, I
have been converted and I now support this amendment.
Madam Chairman, I yield back the balance of my time.
The CHAIRMAN. The question is on the amendment offered by the
gentleman from California (Mr. Gary G. Miller).
The amendment was agreed to.

Amendment No. 4 Offered by Mr. Bishop of New York

The CHAIRMAN. It is now in order to consider amendment No. 4 printed
in part B of House Report 110-330.
Mr. BISHOP of New York. Madam Chairman, I offer an amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:

Amendment No. 4 offered by Mr. Bishop of New York:
Page 35, after line 24, insert the following:
(2) in subsection (b)(4), by striking subparagraph (B) and
inserting the following new subparagraph:
``(B) under a lease that has a term that ends no earlier
than the minimum number of years, as specified by the
Secretary, beyond the actuarial life expectancy of the
mortgagor or comortgagor, whichever is the later date.''.
Page 35, line 25, strike ``(2)'' and insert ``(3)''.
Page 36, line 7, strike ``(3)'' and insert ``(4)''.
Page 36, line 9, strike ``(4)'' and insert ``(5)''.

The CHAIRMAN. Pursuant to House Resolution 650, the gentleman from
New York (Mr. Bishop) and a Member opposed each will control 5 minutes.
The Chair recognizes the gentleman from New York.
Mr. BISHOP of New York. Madam Chairman, let me start by thanking both
Chairman Frank and Chairwoman Waters and their staffs for working with
us on this amendment.
Very simply, my amendment would make it easier for those who owned
fixed-foundation homes on leased land to receive a reverse mortgage.
Current law allows seniors who own fixed-foundation homes on leased
land to receive a reverse mortgage only if the lease is for a term of
not less than 99 years or if the lease is for a period of not less than
10 years beyond the maturity of the mortgage. While this language
covers some seniors, many elderly Americans who own a permanent-
foundation home in a senior community where the land is leased are not
covered by either of these two categories of leases.
My amendment would remove the provision in the bill that allows for a
reverse mortgage if the lease term is for 10 years beyond the maturity
of the mortgage and replace it with language that both clarifies and
expands eligibility. Specifically, my amendment would broaden
eligibility to seniors who have a lease term that ends no earlier than
a minimum number of years beyond their actuarial life expectancy.
This amendment is a commonsense solution to a problem that affects
many seniors, both in my district and across the country; and I urge
its adoption.
Madam Chairman, I reserve the balance of my time.
Mr. FRANK of Massachusetts. Madam Chairman, I claim the time in
opposition.
The CHAIRMAN. The gentleman is recognized for 5 minutes.
Mr. FRANK of Massachusetts. Madam Chairman, I did want to ask a
question of the gentleman from New York. I have a concern about his
amendment, only because it does not seem to me to go far enough.
One of the things we have tried very hard to do in our committee is
to end what has been a kind of discrimination against manufactured
housing, because if we are going to get to more people being able to
own homes without getting into a subprime type of situation where
people are induced to borrow more than they should, manufactured
housing should be part of it.
The gentleman's amendment is properly, from his standpoint, addressed
to a situation in his own district where fixed-foundation housing is
involved. But my question here would be, and I realize it is under the
rule not possible to change the amendment now, but I would have this
question: If his amendment would be adopted, if as the process went
forward some of us were able to work to expand this so it wasn't
limited to fixed foundation, would the gentleman from New York have any
objection to that?
And I will yield to him.
Mr. BISHOP of New York. I would have no objection. In fact, I would
welcome it.
Mr. FRANK of Massachusetts. Madam Chairman, in the face of that
degree of reasonableness, I withdraw my opposition.
I yield back the balance of my time.
The CHAIRMAN. The question is on the amendment offered by the
gentleman from New York (Mr. Bishop).
The amendment was agreed to.

Amendment No. 5 Offered by Mr. Hensarling

The CHAIRMAN. It is now in order to consider amendment No. 5 printed
in part B of House Report 110-330.
Mr. HENSARLING. Madam Chairman, I offer an amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:

Amendment No. 5 offered by Mr. Hensarling:
Page 64, strike lines 6 through 13.

The CHAIRMAN. Pursuant to House Resolution 650, the gentleman from
Texas (Mr. Hensarling) and a Member opposed each will control 5
minutes.
The Chair recognizes the gentleman from Texas.
Mr. HENSARLING. Madam Chairman, I yield myself such time as I may
consume.
Madam Chairman, recently the Democrat majority in this institution
sought to create yet another new government housing program, the
Affordable Housing Fund. This is on top of the roughly 80 other
programs that HUD administers for Housing and Urban Development. So,
Madam Chairman, we are being asked today in the underlying bill to fund
a new program, without terminating any of the other 80-some-odd
programs that are presently on the books; although many have already
achieved their mission, many are ineffective, many are duplicative and
many are quite costly.
Madam Chairman, the so-called Affordable Housing Fund, as designed,
will grant moneys to States for a variety of purposes. I know that the
purposes are noble, but many of us believe that, unfortunately, this
could become a de facto housing slush fund.
I furthermore note, as moneys are handed to the States, almost every
State in our Union is presently running a surplus, yet we regrettably
know the Federal Government continues to run a deficit. So how much
sense does this make?
For those who tell us that the Federal housing function is
underfunded, I might note that according to OMB, in a little over 10
years we have gone from $15.4 billion to $30 billion, roughly double.
That rate is higher than the increase in veterans spending, education
spending, energy spending, transportation spending, international
affairs, and even Social Security over the same period.

[[Page H10468]]

Although the House has passed this ill-conceived program, there has
been no Senate action. The President has signed no bill. So we are
being asked, Madam Chairman, to fund a program that doesn't even exist,
when hardworking Americans can't even fund the roughly 10,000 Federal
programs that are already on the books.
My amendment is a simple one. It would remove this funding mechanism
in this bill for the so-called Affordable Housing Fund. The funding
mechanism shouldn't be in this bill. It has nothing to do with
fundamentally reforming FHA. And the bill siphons money from the FHA
through what I believe and many of us believe to be a back-door tax on
the FHA premiums paid by 4.8 million families that are using FHA
insurance. It does this by diverting part of the increase from a
negative credit subsidy.
To try to speak English here, it appears that people are overpaying
their premiums. If so, maybe that money ought to go back to the people
who paid the premiums in the first place.
I know the creation of the fund has been a long-time goal for
Chairman Frank. I appreciate his sincerity, and I appreciate the
nobility of his purpose and his ideological consistency. But the fact
remains that this is a back-door tax on low- and moderate-income
Americans who use FHA.
This funding provision is unnecessary, it is unwise, it is unsound.
The money ought to go back to the people who paid it. And if that is
not the will of the House, it should at least, at least, be used for
those who paid the premiums in the first place.
Madam Chairman, I reserve the balance of my time.
Mr. FRANK of Massachusetts. Madam Chairman, I rise to sincerely seek
time in opposition.
The CHAIRMAN. The gentleman is recognized for 5 minutes.
Mr. FRANK of Massachusetts. Thank you, Madam Chairman.
We have been debating this. It is a legitimate issue. We debated it
when the gentleman from Georgia offered a version of it in the
appropriations bill. We debated it previously. We debated a similar
argument when we had the GSE bill.
The gentleman says there are 80 HUD programs and HUD money has gone
up. The major reason the HUD funding has gone up, the single biggest
one, has been in the section 8 rental program. There is a problem with
section 8. Section 8 adds equity. But the current section 8 program
provides rental assistance for one year at a time. No one can build
affordable housing based on an annual grant. So what section 8 does,
while it does provide some equity and I have been supportive of it, it
increases the demand for housing without increasing the supply.
So in the current formation of Federal policies, the Federal
Government puts upward pressure on rentals in the moderate- and low-
income areas, because we give people billions of dollars to rent
apartments in a way that does not lead to any construction.
This tries to make it a more balanced program. This and the GSE bill
take money to begin the process of constructing affordable housing,
which in the end could save us money, because it will then say that the
rental levels which section 8 is driving up will no longer be driven
up.
The gentleman says it is going to be a tax on the FHA. In fact, I
hope the gentleman, given his concern about a tax on the people who get
mortgage insurance from the FHA, will vote against the amendment to be
offered by the gentlewoman from Illinois, because in this bill, unlike
the gentlewoman's amendment, we have very tough restrictions on HUD's
ability to raise the FHA fund unless it is necessary for solvency.
In a bipartisan basis last year, we wrote to them and we did it in
the appropriations bill, because HUD was being told by OMB, not HUD,
HUD made it very clear, this was an OMB directive, raise the FHA fees
because FHA isn't contributing enough to the budget.
We put into our bill's restrictions, we have a restriction in our
bill on the amount that can be charged for home equity mortgages by the
originators. It is not in the gentlewoman from Illinois's amendment. We
put caps on the FHA. So exactly the opposite is the case. And as far as
this is concerned, the bill specifically says that no money can go to
the Housing Trust Fund until the HUD Secretary has certified that the
fund will be totally solvent and this will not endanger it.
The money that would go to affordable housing does not come from
raising anybody's fee. It comes from an increase in volume. We capped
the fees. I want to emphasize this. In the bill that we have, as
opposed to the gentlewoman from Illinois's substitute, there are two
separate restrictions on FHA's ability to raise fees that she doesn't
have.
What we do is the law now says FHA can only do 65,000 home equity
reverse mortgages a year. We say, no, there is no reason for that
limit. We say do as many as the market will bear, with a restriction on
what can be charged.
That is what generates the money. It is an increase in volume at a
lower price to the consumer that generates the money; and if that
increased volume and the lower price to the consumer results in there
being a surplus that we can spend to build rental housing, as long as
HUD certifies that that would not in any way require any increase in
the FHA, we say, go ahead.

{time} 1330

As to affordable housing, there is a severe crisis in rental housing
in this country, and you had some of the people pushed into subprime
situations because there wasn't enough rental housing. We think the
Affordable Housing Trust Fund helps deal with that.
Madam Chairman, I reserve the balance of my time.
Mr. HENSARLING. Madam Chairman, I yield 1\1/2\ minutes to the
gentleman from California (Mr. Royce).
Mr. ROYCE. Madam Chairman, I rise in support of this amendment, and I
rise in opposition to the financing of an affordable housing fund.
I don't believe that this fund should be included in legislation to
update and improve the Federal Housing Administration. I hope my
colleagues will join me in opposing the underlying bill if this
provision is included in the legislation.
In 2005, I offered an amendment in the Committee on Financial
Services to strike the creation of an affordable housing fund. Part of
this is philosophical, but ideas have consequences and bad ideas have
bad consequences in the long run. As I said 2 years ago, this fund is
straight out of central planning 101. It should not be supported by
this body.
I think by now we should be able to agree that government housing
grants do little to increase homeownership levels in this country. If
these funds must be derived, they should be geared towards ensuring
that the FHA remains solvent rather than supporting an experiment in
socialism here.
Furthermore, this fund could not be proposed at a worse time, as we
see the current spike in foreclosures in the subprime mortgage market,
many of which are backed by the Federal Housing Administration.
Homeownership rates improve when real interest rates are low and when
consumer incomes are rising, are going up. I believe free market
policies are the most effective way to generate those results, creeping
towards socialism will not. This fund will waste resources and provide
false hope for those who wish to increase homeownership.
Mr. FRANK of Massachusetts. Madam Chairman, I yield myself 30 seconds
to say that I appreciate the candor of the gentleman from California.
He is against Federal programs that help build affordable housing; I
understand that. By the way, this is not, of course, the old forms of
public housing. This is going to be a private corporation.
But I would say to my friends on the other side, I don't think that
you can argue both that we already have enough programs to do this and
that we shouldn't have any at all. In fact, we do not now have programs
that help build family affordable housing. We think in cooperation with
the private sector, and the gentleman mentions the market, every
private market entity, the Realtors, the home builders who are involved
in construction in the private market, support the creation of the
housing fund.
Mr. HENSARLING. Madam Chairman, either there is a surplus or there is
not a surplus. It is really that simple. So now the question is if
there is a surplus, what do you do with it. We believe that surplus
ought to go back to

[[Page H10469]]

the people who paid for it in the first place. And if it is not going
to go back to them, it ought to serve them and it should ensure the
solvency of this program, since we know Uncle Sam's track record on
just about every other Federal insurance program is terrible. This
should ensure the solvency of the program.
We do not need a funding mechanism for another housing program that
does not exist on top of the 90, many of which are not working.
Madam Chairman, I yield back the balance of my time.
Mr. FRANK of Massachusetts. Madam Chairman, I congratulate the
gentleman's dexterity, on his ability to go 180 degrees opposite on his
argument mid-amendment.
He started out saying we can't do this because it will jeopardize the
FHA. We point out that in the bill that couldn't happen. This bill says
this money cannot be used if it would in any way jeopardize an FHA
situation. So he says okay, let's take the surplus and put it into the
regular budget. That is a debate. Do we take surplus and put it into
the budget to detract from other spending? I don't think so. I guess
the question is this. If you take out an FHA mortgage and get mortgage
insurance, and if our bill doesn't pass, this administration will raise
that fee to make more money, should that go to the war in Iraq and for
contractors in Iraq who are wasting money? Or should it go to build
affordable housing in our cities, because that is where the money is
going. The money is not going to reduce the deficit; it is going to be
wasted elsewhere.
What we say is this. We should be building affordable housing. Some
Members say don't give money to the States. No, I think that is a very
good way to go. I think the States and the localities are best able to
respond, and I hope the amendment is defeated.
The CHAIRMAN. The question is on the amendment offered by the
gentleman from Texas (Mr. Hensarling).
The question was taken; and the Chairman announced that the noes
appeared to have it.
Mr. HENSARLING. Madam Chairman, I demand a recorded vote.
The CHAIRMAN. Pursuant to clause 6 of rule XVIII, further proceedings
on the amendment offered by the gentleman from Texas will be postponed.

Amendment No. 6 Offered by Mr. Tiberi

The CHAIRMAN. It is now in order to consider amendment No. 6 printed
in part B of House Report 110-330.
Mr. TIBERI. Madam Chairman, I offer an amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:

Amendment No. 6 offered by Mr. Tiberi:
Page 17, strike lines 3 through 16 and insert the
following:

``(I) At application.--At the time of application for the
loan involved in the mortgage, a list of counseling agencies,
approved by the Secretary, in the area of the applicant.''.

Page 18, strike lines 20 through 22 and insert the
following:
``(i) Requirement.--The Secretary shall require that the
mortgagor shall''.
Page 19, strike lines 4 through 5 and insert the following:

``(I) prior to closing for the loan involved in the
mortgage;''.

The CHAIRMAN. Pursuant to House Resolution 650, the gentleman from
Ohio (Mr. Tiberi) and a Member opposed each will control 5 minutes.
The Chair recognizes the gentleman from Ohio.
Mr. TIBERI. Madam Chairman, I yield myself such time as I may
consume.
I would like to thank Chairman Frank and Chairman Waters for their
leadership on these issues. For the, last 6 years I had an opportunity
to work with both in the Committee on Financial Services and Housing
Subcommittee on very important issues. Unfortunately, I am no longer on
the committee but the issues are still very important to me.
This amendment today is about empowering home buyers. It would
require the Secretary of Housing and Urban Development to ensure high-
risk borrowers and borrowers who are applying for zero down-payment
loans to receive housing counsel. Under the current bill, the language
allows the Secretary to provide counseling; this requires it.
Madam Chairman, as a former Realtor, I have seen firsthand the
benefits, the joys, the importance of homeownership in America.
However, given the current environment in our country, we need to make
sure that there are safeguards put in place to protect homeowners to
ensure fiscal responsible homeownership and guard against further
default, bankruptcy and loss of home.
Buying a house today arguably is the most important and biggest
investment in a person's life. Counseling, I have found, plays a very
important role in empowering consumers, leveling the playing field, and
making sure they have all of the right information to go into owning
their own home.
In the past year, Ohio, California, Florida, Michigan and Georgia
have comprised over half of our Nation's foreclosed homes. Recently
Ohio, under the leadership of Governor Strickland, established the Ohio
Foreclosure Prevention Task Force, which is comprised of various
advocates and people in the housing community throughout the State.
In their report, they listed seven recommendations. One of those
recommendations was to focus on expanding housing counseling services
and making it available to everyone.
This amendment today only deals with two classes of borrowers: high-
risk borrowers and those who are applying for zero-down loans under
this legislation.
I believe it is very, very important, critically important, Madam
Chairman, to make sure these borrowers understand the importance of
homeownership, the responsibilities of homeownership. Madam Chairman,
it is important because if we are going to take a bite out of this
problem, and a bite is all this does today with this amendment because
it only deals with those two types of borrowers, we need to make sure
that every single borrower who is applying for a home under these two
circumstances get all of the education that they need and deserve.
So I urge the adoption of this amendment. This is about empowering
consumers, and I hope the House supports the amendment.
Madam Chairman, I reserve the balance of my time.
Mrs. BIGGERT. Madam Chairman, I claim the time in opposition.
The CHAIRMAN. The gentlewoman from Illinois is recognized for 5
minutes.
Mrs. BIGGERT. Madam Chairman, I have some concerns about what we
would call unintended consequences. I am a big supporter of financial
literacy, and I chair the caucus. It is so important home buyers know
what they are getting into, and I think that counseling is very
important. I think that if we have an educated home buyer, we might not
see so many of these foreclosures or near foreclosures or bankruptcy
with the counseling.
My concern is the mandatory counseling for FHA, and only because of
something that has happened in Illinois, that happened in Chicago when
this mandatory counseling was put in for FHA mortgages.
What happened was that the lenders withdrew from the area. It was put
in first by a ZIP Code in the city of Chicago and then put in for all
of Cook County. The lenders withdrew from the area so there were no
mortgages or very few available for those in that area because they
weren't able to get the counseling that was needed in time to get the
mortgages.
It takes time for counseling, and I know that you put in, and I think
this would help, is that people could get counseling on the Internet. I
think it is a very important thing. I just worry about when it is
mandatory that we are going to have less availability of FHA
involvement than when it is discretionary as in the bill.
I think that it makes FHA less attractive. If you are a prospective
home buyer and one lender, a non-FHA, offers to put you into a mortgage
that day while the FHA loan requires you to go through a counseling
course, which will you pick? People will leave FHA, and we don't want
that to happen. I know it is important that we have counseling and get
people into this type of loan. The whole thing is, FHA is much better
than the more exotic subprime loans, and that is the whole focus of
this bill. I would hope that we can promote FHA, and I hope as this
amendment moves forward, we can take a look at.
Mr. FRANK of Massachusetts. Will the gentlewoman yield?

[[Page H10470]]

Mrs. BIGGERT. I yield to the gentleman from Massachusetts.
Mr. FRANK of Massachusetts. I would say to my friend from Ohio, and
we have worked together on a lot of things, I understand his purpose is
a good one, but I share some of the concerns of the gentlewoman from
Illinois.
I hope the gentleman understands that if this becomes part of the
bill, as I believe it will, we haven't had a chance to consult with the
FHA. We would like their advice. We could wind up strengthening the
urging but allow for some exceptions. I would hope as we went forward
the gentleman could work with us on doing that.
Mr. TIBERI. Would the gentlewoman yield?
Mrs. BIGGERT. I yield to the gentleman from Ohio.
Mr. TIBERI. Yes, I think we can take a look at the best of what is
happening in Ohio right now. We are doing some pretty innovative
things. I am sure in Massachusetts and Illinois there is some
innovation going on as well.
The intent at the end of the day is to help the borrower and level
the playing field. And so yes, I would be happy to work with the
committee.
Mr. FRANK of Massachusetts. If the gentlewoman would continue to
yield, there are some differences that we have of an ideological sort.
There are a lot of general areas of agreement. Mr. Montgomery, the head
of the FHA, has been, I think, a responsible and thoughtful
administrator of the program. We have a common interest in this, and I
would look forward to having him in on this conversation with us, and I
think we can move in that direction with some of the flexibility that
the gentlewoman asked for.
Mrs. BIGGERT. Madam Chairman, with that, I withdraw my objection, and
I yield back the balance of my time.
Mr. TIBERI. Madam Chairman, I yield myself the balance of my time.
I thank the chairman and the gentlewoman from Illinois. Just a point
of clarification: Some of the things that are happening now in Ohio is
you have online counseling that is taking place for people that don't
have access maybe in person to a counselor. So there is room to grow
here, Chairman Frank and Mrs. Biggert.
I think we have an opportunity to empower consumers and look forward
to working with both of you. I urge adoption of this amendment, and
urge passage of the bill.
The CHAIRMAN. The question is on the amendment offered by the
gentleman from Ohio (Mr. Tiberi).
The amendment was agreed to.

Amendment No. 7 Offered by Mrs. Biggert

The CHAIRMAN. It is now in order to consider amendment No. 7 printed
in part B of House Report 110-330.
Mrs. BIGGERT. Madam Chairman, I offer an amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:

Amendment No. 7 offered by Mrs. Biggert:
Strike all after the enacting clause and insert the
following:

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Expanding
American Homeownership Act of 2007''.
(b) Table of Contents.--The table of contents for this Act
is as follows:

Sec. 1. Short title and table of contents.
Sec. 2. Findings and purposes.
Sec. 3. Maximum principal loan obligation.
Sec. 4. Extension of mortgage term.
Sec. 5. Cash investment requirement.
Sec. 6. Temporary reinstatement of downpayment requirement in event of
increased defaults.
Sec. 7. Mortgage insurance premiums.
Sec. 8. Rehabilitation loans.
Sec. 9. Discretionary action.
Sec. 10. Insurance of condominiums.
Sec. 11. Mutual Mortgage Insurance Fund.
Sec. 12. Hawaiian home lands and Indian reservations.
Sec. 13. Conforming and technical amendments.
Sec. 14. Home equity conversion mortgages.
Sec. 15. Conforming loan limit in disaster areas.
Sec. 16. Participation of mortgage brokers and correspondent lenders.
Sec. 17. Sense of Congress regarding technology for financial systems.
Sec. 18. Savings provision.
Sec. 19. Implementation.

SEC. 2. FINDINGS AND PURPOSES.

SEC. 3. MAXIMUM PRINCIPAL LOAN OBLIGATION.

Paragraph (2) of section 203(b) of the National Housing Act
(12 U.S.C. 1709(b)(2)) is amended--
(1) by striking subparagraphs (A) and (B) and inserting the
following new subparagraphs:
``(A) not to exceed the lesser of--
``(i) in the case of a 1-family residence, the median 1-
family house price in the area, as determined by the
Secretary; and in the case of a 2-, 3-, or 4-family
residence, the percentage of such median price that bears the
same ratio to such median price as the dollar amount
limitation in effect under section 305(a)(2) of the Federal
Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) for
a 2-, 3-, or 4-family residence, respectively, bears to the
dollar amount limitation in effect under such section for a
1-family residence; or
``(ii) the dollar amount limitation determined under such
section 305(a)(2) for a residence of the applicable size;
except that the dollar amount limitation in effect for any
area under this subparagraph may not be less than the greater
of (I) the dollar amount limitation in effect under this
section for the area on October 21, 1998, or (II) 65 percent
of the dollar limitation determined under such section
305(a)(2) for a residence of the applicable size; and
``(B) not to exceed the appraised value of the property,
plus any initial service charges, appraisal, inspection and
other fees in connection with the mortgage as approved by the
Secretary.'';
(2) in the matter after and below subparagraph (B), by
striking the second sentence (relating to a definition of
``average closing cost'') and all that follows through
``title 38, United States Code''; and
(3) by striking the last undesignated paragraph (relating
to counseling with respect to the responsibilities and
financial management involved in homeownership).

SEC. 4. EXTENSION OF MORTGAGE TERM.

SEC. 5. CASH INVESTMENT REQUIREMENT.

Paragraph (9) of section 203(b) of the National Housing Act
(12 U.S.C. 1709(b)(9)) is amended by striking the paragraph
designation and all that follows through ``Provided further,
That for'' and inserting the following:
``(9) Be executed by a mortgagor who shall have paid on
account of the property, in cash or its equivalent, an
amount, if any, as the Secretary may determine based on
factors determined by the Secretary and commensurate with the
likelihood of default. For''.

SEC. 6. TEMPORARY REINSTATEMENT OF DOWNPAYMENT REQUIREMENT IN
EVENT OF INCREASED DEFAULTS.

Section 203(b) of the National Housing Act (12 U.S.C.
1709(b)) is amended by adding at the end the following new
paragraph:
``(10) Effect of increased defaults.--
``(A) Annual determination.--If, for any calendar year
described in subparagraph (B)(i), the Secretary determines,
pursuant such subparagraph, that--
``(i) the ratio of the number of mortgage insurance claims
made during such calendar year on mortgages insured under
this section to the total number of mortgages having such
insurance in force during such calendar year exceeds, by 25
percent or more, such ratio for the 12-month period ending on
the effective date of this Act, or

[[Page H10471]]

``(ii) the ratio of the aggregate remaining principal
obligation under mortgages insured under this section for
which an insurance claim is made during such calendar year to
the average, for such calendar year, of the aggregate
outstanding principal obligation under mortgages so insured
exceeds, by 25 percent or more, such ratio for the 12-month
period ending on such effective date,
during the 90-day period beginning upon the submission of the
report for such calendar year under subparagraph (B)(ii)
containing such determination, the Secretary may insure a
mortgage under this section only pursuant to the requirement
under subparagraph (C), and the Secretary shall, not later
than 60 days after submission of the report containing such
determination, submit a report to the Congress under
subparagraph (D) regarding mortgage insurance claims during
such calendar year.
``(B) 5 years of annual determinations.--
``(i) In general.--The Secretary shall, for each of the 5
calendar years commencing after the date of the enactment of
this Act, compare the ratios referred to in subparagraph (A)
and make a determination under such subparagraph.
``(ii) Annual report on defaults.--Not later than 90 days
after the conclusion of each of the calendar years described
in clause (i), the Secretary shall submit a report to the
Congress containing the determination of the Secretary under
such clause with respect to such calendar year and setting
forth the ratios referred to in such clause for such calendar
year.
``(C) Reinstatement of downpayment requirement.--The
requirement under this subparagraph is that paragraph (9) of
this subsection shall apply as such paragraph was in effect
on the day before the effective date of the Expanding
American Homeownership Act of 2007.
``(D) Reports regarding increased default rate.--A report
under this subparagraph, as required under subparagraph (A),
shall contain--
``(i) an analysis of mortgage insurance claims, made during
the calendar year for which the report is submitted, on
mortgages insured under this section;
``(ii) an analysis of the reasons for the increase during
such calendar year in the applicable ratio or ratios under
subparagraph (A), including an analysis of the extent to
which such increase is attributable to the amendments made by
the Expanding American Homeownership Act of 2007;
``(iii) the effect of such increase on the Mutual Mortgage
Insurance Fund;
``(iv) recommendations regarding--

``(I) whether the Congress should, to respond to such
increase, take legislative action (aa) to apply paragraph (9)
of this subsection as such paragraph was in effect on the day
before the effective date of Expanding American Homeownership
Act of 2007, (bb) to apply paragraph (2)(A)(ii) by
substituting `87 percent of the dollar amount limitation' for
`the dollar amount limitation', or (cc) both; and
``(II) whether such provisions should be temporary or
permanent, and, if temporary, the period during which such
provisions should apply; and

``(v) recommendations regarding any other administrative,
regulatory, legislative, or other actions that should be
taken to respond to such increase.
``(E) Defaults in disaster areas not counted for 24
months.--In determining the number of mortgage insurance
claims made and the aggregate remaining principal obligation
under mortgages for which an insurance claim is made for
purposes of subparagraph (A) for any calendar year, the
Secretary shall not take into consideration any claim made
during such period on a mortgage on any property that is
located in an area for which a major disaster was declared
pursuant to the Robert T. Stafford Disaster Relief and
Emergency Assistance Act if such claim was made during the
24-month period beginning upon such declaration.''.

SEC. 7. MORTGAGE INSURANCE PREMIUMS.

Section 203(c) of the National Housing Act (12 U.S.C.
1709(c)) is amended--
(1) in paragraph (2), in the matter preceding subparagraph
(A), by striking ``Notwithstanding'' and inserting ``Except
as provided in paragraph (3) and notwithstanding''; and
(2) by adding at the end the following new paragraph:
``(3) Flexible Risk-Based Premiums.--
``(A) In general.--For any mortgage insured by the
Secretary under this title that is secured by a 1- to 4-
family dwelling and for which the loan application is
received by the mortgagee on or after October 1, 2007, the
Secretary may establish a mortgage insurance premium
structure involving a single premium payment collected prior
to the insurance of the mortgage or annual payments (which
may be collected on a periodic basis), or both, subject to
the limitations in subparagraphs (B) and (C). The rate of
premium for such a mortgage may vary during the mortgage term
as long as the basis for determining the variable rate is
established before the execution of the mortgage. The
Secretary may change a premium structure established under
this subparagraph but only to the extent that such change is
not applied to any mortgage already executed.
``(B) Maximum up-front premium amounts.--For any mortgage
insured under a premium structure established pursuant to
this paragraph, the amount of any single premium payment
authorized by subparagraph (A), if established and collected
prior to the insurance of the mortgage, may not exceed the
following amount:
``(i) Except as provided in clauses (ii) and (iii), 3.0
percent of the amount of the original insured principal
obligation of the mortgage.
``(ii) If the mortgagor has a credit score equivalent to a
FICO score of 560 or more and has paid on account of the
property, in cash or its equivalent, at least 3 percent of
the Secretary's estimate of the cost of acquisition
(excluding the mortgage insurance premium paid at the time
the mortgage is insured), 2.25 percent of the original
insured principal obligation of the mortgage.
``(iii) If the annual premium payment is equal to the
maximum amount allowable under clause (i) of subparagraph
(C), 1.5 percent of the amount of the original insured
principal obligation of the mortgage.
``(C) Maximum annual premium amounts.--For any mortgage
insured under a premium structure established pursuant to
this paragraph, the amount of any annual premium payment
collected may not exceed the following amount:
``(i) Except as provided in clauses (ii) and (iii), 2.0
percent of the remaining insured principal obligation of the
mortgage.
``(ii) If the mortgagor is a mortgagor described in clause
(ii) of subparagraph (B), 0.55 percent of the remaining
insured principal obligation of the mortgage.
``(iii) If the single premium payment collected at the time
of insurance is equal to maximum amount allowable under
clause (i) of subparagraph (B), 1.0 percent of the remaining
insured principal obligation of the mortgage.
``(D) Payment incentive.--Notwithstanding subparagraph (C),
for any mortgage insured under a premium structure
established pursuant to this paragraph and for which the
annual premium payment exceeds the amount set forth in
subparagraph (C)(ii), if during the 5-year period beginning
upon the time of insurance all mortgage insurance premiums
for such mortgage have been paid on a timely basis, upon the
expiration of such period the Secretary shall reduce the
amount of the annual premium payments due thereafter under
such mortgage to an amount equal to the amount set forth in
subparagraph (C)(ii).
``(E) Establishment and alteration of premium structure.--A
premium structure shall be established or changed under
subparagraph (A) only by providing notice to mortgagees and
to the Congress, at least 30 days before the premium
structure is established or changed.
``(F) Considerations for premium structure.--When
establishing a premium structure under subparagraph (A) or
when changing such a premium structure, the Secretary shall
consider the following:
``(i) The effect of the proposed premium structure on the
Secretary's ability to meet the operational goals of the
Mutual Mortgage Insurance Fund as provided in section 202(a).
``(ii) Underwriting variables.
``(iii) The extent to which new pricing under the proposed
premium structure has potential for acceptance in the private
market.
``(iv) The administrative capability of the Secretary to
administer the proposed premium structure.
``(v) The effect of the proposed premium structure on the
Secretary's ability to maintain the availability of mortgage
credit and provide stability to mortgage markets.''.

SEC. 8. REHABILITATION LOANS.

SEC. 9. DISCRETIONARY ACTION.

SEC. 10. INSURANCE OF CONDOMINIUMS.

[[Page H10472]]

(b) Definition of Mortgage.--Section 201(a) of the National
Housing Act (12 U.S.C. 1707(a)) is amended--
(1) in clause (1), by striking ``or'' and inserting a
comma; and
(2) by inserting before the semicolon the following: ``, or
(c) a first mortgage given to secure the unpaid purchase
price of a fee interest in, or long-term leasehold interest
in, a one-family unit in a multifamily project, including a
project in which the dwelling units are attached, semi-
detached, or detached, and an undivided interest in the
common areas and facilities which serve the project''.

SEC. 11. MUTUAL MORTGAGE INSURANCE FUND.

(a) In General.--Subsection (a) of section 202 of the
National Housing Act (12 U.S.C. 1708(a)) is amended to read
as follows:
``(a) Mutual Mortgage Insurance Fund.--
``(1) Establishment.--Subject to the provisions of the
Federal Credit Reform Act of 1990, there is hereby created a
Mutual Mortgage Insurance Fund (in this title referred to as
the `Fund'), which shall be used by the Secretary to carry
out the provisions of this title with respect to mortgages
insured under section 203. The Secretary may enter into
commitments to guarantee, and may guarantee, such insured
mortgages.
``(2) Limit on loan guarantees.--The authority of the
Secretary to enter into commitments to guarantee such insured
mortgages shall be effective for any fiscal year only to the
extent that the aggregate original principal loan amount
under such mortgages, any part of which is guaranteed, does
not exceed the amount specified in appropriations Acts for
such fiscal year.
``(3) Fiduciary responsibility.--The Secretary has a
responsibility to ensure that the Mutual Mortgage Insurance
Fund remains financially sound.
``(4) Annual independent actuarial study.--The Secretary
shall provide for an independent actuarial study of the Fund
to be conducted annually, which shall analyze the financial
position of the Fund. The Secretary shall submit a report
annually to the Congress describing the results of such study
and assessing the financial status of the Fund. The report
shall recommend adjustments to underwriting standards,
program participation, or premiums, if necessary, to ensure
that the Fund remains financially sound.
``(5) Quarterly reports.--During each fiscal year, the
Secretary shall submit a report to the Congress for each
quarter, which shall specify for mortgages that are
obligations of the Fund--
``(A) the cumulative volume of loan guarantee commitments
that have been made during such fiscal year through the end
of the quarter for which the report is submitted;
``(B) the types of loans insured, categorized by risk;
``(C) any significant changes between actual and projected
claim and prepayment activity;
``(D) projected versus actual loss rates; and
``(E) updated projections of the annual subsidy rates to
ensure that increases in risk to the Fund are identified and
mitigated by adjustments to underwriting standards, program
participation, or premiums, and the financial soundness of
the Fund is maintained.
The first quarterly report under this paragraph shall be
submitted on the last day of the first quarter of fiscal year
2008, or upon the expiration of the 90-day period beginning
on the date of the enactment of the Expanding American
Homeownership Act of 2007, whichever is later.
``(6) Adjustment of premiums.--If, pursuant to the
independent actuarial study of the Fund required under
paragraph (5), the Secretary determines that the Fund is not
meeting the operational goals established under paragraph (8)
or there is a substantial probability that the Fund will not
maintain its established target subsidy rate, the Secretary
may either make programmatic adjustments under section 203 as
necessary to reduce the risk to the Fund, or make appropriate
premium adjustments.
``(7) Operational goals.--The operational goals for the
Fund are--
``(A) to charge borrowers under loans that are obligations
of the Fund an appropriate premium for the risk that such
loans pose to the Fund;
``(B) to minimize the default risk to the Fund and to
homeowners;
``(C) to curtail the impact of adverse selection on the
Fund; and
``(D) to meet the housing needs of the borrowers that the
single family mortgage insurance program under this title is
designed to serve.''.
(b) Obligations of Fund.--The National Housing Act is
amended as follows:
(1) Homeownership voucher program mortgages.--In section
203(v) (12 U.S.C. 1709(v))--
(A) by striking ``Notwithstanding section 202 of this
title, the'' and inserting ``The''; and
(B) by striking ``General Insurance Fund'' the first place
such term appears and all that follows and inserting ``Mutual
Mortgage Insurance Fund.''.
(2) Home equity conversion mortgages.--Section 255(i)(2)(A)
of the National Housing Act (12 U.S.C. 1715z-20(i)(2)(A)) is
amended by striking ``General Insurance Fund'' and inserting
``Mutual Mortgage Insurance Fund''.
(c) Conforming Amendments.--The National Housing Act is
amended--
(1) in section 205 (12 U.S.C. 1711), by striking
subsections (g) and (h); and
(2) in section 519(e) (12 U.S.C. 1735c(e)), by striking
``203(b)'' and all that follows through ``203(i)'' and
inserting ``203, except as determined by the Secretary''.

SEC. 12. HAWAIIAN HOME LANDS AND INDIAN RESERVATIONS.

(a) Hawaiian Home Lands.--Section 247(c) of the National
Housing Act (12 U.S.C. 1715z-12) is amended--
(1) by striking ``General Insurance Fund established in
section 519'' and inserting ``Mutual Mortgage Insurance
Fund''; and
(2) in the second sentence, by striking ``(1) all
references'' and all that follows through ``and (2)''.
(b) Indian Reservations.--Section 248(f) of the National
Housing Act (12 U.S.C. 1715z-13) is amended--
(1) by striking ``General Insurance Fund'' the first place
it appears through ``519'' and inserting ``Mutual Mortgage
Insurance Fund''; and
(2) in the second sentence, by striking ``(1) all
references'' and all that follows through ``and (2)''.

SEC. 13. CONFORMING AND TECHNICAL AMENDMENTS.

SEC. 14. HOME EQUITY CONVERSION MORTGAGES.

(a) In General.--Section 255 of the National Housing Act
(12 U.S.C. 1715z-20) is amended--
(1) in subsection (g)--
(A) by striking the first sentence; and
(B) by striking ``established under section 203(b)(2)'' and
all that follows through ``located'' and inserting
``limitation established under section 305(a)(2) of the
Federal Home Loan Mortgage Corporation Act for a 1-family
residence'';
(2) in subsection (i)(1)(C), by striking ``limitations''
and inserting ``limitation''; and
(3) by adding at the end the following new subsection:
``(n) Authority To Insure Home Purchase Mortgage.--
``(1) In general.--Notwithstanding any other provision in
this section, the Secretary may insure, upon application by a
mortgagee, a home equity conversion mortgage upon such terms
and conditions as the Secretary may prescribe, when the
primary purpose of the home equity conversion mortgage is to
enable an elderly mortgagor to purchase a 1- to 4-family
dwelling in which the mortgagor will occupy or occupies one
of the units.
``(2) Limitation on principal obligation.--A home equity
conversion mortgage insured pursuant to paragraph (1) shall
involve a principal obligation that does not exceed the
dollar amount limitation determined under section 305(a)(2)
of the Federal Home Loan Mortgage Corporation Act for a
residence of the applicable size.''.
(b) Mortgages for Cooperatives.--Subsection (b) of section
255 of the National Housing Act (12 U.S.C. 1715z-20(b)) is
amended--
(1) in paragraph (4)--
(A) by inserting ``a first or subordinate mortgage or
lien'' before ``on all stock'';
(B) by inserting ``unit'' after ``dwelling''; and
(C) by inserting ``a first mortgage or first lien'' before
``on a leasehold''; and
(2) in paragraph (5), by inserting ``a first or subordinate
lien on'' before ``all stock''.
(c) Study Regarding Mortgage Insurance Premiums.--The
Secretary of Housing and Urban Development shall conduct a
study regarding mortgage insurance premiums charged under the
program under section 255 of the National Housing Act (12
U.S.C. 1715z-20) for insurance of home equity conversion
mortgages to analyze and determine--
(1) the effects of reducing the amounts of such premiums
from the amounts charged as of the date of the enactment of
this Act on--
(A) costs to mortgagors; and
(B) the financial soundness of the program; and
(2) the feasibility and effectiveness of exempting, from
all the requirements under the program regarding payment of
mortgage insurance premiums (including both up-front or
annual mortgage insurance premiums under section 203(c)(2) of
such Act), any mortgage insured under the program under which
part or all of the amount of future payments made to the
homeowner are used for costs of a long-term care insurance
contract covering the mortgagor or members of the household
residing in the mortgaged property.

[[Page H10473]]

Not later than the expiration of the 12-month period
beginning on the date of the enactment of this Act, the
Secretary shall submit a report to the Congress setting forth
the results and conclusions of the study.

SEC. 15. CONFORMING LOAN LIMIT IN DISASTER AREAS.

SEC. 16. PARTICIPATION OF MORTGAGE BROKERS AND CORRESPONDENT
LENDERS.

(a) Definitions.--
(1) In general.--Section 201 of the National Housing Act
(12 U.S.C. 1707) is amended--
(A) by striking ``As used in section 203 of this title--''
and inserting ``As used in this title and for purposes of
participation in insurance programs under this title, except
as specifically provided otherwise, the following definitions
shall apply:'';
(B) by striking subsection (b) and inserting the following:
``(2) The term `mortgagee' means any of the following
entities, and its successors and assigns, to the extent such
entity is approved by the Secretary:
``(A) A lender or correspondent lender, who--
``(i) makes, underwrites, and services mortgages;
``(ii) submits to the Secretary such financial audits
performed in accordance with the standards for financial
audits of the Government Auditing Standards issued by the
Comptroller of the United States;
``(iii) meet the minimum net worth requirement that the
Secretary shall establish; and
``(iv) complies with such other requirements as the
Secretary may establish.
``(B) A correspondent lender who--
``(i) closes a mortgage in its name but does not underwrite
or service the mortgage;
``(ii) posts a surety bond, in lieu of any requirement to
provide audited financial statements or meet a minimum net
worth requirement, in--

``(I) a form satisfactory to the Secretary; and
``(II) an amount of $75,000, as such amount is adjusted
annually by the Secretary (as determined under regulations of
the Secretary) by the change for such year in the Consumer
Price Index for All Urban Consumers published monthly by the
Bureau of Labor Statistics of the Department of Labor; and

``(iii) complies with such other requirements as the
Secretary may establish.
``(C) A mortgage broker who--
``(i) closes the mortgage in the name of the lender and
does not make, underwrite, or service the mortgage;
``(ii) is licensed, under the laws of the State in which
the property that is subject to the mortgage is located, to
act as a mortgage broker in such State;
``(iii) posts a surety bond in accordance with the
requirements of subparagraph (B)(ii); and
``(iv) complies with such other requirements as the
Secretary may establish.
``(3) The term `mortgagor' includes the original borrower
under a mortgage and the successors and assigns of the
original borrower.'';
(C) in subsection (a), by redesignating clauses (1) and (2)
as clauses (A) and (B) respectively; and
(D) by redesignating subsections (a), (c), (d), (e), and
(f) as paragraphs (1), (4), (5), (6), and (7), respectively,
and realigning such paragraphs two ems from the left margin.
(2) Mortgagee review.--Section 202(c)(7) of the National
Housing Act (12 U.S.C. 1708(c)(7)) is amended--
(A) in subparagraph (A), by inserting ``, as defined in
section 201,'' after ``mortgagee'';
(B) by striking subparagraph (B); and
(C) by redesignating subparagraphs (C) and (D) as
subparagraphs (B) and (C), respectively.
(3) Multifamily rental housing insurance.--Section
207(a)(2) of the National Housing Act (12 U.S.C. 1713(a)(2))
is amended by striking ``means the original lender under a
mortgage, and its successors and assigns, and'' and inserting
``has the meaning given such term in section 201, except that
such term also''.
(4) War housing insurance.--Section 601(b) of the National
Housing Act (12 U.S.C. 1736(b)) is amended by striking
``includes the original lender under a mortgage, and his
successors and assigns approved by the Secretary'' and
inserting ``has the meaning given such term in section 201''.
(5) Armed services housing mortgage insurance.--Section
801(b) of the National Housing Act (12 U.S.C. 1748(b)) is
amended by striking ``includes the original lender under a
mortgage, and his successors and assigns approved by the
Secretary'' and inserting ``has the meaning given such term
in section 201''.
(6) Group practice facilities mortgage insurance.--Section
1106(8) of the National Housing Act (12 U.S.C. 1749aaa-5(8))
is amended by striking ``means the original lender under a
mortgage, and his or its successors and assigns, and'' and
inserting ``has the meaning given such term in section 201,
except that such term also''.
(b) Eligibility for Insurance.--
(1) Title i.--Paragraph (1) of section 8(b) of the National
Housing Act (12 U.S.C. 1706c(b)(1)) is amended--
(A) by striking ``, and be held by,''; and
(B) by striking ``as responsible and able to service the
mortgage properly''.
(2) Single family housing mortgage insurance.--Paragraph
(1) of section 203(b) of the National Housing Act (12 U.S.C.
1709(b)(1)) is amended--
(A) by striking ``, and be held by,''; and
(B) by striking ``as responsible and able to service the
mortgage properly''.
(3) Section 221 mortgage insurance.--Paragraph (1) of
section 221(d) of the National Housing Act (12 U.S.C.
1715l(d)(1)) is amended--
(A) by striking `` and be held by''; and
(B) by striking ``as responsible and able to service the
mortgage properly''.
(4) Home equity conversion mortgage insurance.--Paragraph
(1) of section 255(d) of the National Housing Act (12 U.S.C.
1715z-20(d)(1)) is amended by striking ``as responsible and
able to service the mortgage properly''.
(5) War housing mortgage insurance.--Paragraph (1) of
section 603(b) of the National Housing Act (12 U.S.C.
1738(b)(1)) is amended--
(A) by striking ``, and be held by,''; and
(B) by striking ``as responsible and able to service the
mortgage properly''.
(6) War housing mortgage insurance for large-scale housing
projects.--Paragraph (1) of section 611(b) of the National
Housing Act (12 U.S.C. 1746(b)(1)) is amended--
(A) by striking `` and be held by''; and
(B) by striking ``as responsible and able to service the
mortgage properly''.
(7) Group practice facility mortgage insurance.--Section
1101(b)(2) of the National Housing Act (12 U.S.C.
1749aaa(b)(2)) is amended--
(A) by striking `` and held by''; and
(B) by striking ``as responsible and able to service the
mortgage properly''.
(8) National defense housing insurance.--Paragraph (1) of
section 903(b) of the National Housing Act (12 U.S.C.
1750b(b)(1)) is amended--
(A) by striking ``, and be held by,''; and
(B) by striking ``as responsible and able to service the
mortgage properly''.

SEC. 17. SENSE OF CONGRESS REGARDING TECHNOLOGY FOR FINANCIAL
SYSTEMS.

[[Page H10474]]

(3) the Secretary of Housing and Urban Development should
report to the Congress not later than 180 days after the date
of the enactment of this Act regarding the progress the
Department is making toward such goal and if progress is not
sufficient, the resources needed to make greater progress.

SEC. 18. SAVINGS PROVISION.

Any mortgage insured under title II of the National Housing
Act before the date of enactment of this Act shall continue
to be governed by the laws, regulations, orders, and terms
and conditions to which it was subject on the day before the
date of the enactment of this Act.

SEC. 19. IMPLEMENTATION.

The Secretary of Housing and Urban Development shall by
notice establish any additional requirements that may be
necessary to immediately carry out the provisions of this
Act. The notice shall take effect upon issuance.

The CHAIRMAN. Pursuant to House Resolution 650, the gentlewoman from
Illinois (Mrs. Biggert) and the gentleman from Massachusetts (Mr.
Frank) each will control 10 minutes.
The Chair recognizes the gentlewoman from Illinois.

{time} 1345

Mrs. BIGGERT. Madam Chairman, I yield myself such time as I may
consume.
My amendment strikes the bill in its entirety and inserts language
that is identical to last year's bipartisan FHA modernization bill,
H.R. 5121. Last year the bill had 54 Republicans, 51 Democrats, and
one1 Independent cosponsor. Last year the bill was the bipartisan
compromise that was agreed to by Chairman Waters and Chairman Frank and
then chairman Mike Oxley. Last year's bill passed the House by a vote
of 415-7 on July 25, 2006.
There are differences in the bills. This amendment, last year's
bipartisan bill, I would like to highlight a couple of important
differences. The Frank-Waters bill authorizes the FHA to implement
risk-based pricing, but leaves in place the current, I think, outdated
premium caps. My concern is that these limits on the premium caps will
prevent FHA from serving riskier borrowers who could be prudently
served by charging a slightly higher premium.
With the flexibility to charge slightly higher premiums, FHA would be
able to serve borrowers with lower FICO scores who are currently being
served only by the subprime market at very high interest rates. Just
like last year's bipartisan House-passed bill, my amendment modernizes
and updates premium caps, enabling FHA to reach down and serve riskier
borrowers, but in a prudent manner. I think this is where growth comes
in, because there will be more loans that FHA will be able to make.
Second, the Frank-Waters bill requires the refund of excess upfront
premiums charged to higher-risk borrowers, those with FICO scores below
560. I am concerned that this new provision may treat your higher
initial premiums and unintentionally limit the number of borrowers that
could be served by FHA.
A refund provision also would be difficult to implement. Perhaps most
importantly, refunds like this undercut the very concept of insurance.
It is the logical equivalent of a healthy person requesting a 100
percent refund of his or her health insurance premium, or a driver who
doesn't get into an accident demanding all of his car insurance back.
Just like last year's House-passed bill, my amendment includes
another bipartisan agreement, the automatic reduction of annual
premiums to no more than 55 base points for loans, and remains active
after 5 years. Automatic premium reductions can be a good thing. They
can reduce refinancing and perhaps some defaults and foreclosures as
well.
Finally, the most significant difference between the bill I have
introduced and the Frank-Waters FHA reform proposal, which has been of
great concern to me and many of my colleagues, is the inclusion of a
provision that creates a funding placeholder that you have heard talked
about so much today that siphons off the FHA funds to create a brand-
new government trust fund.
The other provisions that I mentioned are ones that represent
significant differences between our introduced bills. Using FHA program
funds to create a housing trust fund, to me, is where we have the most
difference, and I believe it is not an appropriate use of FHA funds.
Taking funds out of FHA and using them for a purpose unrelated to its
core mission would threaten the solvency of the FHA fund and its
ability to pay out the insurance claims. We don't want to have to come
back here and do a bailout because FHA funds were diverted for other
projects.
There is general agreement on the need for FHA modernization
legislation. By modernizing FHA with my amendment, we can expand FHA
and give a viable alternative to more low-income borrowers who may
otherwise lose their home or be forced into the higher-cost subprime
loans, or even predatory products. It is true that FHA cannot help all
homeowners that are in the red, but it may help a good portion of them.
I would urge my colleagues to support my amendment, last year's
bipartisan bill, the House-passed bill that many of my colleagues
supported last year.
Madam Chairman, I reserve the balance of my time.
Mr. FRANK of Massachusetts. Madam Chairman, I yield myself 3 minutes.
The gentlewoman, incredibly, says this will jeopardize the solvency
of the fund if we put money into affordable housing. I thought reading
was one of the basic things we did around here. In the bill it says
nothing can go to the Affordable Housing Fund if it would jeopardize
solvency. Simply denying plain facts is not an appropriate way to
debate.
In much of her argument she talks about another piece that represents
the difference between us. We say that if you are someone with a weaker
credible, a lower FICO score, the great god, FICO, that governs the
lives of lower-income people, if you get your mortgage insured and you
work hard and make all your payments, you should still be charged more
than the gentlewoman from Illinois or I would be charged for a
mortgage, because that is the insurance principle.
It is an appropriate principle for a private insurance company. For
the Federal Government to say to hardworking people who are making
their payments that they will be held accountable for the fact that
other people didn't make their payments, and I won't be and the
gentlewoman from Illinois wouldn't be, that is not appropriate.
So this principle of, yes, they say if you are healthy, you shouldn't
get your money back, if you work hard and make your mortgage payments,
why should you be charged more because somebody else like you
defaulted? Let's all share that burden.
The gentlewoman said, well, it will be hard to give lower-income
people loans. Those are crocodile tears. You are going to help these
lower-income people by making them pay more for their mortgage than we
would pay.
I would also note, and I wasn't in charge of the drafting, but we did
adopt several amendments today. The gentlewoman's amendment would, of
course, wipe all of them out because it would go back to last year's
bill.
I understand there is regret on the part of many of my colleagues at
the results of last November's election, and it is appropriate to try
to undue last year's election. The appropriate time to do that is in
next November's election, not by bills that passed a year ago with a
differently constructed House and say let's not make any changes.
We made changes to accommodate refinancing for people caught in the
subprime crisis. That is in this bill. It is not in the gentlewoman's
substitute. Taking a year-old bill, with none of the improvements we
have made, it goes beyond the philosophy.
Now, I understand Members don't want to do an affordable housing
fund. That was the gentleman from Texas's amendment. I oppose it. That
one makes some sense in terms of ideological division. But to say let's
ignore everything that has happened in the last year, amendments
adopted here today, several amendments by Members of both parties, the
gentleman from California (Mr. Gary G. Miller); the gentleman from Ohio
(Mr. Tiberi); the gentleman from Massachusetts (Mr. Tierney); the
gentleman from New York (Mr. Bishop). We adopted their amendments. The
gentlewoman wants to wipe them out. That is not an appropriate way to
legislate.
I hope that the amendment is defeated, that we do not say in
particular

[[Page H10475]]

that if you are someone in a lower-income category and you make your
mortgage payments, the Federal Government will charge you more.
Madam Chairman, I reserve the balance of my time.
Mrs. BIGGERT. Madam Chairman, we could have passed this bill 9 months
ago, and then we would have added on to it. Unfortunately, this is my
opportunity to do it, and this is the bill that I have had. I bring it
up now.
As I said before, there are good things that have come out in the
discussion today; there are some good things that have been added onto
the bill that you have brought forward. The reason for bringing this up
is I have some real concerns about some of the things that are in
there, and this is my opportunity.
I don't think that we are penalizing low-income people that much. I
know that in the discussion that we had in committee when this came up
about no down payment, there are people that can't afford a mortgage
with no down payment and can meet the monthly payments, but there was
no risk with those people, no premium for FHA to ensure that kind of
mortgage.
That isn't fair for other people that based on their credit scores
are having to pay a premium. I would just disagree. If you are able to
always meet those, then the risk should be dependent on what you do,
not what somebody else does either. I would agree with that.
Madam Chairman, I reserve the balance of my time.
Mr. FRANK of Massachusetts. I think the gentlewoman confused a couple
of issues. When I talk about not charging someone more because she has
a lower credit score, and it is often a ``she'' that is in that
category, it is not the no-down-payment category. What the bill does
that the gentlewoman has is to say if you are someone with a lower
credit score and get a loan with a down payment, you get charged more
even if you make your payments.
By the way, the bill that she would replace with last year's bill
would also knock out several protections we have in this bill against
FHA fees being raised. The FHA doesn't want to raise fees. OMB has
ordered FHA to try to raise fees. Congress has had to intervene.
There are in our version, unlike the version the gentlewoman is
offering, protections against fee increases. We have an amendment that
was advocated by the gentlewoman from Florida, Ms. Ginny Brown-Waite,
and the gentleman from Georgia, Mr. Marshall, to limit the amount that
can be charged to older people taking out reverse equity mortgages.
That is in the bill that the gentlewoman wants to displace, and she
would displace it with a bill that has no such protection for older
people.
Madam Chairman, I reserve the balance of my time.
Mrs. BIGGERT. Madam Chairman, just because someone is low income does
not mean that they have poor credit. I think that is not where they are
going to have to pay higher premiums, necessarily. It is inevitable in
an insurance fund that lower-risk borrowers will subsidize higher-risk
borrowers. Refunds of the nature that is in your bill would undercut
the concept of insurance, as I said before, being the equivalent of a
healthy person requiring a percent refund of his or her insurance
premium, or a driver that does not get into an accident requiring their
insurance back.
Madam Chairman, I reserve the balance of my time.
The CHAIRMAN. The gentleman from Massachusetts has 6 minutes
remaining. The gentlewoman from Illinois has 3 minutes remaining.
Mr. FRANK of Massachusetts. Madam Chairman, I yield myself 3 minutes.
The gentlewoman has quite honestly joined this one issue. She says it
is the principle of insurance. If you are healthy, you should pay less
for insurance than if you are sick. That is not the principle we follow
in the Federal Government. That is the point the gentlewoman misses.
Yes, if you go to a private company, they will do that. You don't pay
more in a Medicare premium if you are sick than if you are healthy.
That is apparently what the gentlewoman is advocating, that senior
citizens who are sick should pay more premiums than senior citizens who
are healthy.
The question is whether a principle that is necessary in a private
insurance scheme is appropriate for the Federal Government. She says
just because you are low income doesn't mean you have poor credit.
True. Not in every case. She knows there is a correlation; that the
weaker the credit, the likely the people are to have low income. She,
again, is saying explicitly that she believes, and she doesn't deny it,
that it is the principle of insurance.
You are a working woman making in the forties, you get FHA insurance,
you make all your payments, and you have got weaker credit than
somebody who serves in Congress and makes $180,000 a year. You have to
pay more, according to the gentlewoman, than I would pay, even if you
made all your payments.
What we are saying is at the outset it may be that you want to charge
more. Yes, we will give FHA the ability to do that upfront. But you can
earn your way out of that. If you have weaker credit, but you work
hard, you are diligent and you make your payments, why should the
Federal Government charge you more than someone far wealthier than you?
The gentlewoman is wrong to think that is the precedent. In the
health insurance field and the Federal Government field, if you are
under Medicare, you don't pay more in Medicare premiums if you were
sick than if you were healthy. This is what we are saying, that you
should not charge people more.
I would also point out, again, that she said we don't want to raise
fees to people. Our bill limits what the FHA can be forced to charge by
OMB. We have three separate provisions. I will point out again to the
gentlewoman, we adopted a provision, there were negotiations between
AARP and the originators of the home equity mortgages, the services,
and we have in there a reduction, we put a cap on. We cut by one-third
the maximum fee elderly people can be charged for an FHA-insured home
mortgage.

{time} 1400

We reduced the fee that elderly people can be charged by one-third.
The gentlewoman's amendment, it is not her fault, she is not
gratuitously trying to hurt older people; she just picked up this old
amendment from a year ago, this old bill, and offered it without taking
into account the progress we have made. That is not a good way to
legislate.
I reserve the balance of my time.
Mrs. BIGGERT. Madam Chairman, looking at the two bills, let's look at
flexibility risk-based premiums. H.R. 1752 permits upfront or annual
premiums or both. Premium rates may vary over loan term if basis for
change is determined at origination.
Under your bill, the same: requires annual report on risk-based
premiums and how they were determined, authorizes premiums based on
product risk.
The maximum upfront premium amounts, H.R. 1752: 3 percent, or 1.5
percent if annual premium is at its maximum. Under your bill, 2.25
percent for standard-risk and higher-risk mortgages, 3.0 for zero and
lower down mortgages for first-time buyers. And then the maximum annual
premium amounts in H.R. 1752, 2.0, or 1.0 if upfront premium is at its
maximum. Under yours, 0.55 percent for standard and high-risk
mortgages, 0.75 for zero down mortgages. And then the limit on premium
charged for certain mortgages. If a borrower has 3 percent cash
contribution and a score of 560 or more, the upfront premium is limited
to 2.25 percent and the annual 0.55 percent. And then, under your bill
it is included by creation of the standard-risk and higher-risk
mortgage categories.
I guess we disagree on this, but I think I want the same thing. I
want FHA to be used. I want it to be used for low-income, first-time
home buyers and those that are trying to refinance. This is critical
right now, and I just think there is some differences in what we have.
Madam Chairman, I reserve the balance of my time.
Mr. FRANK of Massachusetts. Madam Chairman, let me ask the
gentlewoman from Illinois: If someone has weaker credit and gets
mortgage insurance but makes all the payments for 5 years, why does the
gentlewoman think that she should be charged more? And how does it hurt
the FHA's ability to go forward if, after someone has

[[Page H10476]]

made the payments for 5 years, she gets refunded the extra? I would
yield to the gentlewoman to answer that question, a fundamental
difference on the bill.
Mrs. BIGGERT. I think under the bill, H.R. 1752, their premiums are
reduced; they are not refunded.
Mr. FRANK of Massachusetts. No. Answer the question. They are not
refunded under your bill. They are under, the gentlewoman would not
refund them. How does it hurt the FHA in their ability to lend to
people with weaker credit if they say to people with weaker credit, if
you make your payments for 5 years, we will refund the extra we charged
you?
Mrs. BIGGERT. If the gentleman will yield.
Mr. FRANK of Massachusetts. I yield.
Mrs. BIGGERT. Because the FHA is self-funded. It is not funded by the
government just putting money into it just so that they can do other
mortgages. It is self-funded and it is an insurance program. Now, we
haven't been able to use it because it has been so capped in the amount
of what they can do.
Mr. FRANK of Massachusetts. I take back my time because the
gentlewoman is simply, I understand her answer. It is, if there is a
higher loan loss rate from lending to lower-income people, people with
weaker credit, they have to subsidize each other.
We say, no; raise the jumbo limit, and let those people in California
and Massachusetts and New York who are getting mortgages at $600,000
and $500,000, let them subsidize it. Nobody is subsidizing. You
shouldn't have to subsidize if you are making your own payments.

National Association of Realtors,

Washington, DC, September 14, 2007.
House of Representatives,
Washington, DC.
Dear Representative: On behalf of the 1.3 million members
of the National Association of REALTORS, I urge you to
support H.R. 1852, the ``Expanding American Homeownership Act
of 2007'', when the bill is considered by the full House.
This is an important measure that will allow FHA to function
in the 21st century. Equally important and worthy of your
strongest support is an amendment to be offered by
Representatives Barney Frank (D-MA), Gary Miller (R-CA) and
Dennis Cardoza (D-CA) that is vital to improving the
stability of mortgage markets, a critical component of our
national economy.
The Frank/Miller/Cardoza amendment would increase the
Federal Housing Administration (FHA) loan limits beyond the
language originally included in H.R. 1852. Such an increase
is now needed in light of the significant housing and
mortgage market turmoil that has severely limited the ability
of families to refinance a problematic existing loan or,
alternatively, purchase a home in a high cost market with a
safe and affordable mortgage.
As you well know, many American homeowners now have
mortgages with payments that will soon increase dramatically,
putting them at risk of foreclosure. Raising the FHA loan
limits will provide many of these homeowners living in the
nation's high housing cost markets with a safe FHA loan
alternative. In addition, with the even more recent
tightening of the jumbo market, many homebuyers may not be
able to find a safe, affordable financing option without an
increase in the FHA loan limits.
Although the underlying bill would increase the loan
limits, we strongly believe that the Frank/Miller/Cardoza
amendment is needed to affect real change. H.R. 1852 creates
a new loan ceiling of $417,000. Many markets are
significantly higher than this limit. Median home prices of
communities in New York, New Jersey, Connecticut, California,
Massachusetts, and Pennsylvania are already far above this
limit. The Frank/Miller/Cardoza amendment creates geographic
fairness by raising the loan limit to 125% of the area median
home price. Under the amendment working families in Newark,
NJ can buy a home for $512,000, and families in Los Angeles,
CA can buy homes for $650,000--both median price homes for
their area.
FHA reform is needed now, more than ever. Please vote for
H.R. 1852 and the Frank/Miller/Cardoza amendment when these
measures come to the Floor.
Thank you,
Pat V. Combs,
President.
____

National Association

of Home Builders,

Washington, DC, September 17, 2007.
Hon. John Boehner,
Minority Leader, House of Representatives, Washington, DC.
Dear Leader Boehner: On behalf of the 235,000 members of
the National Association of Home Builders (NAHB), I am
writing to express the building industry's support for H.R.
1852, the Expanding American Homeownership Act of 2007. NAHB
urges you to support this bill, which modernizes the Federal
Housing Administration (FHA), when it comes to the House
floor next week. Because of the importance of this issue to
our industry, we are designating the vote on passage of H.R.
1852 as a KEY VOTE.
NAHB also supports the Frank/Miller/Cardoza amendment that
will further enable home buyers the ability to purchase an
FHA-insured home in many high-cost areas. Currently, the FHA
loan limit is too low to enable many deserving home buyer to
purchase a home in high-cost areas.
Since its creation in 1934, and for much of its existence,
the FHA has been viewed as a housing finance innovator by
insuring millions of mortgage loans, which have made it
possible for America's families to achieve homeownership.
FHA's single family mortgage insurance programs have served
home buyers in all parts of the country during all types of
economic conditions. Moreover, FHA has done this without any
cost to America's taxpayers.
Unfortunately, over the past two decades, the popularity
and relevance of FHA's single family mortgage insurance
programs have waned as FHA's programs have failed to keep
pace with competing conventional mortgage loan programs.
Faced with a deepening constriction in the availability and
affordability of housing credit, Congress now has the
opportunity to modernize the FHA and enable it to play a key
role in stabilizing the mortgage markets, while offering
borrowers a safe and fair mortgage alternative. Recently,
President Bush outlined a plan to help American homeowners
weather the current difficulties in mortgage markets, which
included asking Congress to send him an FHA reform bill as
soon as possible.
To address the problems in today's housing finance market,
I urge your support for H.R. 1852 on the House floor this
week. Again, NAHB will KEY VOTE the vote on passage of H.R.
1852. Thank you for considering the views of the home
building industry.
Sincerely,
Joseph M. Stanton,
Chief Lobbyist.

I yield my remaining time to the gentlewoman from California, the
chairman of the subcommittee.
Ms. WATERS. Madam Chairman and Members, earlier today we talked about
how we worked together so well in order to get the best possible
legislation. And I am just a little bit sad that this substitute
amendment would reform for the Federal Housing Administration's FHA
single-family mortgage insurance activities and would allow FHA to base
each borrower's mortgage insurance premiums on the risk that the
borrower poses to the FHA mortgage insurance fund with slight
variations.
Under this proposal, mortgage insurance premiums will be based on the
borrower's credit history, loan-to-value ratio, debt-to-income ratio,
and on FHA's historical experience with similar borrowers.
This amendment maintains FHA reserves within the insurance fund to
preserve the future solvency of the FHA program. I just rise in strong
opposition to this amendment for the simple reason that H.R. 1852 is a
better bill than the FHA reform bill that passed the House last year.
And I could go on and on and on talking about why this is a much better
bill, but I think this would be a step backwards, and I would ask my
colleagues not to support this amendment. It is not a good amendment.
The CHAIRMAN. The gentleman's time has expired.
The gentlewoman from Illinois has 1 minute remaining.
Mrs. BIGGERT. I guess we will have to agree to disagree that last
year's bill would have served more borrowers. And we are moving forward
here, so I would urge Members to support my amendment.
Madam Chairman, I yield back the balance of my time.
The CHAIRMAN. The question is on the amendment offered by the
gentlewoman from Illinois (Mrs. Biggert).
The question was taken; and the Chairman announced that the noes
appeared to have it.
Mrs. BIGGERT. Madam Chairman, I demand a recorded vote.
The CHAIRMAN. Pursuant to clause 6 of rule XVIII, further proceedings
on the amendment offered by the gentlewoman from Illinois will be
postponed.

Announcement by the Chairman

The CHAIRMAN. Pursuant to clause 6 of rule XVIII, proceedings will
now resume on those amendments on which further proceedings were
postponed, in the following order:
Amendment No. 5 by Mr. Hensarling of Texas.
Amendment No. 7 by Mrs. Biggert of Illinois.
The Chair will reduce to 5 minutes the time for the second electronic
vote in this series.

[[Page H10477]]

Amendment No. 5 Offered by Mr. Hensarling.

The CHAIRMAN. The unfinished business is the demand for a recorded
vote on the amendment offered by the gentleman from Texas (Mr.
Hensarling) on which further proceedings were postponed and on which
the noes prevailed by voice vote.
The Clerk will redesignate the amendment.
The Clerk redesignated the amendment.

Recorded Vote

The CHAIRMAN. A recorded vote has been demanded.
A recorded vote was ordered.
The vote was taken by electronic device, and there were--ayes 148,
noes 280, not voting 9, as follows:

[Roll No. 873]

AYES--148

Aderholt
Akin
Bachmann
Bachus
Baker
Barrett (SC)
Barton (TX)
Biggert
Bilbray
Bilirakis
Bishop (UT)
Blackburn
Blunt
Boehner
Bonner
Bono
Boozman
Boustany
Brady (TX)
Broun (GA)
Brown (SC)
Buchanan
Burgess
Burton (IN)
Buyer
Camp (MI)
Campbell (CA)
Cannon
Cantor
Carter
Chabot
Coble
Conaway
Crenshaw
Culberson
Davis (KY)
Davis, David
Davis, Tom
Deal (GA)
Diaz-Balart, L.
Diaz-Balart, M.
Doolittle
Drake
Dreier
Duncan
Ehlers
Everett
Fallin
Feeney
Flake
Forbes
Fortenberry
Fortuno
Fossella
Foxx
Franks (AZ)
Gallegly
Garrett (NJ)
Gingrey
Gohmert
Goode
Goodlatte
Granger
Graves
Hall (TX)
Hastert
Hastings (WA)
Hayes
Heller
Hensarling
Hoekstra
Hulshof
Hunter
Inglis (SC)
Issa
Johnson, Sam
Jordan
Keller
King (IA)
Kingston
Kirk
Kline (MN)
Kuhl (NY)
LaHood
Lamborn
Latham
Lewis (KY)
Linder
Lucas
Lungren, Daniel E.
Mack
Manzullo
Marchant
McCarthy (CA)
McCaul (TX)
McCotter
McCrery
McHenry
Mica
Miller (FL)
Miller (MI)
Moran (KS)
Musgrave
Myrick
Neugebauer
Nunes
Paul
Pearce
Pence
Peterson (PA)
Petri
Pickering
Pitts
Poe
Price (GA)
Pryce (OH)
Putnam
Radanovich
Reynolds
Rogers (AL)
Rogers (KY)
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Roskam
Royce
Ryan (WI)
Sali
Schmidt
Sensenbrenner
Sessions
Shadegg
Shimkus
Shuster
Smith (NE)
Smith (TX)
Stearns
Sullivan
Thornberry
Tiahrt
Tiberi
Wamp
Weldon (FL)
Westmoreland
Whitfield
Wicker
Wilson (SC)
Young (AK)

NOES--280

Abercrombie
Ackerman
Alexander
Altmire
Andrews
Arcuri
Baca
Baird
Baldwin
Barrow
Bartlett (MD)
Bean
Berkley
Berman
Berry
Bishop (GA)
Bishop (NY)
Blumenauer
Bordallo
Boren
Boswell
Boucher
Boyd (FL)
Boyda (KS)
Brady (PA)
Braley (IA)
Brown, Corrine
Brown-Waite, Ginny
Butterfield
Calvert
Capito
Capps
Capuano
Cardoza
Carnahan
Carson
Castle
Castor
Chandler
Christensen
Clarke
Clay
Cleaver
Clyburn
Cohen
Conyers
Cooper
Costa
Costello
Courtney
Cramer
Crowley
Cuellar
Cummings
Davis (AL)
Davis (CA)
Davis (IL)
Davis, Lincoln
DeFazio
DeGette
Delahunt
DeLauro
Dent
Dicks
Dingell
Doggett
Donnelly
Doyle
Edwards
Ellison
Ellsworth
Emanuel
Emerson
Engel
English (PA)
Eshoo
Etheridge
Faleomavaega
Farr
Fattah
Ferguson
Filner
Frank (MA)
Frelinghuysen
Gerlach
Giffords
Gilchrest
Gillibrand
Gonzalez
Gordon
Green, Al
Green, Gene
Grijalva
Gutierrez
Hall (NY)
Hare
Harman
Hastings (FL)
Herger
Herseth Sandlin
Higgins
Hill
Hinchey
Hinojosa
Hirono
Hobson
Hodes
Holden
Holt
Honda
Hooley
Hoyer
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Johnson (GA)
Johnson (IL)
Johnson, E. B.
Jones (NC)
Jones (OH)
Kagen
Kanjorski
Kaptur
Kennedy
Kildee
Kilpatrick
Kind
King (NY)
Klein (FL)
Kucinich
Lampson
Langevin
Lantos
Larsen (WA)
Larson (CT)
LaTourette
Lee
Levin
Lewis (CA)
Lewis (GA)
Lipinski
LoBiondo
Loebsack
Lofgren, Zoe
Lowey
Lynch
Mahoney (FL)
Maloney (NY)
Markey
Marshall
Matheson
Matsui
McCarthy (NY)
McCollum (MN)
McDermott
McGovern
McHugh
McIntyre
McKeon
McMorris Rodgers
McNerney
McNulty
Meek (FL)
Meeks (NY)
Melancon
Michaud
Miller (NC)
Miller, Gary
Miller, George
Mitchell
Mollohan
Moore (KS)
Moore (WI)
Moran (VA)
Murphy (CT)
Murphy, Patrick
Murphy, Tim
Murtha
Nadler
Napolitano
Neal (MA)
Norton
Oberstar
Obey
Olver
Ortiz
Pallone
Pascrell
Pastor
Payne
Perlmutter
Peterson (MN)
Platts
Pomeroy
Porter
Price (NC)
Rahall
Ramstad
Rangel
Regula
Rehberg
Reichert
Renzi
Reyes
Richardson
Rodriguez
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Salazar
Sanchez, Linda T.
Sanchez, Loretta
Sarbanes
Saxton
Schakowsky
Schiff
Schwartz
Scott (GA)
Scott (VA)
Serrano
Sestak
Shays
Shea-Porter
Sherman
Shuler
Simpson
Sires
Skelton
Slaughter
Smith (NJ)
Smith (WA)
Snyder
Solis
Souder
Space
Spratt
Stark
Stupak
Sutton
Tanner
Tauscher
Taylor
Terry
Thompson (CA)
Thompson (MS)
Tierney
Towns
Turner
Udall (CO)
Udall (NM)
Upton
Van Hollen
Velazquez
Visclosky
Walberg
Walden (OR)
Walsh (NY)
Walz (MN)
Wasserman Schultz
Waters
Watson
Watt
Waxman
Weiner
Welch (VT)
Weller
Wexler
Wilson (NM)
Wilson (OH)
Wolf
Woolsey
Wu
Wynn
Yarmuth
Young (FL)

NOT VOTING--9

Allen
Becerra
Carney
Cole (OK)
Cubin
Davis, Jo Ann
Jindal
Knollenberg
Tancredo

{time} 1432

Messrs. HODES, ORTIZ, OBEY, RICHARDSON, PASTOR, ALEXANDER, REHBERG,
TERRY, BISHOP of Georgia, BARTLETT of Maryland, McKEON, LEWIS of
California, Ms. GINNY BROWN-WAITE of Florida and Ms. JACKSON-LEE of
Texas changed their vote from ``aye'' to ``no.''
Mr. LUCAS, Ms. PRYCE of Ohio, Mr. HOEKSTRA, Mr. BOOZMAN, Mrs.
MUSGRAVE and Mr. KING of Iowa changed their vote from ``no'' to
``aye.''
So the amendment was rejected.
The result of the vote was announced as above recorded.
Stated for:
Mr. HERGER. Madam Chairman, on rollcall No. 873, I inadvertently
voted ``nay.'' I meant to vote ``aye.''

Amendment No. 7 Offered by Mrs. Biggert

The CHAIRMAN. The unfinished business is the demand for a recorded
vote on the amendment offered by the gentlewoman from Illinois (Mrs.
Biggert) on which further proceedings were postponed and on which the
noes prevailed by voice vote.
The Clerk will redesignate the amendment.
The Clerk redesignated the amendment.

Recorded Vote

The CHAIRMAN. A recorded vote has been demanded.
A recorded vote was ordered.
The CHAIRMAN. This will be a 5-minute vote.
The vote was taken by electronic device, and there were--ayes 175,
noes 252, not voting 10, as follows:

[Roll No. 874]

AYES--175

Aderholt
Akin
Alexander
Bachmann
Bachus
Baker
Barrett (SC)
Bartlett (MD)
Barton (TX)
Biggert
Bilbray
Bilirakis
Bishop (UT)
Blackburn
Blunt
Boehner
Bonner
Bono
Boozman
Boustany
Brady (TX)
Broun (GA)
Brown (SC)
Brown-Waite, Ginny
Buchanan
Burgess
Burton (IN)
Buyer
Camp (MI)
Campbell (CA)
Cannon
Cantor
Carter
Castle
Chabot
Coble
Cole (OK)
Conaway
Crenshaw
Culberson
Davis (KY)
Davis, David
Davis, Tom
Deal (GA)
Diaz-Balart, L.
Diaz-Balart, M.
Doolittle
Drake
Dreier
Duncan
Ehlers
Emerson
Everett
Fallin
Feeney
Flake
Forbes
Fortenberry
Fortuno
Fossella
Foxx
Franks (AZ)
Gallegly
Garrett (NJ)
Gilchrest
Gingrey
Gohmert
Goode
Goodlatte
Granger
Graves
Hall (TX)
Hastert
Hastings (WA)
Hayes
Heller
Hensarling
Herger
Hobson
Hoekstra
Hulshof
Hunter
Inglis (SC)
Issa
Johnson (IL)
Johnson, Sam
Jones (NC)
Jordan
Keller
King (IA)
King (NY)
Kingston
Kirk
Kline (MN)
Kuhl (NY)
LaHood
Lamborn
Latham
LaTourette
Lewis (KY)
Linder
Lucas
Lungren, Daniel E.
Mack
Manzullo
Marchant
McCarthy (CA)
McCaul (TX)
McCotter
McCrery
McHenry
McMorris Rodgers
Mica
Miller (FL)
Miller (MI)
Moran (KS)
Murphy, Tim
Musgrave
Myrick
Neugebauer
Nunes
Paul
Pearce
Pence
Peterson (PA)
Petri
Pickering
Pitts
Poe
Price (GA)
Pryce (OH)
Putnam
Radanovich
Regula
Rehberg
Renzi
Reynolds
Rogers (AL)
Rogers (KY)
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Roskam
Royce
Ryan (WI)
Sali
Schmidt
Sensenbrenner
Sessions
Shadegg
Shays
Shimkus
Shuster
Simpson
Smith (NE)
Smith (TX)
Souder
Stearns
Sullivan
Terry
Thornberry
Tiahrt
Tiberi
Turner
Walberg
Wamp
Weldon (FL)
Weller
Westmoreland

[[Page H10478]]

Whitfield
Wicker
Wilson (NM)
Wilson (SC)
Wolf
Young (AK)

NOES--252

Ackerman
Altmire
Andrews
Arcuri
Baca
Baird
Baldwin
Barrow
Bean
Becerra
Berkley
Berman
Berry
Bishop (GA)
Bishop (NY)
Blumenauer
Bordallo
Boren
Boswell
Boucher
Boyd (FL)
Boyda (KS)
Brady (PA)
Braley (IA)
Brown, Corrine
Butterfield
Calvert
Capito
Capps
Capuano
Cardoza
Carnahan
Carson
Castor
Chandler
Christensen
Clarke
Clay
Cleaver
Clyburn
Cohen
Conyers
Cooper
Costa
Costello
Courtney
Cramer
Crowley
Cuellar
Cummings
Davis (AL)
Davis (CA)
Davis (IL)
Davis, Lincoln
DeFazio
DeGette
Delahunt
DeLauro
Dent
Dicks
Dingell
Doggett
Donnelly
Doyle
Edwards
Ellison
Ellsworth
Emanuel
Engel
English (PA)
Eshoo
Etheridge
Faleomavaega
Farr
Fattah
Ferguson
Filner
Frank (MA)
Frelinghuysen
Gerlach
Giffords
Gillibrand
Gonzalez
Gordon
Green, Al
Green, Gene
Grijalva
Gutierrez
Hall (NY)
Hare
Harman
Hastings (FL)
Herseth Sandlin
Higgins
Hill
Hinchey
Hinojosa
Hirono
Hodes
Holden
Holt
Honda
Hooley
Hoyer
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Johnson (GA)
Johnson, E. B.
Jones (OH)
Kagen
Kanjorski
Kaptur
Kennedy
Kildee
Kilpatrick
Kind
Klein (FL)
Kucinich
Lampson
Langevin
Lantos
Larsen (WA)
Larson (CT)
Lee
Levin
Lewis (CA)
Lewis (GA)
Lipinski
LoBiondo
Loebsack
Lofgren, Zoe
Lowey
Lynch
Mahoney (FL)
Maloney (NY)
Markey
Marshall
Matheson
Matsui
McCarthy (NY)
McCollum (MN)
McDermott
McGovern
McHugh
McIntyre
McKeon
McNerney
McNulty
Meek (FL)
Meeks (NY)
Melancon
Michaud
Miller (NC)
Miller, Gary
Miller, George
Mitchell
Mollohan
Moore (KS)
Moore (WI)
Moran (VA)
Murphy (CT)
Murphy, Patrick
Murtha
Nadler
Napolitano
Neal (MA)
Oberstar
Obey
Olver
Ortiz
Pallone
Pascrell
Pastor
Payne
Perlmutter
Peterson (MN)
Platts
Pomeroy
Porter
Price (NC)
Rahall
Ramstad
Rangel
Reichert
Reyes
Richardson
Rodriguez
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Salazar
Sanchez, Linda T.
Sanchez, Loretta
Sarbanes
Saxton
Schakowsky
Schiff
Schwartz
Scott (GA)
Scott (VA)
Serrano
Sestak
Shea-Porter
Sherman
Shuler
Sires
Skelton
Slaughter
Smith (NJ)
Smith (WA)
Snyder
Solis
Space
Spratt
Stark
Stupak
Tanner
Tauscher
Taylor
Thompson (CA)
Thompson (MS)
Tierney
Towns
Udall (CO)
Udall (NM)
Upton
Van Hollen
Velazquez
Visclosky
Walden (OR)
Walsh (NY)
Walz (MN)
Wasserman Schultz
Waters
Watson
Watt
Waxman
Weiner
Welch (VT)
Wexler
Wilson (OH)
Woolsey
Wu
Wynn
Yarmuth
Young (FL)

NOT VOTING--10

Abercrombie
Allen
Carney
Cubin
Davis, Jo Ann
Jindal
Knollenberg
Norton
Sutton
Tancredo

Announcement by the Chairman

The CHAIRMAN (during the vote). Members are advised that there are 2
minutes remaining in this vote.

{time} 1440

So the amendment was rejected.
The result of the vote was announced as above recorded.
The CHAIRMAN. Under the rule, the Committee rises.
Accordingly, the Committee rose; and the Speaker pro tempore (Mr.
Holden) having assumed the chair, Mrs. Jones of Ohio, Chairman of the
Committee of the Whole House on the state of the Union, reported that
that Committee, having had under consideration the bill (H.R. 1852) to
modernize and update the National Housing Act and enable the Federal
Housing Administration to use risk-based pricing to more effectively
reach underserved borrowers, and for other purposes, pursuant to House
Resolution 650, she reported the bill, as amended by that resolution,
back to the House with sundry further amendments adopted by the
Committee of the Whole.
The SPEAKER pro tempore. Under the rule, the previous question is
ordered.
Is a separate vote demanded on any further amendment reported from
the Committee of the Whole? If not, the Chair will put them en gros.
The amendments were agreed to.
The SPEAKER pro tempore. The question is on the engrossment and third
reading of the bill.
The bill was ordered to be engrossed and read a third time, and was
read the third time.

Motion to Recommit Offered by Mr. Price of Georgia

Mr. PRICE of Georgia. Mr. Speaker, I offer a motion to recommit.
The SPEAKER pro tempore. Is the gentleman opposed to the bill?
Mr. PRICE of Georgia. In its current form, I am.
The SPEAKER pro tempore. The Clerk will report the motion to
recommit.
The Clerk read as follows:
Mr. Price of Georgia moves to recommit the bill H.R. 1852
to the Committee on Financial Services with instructions that
the Committee report the same back promptly with the
following amendment:
Page 64, strike line 6, and insert the following:
(4) Affordable housing fund.--
(A) In general.--For each fis-
Page 64, after line 13, insert the following:
``(B) Limitation on use of funds.--
``(i) In general.--Amounts made available pursuant to
subparagraph (A) for affordable housing fund referred to in
such subparagraph may not be used for, or on behalf of, any
individual or household unless the individual provides, or,
in the case of a household, all adult members of the
household provide, personal identification in one of the
following forms:

``(I) Social security card with photo identification card
or real id act identification.--

``(aa) A social security card accompanied by a photo
identification card issued by the Federal Government or a
State Government; or
``(bb) A driver's license or identification card issued by
a State in the case of a State that is in compliance with
title II of the REAL ID Act of 2005 (title II of division B
of Public Law 109-13; 49 U.S.C. 30301 note).

``(II) Passport.--A passport issued by the United States or
a foreign government.
``(III) USCIS photo identification card.--A photo
identification card issued by the Secretary of Homeland
Security (acting through the Director of the United States
Citizenship and Immigration Services).

``(ii) Regulations.--The Federal official responsible for
administering the affordable housing fund referred to in
subparagraph (A) shall, by regulation, require that each
grantee and recipient of assistance from such fund take such
actions as such official considers necessary to ensure
compliance with the requirements of clause (i).''.

{time} 1445

The SPEAKER pro tempore. The gentleman from Georgia is recognized for
5 minutes.
Mr. PRICE of Georgia. Mr. Speaker, this is a commonsense motion to
recommit that would require that any individual or household receiving
money from the Affordable Housing Fund must present verification of
legal residency by a secure identification document.
Americans believe that it's appropriate to ask those receiving hard-
earned taxpayer dollars, taxpayer assistance, that it's right to
establish that they are legal residents of the United States. It's
common sense.
Across the country, whether it's Denver, where in 2006 there were an
estimated 20,000 illegal immigrants holding FHA insured loans, or L.A.
or Atlanta, where similar activity occurs, illegal immigrants are being
given unprecedented access to taxpayer benefits and taxpayer money. In
many of these cases of FHA loans, the documents submitted with their
applications later proved to be false, resident alien numbers that were
never issued, or Social Security numbers belonging to other people, or
W-2 forms that were fabricated. In the case of financial institutions,
minimal documents are required by their regulators to establish a new
customer's identity to open accounts.
The current loopholes in Federal law are an invitation, they're an
attraction, they're a magnet to illegal immigration. We must not reward
those coming here illegally by allowing them the services that ought to
be only afforded to American citizens and they're here legally. If we
do so, this results in back-door amnesty.
This motion to recommit would require that the Federal official
responsible for administering the Housing Trust Fund ensure that any
assistance provided from the Affordable Housing Fund must require that
all adults are legal residents of the United States. Simple common
sense.
Recipients may use one of three different forms of identification.
These forms are considered the most secure types of identification
because they're harder to forge or to duplicate. They're all issued by
a government agency

[[Page H10479]]

which has more checks and balances, more checks and balances preventing
illegal immigrants or criminals or terrorists from obtaining these
documents.
Everyone who is in the United States legally can easily obtain one of
the three identification forms, but illegal immigrants, criminals, and
terrorists would have to go to significant lengths to receive one.
Now, we have offered this type of amendment to bills in the past on
this floor, and it's needed on this bill as well, as there appears to
be no end in sight to the appetite of our friends in the majority to
provide taxpayer benefits to illegals against the will and against the
desire of the American people.
Now, you will hear that this MTR, this motion to recommit, provides
for the committee to report back promptly and that that would ``kill
the bill.'' But we all know that's not true. In fact, the Speaker has
previously ruled that any bill adopted with this language could readily
be returned to the House floor with the new language.
You will hear that those already here illegally cannot get federally
subsidized benefits. Then because it's clear that there are currently
some loopholes in our current system, we ought not have any problem
adopting more enforceable criteria for legal documentation.
You will hear that if you don't drive or you don't travel to foreign
countries, that this is an undue burden. But the American people don't
believe that it is inappropriate to ask those citizens receiving
Federal taxpayer assistance to first establish that they are legal
residents of the United States.
You will hear that this might lead us down the path to using Social
Security as a universal identifier. But if you read this motion, what
it does is simply provide for an array of options for secure IDs that
all Americans and legal immigrants have ready access to. Simple common
sense.
You may hear that it's already in the bill. Well, in fact it is, Mr.
Speaker; but it doesn't cover the Affordable Housing Fund. The current
regulations to establish a customer's identity do a disservice to the
American people. Greater clarification in this area will help stem the
tide of illegal immigrants.
The Federal Government should not be operating under obscure
parameters that do not serve our Nation. We can and should strengthen
these regulations to protect the American people.
This is a much more appropriate solution to the problem of back-door
amnesty than simply saying that we're not going to let illegal
immigrants live in government-subsidized housing. To the best of our
ability, we must eliminate using hard-earned American taxpayer money to
subsidize illegal activity. This motion to recommit does just that, and
I urge my colleagues to support the motion.
Mr. Speaker, I yield back the balance of my time.
Mr. FRANK of Massachusetts. Mr. Speaker, I rise in opposition to the
motion.
The SPEAKER pro tempore. The gentleman is recognized for 5 minutes.
Mr. FRANK of Massachusetts. Mr. Speaker, I ask the Members to follow
closely because there are some unusual twists and turns even to this.
In the first place, the gentleman talked about people getting FHA
loans who weren't here legally, and he made a big point of that. As he
later acknowledged, the bill, as reported, already deals with that.
The gentleman from Georgia is so enamored of this amendment that he's
offering it twice to this bill. Now, he's making up for the fact that
last week he wanted to offer it and couldn't. The gentleman from
Georgia had filed in the Congressional Record a version of this
amendment to offer to the Native American housing bill to prevent
illegal immigrant Native Americans from sneaking in. And when we
pointed that out, the gentleman from Georgia for once thought better of
it and didn't offer the amendment. I think he was afraid that the
Indians would have said, you know, sir, that's a good idea, why didn't
we think of it?
But now, in the amendment, the gentleman offered this amendment in
committee, so the illustration he gave of how they are getting FHA
loans when they shouldn't, that's already in the bill. What he has done
now is to say that this should apply to the Affordable Housing Trust
Fund, which is not created by this bill. The bill does say that if we
later, on the floor of this House, created an affordable housing trust
fund, funds from the FHA excess, if there are any, will go into it. So
there is plenty of time when we deal with the Affordable Housing Trust
Fund.
So last week he couldn't offer the amendment to keep the illegal
immigrants out of the Navajo housing. This week, he's already got it in
the bill that covers the bill before us, but he has now got amendment
envy in the worst way, so he's going to offer it to a program that
doesn't exist yet, preempting our chance to do it. Even that wouldn't
be a problem except that he could have said ``forthwith.'' He said
``promptly.'' It doesn't kill the bill; it significantly delays it.
If this comes back to the Committee on Financial Services, it is now
wide open. The committee then has a markup, and any amendment can be
offered. And I will tell my colleagues that there are Members, yes,
there is your indication of what will happen, this will be filibustered
again. Thank you for your honesty. I appreciate it. If this bill comes
back to committee, it will be wide open.
We are in the midst of a crisis. The President said last month,
please pass the FHA bill promptly. Even the United States Senate is now
acting on this bill. If it comes back to committee, I have 3 days to
notice a markup. How quickly could we do it? Well, I don't think I can
have this markup on Yom Kippur. There may be a lot to atone for in this
amendment, but I can't have it on Friday.
So we go over to next week. We have markups scheduled next week on
HOPE VI and on flood insurance and other important issues, so we
couldn't get to this for a couple of weeks. And then when we do get to
it, the clappers over there are going to offer a whole bunch of
amendments.
Now, if the gentleman just wanted to put this into the program that
doesn't yet exist, and that he will have a chance to do it later, he
could have said ``forthwith.'' Members are asked, when they rise on a
recommit, are you opposed to the bill? The gentleman from Georgia
honestly answered that he is. And he used the choice he had to
substantially delay this bill. No, not kill it, but this will delay
this bill by several weeks in the midst of this subprime crisis.
I would say to Members, preventing the FHA loans from going there,
that's already in the bill. Read pages 54 and following. The Affordable
Housing Trust Fund, it will be created later. I'm sure the gentleman
will offer that amendment again and you will have a chance to vote on
it.
So the sole effect of voting for this recommit is substantially to
delay the bill on the FHA because the program that the bill covers,
this amendment applies already from the committee. And the program that
he would apply it to is not yet in existence and won't be in existence
until we vote.
And for Members who worry about some cheap shot ad that says, oh,
well, ``promptly,'' ``forthwith,'' too complicated, I hope people don't
vote for this amendment. Many of them will. You will have a chance to
vote for it. Long before the next election, the gentleman from Georgia
will have offered this amendment four more times, at least. We've got
more bills in our committee, and so you will have the chance to vote
for it.
Please, if you support the low-income Housing Trust Fund as a concept
and want the funding available when we set it up, if you support, in
particular, the President's request that we move promptly to let the
FHA be available for the subprime crisis, do not vote for a recommit
whose sole effect will be to delay for several weeks passage of this
bill. It won't kill it, but a several-week delay. I've got to hold off
and call the hearing, we have to then have a long markup, they will be
offering more amendments. It will substantially delay a very important
bill, and I hope Members will defeat it.
The SPEAKER pro tempore. Without objection, the previous question is
ordered on the motion to recommit.
There was no objection.
The SPEAKER pro tempore. The question is on the motion to recommit.
The question was taken; and the Speaker pro tempore announced that
the noes appeared to have it.

[[Page H10480]]

Mr. PRICE of Georgia. Mr. Speaker, on that I demand the yeas and
nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 and clause 9 of rule
XX, this 15-minute vote on the motion to recommit will be followed by
5-minute votes on passage of H.R. 1852, if ordered, and suspending the
rules and passing H.R. 3096.
The vote was taken by electronic device, and there were--yeas 209,
nays 216, not voting 8, as follows:

[Roll No. 875]

YEAS--209

Aderholt
Akin
Alexander
Altmire
Bachmann
Bachus
Baker
Barrett (SC)
Barrow
Bartlett (MD)
Barton (TX)
Bean
Biggert
Bilbray
Bilirakis
Bishop (UT)
Blackburn
Blunt
Boehner
Bonner
Bono
Boozman
Boswell
Boustany
Brady (TX)
Broun (GA)
Brown (SC)
Brown-Waite, Ginny
Buchanan
Burgess
Burton (IN)
Buyer
Calvert
Camp (MI)
Campbell (CA)
Cannon
Cantor
Capito
Carter
Castle
Chabot
Coble
Cole (OK)
Conaway
Crenshaw
Culberson
Davis (KY)
Davis, David
Davis, Tom
Deal (GA)
DeFazio
Dent
Diaz-Balart, L.
Diaz-Balart, M.
Donnelly
Doolittle
Drake
Dreier
Duncan
Ehlers
Ellsworth
Emerson
English (PA)
Everett
Fallin
Feeney
Ferguson
Flake
Forbes
Fortenberry
Fossella
Foxx
Franks (AZ)
Frelinghuysen
Gallegly
Garrett (NJ)
Gerlach
Giffords
Gilchrest
Gingrey
Gohmert
Goode
Goodlatte
Granger
Graves
Hall (TX)
Hastert
Hastings (WA)
Hayes
Heller
Hensarling
Herger
Hobson
Hoekstra
Hulshof
Hunter
Inglis (SC)
Issa
Johnson (IL)
Johnson, Sam
Jones (NC)
Jordan
Keller
King (IA)
King (NY)
Kingston
Kirk
Kline (MN)
Kuhl (NY)
LaHood
Lamborn
Lampson
Latham
LaTourette
Lewis (CA)
Lewis (KY)
Linder
LoBiondo
Lucas
Lungren, Daniel E.
Mack
Manzullo
Marchant
Marshall
McCarthy (CA)
McCaul (TX)
McCotter
McCrery
McHenry
McHugh
McIntyre
McKeon
McMorris Rodgers
Mica
Miller (FL)
Miller (MI)
Miller, Gary
Mitchell
Moran (KS)
Murphy, Patrick
Murphy, Tim
Musgrave
Myrick
Neugebauer
Nunes
Paul
Pearce
Pence
Peterson (PA)
Petri
Pickering
Pitts
Platts
Poe
Porter
Price (GA)
Pryce (OH)
Putnam
Radanovich
Ramstad
Regula
Rehberg
Reichert
Reynolds
Rogers (AL)
Rogers (KY)
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Roskam
Royce
Ryan (WI)
Saxton
Schmidt
Sensenbrenner
Sessions
Shadegg
Shays
Shimkus
Shuler
Shuster
Simpson
Smith (NE)
Smith (NJ)
Smith (TX)
Souder
Space
Stearns
Sullivan
Terry
Thornberry
Tiahrt
Tiberi
Turner
Upton
Walberg
Walden (OR)
Walsh (NY)
Wamp
Weldon (FL)
Weller
Westmoreland
Whitfield
Wicker
Wilson (NM)
Wilson (SC)
Wolf
Young (AK)
Young (FL)

NAYS--216

Abercrombie
Ackerman
Andrews
Arcuri
Baca
Baird
Baldwin
Becerra
Berkley
Berman
Berry
Bishop (GA)
Bishop (NY)
Blumenauer
Boren
Boucher
Boyd (FL)
Boyda (KS)
Brady (PA)
Braley (IA)
Brown, Corrine
Butterfield
Capps
Capuano
Cardoza
Carnahan
Carson
Castor
Chandler
Clarke
Clay
Cleaver
Clyburn
Cohen
Conyers
Cooper
Costa
Costello
Courtney
Cramer
Crowley
Cuellar
Cummings
Davis (AL)
Davis (CA)
Davis (IL)
Davis, Lincoln
DeGette
Delahunt
DeLauro
Dicks
Dingell
Doggett
Doyle
Edwards
Ellison
Emanuel
Engel
Eshoo
Etheridge
Farr
Fattah
Filner
Frank (MA)
Gillibrand
Gonzalez
Gordon
Green, Al
Green, Gene
Grijalva
Gutierrez
Hall (NY)
Hare
Harman
Hastings (FL)
Herseth Sandlin
Higgins
Hill
Hinchey
Hinojosa
Hirono
Hodes
Holden
Holt
Honda
Hooley
Hoyer
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Johnson (GA)
Johnson, E. B.
Jones (OH)
Kagen
Kanjorski
Kaptur
Kennedy
Kildee
Kilpatrick
Kind
Klein (FL)
Kucinich
Langevin
Lantos
Larsen (WA)
Larson (CT)
Lee
Levin
Lewis (GA)
Lipinski
Loebsack
Lofgren, Zoe
Lowey
Lynch
Mahoney (FL)
Maloney (NY)
Markey
Matheson
Matsui
McCarthy (NY)
McCollum (MN)
McDermott
McGovern
McNulty
Meek (FL)
Meeks (NY)
Melancon
Michaud
Miller (NC)
Miller, George
Mollohan
Moore (KS)
Moore (WI)
Moran (VA)
Murphy (CT)
Murtha
Nadler
Napolitano
Neal (MA)
Oberstar
Obey
Olver
Ortiz
Pallone
Pascrell
Pastor
Payne
Pelosi
Perlmutter
Peterson (MN)
Pomeroy
Price (NC)
Rahall
Rangel
Renzi
Reyes
Richardson
Rodriguez
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Salazar
Sali
Sanchez, Linda T.
Sanchez, Loretta
Sarbanes
Schakowsky
Schiff
Schwartz
Scott (GA)
Scott (VA)
Serrano
Sestak
Shea-Porter
Sherman
Sires
Skelton
Slaughter
Smith (WA)
Snyder
Solis
Spratt
Stark
Stupak
Sutton
Tanner
Tauscher
Taylor
Thompson (CA)
Thompson (MS)
Tierney
Towns
Udall (CO)
Udall (NM)
Van Hollen
Velazquez
Visclosky
Walz (MN)
Wasserman Schultz
Waters
Watson
Watt
Waxman
Weiner
Welch (VT)
Wexler
Wilson (OH)
Woolsey
Wu
Wynn
Yarmuth

NOT VOTING--8

Allen
Carney
Cubin
Davis, Jo Ann
Jindal
Knollenberg
McNerney
Tancredo

{time} 1514

Messrs. LINDER, RAMSTAD and DONNELLY changed their vote from ``nay''
to ``yea.''
So the motion to recommit was rejected.
The result of the vote was announced as above recorded.
The SPEAKER pro tempore. The question is on the passage of the bill.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.

Recorded Vote

Mr. KIRK. Mr. Speaker, I demand a recorded vote.
A recorded vote was ordered.
The SPEAKER pro tempore. This will be a 5-minute vote.
The vote was taken by electronic device, and there were--ayes 348,
noes 72, not voting 12, as follows:

[Roll No. 876]

AYES--348

Abercrombie
Ackerman
Aderholt
Alexander
Altmire
Arcuri
Baca
Baird
Baldwin
Barrow
Bartlett (MD)
Bean
Becerra
Berkley
Berry
Biggert
Bilirakis
Bishop (GA)
Bishop (NY)
Blumenauer
Blunt
Bonner
Bono
Boozman
Boren
Boswell
Boucher
Boyd (FL)
Boyda (KS)
Brady (PA)
Brady (TX)
Braley (IA)
Brown (SC)
Brown, Corrine
Brown-Waite, Ginny
Buchanan
Burton (IN)
Butterfield
Calvert
Camp (MI)
Capito
Capps
Capuano
Cardoza
Carnahan
Carson
Carter
Castle
Castor
Chabot
Chandler
Clarke
Clay
Cleaver
Clyburn
Coble
Cohen
Cole (OK)
Conyers
Cooper
Costa
Costello
Courtney
Cramer
Crenshaw
Crowley
Cuellar
Cummings
Davis (AL)
Davis (CA)
Davis (IL)
Davis, David
Davis, Lincoln
Davis, Tom
DeFazio
DeGette
Delahunt
DeLauro
Dent
Diaz-Balart, L.
Diaz-Balart, M.
Dicks
Dingell
Doggett
Donnelly
Doolittle
Doyle
Drake
Duncan
Edwards
Ellison
Ellsworth
Emanuel
Emerson
Engel
English (PA)
Eshoo
Etheridge
Everett
Fallin
Farr
Fattah
Ferguson
Filner
Fortenberry
Fossella
Frank (MA)
Frelinghuysen
Gallegly
Gerlach
Giffords
Gilchrest
Gillibrand
Gohmert
Gonzalez
Goodlatte
Gordon
Granger
Graves
Green, Gene
Grijalva
Gutierrez
Hall (NY)
Hall (TX)
Hare
Harman
Hastings (FL)
Hayes
Heller
Herseth Sandlin
Higgins
Hill
Hinchey
Hinojosa
Hirono
Hobson
Hodes
Holden
Holt
Honda
Hooley
Hoyer
Hulshof
Hunter
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
Johnson (GA)
Johnson (IL)
Johnson, E. B.
Jones (NC)
Jones (OH)
Kagen
Kanjorski
Kaptur
Keller
Kennedy
Kildee
Kilpatrick
Kind
King (NY)
Kirk
Klein (FL)
Kucinich
Kuhl (NY)
LaHood
Lampson
Langevin
Lantos
Larsen (WA)
Larson (CT)
Latham
LaTourette
Lee
Levin
Lewis (CA)
Lewis (GA)
Lewis (KY)
Lipinski
LoBiondo
Loebsack
Lofgren, Zoe
Lowey
Lungren, Daniel E.
Lynch
Mahoney (FL)
Maloney (NY)
Marchant
Markey
Marshall
Matheson
Matsui
McCarthy (CA)
McCarthy (NY)
McCaul (TX)
McCollum (MN)
McCotter
McDermott
McGovern
McHugh
McIntyre
McKeon
McMorris Rodgers
McNerney
McNulty
Meek (FL)
Meeks (NY)
Melancon
Michaud
Miller (MI)
Miller (NC)
Miller, Gary
Miller, George
Mitchell
Mollohan
Moore (KS)
Moore (WI)
Moran (KS)
Moran (VA)
Murphy, Patrick
Murphy, Tim
Murtha
Nadler
Napolitano
Neal (MA)
Oberstar
Obey
Olver
Ortiz
Pallone
Pascrell
Pastor
Payne
Perlmutter
Peterson (MN)
Peterson (PA)
Pitts
Platts
Poe
Pomeroy
Porter
Price (NC)
Pryce (OH)
Rahall
Ramstad
Rangel
Regula
Rehberg
Reichert
Renzi
Reyes
Reynolds
Richardson
Rodriguez
Rogers (AL)
Rogers (KY)
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Ross
Rothman
Roybal-Allard
Ruppersberger
Rush
Ryan (OH)
Salazar
Sanchez, Linda T.
Sanchez, Loretta
Sarbanes

[[Page H10481]]

Saxton
Schakowsky
Schiff
Schmidt
Schwartz
Scott (GA)
Scott (VA)
Serrano
Sessions
Sestak
Shays
Shea-Porter
Sherman
Shimkus
Shuler
Shuster
Simpson
Sires
Skelton
Slaughter
Smith (NE)
Smith (NJ)
Smith (TX)
Smith (WA)
Snyder
Solis
Souder
Space
Spratt
Stark
Stupak
Sutton
Tanner
Tauscher
Taylor
Terry
Thompson (CA)
Thompson (MS)
Thornberry
Tiahrt
Tiberi
Tierney
Towns
Turner
Udall (CO)
Udall (NM)
Upton
Van Hollen
Velazquez
Visclosky
Walberg
Walden (OR)
Walsh (NY)
Walz (MN)
Wamp
Wasserman Schultz
Waters
Watson
Watt
Waxman
Weiner
Welch (VT)
Weldon (FL)
Weller
Westmoreland
Wexler
Whitfield
Wicker
Wilson (NM)
Wilson (OH)
Wolf
Woolsey
Wu
Wynn
Yarmuth
Young (AK)
Young (FL)

NOES--72

Akin
Bachmann
Bachus
Baker
Barrett (SC)
Barton (TX)
Bilbray
Bishop (UT)
Blackburn
Boehner
Boustany
Broun (GA)
Burgess
Buyer
Campbell (CA)
Cannon
Cantor
Conaway
Culberson
Davis (KY)
Deal (GA)
Dreier
Ehlers
Feeney
Flake
Forbes
Foxx
Franks (AZ)
Garrett (NJ)
Gingrey
Goode
Hastert
Hastings (WA)
Hensarling
Herger
Hoekstra
Inglis (SC)
Issa
Johnson, Sam
Jordan
King (IA)
Kingston
Kline (MN)
Lamborn
Linder
Lucas
Mack
Manzullo
McCrery
McHenry
Mica
Miller (FL)
Musgrave
Myrick
Neugebauer
Paul
Pearce
Pence
Petri
Price (GA)
Putnam
Radanovich
Roskam
Royce
Ryan (WI)
Sali
Sensenbrenner
Shadegg
Stearns
Sullivan
Tancredo
Wilson (SC)

NOT VOTING--12

Allen
Andrews
Berman
Carney
Cubin
Davis, Jo Ann
Green, Al
Jindal
Knollenberg
Murphy (CT)
Nunes
Pickering

Announcement by the Speaker Pro Tempore

The SPEAKER pro tempore (during the vote). Members are advised 2
minutes remain in this vote.

{time} 1521

Mr. POE changed his vote from ``no'' to ``aye.''
So the bill was passed.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.
Stated for:
Mr. NUNES. Mr. Speaker, on rollcall No. 876 I was inadvertently
detained. Had I been present, I would have voted ``aye.''
Mr. BERMAN. Mr. Speaker, I inadvertently missed the vote on rollcall
876. I had intended to vote ``aye.''

____________________