[House Report 115-416]
[From the U.S. Government Publishing Office]


115th Congress   }                                      {       Report
                        HOUSE OF REPRESENTATIVES
 1st Session     }                                      {      115-416

======================================================================



 
         PRESERVING ACCESS TO MANUFACTURED HOUSING ACT OF 2017

                                _______
                                

 November 21, 2017.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

Mr. Hensarling, from the Committee on Financial Services, submitted the 
                               following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                        [To accompany H.R. 1699]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Financial Services, to whom was referred 
the bill (H.R. 1699) to amend the Truth in Lending Act to 
modify the definitions of a mortgage originator and a high-cost 
mortgage, to amend the Secure and Fair Enforcement for Mortgage 
Licensing Act of 2008 to modify the definition of a loan 
originator, and for other purposes, having considered the same, 
report favorably thereon without amendment and recommend that 
the bill do pass.

                          Purpose and Summary

    Introduced by Representative Andy Barr on March 23, 2017, 
H.R. 1699, the ``Preserving Access to Manufactured Housing Act 
of 2017'', amends Section 103 of the Truth in Lending Act 
(TILA) (15 U.S.C. 1602) to clarify that retailers of 
manufactured homes, or their employees, are not ``mortgage 
originators'' for purposes of the TILA unless these retailers 
or their employees receive compensation from a lender, mortgage 
broker, or loan originator. The bill also amends the Section 
1503 of the Secure and Fair Enforcement for Mortgage Licensing 
(SAFE) Act of 2008 (12 U.S.C. 5102) to specify that such a 
retailer is generally not a ``loan originator'' subject to 
requirements under that Act.
    The bill also revises the Consumer Financial Protection 
Bureau's (CFPB) definition of ``high cost mortgages,'' and 
adjusts the Home Ownership and Equity Protection Act (HOEPA) 
high-cost mortgage thresholds for a first mortgage of less than 
$75,000 on a dwelling that is not real property to: (1) an 
Annual Percentage Rate (APR) that will exceed the average prime 
offer rate by more than 10 percentage points, or (2) points and 
fees that will exceed the greater of 5 percent of the total 
transaction amount or $3,000.

                  Background and Need for Legislation

    In 1994 Congress amended, and President Clinton signed into 
law, amendments to TILA, known as HOEPA, to address abusive 
practices in mortgage re-financings and closed-end home equity 
loans with high interest rates or high fees. Since HOEPA's 
enactment, re-financings or home equity mortgage loans meeting 
any of HOEPA's high-cost coverage tests have been subject to 
special disclosure requirements and restrictions on loan terms, 
and HOEPA provides enhanced remedies to consumers with high-
cost mortgages for violations of the law. HOEPA identifies a 
class of high-cost mortgage loans through rate and fee 
triggers, and it provides consumers that enter into these 
transactions with special protections.
    On January 10, 2013, the CFPB issued a final rule to 
implement the changes to HOEPA mandated by the Dodd-Frank Wall 
Street Reform and Consumer Protection Act (P.L. 111-203). The 
Dodd-Frank Act expanded HOEPA's scope to include purchase money 
mortgage loans and home equity lines of credit. Previously 
HOEPA only applied to re-financings and home equity installment 
loans.
    Additionally, the Dodd-Frank Act, and the implementing 
rule, amends the tests used to determine whether a loan is 
`high cost' under HOEPA. Previously a loan was covered by HOEPA 
if the annual percentage rate (APR) exceeded the rate for 
Treasury securities with a comparable maturity by more than 10 
percentage points, or if the points and fees paid by the 
consumer exceeded the greater of 8 percent of the loan amount 
or $400. The $400 figure, set in 1994, was adjusted annually 
based on the Consumer Price Index. The Dodd-Frank Act, and the 
implementing rule, lowered the rate threshold for HOEPA 
coverage. Under the new regime, a loan will be covered by HOEPA 
if the APR applicable to the transaction exceeds the average 
prime offer rate (APOR) for a comparable transaction by more 
than 6.5 percent for a first-lien mortgage, or by more than 8.5 
percent for a first-lien mortgage if the transaction is for 
less than $50,000. Additionally, the Dodd-Frank Act, and the 
implementing rule, reduces the total amount of points and fees 
that would trigger HOEPA coverage. A loan will be covered by 
HOEPA if the points and fees associated with the transaction 
exceed 5 percent of the total loan amount for a loan greater 
than or equal to $20,000; or 8 percent of the total loan amount 
or $1,000 (whichever is less) for a loan less than $20,000.
    H.R. 1699 clarifies that a manufactured home sales person 
is not originating a loan when it assists a consumer apply for 
a mortgage or prepare loan information, unless they receive 
compensation from a creditor, lender or mortgage broker. The 
legislation also improves the ``high cost'' mortgage definition 
by slightly increasing the maximum interest rate and points and 
fees cap for manufactured loans that are provided for less than 
$75,000 in order to preserve access to mortgage credit for low 
and moderate-income consumers who are seeking to buy a 
manufactured home.
    In a statement in support for H.R. 1699 dated March 24, 
2017, the Manufactured Housing Institute wrote:

          Recent Home Mortgage Disclosure Act data shows that 
        consumers have been shut out of the market for quality, 
        affordable housing because regulations have decreased 
        the availability of financing for manufactured homes, 
        which are a vital source of affordable housing for 
        millions of low- and moderate-income families across 
        the country . . .
          . . . H.R. 1699 modifies the definition of ``high-
        cost'' loans so that manufactured home loans are not 
        unfairly swept under this designation simply due to 
        their small size. The provision of the Dodd-Frank Act 
        that established parameters for which mortgage loans 
        are classified as ``high cost'' included more flexible 
        annual percentage rate (APR) and points and fees 
        provisions for small loans. This was in recognition of 
        the simple mathematical fact that fixed costs on 
        smaller loans translate into higher percentages of the 
        total loan. In practice, this flexibility has not been 
        sufficient to address market realities. Thus, some 
        manufactured housing lenders have exited the market and 
        others are no longer offering smaller dollar amount 
        (and most affordable) loans.

    In a letter of support for H.R. 1699 dated May 1, 2017, the 
Mortgage Bankers Association wrote:

          [H.R. 1699] would allow more low-balance loans to fit 
        within the cap on points and fees under the Home 
        Ownership and Equity Protection Act by revising those 
        triggers. This will allow more consumers, particularly 
        on the lower end of the economic spectrum, to gain 
        access to safe and affordable mortgage credit.

    In a letter of support for H.R. 1699 dated October 11, 
2017, the National Association of Federal Credit Unions Inc. 
wrote:

          [H.R. 1699] would modify the definitions of a 
        mortgage originator and a high-cost mortgage to ensure 
        that consumers of small-balance mortgage loans, 
        including manufactured housing loans, will have access 
        credit. Working families across the country, 
        particularly in rural America, depend on access to 
        financing for affordable manufactured homes and this 
        bill addresses an impo1tant barrier to entry in the 
        marketplace.

                                Hearings

    The Committee on Financial Services held a hearing 
examining matters relating to H.R. 1699 on April 5, 2017, April 
26, 2017 and April 28, 2017.

                        Committee Consideration

    The Committee on Financial Services met in open session on 
October 11 and 12, 2017 and ordered H.R. 1699 to be reported 
favorably to the House as amended by a recorded vote of 42 yeas 
to 18 nays (Record vote no. FC-75), a quorum being present.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. The 
sole recorded vote was on a motion by Chairman Hensarling to 
report the bill favorably to the House as amended. The motion 
was agreed to by a recorded vote of 42 yeas to 18 nays (Record 
vote no. FC-75), a quorum being present.


                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the findings and recommendations of 
the Committee based on oversight activities under clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
are incorporated in the descriptive portions of this report.

                    Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the Committee states that H.R. 1699 
will alter certain definitions contained within the Truth in 
Lending Act and Secure and Fair Enforcement for Mortgage 
Licensing Act to ensure that consumers of small-balance 
residential loans have access to mortgage credit.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act of 1974.

                 Congressional Budget Office Estimates

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                 Washington, DC, November 21, 2017.
Hon. Jeb Hensarling,
Chairman, Committee on Financial Services,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1699, the 
Preserving Access to Manufactured Housing Act of 2017.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Stephen 
Rabent.
            Sincerely,
                                             Mark P. Hadley
                                                  (For Keith Hall).
    Enclosure.

H.R. 1699--Preserving Access to Manufactured Housing Act of 2017

    H.R. 1699 would amend the Truth in Lending Act (TILA) and 
the SAFE Mortgage Licensing Act to change the definitions of 
mortgage originator, loan originator, and high-cost mortgage. 
Under TILA, employees of manufactured-home retailers that do 
not accept residential mortgage loan applications, offer or 
negotiate terms of loans, or advise consumers on loan terms are 
excluded from the definition of mortgage originator. H.R. 1699 
would broaden that exception to include retailers of 
manufactured homes and their employees, as long as they receive 
no more compensation for selling a home with a mortgage than 
they would for selling the same home for cash. The bill also 
would amend the SAFE Mortgage Licensing Act to exempt the same 
people from the definition of loan originator.
    TILA also provides special protections, such as 
restrictions on certain fees, to consumers who are offered 
high-cost mortgages. H.R. 1699 would increase the amount an 
originator or creditor could charge in interest rates and fees 
for a loan on manufactured housing before the loan would be 
considered a high-cost mortgage.
    Based on an analysis of information from the Consumer 
Financial Protection Bureau, CBO estimates that enacting H.R. 
1699 would increase direct spending by less than $500,000 for 
that agency to implement the proposed changes to TILA and the 
SAFE Mortgage Licensing Act. Because enacting the bill would 
affect direct spending, pay-as-you-go procedures apply. 
Enacting the bill would not affect revenues.
    CBO estimates that enacting H.R. 1699 would not increase 
net direct spending or on-budget deficits in any of the four 
consecutive 10-year periods beginning in 2028.
    H.R. 1699 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act.
    The CBO staff contact for this estimate is Stephen Rabent. 
The estimate was approved by H. Samuel Papenfuss, Deputy 
Assistant Director for Budget Analysis.

                       Federal Mandates Statement

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995.
    The Committee has determined that the bill does not contain 
Federal mandates on the private sector. The Committee has 
determined that the bill does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of the section 
102(b)(3) of the Congressional Accountability Act.

                         Earmark Identification

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provisions of the bill and states that the provisions of 
the bill do not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits within the meaning of the 
rule.

                    Duplication of Federal Programs

    In compliance with clause 3(c)(5) of rule XIII of the Rules 
of the House of Representatives, the Committee states that no 
provision of the bill establishes or reauthorizes: (1) a 
program of the Federal Government known to be duplicative of 
another Federal program; (2) a program included in any report 
from the Government Accountability Office to Congress pursuant 
to section 21 of Public Law 111-139; or (3) a program related 
to a program identified in the most recent Catalog of Federal 
Domestic Assistance, published pursuant to the Federal Program 
Information Act (Pub. L. No. 95-220, as amended by Pub. L. No. 
98-169).

                   Disclosure of Directed Rulemaking

    Pursuant to section 3(i) of H. Res. 5 (115th Congress) the 
following statement is made concerning directed rulemakings: 
The Committee estimates that the bill requires no directed 
rulemakings within the meaning of such section.

             Section-by-Section Analysis of the Legislation


Section 1. Short title

    This section cites H.R. 1699 as the `Preserving Access to 
Manufactured Housing Act of 2017.'

Section 2. Mortgage and loan originator definition

    This section amends section 103 of the Truth in Lending Act 
(P.L. 90-321) to specify that the definition of `mortgage 
originator' does not include any person who is a retailer of 
manufactured or modular homes unless the retailer or its 
employees receive compensation for taking a residential 
mortgage loan application, assisting a consumer in obtaining or 
applying to obtain a residential mortgage loan, or offering or 
negotiating terms of a residential mortgage loan that is in 
excess of any compensation or gain received in a comparable 
cash transaction.
    This section amends section 1503 of the Secure and Fair 
Enforcement for Mortgage Licensing Act of 2008 (P.L. 110-289) 
to specify that the definition of `loan originator' does not 
include a retailer of manufactured or modular homes or its 
employees unless such retailer or its employees receive 
compensation or gain for engaging in activities related to 
taking a residential mortgage loan application, and offering or 
negotiating terms of a residential mortgage loan for 
compensation or gain, that is in excess of any compensation or 
gain received in a comparable cash transaction.

Section 3. High-cost mortgage definition

    This section amends section 103 of the Truth in Lending Act 
(P.L. 90-321), as added by the Dodd-Frank Wall Street Reform 
and Consumer Protection Act (P.L. 111-203), to clarify that a 
first mortgage on a consumer's principal dwelling that is 
considered personal property will be considered a `high-cost 
mortgage' if the annual percentage rate at consummation of the 
transaction will exceed the average prime offer rate for a 
comparable transaction by more than 10 percentage points, in 
the case of a transaction in an amount of $75,000 or less. This 
section would also amend the definition of `high-cost mortgage' 
to include a transaction for less than $75,000 in which the 
dwelling is personal property and the total points and fees 
payable in connection with the transaction, other than bona 
fide third party charges not retained by the mortgage 
originator, creditor, or an affiliate of the creditor or 
mortgage originator, exceed the greater of 5 percent of the 
total transaction amount or $3,000. This section authorizes the 
CFPB to adjust such amounts to reflect the change in the 
Consumer Price Index.

         Changes in Existing Law Made by the Bill, as Reported

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

                          TRUTH IN LENDING ACT




           *       *       *       *       *       *       *
TITLE I--CONSUMER CREDIT COST DISCLOSURE

           *       *       *       *       *       *       *


CHAPTER 1--GENERAL PROVISIONS

           *       *       *       *       *       *       *



Sec.  103. Definitions and rules of construction

  (a) The definitions and rules of construction set forth in 
this section are applicable for the purposes of this title.
  (b) Bureau.--The term ``Bureau'' means the Bureau of Consumer 
Financial Protection.
  (c) The term ``Bureau'' refers to the Bureau of Governors of 
the Federal Reserve System.
  (d) The term ``organization'' means a corporation, government 
or governmental subdivision or agency, trust, estate, 
partnership, cooperative, or association.
  (e) The term ``person'' means a natural person or an 
organization.
  (f) The term ``credit'' means the right granted by a creditor 
to a debtor to defer payment of debt or to incur debt and defer 
its payment.
  (g) The term ``creditor'' refers only to a person who both 
(1) regularly extends, whether in connection with loans, sales 
of property or services, or otherwise, consumer credit which is 
payable by agreement in more than four installments or for 
which the payment of a finance charge is or may be required, 
and (2) is the person to whom the debt arising from the 
consumer credit transaction is initially payable on the face of 
the evidence of indebtedness or, if there is no such evidence 
of indebtedness, by agreement. Notwithstanding the preceding 
sentence, in the case of an open-end credit plan involving a 
credit card, the card issuer and any person who honors the 
credit card and offers a discount which is a finance charge are 
creditors. For the purpose of the requirements imposed under 
chapter 4 and sections 127(a)(5), 127(a)(6), 127(a)(7), 
127(b)(1), 127(b)(2), 127(b)(3), 127(b)(8), and 127(b)(10) of 
chapter 2 of this title, the term ``creditor'' shall also 
include card issuers whether or not the amount due is payable 
by agreement in more than four installments or the payment of a 
finance charge is or may be required, and the Bureau shall, by 
regulation, apply these requirements to such card issuers, to 
the extent appropriate, even though the requirements are by 
their terms applicable only to creditors offering open-end 
credit plans. Any person who originates 2 or more mortgages 
referred to in subsection (aa) in any 12-month period or any 
person who originates 1 or more such mortgages through a 
mortgage broker shall be considered to be a creditor for 
purposes of this title. The term ``creditor'' includes a 
private educational lender (as that term is defined in section 
140) for purposes of this title.
  (h) The term ``credit sale'' refers to any sale in which the 
seller is a creditor. The term includes any contract in the 
form of a bailment or lease if the bailee or lessee contracts 
to pay as compensation for use a sum substantially equivalent 
to or in excess of the aggregate value of the property and 
services involved and it is agreed that the bailee or lessee 
will become, or for no other or a nominal consideration has the 
option to become, the owner of the property upon full 
compliance with his obligations under the contract.
  (i) The adjective ``consumer'', used with reference to a 
credit transaction, characterizes the transaction as one in 
which the party to whom credit is offered or extended is a 
natural person, and the money, property, or services which are 
the subject of the transaction are primarily for personal, 
family, or household purposes.
  (j) The terms ``open end credit plan'' and ``open end 
consumer credit plan'' mean a plan under which the creditor 
reasonably contemplates repeated transactions, which prescribes 
the terms of such transactions, and which provides for a 
finance charge which may be computed from time to time on the 
outstanding unpaid balance. A credit plan or open end consumer 
credit plan which is an open end credit plan or open end 
consumer credit plan within the meaning of the preceding 
sentence is an open end credit plan or open end consumer credit 
plan even if credit information is verified from time to time.
  (k) The term ``adequate notice'', as used in section 133, 
means a printed notice to a cardholder which sets forth the 
pertinent facts clearly and conspicuously so that a person 
against whom it is to operate could reasonably be expected to 
have noticed it and understood its meaning. Such notice may be 
given to a cardholder by printing the notice on any credit 
card, or on each periodic statement of account, issued to the 
cardholder, or by any other means reasonably assuring the 
receipt thereof by the cardholder.
  (l) The term ``credit card'' means any card, plate, coupon 
book or other credit device existing for the purpose of 
obtaining money, property, labor, or services on credit.
  (m) The term ``accepted credit card'' means any credit card 
which the cardholder has requested and received or has signed 
or has used, or authorized another to use, for the purpose of 
obtaining money, property, labor, or services on credit.
  (n) The term ``cardholder'' means any person to whom a credit 
card is issued or any person who has agreed with the card 
issuer to pay obligations arising from the issuance of a credit 
card to another person.
  (o) The term ``card issuer'' means any person who issues a 
credit card, or the agent of such person with respect to such 
card.
  (p) The term ``unauthorized use'', as used in section 133, 
means a use of a credit card by a person other than the 
cardholder who does not have actual, implied, or apparent 
authority for such use and from which the cardholder receives 
no benefit.
  (q) The term ``discount'' as used in section 167 means a 
reduction made from the regular price. The term ``discount'' as 
used in section 167 shall not mean a surcharge.
  (r) The term ``surcharge'' as used in section 103 and section 
167 means any means of increasing the regular price to a 
cardholder which is not imposed upon customers paying by cash, 
check, or similar means.
  (s) The term ``State'' refers to any State, the Commonwealth 
of Puerto Rico, the District of Columbia, and any territory or 
possession of the United States.
  (t) The term ``agricultural purposes'' includes the 
production, harvest, exhibition, marketing, transportation, 
processing, or manufacture of agricultural products by a 
natural person who cultivates, plants, propagates, or nurtures 
those agricultural products, including but not limited to the 
acquisition of farmland, real property with a farm residence, 
and personal property and services used primarily in farming.
  (u) The term ``agricultural products'' includes agricultural, 
horticultural, viticultural, and dairy products, livestock, 
wildlife, poultry, bees, forest products, fish and shellfish, 
and any products thereof, including processed and manufactured 
products, and any and all products raised or produced on farms 
and any processed or manufactured products thereof.
  (v) The term ``material disclosures'' means the disclosure, 
as required by this title, of the annual percentage rate, the 
method of determining the finance charge and the balance upon 
which a finance charge will be imposed, the amount of the 
finance charge, the amount to be financed, the total of 
payments, the number and amount of payments, the due dates or 
periods of payments scheduled to repay the indebtedness, and 
the disclosures required by section 129(a).
  (w) The term ``dwelling'' means a residential structure or 
mobile home which contains one to four family housing units, or 
individual units of condominiums or cooperatives.
  (x) The term ``residential mortgage transaction'' means a 
transaction in which a mortgage, deed of trust, purchase money 
security interest arising under an installment sales contract, 
or equivalent consensual security interest is created or 
retained against the consumer's dwelling to finance the 
acquisition or initial construction of such dwelling.
  (y) As used in this section and section 167, the term 
``regular price'' means the tag or posted price charged for the 
property or service if a single price is tagged or posted, or 
the price charged for the property or service when payment is 
made by use of an open-end credit plan or a credit card if 
either (1) no price is tagged or posted, or (2) two prices are 
tagged or posted, one of which is charged when payment is made 
by use of an open-end credit plan or a credit card and the 
other when payment is made by use of cash, check, or similar 
means. For purposes of this definition, payment by check, 
draft, or other negotiable instrument which may result in the 
debiting of an open-end credit plan or a credit cardholder's 
open-end account shall not be considered payment made by use of 
the plan or the account.
  (z) Any reference to any requirement imposed under this title 
or any provision thereof includes reference to the regulations 
of the Bureau under this title or the provision thereof in 
question.
  [(bb)] (aa) High-cost Mortgage.--
          (1) Definition.--
                  (A) In general.--The term ``high-cost 
                mortgage'', and a mortgage referred to in this 
                subsection, means a consumer credit transaction 
                that is secured by the consumer's principal 
                dwelling, other than a reverse mortgage 
                transaction, if--
                          (i) in the case of a credit 
                        transaction secured--
                                  (I) by a first mortgage on 
                                the consumer's principal 
                                dwelling, the annual percentage 
                                rate at consummation of the 
                                transaction will exceed by more 
                                than 6.5 percentage points 
                                [(8.5 percentage points, if the 
                                dwelling is personal property 
                                and the transaction is for less 
                                than $50,000)] (10 percentage 
                                points if the dwelling is 
                                personal property or is a 
                                transaction that does not 
                                include the purchase of real 
                                property on which a dwelling is 
                                to be placed, and the 
                                transaction is for less than 
                                $75,000 (as such amount is 
                                adjusted by the Bureau to 
                                reflect the change in the 
                                Consumer Price Index)) the 
                                average prime offer rate, as 
                                defined in section 
                                129C(b)(2)(B), for a comparable 
                                transaction; or
                                  (II) by a subordinate or 
                                junior mortgage on the 
                                consumer's principal dwelling, 
                                the annual percentage rate at 
                                consummation of the transaction 
                                will exceed by more than 8.5 
                                percentage points the average 
                                prime offer rate, as defined in 
                                section 129C(b)(2)(B), for a 
                                comparable transaction;
                          (ii) the total points and fees 
                        payable in connection with the 
                        transaction, other than bona fide third 
                        party charges not retained by the 
                        mortgage originator, creditor, or an 
                        affiliate of the creditor or mortgage 
                        originator, exceed--
                                  (I) in the case of a 
                                transaction for $20,000 or 
                                more, 5 percent of the total 
                                transaction amount; [or]
                                  (II) in the case of a 
                                transaction for less than 
                                $20,000, the lesser of 8 
                                percent of the total 
                                transaction amount or $1,000 
                                (or such other dollar amount as 
                                the Bureau shall prescribe by 
                                regulation); or
                                  (III) notwithstanding 
                                subclauses (I) and (II), in the 
                                case of a transaction for less 
                                than $75,000 (as such amount is 
                                adjusted by the Bureau to 
                                reflect the change in the 
                                Consumer Price Index) in which 
                                the dwelling is personal 
                                property (or is a consumer 
                                credit transaction that does 
                                not include the purchase of 
                                real property on which a 
                                dwelling is to be placed) the 
                                greater of 5 percent of the 
                                total transaction amount or 
                                $3,000 (as such amount is 
                                adjusted by the Bureau to 
                                reflect the change in the 
                                Consumer Price Index); or
                          (iii) the credit transaction 
                        documents permit the creditor to charge 
                        or collect prepayment fees or penalties 
                        more than 36 months after the 
                        transaction closing or such fees or 
                        penalties exceed, in the aggregate, 
                        more than 2 percent of the amount 
                        prepaid.
                  (B) Introductory rates taken into account.--
                For purposes of subparagraph (A)(i), the annual 
                percentage rate of interest shall be determined 
                based on the following interest rate:
                          (i) In the case of a fixed-rate 
                        transaction in which the annual 
                        percentage rate will not vary during 
                        the term of the loan, the interest rate 
                        in effect on the date of consummation 
                        of the transaction.
                          (ii) In the case of a transaction in 
                        which the rate of interest varies 
                        solely in accordance with an index, the 
                        interest rate determined by adding the 
                        index rate in effect on the date of 
                        consummation of the transaction to the 
                        maximum margin permitted at any time 
                        during the loan agreement.
                          (iii) In the case of any other 
                        transaction in which the rate may vary 
                        at any time during the term of the loan 
                        for any reason, the interest charged on 
                        the transaction at the maximum rate 
                        that may be charged during the term of 
                        the loan.
                  (C) Mortgage insurance.--For the purposes of 
                computing the total points and fees under 
                paragraph (4), the total points and fees shall 
                exclude--
                          (i) any premium provided by an agency 
                        of the Federal Government or an agency 
                        of a State;
                          (ii) any amount that is not in excess 
                        of the amount payable under policies in 
                        effect at the time of origination under 
                        section 203(c)(2)(A) of the National 
                        Housing Act (12 U.S.C. 1709(c)(2)(A)), 
                        provided that the premium, charge, or 
                        fee is required to be refundable on a 
                        pro-rated basis and the refund is 
                        automatically issued upon notification 
                        of the satisfaction of the underlying 
                        mortgage loan; and
                          (iii) any premium paid by the 
                        consumer after closing.
  (2)(A) After the 2-year period beginning on the effective 
date of the regulations promulgated under section 155 of the 
Riegle Community Development and Regulatory Improvement Act of 
1994, and no more frequently than biennially after the first 
increase or decrease under this subparagraph, the Bureau may by 
regulation increase or decrease the number of percentage points 
specified in paragraph (1)(A), if the Bureau determines that 
the increase or decrease is--
          (i) consistent with the consumer protections against 
        abusive lending provided by the amendments made by 
        subtitle B of title I of the Riegle Community 
        Development and Regulatory Improvement Act of 1994; and
          (ii) warranted by the need for credit.
          (B) An increase or decrease under subparagraph (A)--
                  (i) may not result in the number of 
                percentage points referred to in paragraph 
                (1)(A)(i)(I) being less than 6 percentage 
                points or greater than 10 percentage points; 
                and
                  (ii) may not result in the number of 
                percentage points referred to in paragraph 
                (1)(A)(i)(II) being less than 8 percentage 
                points or greater than 12 percentage points.
  (C) In determining whether to increase or decrease the number 
of percentage points referred to in subparagraph (A), the 
Bureau shall consult with representatives of consumers, 
including low-income consumers, and lenders.
  (3) The amount specified in paragraph (1)(B)(ii) shall be 
adjusted annually on January 1 by the annual percentage change 
in the Consumer Price Index, as reported on June 1 of the year 
preceding such adjustment.
  (4) For purposes of paragraph (1)(B), points and fees shall 
include--
          (A) all items included in the finance charge, except 
        interest or the time-price differential;
          (B) all compensation paid directly or indirectly by a 
        consumer or creditor to a mortgage originator from any 
        source, including a mortgage originator that is also 
        the creditor in a table-funded transaction;
          (C) each of the charges listed in section 106(e) 
        (except an escrow for future payment of taxes), 
        unless--
                  (i) the charge is reasonable;
                  (ii) the creditor receives no direct or 
                indirect compensation; and
                  (iii) the charge is paid to a third party 
                unaffiliated with the creditor; and
          (D) premiums or other charges payable at or before 
        closing for any credit life, credit disability, credit 
        unemployment, or credit property insurance, or any 
        other accident, loss-of-income, life or health 
        insurance, or any payments directly or indirectly for 
        any debt cancellation or suspension agreement or 
        contract, except that insurance premiums or debt 
        cancellation or suspension fees calculated and paid in 
        full on a monthly basis shall not be considered 
        financed by the creditor;
          (E) the maximum prepayment fees and penalties which 
        may be charged or collected under the terms of the 
        credit transaction;
          (F) all prepayment fees or penalties that are 
        incurred by the consumer if the loan refinances a 
        previous loan made or currently held by the same 
        creditor or an affiliate of the creditor; and
          (G) such other charges as the Bureau determines to be 
        appropriate.
          (5) Calculation of points and fees for open-end 
        consumer credit plans.--In the case of open-end 
        consumer credit plans, points and fees shall be 
        calculated, for purposes of this section and section 
        129, by adding the total points and fees known at or 
        before closing, including the maximum prepayment 
        penalties which may be charged or collected under the 
        terms of the credit transaction, plus the minimum 
        additional fees the consumer would be required to pay 
        to draw down an amount equal to the total credit line.
  (6) This subsection shall not be construed to limit the rate 
of interest or the finance charge that a person may charge a 
consumer for any extension of credit.
  [(aa)] (bb) The disclosure of an amount or percentage which 
is greater than the amount or percentage required to be 
disclosed under this title does not in itself constitute a 
violation of this title.
  (cc) The term ``reverse mortgage transaction'' means a 
nonrecourse transaction in which a mortgage, deed of trust, or 
equivalent consensual security interest is created against the 
consumer's principal dwelling--
          (1) securing one or more advances; and
          (2) with respect to which the payment of any 
        principal, interest, and shared appreciation or equity 
        is due and payable (other than in the case of default) 
        only after--
                  (A) the transfer of the dwelling;
                  (B) the consumer ceases to occupy the 
                dwelling as a principal dwelling; or
                  (C) the death of the consumer.
  [(cc)] (dd) Definitions Relating to Mortgage Origination and 
Residential Mortgage Loans.--
          (1) Commission.--Unless otherwise specified, the term 
        ``Commission'' means the Federal Trade Commission.
          (2) Mortgage originator.--The term ``mortgage 
        originator''--
                  (A) means any person who, for direct or 
                indirect compensation or gain, or in the 
                expectation of direct or indirect compensation 
                or gain--
                          (i) takes a residential mortgage loan 
                        application;
                          (ii) assists a consumer in obtaining 
                        or applying to obtain a residential 
                        mortgage loan; or
                          (iii) offers or negotiates terms of a 
                        residential mortgage loan;
                  (B) includes any person who represents to the 
                public, through advertising or other means of 
                communicating or providing information 
                (including the use of business cards, 
                stationery, brochures, signs, rate lists, or 
                other promotional items), that such person can 
                or will provide any of the services or perform 
                any of the activities described in subparagraph 
                (A);
                  (C) does not include any person who is (i) 
                not otherwise described in subparagraph (A) or 
                (B) and who performs purely administrative or 
                clerical tasks on behalf of a person who is 
                described in any such subparagraph, or (ii) [an 
                employee of a retailer of manufactured homes 
                who is not described in clause (i) or (iii) of 
                subparagraph (A) and who does not advise a 
                consumer on loan terms (including rates, fees, 
                and other costs)] a retailer of manufactured or 
                modular homes or its employees unless such 
                retailer or its employees receive compensation 
                or gain for engaging in activities described in 
                subparagraph (A) that is in excess of any 
                compensation or gain received in a comparable 
                cash transaction;
                  (D) does not include a person or entity that 
                only performs real estate brokerage activities 
                and is licensed or registered in accordance 
                with applicable State law, unless such person 
                or entity is compensated by a lender, a 
                mortgage broker, or other mortgage originator 
                or by any agent of such lender, mortgage 
                broker, or other mortgage originator;
                  (E) does not include, with respect to a 
                residential mortgage loan, a person, estate, or 
                trust that provides mortgage financing for the 
                sale of 3 properties in any 12-month period to 
                purchasers of such properties, each of which is 
                owned by such person, estate, or trust and 
                serves as security for the loan, provided that 
                such loan--
                          (i) is not made by a person, estate, 
                        or trust that has constructed, or acted 
                        as a contractor for the construction 
                        of, a residence on the property in the 
                        ordinary course of business of such 
                        person, estate, or trust;
                          (ii) is fully amortizing;
                          (iii) is with respect to a sale for 
                        which the seller determines in good 
                        faith and documents that the buyer has 
                        a reasonable ability to repay the loan;
                          (iv) has a fixed rate or an 
                        adjustable rate that is adjustable 
                        after 5 or more years, subject to 
                        reasonable annual and lifetime 
                        limitations on interest rate increases; 
                        and
                          (v) meets any other criteria the 
                        Bureau may prescribe;
                  (F) does not include the creditor (except the 
                creditor in a table-funded transaction) under 
                paragraph (1), (2), or (4) of section 129B(c); 
                and
                  (G) does not include a servicer or servicer 
                employees, agents and contractors, including 
                but not limited to those who offer or negotiate 
                terms of a residential mortgage loan for 
                purposes of renegotiating, modifying, replacing 
                and subordinating principal of existing 
                mortgages where borrowers are behind in their 
                payments, in default or have a reasonable 
                likelihood of being in default or falling 
                behind.
          (3) Nationwide mortgage licensing system and 
        registry.--The term ``Nationwide Mortgage Licensing 
        System and Registry'' has the same meaning as in the 
        Secure and Fair Enforcement for Mortgage Licensing Act 
        of 2008.
          (4) Other definitions relating to mortgage 
        originator.--For purposes of this subsection, a person 
        ``assists a consumer in obtaining or applying to obtain 
        a residential mortgage loan'' by, among other things, 
        advising on residential mortgage loan terms (including 
        rates, fees, and other costs), preparing residential 
        mortgage loan packages, or collecting information on 
        behalf of the consumer with regard to a residential 
        mortgage loan.
          (5) Residential mortgage loan.--The term 
        ``residential mortgage loan'' means any consumer credit 
        transaction that is secured by a mortgage, deed of 
        trust, or other equivalent consensual security interest 
        on a dwelling or on residential real property that 
        includes a dwelling, other than a consumer credit 
        transaction under an open end credit plan or, for 
        purposes of sections 129B and 129C and section 128(a) 
        (16), (17), (18), and (19), and sections 128(f) and 
        130(k), and any regulations promulgated thereunder, an 
        extension of credit relating to a plan described in 
        section 101(53D) of title 11, United States Code.
          (6) Secretary.--The term ``Secretary'', when used in 
        connection with any transaction or person involved with 
        a residential mortgage loan, means the Secretary of 
        Housing and Urban Development.
          (7) Servicer.--The term ``servicer'' has the same 
        meaning as in section 6(i)(2) of the Real Estate 
        Settlement Procedures Act of 1974 (12 U.S.C. 
        2605(i)(2)).
  [(dd)] (ee) Bona Fide Discount Points and Prepayment 
Penalties.--For the purposes of determining the amount of 
points and fees for purposes of subsection (aa), either the 
amounts described in paragraph (1) or (2) of the following 
paragraphs, but not both, shall be excluded:
          (1) Up to and including 2 bona fide discount points 
        payable by the consumer in connection with the 
        mortgage, but only if the interest rate from which the 
        mortgage's interest rate will be discounted does not 
        exceed by more than 1 percentage point--
                  (A) the average prime offer rate, as defined 
                in section 129C; or
                  (B) if secured by a personal property loan, 
                the average rate on a loan in connection with 
                which insurance is provided under title I of 
                the National Housing Act (12 U.S.C. 1702 et 
                seq.).
          (2) Unless 2 bona fide discount points have been 
        excluded under paragraph (1), up to and including 1 
        bona fide discount point payable by the consumer in 
        connection with the mortgage, but only if the interest 
        rate from which the mortgage's interest rate will be 
        discounted does not exceed by more than 2 percentage 
        points--
                  (A) the average prime offer rate, as defined 
                in section 129C; or
                  (B) if secured by a personal property loan, 
                the average rate on a loan in connection with 
                which insurance is provided under title I of 
                the National Housing Act (12 U.S.C. 1702 et 
                seq.).
          (3) For purposes of paragraph (1), the term ``bona 
        fide discount points'' means loan discount points which 
        are knowingly paid by the consumer for the purpose of 
        reducing, and which in fact result in a bona fide 
        reduction of, the interest rate or time-price 
        differential applicable to the mortgage.
          (4) Paragraphs (1) and (2) shall not apply to 
        discount points used to purchase an interest rate 
        reduction unless the amount of the interest rate 
        reduction purchased is reasonably consistent with 
        established industry norms and practices for secondary 
        mortgage market transactions.

           *       *       *       *       *       *       *

                              ----------                              


SECTION 1503 OF THE SECURE AND FAIR ENFORCEMENT FOR MORTGAGE LICENSING 
                              ACT OF 2008

SEC. 1503. DEFINITIONS

  For purposes of this title, the following definitions shall 
apply:
          (1) Bureau.--The term ``Bureau'' means the Bureau of 
        Consumer Financial Protection.
          (2) Federal banking agency.--The term ``Federal 
        banking agency'' means the Board of Governors of the 
        Federal Reserve System, the Office of the Comptroller 
        of the Currency, the National Credit Union 
        Administration, and the Federal Deposit Insurance 
        Corporation.
          (3) Depository institution.--The term ``depository 
        institution'' has the same meaning as in section 3 of 
        the Federal Deposit Insurance Act, and includes any 
        credit union.
          (4) Loan originator.--
                  (A) In general.--The term ``loan 
                originator''--
                          (i) means an individual who--
                                  (I) takes a residential 
                                mortgage loan application; and
                                  (II) offers or negotiates 
                                terms of a residential mortgage 
                                loan for compensation or gain;
                          (ii) does not include any individual 
                        who is not otherwise described in 
                        clause (i) and who performs purely 
                        administrative or clerical tasks on 
                        behalf of a person who is described in 
                        any such clause;
                          (iii) does not include a person or 
                        entity that only performs real estate 
                        brokerage activities and is licensed or 
                        registered in accordance with 
                        applicable State law, unless the person 
                        or entity is compensated by a lender, a 
                        mortgage broker, or other loan 
                        originator or by any agent of such 
                        lender, mortgage broker, or other loan 
                        originator; [and]
                          (iv) does not include a person or 
                        entity solely involved in extensions of 
                        credit relating to timeshare plans, as 
                        that term is defined in section 
                        101(53D) of title 11, United States 
                        Code[.]; and
                          (v) does not include a retailer of 
                        manufactured or modular homes or its 
                        employees unless such retailer or its 
                        employees receive compensation or gain 
                        for engaging in activities described in 
                        clause (i) that is in excess of any 
                        compensation or gain received in a 
                        comparable cash transaction.
                  (B) Other definitions relating to loan 
                originator.--For purposes of this subsection, 
                an individual ``assists a consumer in obtaining 
                or applying to obtain a residential mortgage 
                loan'' by, among other things, advising on loan 
                terms (including rates, fees, other costs), 
                preparing loan packages, or collecting 
                information on behalf of the consumer with 
                regard to a residential mortgage loan.
                  (C) Administrative or clerical tasks.--The 
                term ``administrative or clerical tasks'' means 
                the receipt, collection, and distribution of 
                information common for the processing or 
                underwriting of a loan in the mortgage industry 
                and communication with a consumer to obtain 
                information necessary for the processing or 
                underwriting of a residential mortgage loan.
                  (D) Real estate brokerage activity defined.--
                The term ``real estate brokerage activity'' 
                means any activity that involves offering or 
                providing real estate brokerage services to the 
                public, including--
                          (i) acting as a real estate agent or 
                        real estate broker for a buyer, seller, 
                        lessor, or lessee of real property;
                          (ii) bringing together parties 
                        interested in the sale, purchase, 
                        lease, rental, or exchange of real 
                        property;
                          (iii) negotiating, on behalf of any 
                        party, any portion of a contract 
                        relating to the sale, purchase, lease, 
                        rental, or exchange of real property 
                        (other than in connection with 
                        providing financing with respect to any 
                        such transaction);
                          (iv) engaging in any activity for 
                        which a person engaged in the activity 
                        is required to be registered or 
                        licensed as a real estate agent or real 
                        estate broker under any applicable law; 
                        and
                          (v) offering to engage in any 
                        activity, or act in any capacity, 
                        described in clause (i), (ii), (iii), 
                        or (iv).
          (5) Loan processor or underwriter.--
                  (A) In general.--The term ``loan processor or 
                underwriter'' means an individual who performs 
                clerical or support duties at the direction of 
                and subject to the supervision and instruction 
                of--
                          (i) a State-licensed loan originator; 
                        or
                          (ii) a registered loan originator.
                  (B) Clerical or support duties.--For purposes 
                of subparagraph (A), the term ``clerical or 
                support duties'' may include--
                          (i) the receipt, collection, 
                        distribution, and analysis of 
                        information common for the processing 
                        or underwriting of a residential 
                        mortgage loan; and
                          (ii) communicating with a consumer to 
                        obtain the information necessary for 
                        the processing or underwriting of a 
                        loan, to the extent that such 
                        communication does not include offering 
                        or negotiating loan rates or terms, or 
                        counseling consumers about residential 
                        mortgage loan rates or terms.
          (6) Nationwide mortgage licensing system and 
        registry.--The term ``Nationwide Mortgage Licensing 
        System and Registry'' means a mortgage licensing system 
        developed and maintained by the Conference of State 
        Bank Supervisors and the American Association of 
        Residential Mortgage Regulators for the State licensing 
        and registration of State-licensed loan originators and 
        the registration of registered loan originators or any 
        system established by the Director under section 1509.
          (7) Nontraditional mortgage product.--The term 
        ``nontraditional mortgage product'' means any mortgage 
        product other than a 30-year fixed rate mortgage.
          (8) Registered loan originator.--The term 
        ``registered loan originator'' means any individual 
        who--
                  (A) meets the definition of loan originator 
                and is an employee of--
                          (i) a depository institution;
                          (ii) a subsidiary that is--
                                  (I) owned and controlled by a 
                                depository institution; and
                                  (II) regulated by a Federal 
                                banking agency; or
                          (iii) an institution regulated by the 
                        Farm Credit Administration; and
                  (B) is registered with, and maintains a 
                unique identifier through, the Nationwide 
                Mortgage Licensing System and Registry.
          (9) Residential mortgage loan.--The term 
        ``residential mortgage loan'' means any loan primarily 
        for personal, family, or household use that is secured 
        by a mortgage, deed of trust, or other equivalent 
        consensual security interest on a dwelling (as defined 
        in section 103(v) of the Truth in Lending Act) or 
        residential real estate upon which is constructed or 
        intended to be constructed a dwelling (as so defined).
          (10) Director.--The term ``Director'' means the 
        Director of the Bureau of Consumer Financial 
        Protection.
          (11) State.--The term ``State'' means any State of 
        the United States, the District of Columbia, any 
        territory of the United States, Puerto Rico, Guam, 
        American Samoa, the Trust Territory of the Pacific 
        Islands, the Virgin Islands, and the Northern Mariana 
        Islands.
          (12) State-licensed loan originator.--The term 
        ``State-licensed loan originator'' means any individual 
        who--
                  (A) is a loan originator;
                  (B) is not an employee of--
                          (i) a depository institution;
                          (ii) a subsidiary that is--
                                  (I) owned and controlled by a 
                                depository institution; and
                                  (II) regulated by a Federal 
                                banking agency; or
                          (iii) an institution regulated by the 
                        Farm Credit Administration; and
                  (C) is licensed by a State or by the Director 
                under section 1508 and registered as a loan 
                originator with, and maintains a unique 
                identifier through, the Nationwide Mortgage 
                Licensing System and Registry.
          (13) Unique identifier.--
                  (A) In general.--The term ``unique 
                identifier'' means a number or other identifier 
                that--
                          (i) permanently identifies a loan 
                        originator;
                          (ii) is assigned by protocols 
                        established by the Nationwide Mortgage 
                        Licensing System and Registry and the 
                        Bureau to facilitate electronic 
                        tracking of loan originators and 
                        uniform identification of, and public 
                        access to, the employment history of 
                        and the publicly adjudicated 
                        disciplinary and enforcement actions 
                        against loan originators; and
                          (iii) shall not be used for purposes 
                        other than those set forth under this 
                        title.
                  (B) Responsibility of states.--To the 
                greatest extent possible and to accomplish the 
                purpose of this title, States shall use unique 
                identifiers in lieu of social security numbers.

                             MINORITY VIEWS

    We believe that low-income families that rely on 
manufactured housing as an affordable option deserve the same 
anti-predatory lending standards as other families. H.R. 1699 
would not create more access to affordable housing, but instead 
allow an already incredibly profitable industry to make even 
more money by charging higher interest rates and fees to low-
income borrowers while simultaneously decreasing consumer 
protections.
    First, H.R. 1699 would change the definition of a 
``mortgage originator'' such that rules established by the 
Consumer Financial Protection Bureau (Consumer Bureau) for 
marketing and documenting consumer financial transactions would 
not apply to manufactured housing salespeople that offer credit 
to borrowers.
    In 2014, the Consumer Bureau published a study on the 
manufactured housing industry, which noted that individuals who 
apply for manufactured housing loans ``include consumers that 
may be considered more financially vulnerable and, thus, may 
particularly stand to benefit from strong consumer 
protections.'' This study also revealed that many practices, 
consistent with the current definition of a mortgage loan 
originator, are practices commonly engaged in by retailers of 
manufactured housing, such as assisting customers in filling 
out a mortgage application and exempting retailers from the 
definition may increase consumer costs and reduce incentives to 
work in the best interests of the customer.\1\ Furthermore, 
while increasing access to credit in the manufactured housing 
sector is a worthy goal, information from this study, as well 
as press articles highlighting increased production in the 
manufactured housing sector,\2\ suggests that reducing consumer 
protections is not an appropriate trade-off.
---------------------------------------------------------------------------
    \1\``Manufactured-housing consumer finance in the United States''' 
at 40-42.
    \2\See, Manufactured Housing Institute, ``4,942 New HUD-Code Homes 
Shipped in January 2015,'' http://www.manufacturedhousing.org/lib/
showtemp_detail.asp?Id=1127&cat=whats_hot (noting a trend of ``[year 
over year] gains across the board'' in January 2015 for the 
manufacturers of mobile homes in homes and floors shipped); see also, 
``4,730 New HUD-Code Homes Shipped in December 2014,'' http://
www.manufacturedhousing.org/lib/showtemp_detail 
asp?Id=1125&cat=whats_hot (``Compared with the prior year, 2014 has 
recorded shipment increases in every month. For all twelve months, 
shipments totaled 64,344 homes compared with 60,210 homes in 2013, a 
net increase of 6.9 percent'').
---------------------------------------------------------------------------
    Additionally, a years-long joint investigation by The 
Seattle Times and Center for Public Integrity, which focused on 
Clayton Homes, the largest manufactured homebuilder in the 
United States, found that Clayton Homes, which is controlled by 
multi-billionaire Warren Buffet, reaps significant financial 
profits from unsuspecting consumers--from producing the 
housing, to selling the housing, to originating loans that take 
advantage of vulnerable consumers that leave them with 
virtually no way to refinance.\3\ Specifically, the article 
noted that, ``Clayton systematically pursues unwitting minority 
homebuyers and baits them into costly subprime loans, many of 
which are doomed to fail,'' charges minority borrowers 
substantially higher rates, on average, than their white 
counterparts, and ``typically charges black people who make 
over $75,000 a year slightly more than white people who make 
only $35,000.''\4\
---------------------------------------------------------------------------
    \3\See ``The Mobile Home Trap,'' The Seattle Times, https://
www.seattletimes.com/category/mobile-homes/.
    \4\Mike Baker and Daniel Wagner, ``Minorities Exploited by Warren 
Buffet's Mobile Home Empire,'' THE SEATTLE TIMES, Dec. 26, 2015, 
available at https://www.seattletimes.com/seattle-news/times-watchdog/
minorities-exploited-by-warren-buffetts-mobile-home-empire-clayton-
homes/.
---------------------------------------------------------------------------
    Second, H.R. 1699 would increase the spread over the 
average prime offer rate (APOR) required to trigger Home 
Ownership and Equity Protection Act (HOEPA) protections for 
loans that do not include the purchase of real property from 
6.5 percent to 10 percent for loans between $50,000 and $75,000 
and from 8.5 percent to 10 percent for loans under $50,000. The 
bill would also raise the fees cap that trigger HOEPA 
protections to the greater of 5 percent of the total 
transaction amount or $3,000, whichever is greater. According 
to Home Mortgage Disclosure Act (HMDA) data, obtained from the 
Consumer Bureau, this new interest rate trigger would have 
exempted 58 percent of manufactured home loans originated in 
2013 from HOEPA protections. HOEPA is an essential protection 
tool for consumers and we support policy ensuring that all 
vulnerable homeowners are protected under the statute, 
including owners of manufactured homes.
    For these reasons, we oppose H.R. 1699.

                                   Maxine Waters.
                                   Michael E. Capuano.
                                   Wm. Lacy Clay.
                                   Keith Ellison.
                                   Nydia M. Velazquez.
                                   Al Green.
                                   Carolyn B. Maloney.
                                   Emanuel Cleaver.
                                   Gwen Moore.
                                   Denny Heck.

                                  [all]