Version	Word Count	Changes From Previous Version	Percent Change
Introduced in House	136,720	n/a	n/a
Engrossed in House	176,114	192	26%
Placed on Calendar Senate	175,304	12	0%
Engrossed Amendment Senate	27,763	1,868	98%
Engrossed Amendment House	109,464	1,759	96%
Enrolled Bill	117,312	4,300 Show Changes Hide Changes	82%

Display Version Introduced in House Engrossed in House Placed on Calendar Senate Engrossed Amendment Senate Engrossed Amendment House Enrolled Bill

HR 3221 EAH

In the House of Representatives, U. S.,May 8, 2008.Resolved, That the House agree to the amendment of the Senate to the title of the bill (H.R.3221CommentsClose CommentsPermalink

) entitled `An Act moving the United States toward greater energy independence and security, developing innovative new technologies, reducing carbon emissions, creating green jobs, protecting consumers, increasing clean renewable energy production, and modernizing our energy infrastructure, and to amend the Internal Revenue Code of 1986 to provide tax incentives for the production of renewable energy and energy conservation' and be it furtherResolved, That the House agree to the amendment of the Senate to the text of the aforesaid bill, with the followingHOUSE AMENDMENTS TO SENATE AMENDMENTS:( 1 ) In the matter proposed to be inserted by the amendment of the Senate to the text of the bill, strike section 1 and all that follows through the end of title V and insert the following:SECTION One Hundred Tenth Congress CommentsClose CommentsPermalink

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SECTION. 1. SHORT TITLE AND; TABLE OF CONTENTS.

(a) Short Title- This Act may be cited as the `American Housing Rescue and Foreclosure Prevention Act of 2008'‘Housing and Economic Recovery Act of 2008’.CommentsClose CommentsPermalink





(b) Table of Contents- The table of contents for this Act is as follows:CommentsClose CommentsPermalink





Sec. 1. Short title and; table of contents.CommentsClose CommentsPermalink

TITLE I--FHA HOUSING STABILIZATION AND HOMEOWNERSHIP RETENTIONSec. 101. Short title.Subtitle A--Homeownership RetentionSec. 111. Purposes.Sec. 112. Insurance of homeownership retention mortgages.Sec. 113. Study of Auction or Bulk Refinance Program.Sec. 114. Temporary increase in maximum loan guaranty amount for certain housing loans guaranteed by Secretary of Veterans Affairs.Sec. 115. Study of possible accounting revisions relating to property at risk of foreclosure and the availability of credit for refinancing home mortgages at risk of foreclosure.Sec. 116. GAO study of the effect of tightening credit markets in communities affected by the subprime mortgage foreclosure crises and predatory lending on prospective first-time homebuyers seeking mortgages.Subtitle B--Office of Housing CounselingSec. 131. Short title.Sec. 132. Establishment of Office of Housing Counseling.Sec. 133. Counseling procedures.Sec. 134. Grants for housing counseling assistance.Sec. 135. Requirements to use HUD-certified counselors under HUD programs.Sec. 136. Study of defaults and foreclosures.Sec. 137. Definitions for counseling-related programs.Sec. 138. Updating and simplification of mortgage information booklet.Subtitle C--Combating Mortgage FraudSec. 151. Authorization of appropriations to combat mortgage fraud.TITLE II--FHA REFORM AND MANUFACTURED HOUSING LOAN INSURANCE MODERNIZATIONSubtitle A--FHA ReformSec. 201. Short title.Sec. 202. Findings and purposes.Sec. 203. Maximum principal loan obligation.Sec. 204. Extension of mortgage term.Sec. 205. Downpayment simplification.Sec. 206. Mortgage insurance premiums for qualified homeownership assistance entities and higher-risk borrowers.Sec. 207. Risk-based mortgage insurance premiums.Sec. 208. Payment incentives for higher-risk borrowers.Sec. 209. Protections for higher-risk borrowers.Sec. 210. Refinancing mortgages.Sec. 211. Annual reports on new programs and loss mitigation.Sec. 212. Insurance for single family homes with licensed child care facilities.Sec. 213. Rehabilitation loans.Sec. 214. Discretionary action.Sec. 215. Insurance of condominiums and manufactured housing.Sec. 216. Mutual Mortgage Insurance Fund.Sec. 217. Hawaiian home lands and Indian reservations.Sec. 218. Conforming and technical amendments.Sec. 219. Home equity conversion mortgages.Sec. 220. Study on participation of mortgage brokers and correspondent lenders.Sec. 221. Conforming loan limit in disaster areas.Sec. 222. Failure to pay amounts from escrow accounts for single family mortgages.Sec. 223. Acceptable identification for FHA mortgagors.Sec. 224. Pilot program for automated process for borrowers without sufficient credit history.Sec. 225. Sense of Congress regarding technology for financial systems.Sec. 226. Clarification of disposition of certain properties.Sec. 227. Valuation of multifamily properties in noncompetitive sales by HUD to states and localities.Sec. 228. Limitation on mortgage insurance premium increases.Sec. 229. Civil money penalties for improperly influencing appraisals.Sec. 230. Mortgage insurance premium refunds.Sec. 231. Savings provision.Sec. 232. Implementation.Subtitle B--FHA Manufactured Housing Loan Insurance ModernizationSec. 25 DIVISION A--HOUSING FINANCE REFORM

Sec. 1001. Short title.CommentsClose CommentsPermalink





Sec. 252. Findings and purposes.Sec. 253. Exception to limitation on financial institution portfolio.Sec. 254. Insurance benefits.Sec. 255. Maximum loan limits.Sec. 256. Insurance premiums.Sec. 257. Technical corrections.Sec. 258. Revision of underwriting criteria.Sec. 259. Requirement of social security account number for assistance.Sec. 260. GAO study of mitigation of tornado risks to manufactured home1002. Definitions.CommentsClose CommentsPermalink

TITLE III--REFORM OF GOVERNMENT-SPONSORED ENTITIES FOR HOUSING FINANCESec. 301. Short title.Sec. 302. Definitions.Subtitle A--Reform of Regulation of Enterprises and Federal Home Loan BanksChapter 1--Improvement of Safety and SoundnessSec. 31REGULATION OF ENTERPRISES

Sec. 1101. Establishment of the Federal Housing Finance Agency.CommentsClose CommentsPermalink





Sec. 311102. Duties and authorities of Director.Sec. 313. Federal Housing Enterprise Board.Sec. 314. Authority to require reports by regulated entities.Sec. 315. Disclosure of income and charitable contributions by enterprisesthe Director.CommentsClose CommentsPermalink





Sec. 316. Assessments1103. Federal Housing Finance Oversight Board.CommentsClose CommentsPermalink





Sec. 317. Examiners and accountant1104. Authority to require reports by regulated entities.CommentsClose CommentsPermalink





Sec. 318. Prohibition and withholding of executive compensatio1105. Examiners and accountants; authority to contract for reviews of regulated entities; ombudsman.CommentsClose CommentsPermalink





Sec. 319. Reviews of regulated entities.Sec. 320. Inclusion of minorities and women; diversity in Agency workforce1106. Assessments.CommentsClose CommentsPermalink





Sec. 3211107. Regulations and orders.CommentsClose CommentsPermalink





Sec. 322. Non-waiver of privilege1108. Prudential management and operations standards.CommentsClose CommentsPermalink





Sec. 3231109. Review of and authority over enterprise assets and liabilities.CommentsClose CommentsPermalink





Sec. 1110. Risk-based capital requirements.CommentsClose CommentsPermalink





Sec. 324. Minimum and critical1111. Minimum capital levels.CommentsClose CommentsPermalink





Sec. 325. Review of and authority over enterprise assets and liabilitie1112. Registration under the securities laws.CommentsClose CommentsPermalink





Sec. 326. Corporate governance of enterprises.Sec. 327. Required registration under Securities Exchange Act of 19341113. Prohibition and withholding of executive compensation.CommentsClose CommentsPermalink





Sec. 328. Liaison with Financial Institutions Examination Council1114. Limit on golden parachutes.CommentsClose CommentsPermalink





Sec. 329. Guarantee fee study1115. Reporting of fraudulent loans.CommentsClose CommentsPermalink





Sec. 330. Conforming amendments.Chapter 21116. Inclusion of minorities and women; diversity in Agency workforce.CommentsClose CommentsPermalink





Sec. 1117. Temporary authority for purchase of obligations of regulated entities by Secretary of Treasury.CommentsClose CommentsPermalink





Sec. 1118. Consultation between the Director of the Federal Housing Finance Agency and the Board of Governors of the Federal Reserve System to ensure financial market stability .CommentsClose CommentsPermalink

Subtitle B--Improvement of Mission Supervision

Sec. 331. Transfer of product1121. Transfer of program approval and housing goal oversight.CommentsClose CommentsPermalink





Sec. 3321122. Assumption by the Director of certain other HUD responsibilities.CommentsClose CommentsPermalink





Sec. 1123. Review of enterprise products.CommentsClose CommentsPermalink





Sec. 3331124. Conforming loan limits.CommentsClose CommentsPermalink





Sec. 334. Annual housing report regarding regulated entities.Sec. 335. Annual reports by regulated entities on affordable housing stock.Sec. 336. Mortgagor identification requirements for mortgages of regulated entities1125. Annual housing report.CommentsClose CommentsPermalink





Sec. 337. Revision of housing goals1126. Public use database.CommentsClose CommentsPermalink





Sec. 3381127. Reporting of mortgage data.CommentsClose CommentsPermalink





Sec. 1128. Revision of housing goals.CommentsClose CommentsPermalink





Sec. 1129. Duty to serve underserved markets.CommentsClose CommentsPermalink





Sec. 3391130. Monitoring and enforcing compliance with housing goals.CommentsClose CommentsPermalink





Sec. 340. Affordable Housing Fund.Sec. 341. Consistency with mission1131. Affordable housing programs.CommentsClose CommentsPermalink





Sec. 342. Enforcement1132. Financial education and counseling.CommentsClose CommentsPermalink





Sec. 343. Conforming amendments.Chapter 31133. Transfer and rights of certain HUD employees.CommentsClose CommentsPermalink

Subtitle C--Prompt Corrective Action

Sec. 3451141. Critical capital levels.CommentsClose CommentsPermalink





Sec. 1142. Capital classifications.CommentsClose CommentsPermalink





Sec. 3461143. Supervisory actions applicable to undercapitalized regulated entities.CommentsClose CommentsPermalink





Sec. 3471144. Supervisory actions applicable to significantly undercapitalized regulated entities.CommentsClose CommentsPermalink





Sec. 3481145. Authority over critically undercapitalized regulated entities.CommentsClose CommentsPermalink

Subtitle D--Enforcement Actions

Sec. 351. Cease-and-1151. Cease and desist proceedings.CommentsClose CommentsPermalink





Sec. 31152. Temporary cease-and- and desist proceedings.CommentsClose CommentsPermalink





Sec. 353. Prejudgment attachment1153. Removal and prohibition authority.CommentsClose CommentsPermalink





Sec. 31154. Enforcement and jurisdiction.CommentsClose CommentsPermalink





Sec. 31155. Civil money penalties.CommentsClose CommentsPermalink





Sec. 356. Removal and prohibition authority.Sec. 3571156. Criminal penalty.CommentsClose CommentsPermalink





Sec. 358. Subpoena authority1157. Notice after separation from service.CommentsClose CommentsPermalink





Sec. 359. Conforming amendments.Chapter 51158. Subpoena authority.CommentsClose CommentsPermalink

Subtitle E--General Provisions

Sec. 361. Boards of enterprises.Sec. 362. Report on portfolio operations, safety and soundness, and mission of enterprises.Sec. 3631161. Conforming and technical amendments.CommentsClose CommentsPermalink





Sec. 364. Study of alternative secondary market systems.Sec. 365. Effective date.Subtitle B--Federal Home Loan BanksSec. 371. Definition1162. Presidentially-appointed directors of enterprises.CommentsClose CommentsPermalink





Sec. 1163. Effective date.CommentsClose CommentsPermalink

Sec. 1201. Recognition of distinctions between the enterprises and the Federal Home Loan Banks.CommentsClose CommentsPermalink





Sec. 371202. Directors.CommentsClose CommentsPermalink





Sec. 373. Federal Housing Finance1203. Definitions.CommentsClose CommentsPermalink





Sec. 1204. Agency oversight of Federal Home Loan Banks.CommentsClose CommentsPermalink





Sec. 374. Joint activities of Bank1205. Housing goals.CommentsClose CommentsPermalink





Sec. 3751206. Community development financial institutions.CommentsClose CommentsPermalink





Sec. 1207. Sharing of information between Federal Home Loan Bankamong Federal Home Loan Banks.CommentsClose CommentsPermalink





Sec. 1208. Exclusion from certain requirements.CommentsClose CommentsPermalink





Sec. 376. Reorganization of Banks and voluntary merger1209. Voluntary mergers.CommentsClose CommentsPermalink





Sec. 377. Securities and Exchange Commission disclosure1210. Authority to reduce districts.CommentsClose CommentsPermalink





Sec. 3781211. Community financial institution members.CommentsClose CommentsPermalink





Sec. 3791212. Public use database; reports to Congress.CommentsClose CommentsPermalink





Sec. 1213. Semiannual reports.CommentsClose CommentsPermalink





Sec. 1214. Liquidation or reorganization of a Federal Home Loan Bank.CommentsClose CommentsPermalink





Sec. 1215. Study and report to Congress on securitization of acquired member assets.CommentsClose CommentsPermalink





Sec. 1216. Technical and conforming amendments.CommentsClose CommentsPermalink





Sec. 380. Study of affordable housing program use for long-term care faciliti1217. Study on Federal Home Loan Bank advances.CommentsClose CommentsPermalink





Sec. 381. Effective date.Subtitle C--Transfer of Functions, Personnel, and Property of Office of Federal Housing Enterprise Oversight, Federal Housing Finance Board, and Department of Housing and Urban DevelopmentChapter 1--Office of Federal Housing Enterprise OversightSec. 3851218. Federal Home Loan Bank refinancing authority for certain residential mortgage loans.CommentsClose CommentsPermalink

Sec. 1301. Abolishment of OFHEO.CommentsClose CommentsPermalink





Sec. 3861302. Continuation and coordination of certain regulaactions.CommentsClose CommentsPermalink





Sec. 3871303. Transfer and rights of employees of OFHEO.CommentsClose CommentsPermalink





Sec. 3881304. Transfer of property and facilities.CommentsClose CommentsPermalink

Chapter 2Subtitle B--Federal Housing Finance Board

Sec. 391311. Abolishment of the Federal Housing Finance Board.CommentsClose CommentsPermalink





Sec. 391312. Continuation and coordination of certain regulaactions.CommentsClose CommentsPermalink





Sec. 391313. Transfer and rights of employees of the Federal Housing Finance Board.CommentsClose CommentsPermalink





Sec. 391314. Transfer of property and facilities.CommentsClose CommentsPermalink

TITLE IV--EMERGENCY MORTGAGE LOAN MODIFICATIONSec. HOPE FOR HOMEOWNERS

Sec. 1401. Short title.CommentsClose CommentsPermalink





Sec. 402. Safe harbor for qualified loan modifications or workout plans for certain1402. Establishment of HOPE for Homeowners Program.CommentsClose CommentsPermalink





Sec. 1403. Fiduciary duty of servicers of pooled residential mortgage loans.CommentsClose CommentsPermalink





Sec. 1404. Revised standards for FHA appraisers.CommentsClose CommentsPermalink

TITLE V--OTHER HOUSING PROVISIONSSec. 501. Depository Institution Community Development Investments EnhancementS.A.F.E. MORTGAGE LICENSING ACT

Sec. 1501. Short title.CommentsClose CommentsPermalink





Sec. 502. Preservation of certain affordable housing dwelling units1502. Purposes and methods for establishing a mortgage licensing system and registry.CommentsClose CommentsPermalink





Sec. 503. Eligibility of certain projects for enhanced voucher assistance1503. Definitions.CommentsClose CommentsPermalink





Sec. 504. Transfer of certain rental assistance contracts1504. License or registration required.CommentsClose CommentsPermalink





Sec. 505. Protection against discriminatory treatment.

TITLE I--FHA HOUSING STABILIZATION AND HOMEOWNERSHIP RETENTIONSEC. 101. SHORT TITLE.This title may be cited as the `FHA Housing Stabilization and Homeownership Retention Act of 2008'.Subtitle A--Homeownership RetentionSEC. 111. PURPOSES.The purposes of this subtitle are--(1) to create an FHA program, which is voluntary on the part of borrowers and existing mortgage loan holders, including both existing senior mortgage loan holders and existing subordinate mortgage loan holders, to insure refinance loans for substantial numbers of borrowers at risk of foreclosure, at levels which are reasonably likely to be sustainable through enhanced affordability of debt service;(2) to provide flexible underwriting for FHA-insured loans under such a program to provide refinancing opportunities under fiscally responsible terms, including higher fees commensurate with higher risk levels, a seasoning requirement for higher debt to income loans, and additional program controls to limit and control risk;(3) to bar speculators and second home owners from participation in such program;(4) to require existing mortgage loan holders to take substantial loan writedowns in exchange for having the Federal Government and the borrower assume the ongoing risk of the refinanced loan;(5) to set a loan-to-value limit on such loans that provides the FHA with an equity buffer against potential loan losses, provides protections against the risk of future home price declines, and creates incentives for borrowers to maintain payments on the loan;(6) to protect the FHA against losses which may exceed normal FHA loss levels by establishing higher fee levels, including an exit fee and profit sharing during the first five years of the loan, with such higher fee levels effectively being funded through the required lender writedown;(7) to provide a fair level of incentives for junior lien holders to provide the necessary releases of their lien interests, in order to meet program requirements that all outstanding liens must be extinguished, and thereby permit the refinancing to be completed;(8) to enhance the administrative capacity of the FHA to carry out its expanded role under the program through establishment of an Oversight Board which adds expertise from the Federal Reserve and the Department of the Treasury, through additional funding to contract out for the provision of any needed expertise in designing program requirements and oversight, and through additional funding to increase FHA personnel resources as needed to handle the increased loan volume resulting from the program;(9) to sunset the program when it is no longer needed; and(10) to study the need for and efficacy of an auction or bulk refinancing mechanism to facilitate more expeditious refinancing of larger volumes of existing mortgages that are at risk for foreclosure into FHA-insured mortgages.SEC. 112. INSURANCE OF HOMEOWNERSHIP RETENTION MORTGAGES.(a) Mortgage Insurance Program- 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. INSURANCE OF HOMEOWNERSHIP RETENTION MORTGAGES.`(a) Oversight Board-`(1) ESTABLISHMENT- There is hereby established the Refinance Program Oversight Board (in this section referred to as the `Oversight Board').`(2) MEMBERSHIP- The Oversight Board shall consist of the following members or their designees:`(A) The Secretary of the Treasury.`(B) The Secretary of Housing and Urban Development.`(C) The Chairman of the Board of Governors of the Federal Reserve System.`(3) NO ADDITIONAL COMPENSATION- Members of the Oversight Board shall receive no additional pay by reason of service on the Oversight Board.`(4) RESPONSIBILITIES- The Oversight Board shall be responsible for establishing program and oversight requirements for the program under this section, which shall include--`(A) detailed program requirements under subsection (c);`(B) flexible underwriting criteria under subsection (d);`(C) a mortgage premium structure under subsection (e);`(D) a reasonable fee and rate limitation under subsection (f);`(E) enhancement of FHA capacity under subsection (i), including oversight of such activities and personnel as may be contracted for as provided therein;`(F) monitoring of underwriting risk under subsection (j); and`(G) such additional requirements as may be necessary and appropriate to oversee and implement the program.`(5) USE OF RESOURCES- In carrying out its functions under this section, the Oversight Board may utilize, with their consent and to the extent practical, the personnel, services, and facilities of the Department of the Treasury, the Department of Housing and Urban Development, the Board of Governors of the Federal Reserve System, the Federal Reserve Banks, and other Federal agencies, with or without reimbursement therefore.`(b) Authority-`(1) IN GENERAL- The Secretary shall, subject only to the absence of qualified requests for insurance under this section and to the limitations under subsection (h) of this section and section 531(a), make commitments to insure and insure any mortgage covering a 1- to 4-family residence that is made for the purpose of paying or prepaying outstanding obligations under an existing mortgage or mortgages on the residence if the mortgage being insured under this section meets the requirements of this section, as established by the Oversight Board, and of section 203, except as modified by this section.`(2) ESTABLISHMENT AND IMPLEMENTATION OF PROGRAM REQUIREMENTS- The Oversight Board shall establish program requirements and standards under this section and the Secretary shall implement such requirements and standards. The Oversight Board and the Secretary may establish and implement any requirements or standards through interim guidance and mortgagee letters.`(c) Requirements- To be eligible for insurance under this section, a mortgage shall comply with all of the following requirements:`(1) OWNER-OCCUPIED PRINCIPAL RESIDENCE REQUIREMENT- The residence securing the mortgage insured under this section shall be occupied by the mortgagor as the principal residence of the mortgagor and the mortgagor shall provide a certification to the originator of the mortgage that such residence securing the mortgage insured under this section is the only residence in which the mortgagor has any present ownership interest. With regard to such certification, the Oversight Board may create exceptions for mortgagors who have only a partial ownership interest in a residence other than the residence securing the mortgage insured under this section.`(2) LACK OF CAPACITY TO PAY EXISTING MORTGAGE OR MORTGAGES-`(A) BORROWER CERTIFICATION-`(i) The mortgagor shall provide a certification to the originator of the mortgage that the mortgagor--`(I) has not intentionally defaulted on the existing mortgage or mortgages; and`(II) has not knowingly, or willfully and with actual knowledge furnished material information known to be false for the purpose of obtaining the existing mortgage or mortgages.`(ii) The mortgagor shall agree in writing that the mortgagor shall be liable to repay the FHA any direct financial benefit achieved from the reduction of indebtedness on the existing mortgage or mortgages on the residence refinanced under this section derived from misrepresentations made in the certifications and documentation required under this subparagraph, subject to the discretion of the Oversight Board.`(B) CURRENT BORROWER DEBT-TO-INCOME RATIO- As of March 1, 2008, the mortgagor shall have had a ratio of mortgage debt to income, taking into consideration all existing mortgages at such time, greater than 35 percent.`(C) LOSS MITIGATION RESPONSIBILITIES- This section may not be construed to alter or in any way affect the responsibilities of any party (including the mortgage servicer) to engage in any or all loan modification or other loss mitigation strategies to maximize value to investors as established by any applicable contract.`(3) ELIGIBILITY OF MORTGAGES BY DATE OF ORIGINATION- The existing senior mortgage shall have been originated on or before December 31, 2007.`(4) MAXIMUM LOAN-TO-VALUE RATIO FOR NEW LOANS- The mortgage being insured under this section shall involve a principal obligation (including such initial service charges, appraisal, inspection, and other fees as the Secretary shall approve and including the mortgage insurance premium paid pursuant to subsection (e)(1)) in an amount not to exceed 90 percent of the current appraised value of the property. Section 203(d) shall not apply to mortgages insured under this section.`(5) REQUIRED WAIVER OF PREPAYMENT PENALTIES AND FEES- All penalties for prepayment of the existing mortgage or mortgages, and all fees and penalties related to default or delinquency on all existing mortgages or mortgages, shall be waived or forgiven.`(6) REQUIRED LOAN REDUCTION-`(A) REDUCTION OF INDEBTEDNESS UNDER EXISTING SENIOR MORTGAGE- The amount of indebtedness on the existing mortgage or mortgages on the residence shall have been substantially reduced by such percentage as the Oversight Board may require, and such reduction shall be at least sufficient to--`(i) provide for the refinancing of such existing mortgage or mortgages in an amount not greater than 90 percent of the current appraised value of the property involved;`(ii) pay the full amount of the single premium to be collected pursuant to subsection (e)(1) (which shall be an amount equal to 3.0 percent of the amount of the original insured principal obligation of the mortgage insured under this section and which shall serve as an additional reserve to cover possible loan losses); and`(iii) pay the full amount of the loan origination fee and any other closing costs, not to exceed 2.0 percent of the amount of the original insured principal obligation of the mortgage insured under this section.`(B) EXTINGUISHMENT OF DEBT BY REFINANCING-`(i) REQUIRED AGREEMENT- All existing holders of mortgage liens on the property securing the mortgage to be insured under this section shall agree to accept the proceeds of the insured loan as payment in full of all indebtedness under all existing mortgages, and all encumbrances related to such mortgages shall be removed. The Oversight Board may take such actions as the Oversight Board considers necessary or appropriate to facilitate coordination and agreement between the holders of the existing senior mortgage and any existing subordinate mortgages, taking into consideration the subordinate lien status of such subordinate mortgages, to comply with the requirement under this subparagraph.`(ii) TREATMENT OF MULTIPLE MORTGAGE LIENS- In addition to clause (i), the Oversight Board shall adopt one of the following approaches for all mortgages or such classes of mortgages as the Oversight Board may determine and may, from time to time, reconsider:`(I) FIXED PRICE- As a requirement for participating in this program, all existing lien holders will agree to not provide any payment to subordinate lien holders other than such payment in accordance with a formula established by the Oversight Board as set forth in clause (iii); except that the Oversight Board may establish a short period within which first and subordinate lien holders may negotiate to extinguish all subordinate liens for compensation that may be different from the amount determined under such formula set forth in clause (iii).`(II) SHARED EQUITY- The Oversight Board may require the mortgagor under a mortgage insured under this section to agree to share a portion of any future equity in the mortgaged property with holders of existing subordinate mortgages, in accordance with a formula for such shared equity established by the Oversight Board as set forth in clause (iii), except that payments of such shared equity may be made only after the Secretary recovers all amounts owed to the Secretary with respect to such mortgage pursuant to the program under this section (including amounts owed pursuant to paragraph (8)).`(iii) FORMULA- In determining a formula for determining any payments to subordinate lien holders pursuant to subclauses (I) and (II) of clause (ii), and in any reconsideration of such formula as the Oversight Board may from time to time undertake, the Oversight Board shall take into consideration the current market value of such liens. In no case may a formula provide for the payment of more than 1 percent of the current appraised value of the mortgaged property to a subordinate lien holder if the outstanding balance owed to more senior lien holders is equal to or exceeds such current appraised value.`(iv) VOLUNTARY PROGRAM- This section may not be construed to require any holder of any existing mortgage to participate in the program under this section generally, or with respect to any particular loan.`(v) SOURCE OF PAYMENTS FOR SUBORDINATE LOANS- Any amounts paid to holders of any existing subordinate mortgages in connection with the origination and insurance of a mortgage under this section shall derive only from--`(I) the holder of the existing senior mortgage; or`(II) in the case only of the shared equity approach under clause (ii)(II), the mortgagor under the mortgage insured under this section`(7) REQUIRED REDUCTION OF DEBT SERVICE- The debt service payments due under the mortgage insured under this section shall be in an amount that is substantially reduced from the debt service payments due under the existing mortgage or mortgages, which reduction may be achieved through a reduction of indebtedness, a reduction in the interest rate being paid, or an extension of the term of the mortgage, or any combination thereof.`(8) FINANCIAL RECOVERY TO FEDERAL GOVERNMENT THROUGH EXIT PREMIUM-`(A) SUBORDINATE LIEN- The mortgage shall provide that the Secretary shall retain a lien on the residence involved, which shall be subordinate to the mortgage insured under this section but senior to all other mortgages on the residence that may exist at any time, and which shall secure the repayment of the amount due under subparagraph (D).`(B) NO INTEREST OR PAYMENT DURING MORTGAGE- The amount secured by the lien retained by the Secretary pursuant to subparagraph (A) shall not bear interest and shall not be repayable to the Secretary except as provided in subparagraph (D) of this paragraph.`(C) NET PROCEEDS AVAILABLE FOR EXIT PREMIUM- Upon the sale, refinancing, or other disposition of the residence securing a mortgage insured under this section, any proceeds resulting from such disposition that remain after deducting the remaining insured principal balance of the mortgage insured under this section shall be available to meet the obligation under subparagraph (D). In the case of a refinance, non-arms length transaction, or such other transaction as the Oversight Board shall determine, the proceeds shall be based on the current appraised value at the time of the refinance or transaction.`(D) EXIT PREMIUM- Upon any refinancing of the mortgage insured under this section or any sale or disposition of the residence securing the mortgage, the Secretary shall, subject to the availability of sufficient net proceeds described in subparagraph (C), receive the greater of--`(i) 3 percent of the amount of the original insured principal obligation of the mortgage (or the entire amount of the net proceeds described in subparagraph (C) if such net proceeds are less than 3 percent of the amount of the original insured principal obligation of the mortgage); or`(ii) a percentage of the portion of the net proceeds available for profit-sharing, as described in subparagraph (E), which shall be--`(I) in the case of any refinancing, sale, or disposition occurring during the first year of the term of the mortgage, 100 percent of such net proceeds;`(II) in the case of any refinancing, sale, or disposition occurring during the second year of the term of the mortgage, 80 percent;`(III) in the case of any refinancing, sale, or disposition occurring during the third year of the term of the mortgage, 60 percent; and`(IV) in the case of any refinancing, sale, or disposition occurring during the fourth year of the term of the mortgage or at any time thereafter, 50 percent;except that such percentage of proceeds shall be reduced by all fees the Secretary has collected for the mortgage prior to such refinancing, sale, or disposition.`(E) NET PROCEEDS AVAILABLE FOR PROFIT-SHARING- With respect to any mortgage insured under this section, the net proceeds available for purposes of subparagraph (D)(ii) shall be any proceeds resulting from the sale, refinancing, or other disposition of the residence securing the mortgage that remain after deducting the original insured principal obligation of the mortgage. In the case of a refinance, non-arms length transaction, or such other transaction as the Oversight Board shall determine, the proceeds shall be based on the current appraised value at the time of the refinance or transaction.`(F) AUTHORITY TO PROHIBIT NEW SECOND LIENS- The Oversight Board shall prohibit borrowers from granting a new second lien on the mortgaged property during the first five years of the term of the mortgage insured under this section, except as the Oversight Board determines to be necessary to ensure the appropriate maintenance of the mortgaged property.`(9) DOCUMENTATION AND VERIFICATION OF INCOME- In complying with the FHA underwriting requirements under the program under this section, the mortgagee shall document and verify the income of the mortgagor or non-filing status by procuring (A) an income tax return transcript of the income tax returns of the mortgagor, or (B) a copy of the income tax returns for the Internal Revenue Service, for the two most recent years for which the filing deadline for such years has passed and by any other method, in accordance with procedures and standards that the Oversight Board shall establish.`(10) FIXED RATE MORTGAGE- The mortgage insured under this section shall bear interest at a single rate that is fixed for the entire term of the mortgage.`(11) MAXIMUM LOAN AMOUNT- Notwithstanding section 203(b)(2), the mortgage being insured under this section shall involve a principal obligation in an amount that does not exceed the limitation (for a property of the applicable size) on the amount of the principal obligation that would be allowable under the terms of section 202(a) of the Economic Stimulus Act of 2008 if the mortgage were insured pursuant to such section. The limitation on the amount of the principal obligation allowable under such Act shall apply for the purposes of this section until the termination under subsection (n) of the program under this section.`(12) INELIGIBILITY FOR FRAUD CONVICTION- The mortgagor shall not have been convicted under Federal or State law for mortgage fraud during the 7-year period ending upon the insurance of the mortgage under this section.`(13) LENDER REVIEW- The mortgagee under the mortgage shall conduct an electronic database search of the mortgagor's criminal history to determine if the mortgagor has had a conviction described in paragraph (12). The mortgagee may charge the mortgagor a reasonable fee for the actual cost of the search not to exceed a maximum rate established by the Oversight Board. The Oversight Board may provide clarification, if needed, to help mortgagees identify any differences among the States in how they report mortgage fraud convictions. The Oversight Board shall establish procedures sufficient to allow the mortgagor to challenge a mortgagee's determination with respect to paragraph (12) (including to correct inaccuracies resulting from theft of the mortgagor's identity or personally identifiable information).`(14) APPRAISALS- Any appraisal conducted in connection with a mortgage insured under this section shall--`(A) be based on the current value of the property;`(B) be conducted in accordance with title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3331 et seq.);`(C) be completed by an appraiser who meets the competency requirements of the Uniform Standards of Professional Appraisal Practice;`(D) be wholly consistent with the appraisal standards, practices, and procedures under section 202(e) of this Act that apply to all loans insured under this Act; and`(E) comply with the requirements of subsection (g) of this section (relating to appraisal independence).`(15) STATEMENT OF LOAN TERMS-`(A) REQUIREMENT- The mortgagor shall have been provided by the mortgagee, not later than three days before closing for the mortgage, a form described in subparagraph (B) appropriately and accurately completed by the mortgagee.`(B) FORM- The form described in this subparagraph shall be a single page, written disclosure regarding the mortgage loan to be insured under this section that, when completed by the mortgagee, sets forth, in accordance with such requirements as the Secretary shall by regulation establish a best possible estimate of--`(i) the total loan amount under the mortgage;`(ii) the loan-to-value ratio for the mortgage;`(iii) the final maturity date for the mortgage;`(iv) the amount of any prepayment fee to be charged if the mortgage is paid in full before the final maturity date for the mortgage, including the percentages of any net proceeds to be received by the Secretary pursuant to paragraph (8)(D)(ii);`(v) the amount of the exit premium under the mortgage pursuant to subsection (e)(3);`(vi) the interest rate under the mortgage expressed as an annual percentage rate, and the amount of the monthly payment due under such rate;`(vii) the fully indexed rate of interest under the mortgage expressed as an annual percentage rate and the amount of the monthly payment due under such rate;`(viii) the monthly household income of the borrower upon which the mortgage is based;`(ix) the amount of the monthly payment due under the mortgage, and the amount of such initial monthly payment plus monthly amounts due for taxes and insurance on the property for which the mortgage is made, both expressed as a percentage of the monthly household income of the borrower; and`(x) the aggregate amount of settlement charges for all settlement services provided in connection with the mortgage, the amount of such charges that are included in the principal amount and the amount of such charges the borrower must pay at closing, the aggregate amount of mortgagee's fees connection with the mortgage, and the aggregate amount of other fees or required payments in connection with the mortgage.`(d) Flexible Underwriting Criteria-`(1) IN GENERAL- The Oversight Board shall establish, and the Secretary acting on behalf of the Oversight Board shall implement, underwriting standards for mortgages insured under this section that--`(A) ensure that each mortgagor under a mortgage insured under this section has a reasonable expectation of repaying the mortgage, taking into consideration the mortgagor's income, assets, liabilities, payment history, and other applicable criteria, but which shall not result in a denial of insurance solely on the basis of the mortgagor's current FICO or other credit scores, or any delinquency or default by the mortgagor under the existing mortgage or mortgages, or any case filed under title 11, United States Code, by the mortgagor; and`(B) subject to the provisions of subparagraph (A), permit a total debt-to-income ratio of up to 43 percent.`(2) EXCEPTION-`(A) IN GENERAL- Subject to the underwriting standards established under paragraph (1)(A) and any additional requirements that the Oversight Board considers appropriate, the Oversight Board shall permit a total debt-to-income ratio of more than 43 percent, but not more than 50 percent, if the mortgagor has made, on a timely basis before the endorsement of the mortgage insured under this section, not less than six months of payments in an amount not less than the amount of the monthly payment due under the mortgage to be insured under this section. The holder of the existing senior mortgage shall exercise forbearance with respect to such mortgage during the period in which such payments are made.`(B) COMPUTATION OF DEBT-TO-INCOME RATIO- In computing the mortgagor's total debt-to-income ratio for purposes of mortgage qualification under the underwriting standards established pursuant to this section--`(i) if the mortgagor is a debtor in a case under chapter 13 of title 11, United States Code, payments on recurring debts other than housing expenses shall be based on the amounts being paid on such debts under the mortgagor's confirmed plan under such chapter; and`(ii) if the mortgagor is a debtor in a case under chapter 7 of title 11, United States Code, recurring debts that are to be discharged in that case shall not be considered.`(3) AUTHORITY- The Oversight Board may alter the ratios under this subsection for a particular class of borrowers subject to such requirements as the Board determines is necessary and appropriate to fulfill the purposes of this Act.`(4) REPRESENTATIONS AND WARRANTIES- The Oversight Board shall require the underwriter of the insured loan to provide such representations and warranties as the Oversight Board considers necessary or appropriate for the Secretary to enforce compliance with all underwriting and appraisal standards of the program.`(e) Premiums- For each mortgage insured under this section, the Oversight Board shall establish and the Secretary shall collect--`(1) at the time of insurance, a single premium payment in an amount equal to 3.0 percent of the amount of the original insured principal obligation of the mortgage, which shall be paid from the proceeds of the mortgage being insured under this section, through the reduction of the amount of indebtedness on the existing senior mortgage required under subsection (c)(6)(A);`(2) in addition to the premium under paragraph (1), annual premium payments in an amount equal to 1.50 percent of the remaining insured principal balance of the mortgage; and`(3) an exit premium in the amount determined under subsection (c)(8), but which shall not be less than 3.0 percent of the original insured principal obligation of the mortgage, subject only to the availability of sufficient net proceeds from sale, refinancing, or other disposition of the property, as determined in subsection (c)(8).`(f) Origination Fees and Mortgage Rate- The Oversight Board shall establish and the Secretary shall implement a reasonable limitation on origination fees for mortgages insured under this section and shall establish procedures to ensure that interest rates on such mortgages shall be commensurate with market rate interest rates on such types of loans.`(g) Appraisal Independence-`(1) PROHIBITIONS ON INTERESTED PARTIES IN A REAL ESTATE TRANSACTION- No mortgage lender, mortgage broker, mortgage banker, real estate broker, appraisal management company, employee of an appraisal management company, nor any other person with an interest in a real estate transaction involving an appraisal in connection with a mortgage insured under this section shall improperly influence, or attempt to improperly influence, through coercion, extortion, collusion, compensation, instruction, inducement, intimidation, non-payment for services rendered, or bribery, the development, reporting, result, or review of a real estate appraisal sought in connection with the mortgage.`(2) EXCEPTIONS- The requirements of paragraph (1) shall not be construed as prohibiting a mortgage lender, mortgage broker, mortgage banker, real estate broker, appraisal management company, employee of an appraisal management company, or any other person with an interest in a real estate transaction from asking an appraiser to provide 1 or more of the following services:`(A) Consider additional, appropriate property information, including the consideration of additional comparable properties to make or support an appraisal.`(B) Provide further detail, substantiation, or explanation for the appraiser's value conclusion.`(C) Correct errors in the appraisal report.`(3) CIVIL MONETARY PENALTIES- The Secretary may impose a civil money penalty for any knowing and material violation of paragraph (1) under the same terms and conditions as are authorized in section 536(a) of this Act.`(h) Limitation on Aggregate Insurance Authority- The aggregate original principal obligation of all mortgages insured under this section may not exceed $300,000,000,000.`(i) Enhancement of FHA Capacity- Under the direction of the Oversight Board, the Secretary shall take such actions as may be necessary to--`(1) contract for the establishment of underwriting criteria, automated underwriting systems, pricing standards, and other factors relating to eligibility for mortgages insured under this section;`(2) contract for independent quality reviews of underwriting, including appraisal reviews and fraud detection, of mortgages insured under this section or pools of such mortgages; and`(3) increase personnel of the Department as necessary to process or monitor the processing of mortgages insured under this section.`(j) Monitoring of Underwriting Risk-`(1) MONITORING OF DESIGNATED UNDERWRITERS- The Oversight Board and the Secretary shall monitor independent quality reviews as established pursuant to subsection (i)(2) to--`(A) determine compliance of designated underwriters with underwriting standards;`(B) determine rates of delinquency, claims rates, and loss rates of designated underwriters; and`(C) terminate eligibility of designated underwriters that do not meet minimum performance standards as the Oversight Board may establish and the Secretary implements.`(2) REPORTS BY OVERSIGHT BOARD- The Oversight Board shall submit monthly reports to the Congress identifying the progress of the program for mortgage insurance under this section, which shall contain the following information for each month:`(A) The number of new mortgages insured under this section, including the location of the properties subject to such mortgages by census tract.`(B) The aggregate principal obligation of new mortgages insured under this section.`(C) The average amount by which the indebtedness on existing mortgages is reduced in accordance with subsection (c)(6).`(D) The average amount by which the debt service payments on existing mortgages is reduced in accordance with subsection (c)(7).`(E) The amount of premiums collected for insurance of mortgages under this section.`(F) The claim and loss rates for mortgages insured under this section.`(G) The race, ethnicity, gender, and income of the mortgagors, aggregated by geographical areas at least as specific as census tracts, except where necessary to protect privacy of the borrower.`(H) Any other information that the Oversight Board considers appropriate.`(3) REPORT BY INSPECTOR GENERAL- The Inspector General of the Department of Housing and Urban Development shall conduct an annual audit of the program for mortgage insurance under this section to determine compliance with this section and program rules.`(k) GNMA Commitment Authority-`(1) GUARANTEES- The Secretary shall take such actions as may be necessary to ensure that securities based on and backed by a trust or pool composed of mortgages insured under this section are available to be guaranteed by the Government National Mortgage Association as to the timely payment of principal and interest.`(2) GUARANTEE AUTHORITY- To carry out the purposes of section 306 of the National Housing Act (12 U.S.C. 1721), the Government National Mortgage Association may enter into new commitments to issue guarantees of securities based on or backed by mortgages insured under this section, not exceeding $300,000,000,000. The amount of authority provided under the preceding sentence to enter into new commitments to issue guarantees is in addition to any amount of authority to make new commitments to issue guarantees that is provided to the Association under any other provision of law.`(l) Special Risk Insurance Fund- The insurance of each mortgage under this section shall be the obligation of the Special Risk Insurance Fund established by section 238.`(m) Definitions- For purposes of this section, the following definitions shall apply:`(1) EXISTING MORTGAGE- The term `existing mortgage' means, with respect to a mortgage insured under this section, a mortgage that is to be extinguished, and paid or prepaid, from the proceeds of the mortgage insured under this section.`(2) EXISTING SENIOR MORTGAGE- The term `existing senior mortgage' means, with respect to a mortgage insured under this section, the existing mortgage that has superior priority.`(3) EXISTING SUBORDINATE MORTGAGE- The term `existing subordinate mortgage' means, with respect to a mortgage insured under this section, an existing mortgage that has subordinate priority to the existing senior mortgage.`(n) Sunset-`(1) IN GENERAL- Except as provided in paragraph (2), the authority of the Secretary to make any new commitment to insure any mortgage under this section shall terminate upon the expiration of the 2-year period beginning on the date of the enactment of the FHA Housing Stabilization and Homeownership Retention Act of 2008.`(2) EXTENSIONS- The Oversight Board may, not more than four times, extend the authority to enter into new commitments to insure mortgages under this section beyond the date specified in paragraph (1), except that each such extension shall--`(A) be effective only if, before the program terminates pursuant to paragraph (1) or any previous extension pursuant to this paragraph, the Oversight Board--`(i) certifies the need for such extension in writing to the Congress; and`(ii) causes notice of such extension to be published in the Federal Register no later than the beginning of the 3-month period that ends upon the scheduled termination date of the program; and`(B) be for a period of not more than 6 months.`(o) Authorizations of Appropriations- There is authorized to be appropriated for each of fiscal years 2008 and 2009--`(1) $230,000,000 for providing counseling regarding loss mitigation for mortgagors with 1- to 4-family residences, including determining eligibility for the program under this section, with grants to be administered through the Neighborhood Reinvestment Corporation, except that--`(A) funds shall be targeted to States and communities based on their levels of foreclosures and delinquencies in 2007 and 2008;`(B) not less than 15 percent of the funds made available pursuant to this paragraph shall be provided to counseling organizations that target counseling services regarding loss mitigation to minority and low-income homeowners or provide such services in neighborhoods with high concentrations of minority and low-income homeowners;`(C) $35,000,000 of the funds made available pursuant to this paragraph shall be used by the Neighborhood Reinvestment Corporation (referred to in this subparagraph as the `NRC') to make grants to State and local legal organizations or attorneys that have demonstrated legal experience in home foreclosure or eviction law to provide legal assistance related to home ownership preservation, home foreclosure prevention, and tenancy associated with home foreclosure or to counseling intermediaries that have been approved by the Department of Housing and Urban Development for the purpose of making such grants or contracting for such legal assistance; of the amount provided under this subparagraph, at least 60 percent shall be allocated for legal assistance to low-income homeowners or tenants; such attorneys shall be capable of assisting homeowners in owner-occupied homes or tenants who live in homes with mortgages in default, in danger of default, or subject to or at risk of foreclosure or eviction and who have legal issues that cannot be handled by counselors employed by NRC intermediaries; in using the amount made available under this subparagraph, the NRC shall give priority consideration to State and local legal organizations and attorneys that (i) provide legal assistance in the 100 metropolitan statistical areas (as defined by the Director of the Office of Management and Budget) with the highest home foreclosure rates, and (ii) have the capacity to begin using the financial assistance within 90 days after receipt of the assistance; as a condition of the receipt of a grant under this subparagraph, the grantee shall submit to NRC information relating to the demographic characteristics of the assisted homeowners or tenants, the dollar amount and terms of the relevant mortgages and the outcome of legal proceedings related to the foreclosure or eviction proceedings, including the resolutions thereof; except that no funds under this subparagraph shall be used for class action litigation;`(D) $20,000,000 of the funds made available pursuant to this paragraph shall be used for such counseling for veterans recently returning from active duty in the Armed Forces;`(E) the NRC shall give priority consideration for funding with amounts made available pursuant to this paragraph, except for funds made available under subparagraphs (B), (C), and (D), to entities that have an effective plan in place for making contact, including personal contact, with defaulted mortgagors, and such a plan may include use of third parties (including both for-profit and not-for-profit entities) to make personal contact with defaulted mortgagors, or visits to such mortgagors, or both;`(F) except with respect to funds reserved under subparagraphs (B), (C), and (D), the NRC shall give priority consideration for funding with amounts made available pursuant to this paragraph to entities that have a written plan that has been implemented for providing in-person counseling and for making contact, including personal contact, with defaulted mortgagors, for the purpose of providing counseling or providing information about available counseling, both (i) prior to commencement of any foreclosure proceedings, and (ii) in the event effective in person or phone contact has not been made with such defaulted mortgagors prior thereto, then prior to the conclusion of the foreclosure process; and`(G) not less than 2 percent of the funds made available pursuant to this paragraph shall be used only for identifying and notifying borrowers under existing mortgages who are eligible under this section for insurance of refinancing mortgages, and in making funds reserved under this subparagraph available for such purpose, the Secretary shall give preference to assistance for programs that have a proven history of outreach within minority communities; and`(2) $150,000,000 for costs of activities under subsection (i).`(p) Audit and Report by Inspector General-`(1) AUDIT- The Inspector General of the Department of Housing and Urban Development shall conduct an audit of the program for loss mitigation counseling funded with amounts made available under subsection (o)(1) to determine compliance with such subsection.`(2) REPORTS TO CONGRESS- Not later than March 30, 2009, and every calendar quarter thereafter, the Inspector General shall submit to the appropriate committees of the Congress a report summarizing the activities of the Inspector General and the Neighborhood Reinvestment Corporation during the 120-day period ending on the date of such report. Each report shall include, for the period covered by such report, a detailed statement of all obligations, expenditures, and revenues associated with paragraphs (1) and (2) of subsection (o), including--`(A) obligations and expenditures of appropriated funds;`(B) the number of homeowners eligible in such program;`(C) the number of homeowners participating in such program;`(D) the status of homeowners within such program;`(E) the number of homeowners who have rejected assistance from the Neighborhood Reinvestment Corporation; and`(F) information on participating counseling services.'.(b) Special Risk Insurance Fund- Section 238 of the National Housing Act (12 U.S.C. 1715z-3) is amended--(1) in subsection (a)(1), by striking `or 243' each place such term appears and inserting `243, or 257'; and(2) in subsection (b), by striking `and 243' each place such term appears and inserting `243, and 257'.(c) FHA Reverse Mortgage Program- Section 255(g) of the National Housing Act (12 U.S.C. 1715z-20(g)) is amended by striking the first sentence.

SEC. 113. STUDY OF AUCTION OR BULK REFINANCE PROGRAM.(a) Study- The Board of Governors of the Federal Reserve System (in this section referred to as the `Board of Governors'), in consultation with other members of the Oversight Board established by section 257(a) of the National Housing Act (as added by the amendment made by section 112(a) of this title), shall conduct a study of the need for and efficacy of an auction or bulk refinancing mechanism to facilitate refinancing of existing residential mortgages that are at risk for foreclosure into mortgages insured under the mortgage insurance program under title II of the National Housing Act. The study shall identify and examine various options for mechanisms under which lenders and servicers of such mortgages may make bids for forward commitments for such insurance in an expedited manner.(b) Content-(1) ANALYSIS- The study required under subsection (a) shall analyze--(A) the feasibility of establishing a mechanism that would facilitate the more rapid refinancing of borrowers at risk of foreclosure into performing mortgages insured under title II of the National Housing Act;(B) whether such a mechanism would provide an effective and efficient mechanism to reduce foreclosures on qualified existing mortgages;(C) whether the use of an auction or bulk refinance program is necessary to stabilize the housing market and reduce the impact of turmoil in that market on the economy of the United States;(D) whether there are other mechanisms or authority that would be useful to reduce foreclosure; and(E) and any other factors that the Board of Governors considers relevant.(2) DETERMINATIONS- To the extent that the Board of Governors finds that a facility of the type described in paragraph (1) is feasible and useful, the study shall--(A) determine and identify any additional authority or resources needed to establish and operate such a mechanism;(B) determine whether there is a need for additional authority with respect to the loan underwriting criteria included in the amendment made by section 112(a) of this title or with respect to eligibility of participating borrowers, lenders, or holders of liens;(C) determine whether such underwriting criteria should be established on the basis of individual loans, in the aggregate, or otherwise to facilitate the goal of refinancing borrowers at risk of foreclosure into viable loans insured under the National Housing Act.(c) Report- Not later than the expiration of the 60-day period beginning on the date of the enactment of this Act, the Board of Governors shall submit a report regarding the results of the study conducted under this section to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate. The report shall include a detailed description of the analysis required under subsection (b)(1) and of the determinations made pursuant to subsection (b)(2), and shall include any other findings and recommendations of the Board of Governors pursuant to the study, including identifying various options for mechanisms described in subsection (a).SEC. 114. TEMPORARY INCREASE IN MAXIMUM LOAN GUARANTY AMOUNT FOR CERTAIN HOUSING LOANS GUARANTEED BY SECRETARY OF VETERANS AFFAIRS.Notwithstanding subparagraph (C) ofsection 3703(a)(1) of title 38, United States Code, for purposes of any loan described in subparagraph (A)(i)(IV) of such section that is originated during the period beginning on the date of the enactment of this Act and ending on December 31, 2008, the term `maximum guaranty amount' shall mean an amount equal to 25 percent of the higher of--(1) the limitation determined under section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) for the calendar year in which the loan is originated for a single-family residence; or(2) 125 percent of the area median price for a single-family residence, but in no case to exceed 175 percent of the limitation determined under such section 305(a)(2) for the calendar year in which the loan is originated for a single-family residence.SEC. 115. STUDY OF POSSIBLE ACCOUNTING REVISIONS RELATING TO PROPERTY AT RISK OF FORECLOSURE AND THE AVAILABILITY OF CREDIT FOR REFINANCING HOME MORTGAGES AT RISK OF FORECLOSURE.(a) Study Required- The Securities and Exchange Commission, in consultation with the Board of Governors of the Federal Reserve System, shall conduct a study on fair value accounting standards applicable to financial institutions, including depository institutions, with respect to their residential mortgages that are at risk of foreclosure and mortgage-backed securities involving such mortgages, the effects of such accounting standards on a financial institution's balance sheet and capacity to provide refinancing to residential mortgagors that are at risk of foreclosure and to residential mortgagors during periods of market value declines and increased foreclosures, and the advisability and feasibility of modifications of such standards during periods of market fluctuation in order to maintain the ability of the institution to continue to carry mortgages on residential property at risk of foreclosure and assure the availability of credit to refinance at-risk residential mortgages.(b) Report Required- The Securities and Exchange Commission shall submit a report to the Congress before the end of the 90-day period beginning on the date of the enactment of this Act containing the findings and determinations of the Commission with respect to the study conducted under subsection (a) and such administrative and legislative recommendations as the Commission may determine to be appropriate.SEC. 116. GAO STUDY OF THE EFFECT OF TIGHTENING CREDIT MARKETS IN COMMUNITIES AFFECTED BY THE SUBPRIME MORTGAGE FORECLOSURE CRISES AND PREDATORY LENDING ON PROSPECTIVE FIRST-TIME HOMEBUYERS SEEKING MORTGAGES.The Comptroller General of the United States shall conduct a study to analyze the effects of tightening credit markets on prospective first-time home buyers who reside in selected communities that have been most detrimentally affected by both the current subprime mortgage foreclosure crisis and predatory mortgage lending. Such study shall also analyze the adequacy of financial literacy outreach efforts by agencies of the Federal Government tasked with implementing financial literacy education in such communities and shall assess whether the current funding levels for such efforts are at sufficient levels to reduce the levels of subprime mortgage delinquencies and foreclosures and to increase the level of financial literacy in the selected communities so as to minimize the incidences of predatory mortgage lending. Not later than the expiration of the 6-month period beginning on the date of the enactment of this Act, the Comptroller General shall submit a report to the Congress setting forth the results of the study and including recommendations regarding such funding levels.Subtitle B--Office of Housing CounselingSEC. 131. SHORT TITLE.This subtitle may be cited as the `Expand and Preserve Home Ownership Through Counseling Act'.SEC. 132. ESTABLISHMENT OF OFFICE OF HOUSING COUNSELING.Section 4 of the Department of Housing and Urban Development Act (42 U.S.C. 3533) is amended by adding at the end the following new subsection:`(g) Office of Housing Counseling-`(1) ESTABLISHMENT- There is established, in the Office of the Secretary, the Office of Housing Counseling.`(2) DIRECTOR- There is established the position of Director of Housing Counseling. The Director shall be the head of the Office of Housing Counseling and shall be appointed by the Secretary. Such position shall be a career-reserved position in the Senior Executive Service.`(3) FUNCTIONS-`(A) IN GENERAL- The Director shall have ultimate responsibility within the Department, except for the Secretary, for all activities1505. State license and registration application and matters relating to homeownership counseling and rental housing counseling, including--`(i) research, grant administration, public outreach, and policy development relating to such counseling; and`(ii) establishment, coordination, and administration of all regulations, requirements, standards, and performance measures under programs and laws administered by the Department that relate to housing counseling, homeownership counseling (including maintenance of homes), mortgage-related counseling (including home equity conversion mortgages and credit protection options to avoid foreclosure), and rental housing counseling, including the requirements, standards, and performance measures relating to housing counseling.`(B) SPECIFIC FUNCTIONS- The Director shall carry out the functions assigned to the Director and the Office under this section and any other provisions of law. Such functions shall include establishing rules necessary for--`(i) the counseling procedures under section 106(g)(1) of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(h)(1));`(ii) carrying out all other functions of the Secretary under section 106(g) of the Housing and Urban Development Act of 1968, including the establishment, operation, and publication of the availability of the toll-free telephone number under paragraph (2) of such section;`(iii) carrying out section 5 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2604) for home buying information booklets prepared pursuant to such section;`(iv) carrying out the certification program under section 106(e) of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(e));`(v) carrying out the assistance program under section 106(a)(4) of the Housing and Urban Development Act of 1968, including criteria for selection of applications to receive assistance;`(vi) carrying out any functions regarding abusive, deceptive, or unscrupulous lending practices relating to residential mortgage loans that the Secretary considers appropriate, which shall include conducting the study under section 136 of the Expand and Preserve Home Ownership Through Counseling Act;`(vii) providing for operation of the advisory committee established under paragraph (4) of this subsection;`(viii) collaborating with community-based organizations with expertise in the field of housing counseling; and`(ix) providing for the building of capacity to provide housing counseling services in areas that lack sufficient services.`(4) ADVISORY COMMITTEE-`(A) IN GENERAL- The Secretary shall appoint an advisory committee to provide advice regarding the carrying out of the functions of the Director.`(B) MEMBERS- Such advisory committee shall consist of not more than 12 individuals, and the membership of the committee shall equally represent all aspects of the mortgage and real estate industry, including consumers.`(C) TERMS- Except as provided in subparagraph (D), each member of the advisory committee shall be appointed for a term of 3 years. Members may be reappointed at the discretion of the Secretary.`(D) TERMS OF INITIAL APPOINTEES- As designated by the Secretary at the time of appointment, of the members first appointed to the advisory committee, 4 shall be appointed for a term of 1 year and 4 shall be appointed for a term of 2 years.`(E) PROHIBITION OF PAY; TRAVEL EXPENSES- Members of the advisory committee shall serve without pay, but shall receive travel expenses, including per diem in lieu of subsistence, in accordance with applicable provisions under subchapter I of chapter 57 of title 5, United States Code.`(F) ADVISORY ROLE ONLY- The advisory committee shall have no role in reviewing or awarding housing counseling grants.`(5) SCOPE OF HOMEOWNERSHIP COUNSELING- In carrying out the responsibilities of the Director, the Director shall ensure that homeownership counseling provided by, in connection with, or pursuant to any function, activity, or program of the Department addresses the entire process of homeownership, including the decision to purchase a home, the selection and purchase ofissuance.CommentsClose CommentsPermalink




Sec. 1506. Standards for State license renewal.CommentsClose CommentsPermalink





Sec. 1507. System of registration administration by Federal agencies.CommentsClose CommentsPermalink





Sec. 1508. Secretary of Housing and Urban Development backup authority to establish a loan originator licensing system.CommentsClose CommentsPermalink





Sec. 1509. Backup authority to establish a home, issues arising during or affecting the period of ownership of a home (including refinancing, default and foreclosure, and other financial decisions), and the sale or other disposition of a home.'.SEC. 133. COUNSELING PROCEDURES.(a) In General- Section 106 of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x) is amended by adding at the end the following new subsection:`(g) Procedures and Activities-`(1) COUNSELING PROCEDURES-`(A) IN GENERAL- The Secretary shall establish, coordinate, and monitor the administration by the Department of Housing and Urban Development of the counseling procedures for homeownership counseling and rental housing counseling provided in connection with any program of the Department, including all requirements, standards, and performance measures that relate to homeownership and rental housing counseling.`(B) HOMEOWNERSHIP COUNSELING- For purposes of this subsection and as used in the provisions referred to in this subparagraph, the term `homeownership counseling' means counseling related to homeownership and residential mortgage loans. Such term includes counseling related to homeownership and residential mortgage loans that is provided pursuant to--`(i) section 105(a)(20) of the Housing and Community Development Act of 1974 (42 U.S.C. 5305(a)(20));`(ii) in the United States Housing Act of 1937--`(I) section 9(e) (42 U.S.C. 1437g(e));`(II) section 8(y)(1)(D) (42 U.S.C. 1437f(y)(1)(D));`(III) section 18(a)(4)(D) (42 U.S.C. 1437p(a)(4)(D));`(IV) section 23(c)(4) (42 U.S.C. 1437u(c)(4));`(V) section 32(e)(4) (42 U.S.C. 1437z-4(e)(4));`(VI) section 33(d)(2)(B) (42 U.S.C. 1437z-5(d)(2)(B));`(VII) sections 302(b)(6) and 303(b)(7) (42 U.S.C. 1437aaa-1(b)(6), 1437aaa-2(b)(7)); and`(VIII) section 304(c)(4) (42 U.S.C. 1437aaa-3(c)(4));`(iii) section 302(a)(4) of the American Homeownership and Economic Opportunity Act of 2000 (42 U.S.C. 1437f note);`(iv) sections 233(b)(2) and 258(b) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12773(b)(2), 12808(b));`(v) this section and section 101(e) of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x, 1701w(e));`(vi) section 220(d)(2)(G) of the Low-Income Housing Preservation and Resident Homeownership Act of 1990 (12 U.S.C. 4110(d)(2)(G));`(vii) sections 422(b)(6), 423(b)(7), 424(c)(4), 442(b)(6), and 443(b)(6) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12872(b)(6), 12873(b)(7), 12874(c)(4), 12892(b)(6), and 12893(b)(6));`(viii) section 491(b)(1)(F)(iii) of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11408(b)(1)(F)(iii));`(ix) sections 202(3) and 810(b)(2)(A) of the Native American Housing and Self-Determination Act of 1996 (25 U.S.C. 4132(3), 4229(b)(2)(A));`(x) in the National Housing Act--`(I) in section 203 (12 U.S.C. 1709), the penultimate undesignated paragraph of paragraph (2) of subsection (b), subsection (c)(2)(A), and subsection (r)(4);`(II) subsections (a) and (c)(3) of section 237 (12 U.S.C. 1715z-2); and`(III) subsections (d)(2)(B) and (m)(1) of section 255 (12 U.S.C. 1715z-20);`(xi) section 502(h)(4)(B) of the Housing Act of 1949 (42 U.S.C. 1472(h)(4)(B)); and`(xii) section 508 of the Housing and Urban Development Act of 1970 (12 U.S.C. 1701z-7).`(C) RENTAL HOUSING COUNSELING- For purposes of this subsection, the term `rental housing counseling' means counseling related to rental of residential property, which may include counseling regarding future homeownership opportunities and providing referrals for renters and prospective renters to entities providing counseling and shall include counseling related to such topics that is provided pursuant to--`(i) section 105(a)(20) of the Housing and Community Development Act of 1974 (42 U.S.C. 5305(a)(20));`(ii) in the United States Housing Act of 1937--`(I) section 9(e) (42 U.S.C. 1437g(e));`(II) section 18(a)(4)(D) (42 U.S.C. 1437p(a)(4)(D));`(III) section 23(c)(4) (42 U.S.C. 1437u(c)(4));`(IV) section 32(e)(4) (42 U.S.C. 1437z-4(e)(4));`(V) section 33(d)(2)(B) (42 U.S.C. 1437z-5(d)(2)(B)); and`(VI) section 302(b)(6) (42 U.S.C. 1437aaa-1(b)(6));`(iii) section 233(b)(2) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12773(b)(2));`(iv) section 106 of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x);`(v) section 422(b)(6) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12872(b)(6));`(vi) section 491(b)(1)(F)(iii) of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11408(b)(1)(F)(iii));`(vii) sections 202(3) and 810(b)(2)(A) of the Native American Housing and Self-Determination Act of 1996 (25 U.S.C. 4132(3), 4229(b)(2)(A)); and`(viii) the rental assistance program under section 8 of the United States Housing Act of 1937 (42 U.S.C. 1437f).`(2) STANDARDS FOR MATERIALS- The Secretary, in conjunction with the advisory committee established under subsection (g)(4) of the Department of Housing and Urban Development Act, shall establish standards for materials and forms to be used, as appropriate, by organizations providing homeownership counseling services, including any recipients of assistance pursuant to subsection (a)(4).`(3) MORTGAGE SOFTWARE SYSTEMS-`(A) CERTIFICATION- The Secretary shall provide for the certification of various computer software programs for consumers to use in evaluating different residential mortgage loan proposals. The Secretary shall require, for such certification, that the mortgage software systems take into account--`(i) the consumer's financial situation and the cost of maintaining a home, including insurance, taxes, and utilities;`(ii) the amount of time the consumer expects to remain in the home or expected time to maturity of the loan;`(iii) such other factors as the Secretary considers appropriate to assist the consumer in evaluating whether to pay points, to lock in an interest rate, to select an adjustable or fixed rate loan, to select a conventional or government-insured or guaranteed loan and to make other choices during the loan application process.If the Secretary determines that available existing software is inadequate to assist consumers during the residential mortgage loan application process, the Secretary shall arrange for the development by private sector software companies of new mortgage software systems that meet the Secretary's specifications.`(B) USE AND INITIAL AVAILABILITY- Such certified computer software programs shall be used to supplement, not replace, housing counseling. The Secretary shall provide that such programs are initially used only in connection with the assistance of housing counselors certified pursuant to subsection (e).`(C) AVAILABILITY- After a period of initial availability under subparagraph (B) as the Secretary considers appropriate, the Secretary shall take reasonable steps to make mortgage software systems certified pursuant to this paragraph widely available through the Internet and at public locations, including public libraries, senior-citizen centers, public housing sites, offices of public housing agencies that administer rental housing assistance vouchers, and housing counseling centers.`(4) NATIONAL PUBLIC SERVICE MULTIMEDIA CAMPAIGNS TO PROMOTE HOUSING COUNSELING-`(A) IN GENERAL- The Director of Housing Counseling shall develop, implement, and conduct national public service multimedia campaigns designed to make persons facing mortgage foreclosure, persons considering a subprime mortgage loan to purchase a home, elderly persons, persons who face language barriers, low-income persons, and other potentially vulnerable consumers aware that it is advisable, before seeking or maintaining a residential mortgage loan, to obtain homeownership counseling from an unbiased and reliable sources and that such homeownership counseling is available, including through programs sponsored by the Secretary of Housing and Urban Development.`(B) CONTACT INFORMATION- Each segment of the multimedia campaign under subparagraph (A) shall publicize the toll-free telephone number and web site of the Department of Housing and Urban Development through which persons seeking housing counseling can locate a housing counseling agency in their State that is certified by the Secretary of Housing and Urban Developmentnationwide mortgage licensing and can provide advice on buying a home, renting, defaults, foreclosures, credit issues, and reverse mortgages.`(C) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated to the Secretary, not to exceed $3,000,000 for fiscal years 2008, 2009, and 2010, for the develop, implement, and conduct of national public service multimedia campaigns under this paragraph.`(5) EDUCATION PROGRAMS- The Secretary shall provide advice and technical assistance to States, units of general local government, and nonprofit organizations regarding the establishment and operation of, including assistance with the development of content and materials for, educational programs to inform and educate consumers, particularly those most vulnerable with respect to residential mortgage loans (such as elderly persons, persons facing language barriers, low-income persons, and other potentially vulnerable consumers), regarding home mortgages, mortgage refinancing, home equity loans, and home repair loans.'.(b) Conforming Amendments to Grant Program for Homeownership Counseling Organizations- Section 106(c)(5)(A)(ii) of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(c)(5)(A)(ii)) is amended--(1) in subclause (III), by striking `and' at the end;(2) in subclause (IV) by striking the period at the end and inserting `; and'; and(3) by inserting after subclause (IV) the following new subclause:

`(V) notify the housing or mortgage applicant of the availability of mortgage software systems provided pursuant to subsection (g)(3).'.

SEC. 134. GRANTS FOR HOUSING COUNSELING ASSISTANCE.Section 106(a) of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(a)(3)) is amended by adding at the end the following new paragraph:

`(4) Homeownership and Rental Counseling Assistance-`(A) IN GENERAL- The Secretary shall make financial assistance available under this paragraph to States, units of general local governments, and nonprofit organizations providing homeownership or rental counseling (as such terms are defined in subsection (g)(1)).`(B) QUALIFIED ENTITIES- The Secretary shall establish standards and guidelines for eligibility of organizations (including governmental and nonprofit organizations) to receive assistance under this paragraph.`(C) DISTRIBUTION- Assistance made available under this paragraph shall be distributed in a manner that encourages efficient and successful counseling programs.`(D) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated $45,000,000 for each of fiscal years 2008 through 2011 for--`(i) the operations of the Office of Housing Counseling of the Department of Housing and Urban Development;`(ii) the responsibilities of the Secretary under paragraphs (2) through (5) of subsection (g); and`(iii) assistance pursuant to this paragraph for entities providing homeownership and rental counseling.'.

SEC. 135. REQUIREMENTS TO USE HUD-CERTIFIED COUNSELORS UNDER HUD PROGRAMS.Section 106(e) of the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(e)) is amended--(1) by striking paragraph (1) and inserting the following new paragraph:

`(1) REQUIREMENT FOR ASSISTANCE- An organization may not receive assistance for counseling activities under subsection (a)(1)(iii), (a)(2), (a)(4), (c), or (d) of this section, or under section 101(e), unless the organization, or the individuals through which the organization provides such counseling, has been certified by the Secretary under this subsection as competent to provide such counseling.';

(2) in paragraph (2)--(A) by inserting `and for certifying organizations' before the period at the end of the first sentence; and(B) in the second sentence by striking `for certification' and inserting `, for certification of an organization, that each individual through which the organization provides counseling shall demonstrate, and, for certification of an individual,';(3) in paragraph (3), by inserting `organizations and' before `individuals';(4) by redesignating paragraph (3) as paragraph (5); and(5) by inserting after paragraph (2) the following new paragraphs:`(3) REQUIREMENT UNDERregistry system.CommentsClose CommentsPermalink




Sec. 1510. Fees.CommentsClose CommentsPermalink





Sec. 1511. Background checks of loan originators.CommentsClose CommentsPermalink





Sec. 1512. Confidentiality of information.CommentsClose CommentsPermalink





Sec. 1513. Liability provisions.CommentsClose CommentsPermalink





Sec. 1514. Enforcement under HUD PROGRAMS- Any homeownership counseling or rental housing counseling (as such terms are defined in subsection (g)(1)) required under, or provided in connection with, any program administered by the Department of Housing and Urban Development shall be provided only by organizations or counselors certified by the Secretary under this subsection as competent to provide such counseling.`(4) OUTREACH- The Secretary shall take such actions as the Secretary considers appropriate to ensure that individuals and organizations providing homeownership or rental housing counseling are aware of the certification requirements and standards of this subsection and of the training and certification programs under subsection (f).'.SEC. 136. STUDY OF DEFAULTS AND FORECLOSURES.The Secretary of Housing and Urban Development shall conduct an extensive study of the root causes of default and foreclosure of home loans, using as much empirical data as are available. The study shall also examine the role of escrow accounts in helping prime and nonprime borrowers to avoidbackup licensing system.CommentsClose CommentsPermalink





Sec. 1515. State examination authority.CommentsClose CommentsPermalink





Sec. 1516. Reports and recommendations to Congress.CommentsClose CommentsPermalink





Sec. 1517. Study and reports on defaults and foreclosures.CommentsClose CommentsPermalink

TITLE II--FHA REFORM AND MANUFACTURED HOUSING LOAN INSURANCE MODERNIZATIONSubtitle AVI--MISCELLANEOUS

TITLE I--FHA ReformSEC. 201. SHORT TITLE.This subtitle may be cited as the `ExpanMODERNIZATION ACT OF 2008

Subtitle A--Building American Homeownership

Act of 2008'.SEC. 202. 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 subtitle 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. 203. MAXIMUM PRINCIPAL LOAN OBLIGATION.(a) In General- 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 determined 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 determined under such section for a 1-family residence; or`(ii) 175 percent of the dollar amount limitation determined under such section 305(a)(2)(A) 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 and without regard to the high-cost area limitation under such section 305(a)(2)(B));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 determined under such section 305(a)(2) for a residence of the applicable size; 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'.

(b) Treatment of Temporary Loan Limit Increase- Subsection (a) and the amendment made by such subsection may not be construed to in any way affect the effectiveness of section 202 of the Economic Stimulus Act of 2008 (Public Law 110-185; 122 Stat. 620).SEC. 204. 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. 205. 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) 97.75 percent of the appraised value of the property.';

(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)--(A) 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, 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'; and

(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 Sec. 2111. Short title. CommentsClose CommentsPermalink




Sec. 2112. Maximum principal loan obligation.CommentsClose CommentsPermalink





Sec. 2113. Cash investment requirement and prohibition of seller-funded down payment assistance.CommentsClose CommentsPermalink





Sec. 2114. Mortgage insurance premiums.CommentsClose CommentsPermalink





Sec. 2115. Rehabilitation loans.CommentsClose CommentsPermalink





Sec. 2116. Discretionary action.CommentsClose CommentsPermalink





Sec. 2117. Insurance of condominiums.CommentsClose CommentsPermalink





Sec. 2118. Mutual Mortgage Insurance Fund by maintaining a minimum net worth of $4,000,000 of acceptable assets.'.SEC. 206. MORTGAGE INSURANCE PREMIUMS FOR QUALIFIED HOMEOWNERSHIP ASSISTANCE ENTITIES 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) in subparagraph (A), in the matter preceding subparagraph (A), by striking the first comma after `section 234(c)';(2) in subparagraph (A), by inserting after the period at the end of the second sentence the following: `In the case of a mortgage for which any amounts gifted by a qualified homeownership assistance entity (as such term is defined in paragraph (9) of subsection (b)) that is a private nonprofit organization are treated as cash or its equivalent for purposes of meeting the 3 percent requirement under such paragraph, the premium payment under this subparagraph shall not exceed 3.0 percent of the amount of the original insured principal obligation of the mortgage.'; and(3) 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. 207. 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 subtitle, 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 a mortgage described in the third sentence of subparagraph (A) of paragraph (2) (relating to mortgages for which amounts are gifted by a nonprofit qualified homeownership assistance entity), for which the loan application is received by the mortgagee on or after the date of the enactment of the Expanding American Homeownership Act of 2008:`(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 .CommentsClose CommentsPermalink




Sec. 2119. Hawaiian home lands and Indian reservations.CommentsClose CommentsPermalink





Sec. 2120. Conforming and technical amendments.CommentsClose CommentsPermalink





Sec. 2121. Insurance of mortgages.CommentsClose CommentsPermalink





Sec. 2122. Home equity conversion mortgages.CommentsClose CommentsPermalink





Sec. 2123. Energy efficient mortgages program.CommentsClose CommentsPermalink





Sec. 2124. Pilot program for automated process for borrowers without sufficient credit history.CommentsClose CommentsPermalink





Sec. 2125. Homeownership preservation.CommentsClose CommentsPermalink





Sec. 2126. Use of FHA savings for improvements in FHA technologies, procedures, processes, program performance, staffing, and salaries.CommentsClose CommentsPermalink





Sec. 2127. Post-purchase housing counseling eligibility improvements.CommentsClose CommentsPermalink





Sec. 2128. Pre-purchase homeownership counseling demonstration.CommentsClose CommentsPermalink





Sec. 2129. Fraud prevention.CommentsClose CommentsPermalink





Sec. 2130. Limitation on mortgage insurance 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. 208. PAYMENT INCENTIVES FOR HIGHER-RISK BORROWERS.Section 203(c) of the National Housing Act (12 U.S.C. 1709(c)), as amended by the preceding provisions of this subtitle, 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):`(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 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) 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. 209. PROTECTIONS FOR HIGHER-RISK BORROWERS.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) PROTECTIONS FOR HIGHER-RISK BORROWERS- Except as otherwise specifically provided in this paragraph, in the case of any mortgage referred to in paragraph (2)(C) 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, a list of counseling agencies, approved by the Secretary, in the area of the applicant.`(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) of subsection (c).`(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) REQUIREMENT- The Secretary shall 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 closing 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) 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. 210. 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 TO BORROWERS IN DEFAULT OR AT RISK OF DEFAULT- In facilitating insurance for such mortgages, the Secretary may insure 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. 211. 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 program for mortgage insurance under paragraph (2)(C) 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. 212. 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 subtitle, 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. 213. 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'.SEC. 214. 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. 215. 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 subtitle, 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. 216. 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 toincreases.CommentsClose CommentsPermalink




Sec. 2131. Savings provision.CommentsClose CommentsPermalink





Sec. 2132. Implementation.CommentsClose CommentsPermalink





Sec. 2133. Moratorium on implementation of risk-based premiums.CommentsClose CommentsPermalink

Sec. 2141. Short title.CommentsClose CommentsPermalink





Sec. 2142. Purposes.CommentsClose CommentsPermalink





Sec. 2143. Exception to limitation on financial institution portfolio.CommentsClose CommentsPermalink





Sec. 2144. Insurance benefits.CommentsClose CommentsPermalink





Sec. 2145. Maximum loan limits.CommentsClose CommentsPermalink





Sec. 2146. Insurance premiums.CommentsClose CommentsPermalink





Sec. 2147. Technical corrections.CommentsClose CommentsPermalink





Sec. 2148. Revision of 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 2008, 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. 217. 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. 218. 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. 219. 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 (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.'.

(3) in the second sentence of subsection (g), by striking `the maximum dollar amount established under section 203(b)(2)' and all that follows through `located' and inserting `132 percent of the dollar amount limitation determined under section 305(a)(2)(A) of the Federal Home Loan Mortgage Corporation Act for a 1-family residence (without regard to any authority to increase such limitations with respect to properties located in Alaska, Guam, Hawaii, or the Virgin Islands and without regard to the high-cost area limitation under such section 305(a)(2)(B))';(4) in subsection (i)(1)(C), by striking `limitations' and inserting `limitation'; and(5) by adding at the end the following new subsection:

`(o) Authority to Insure Home Purchase Mortgages-`(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 limitation under subsection (g) of this section on the maximum amount of the benefits of insurance under this section.'.

(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) Prohibition on Required Purchase of an Annuity- Section 255 of the National Housing Act of 1937 (12 U.S.C. 1715z-20) is amended--(1) by striking subparagraph (B) of subsection (d)(2) and inserting the following new subparagraph:

`(B) has received adequate counseling by a third party (other than a reverse mortgage lender, servicer or investor, or an entity engaged in the sale of annuities, investments, long-term care insurance, or any other type of financial or insurance product) as provided in subsection (f);';

(2) by striking the first sentence of subsection (f) and inserting the following new sentence: `The Secretary shall provide or cause to be provided and paid for by entities other than a reverse mortgage lender, servicer or investor, or an entity engaged in the sale of annuities, investments, long-term care insurance, or any other type of financial or insurance product the information required in subsection (d)(2)(B).'; and(3) by striking subsections (l) and (m) and inserting the following new subsection:

`(l) Regulations to Protect Elderly Homeowners-`(1) IN GENERAL- Not later than 6 months after the date of the enactment of the Expanding American Homeownership Act of 2008, the Secretary shall, in consultation with other relevant Federal departments and agencies, prescribe regulations to help protect elderly homeowners from the marketing of financial and insurance products not in the interest of such homeowners, including the marketing or sale of an annuity as a condition of obtaining any home equity conversion mortgage.`(2) CONSULTATION- In developing the regulations required under paragraph (1), the Secretary shall consult with consumer advocates (including recognized experts in consumer protection), industry representatives, representatives of counseling organizations, and other interested parties.'.

(d) 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) be equal to 2.0 percent of the maximum claim amount of the mortgage up to a maximum claim amount of $200,000 plus 1 percent of any portion of the maximum claim amount that is greater than $200,000, unless adjusted thereafter 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;`(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 219(a)(3) of the Expanding American Homeownership Act of 2008; and`(6) be subject to a maximum origination fee of $6,000, except that such maximum limit shall be adjusted in accordance with the annual percentage increase in the Consumer Price Index of the Bureau of Labor Statistics of the Department of Labor in increments of $500 only when the percentage increase in such index, when applied to the maximum origination fee, produce dollar increases that exceed $500.'.

(e) 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.(f) Purchase Authority of Fannie Mae and Freddie Mac-(1) FANNIE MAE- Section 302(b) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1717(b)) is amended by adding at the end the following:

`(7) The corporation is authorized to purchase, service, sell, lend on the security of, and otherwise deal in any mortgage insured under section 255 of the National Housing Act (12 U.S.C. 1715z-20), notwithstanding the limitations under paragraph (2) on the maximum original principal obligations of mortgages.'.

(2) FREDDIE MAC- Section 305(a) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)) is amended by adding at the end the following:

`(6) The Corporation is authorized to purchase, service, sell, lend on the security of, and otherwise deal in any mortgage insured under section 255 of the National Housing Act (12 U.S.C. 1715z-20), notwithstanding the limitations under paragraph (2) on the maximum original principal obligations of mortgages.'.

SEC. 220. STUDY ON PARTICIPATION OF criteria.CommentsClose CommentsPermalink




Sec. 2149. Prohibition against kickbacks and unearned fees.CommentsClose CommentsPermalink





Sec. 2150. Leasehold requirements.CommentsClose CommentsPermalink

TITLE II--MORTGAGE BROKERS AND CORRESPONDENT LENDERS.(a) Study- The Comptroller General of the United States shall conduct a study, which shall be completed not later than the expiration of the 12-month period beginning on the date of the enactment of this Act, which shall analyze and determine--(1) the extent to which the financial audit and net worth requirements impede participation by mortgage brokers and correspondent lenders in the mortgage insurance programs under the National Housing Act, as measured by the number and value of such insured mortgages, disaggregated by the States in which the properties subject to such mortgages are located;(2) the extent and effectiveness of the financial audit and net worth requirements in protecting the Mutual Mortgage Insurance Fund;(3) the extent and effectiveness of the supervision and quality control enforcement, by the Secretary, of mortgagees in the FHA program, separate from the financial audit and net worth requirements for participation, in protecting the Mutual Mortgage Insurance Fund;(4) the extent to which allowing a mortgage broker to secure a surety bond in lieu of the financial audit and net worth requirements would increase participation by mortgage brokers and correspondent lenders in the mortgage insurance programs under the National Housing Act;(5) the extent to which allowing a mortgage broker to secure a surety bond in lieu of the financial audit and net worth requirements would protect the Mutual Mortgage Insurance Fund; and(6) the potential impact of such changes on the costs incurred by the Secretary of Housing and Urban Development in administering the mortgage insurance programs under such Act.(b) GAO Report- Not later than the expiration of the 12-month 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 subsection (a).(c) HUD Report- Not later than the expiration of the 18-month period beginning upon the date of the enactment of this Act, the Secretary of Housing and Urban Development may submit a report to the Congress making recommendations regarding any changes in requirements for participation of mortgage brokers and correspondent lenders in the mortgage insurance programs under the National Housing Act arising from a review of the study conducted pursuant to subsection (a).SEC. 221. 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. 222. 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 purposeFORECLOSURE PROTECTIONS FOR SERVICEMEMBERS

Sec. 2201. Temporary increase in maximum loan guaranty amount for certain housing loans guaranteed by the Secretary 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)Veterans Affairs.CommentsClose CommentsPermalink





Sec. 2202. Counseling on mortgage foreclosures for members 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 ofArmed Forces returning from service abroad.CommentsClose CommentsPermalink





Sec. 2203. Enhancement of protections for servicemembers relating to mortgages and mortgage foreclosures.CommentsClose CommentsPermalink

Sec. 2301. Emergency assistance for 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. 223. 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) A valid social security number verified in accordance with paragraph 3-1 C of chapter 3 of HUD Handbook 4155.1 REV-5.`(2) 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 ofPublic Law 109-13; 49 U.S.C. 30301 note).`(3) A passport issued by the United States or a foreign government.`(4) 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 6 months after the date of the enactment of this Act.

SEC. 224. 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 subtitle, 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 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 2008, 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 4-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), the Comptroller General of the United States shall submit to the Congress a report identifying the number of additional mortgagors served using 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. 225. 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. 226. 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. 227. VALUATION OF MULTIFAMILY PROPERTIES IN 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. VALUATION OF MULTIFAMILY PROPERTIES IN NONCOMPETITIVE SALES BY HUD TO STATES AND LOCALITIES.`Notwithstanding any other provision of law, in determining the market value of any multifamily real property or multifamily loan for any noncompetitive sale to a State or local government entity occurring during fiscal year 2008, the Secretary shall consider, but not be limited to, industry standard appraisal practices, including the cost of repairs needed to bring the property at least to minimum State and local code standards and of maintaining the existing affordability restrictions imposed by the Secretary on the multifamily real property or multifamily loan.'.'.

SEC. 228. LIMITATION ON redevelopment of abandoned and foreclosed homes.CommentsClose CommentsPermalink




Sec. 2302. Nationwide distribution of resources.CommentsClose CommentsPermalink





Sec. 2303. Limitation on use of funds with respect to eminent domain.CommentsClose CommentsPermalink





Sec. 2304. Limitation on distribution of funds.CommentsClose CommentsPermalink





Sec. 2305. Counseling intermediaries.CommentsClose CommentsPermalink

TITLE V--MORTGAGE INSURANCE PREMIUM INCREASES.Notwithstanding any other provision of law, including any provision of this subtitle and any amendment made by this subtitle--(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 programDISCLOSURE IMPROVEMENT ACT

Sec. 2601. Home improvements and structural alterations for totally disabled members of the Armed Forces before discharge or release from the Armed Forces.CommentsClose CommentsPermalink





Sec. 2602. Eligibility for specially adapted housing benefits and assistance for members of the Armed Forces with service-connected disabilities and individuals residing outside the United States.CommentsClose CommentsPermalink





Sec. 2603. Specially adapted housing assistance for individuals with severe burn injuries.CommentsClose CommentsPermalink





Sec. 2604. Extension of assistance for individuals residing temporarily in housing owned by a family member.CommentsClose CommentsPermalink





Sec. 2605. Increase in specially adapted housing benefits for disabled veterans.CommentsClose CommentsPermalink





Sec. 2606. Report on specially adapted housing for disabled individuals.CommentsClose CommentsPermalink





Sec. 2607. Report on specially adapted housing assistance for individuals who reside in housing owned by a family member 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 undersection 553 of title 5, United States Code (notwithstanding subsections (a)(2), (b)(B), and (d)(3) of such section).SEC. 229. CIVIL MONEY PENALTIES 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. 230. 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.SEC. 231. 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. 232. IMPLEMENTATION.Except as provided in section 223(b), the Secretarypermanent basis.CommentsClose CommentsPermalink




Sec. 2608. Definition of annual income for purposes of section 8 and other public housing programs.CommentsClose CommentsPermalink





Sec. 2609. Payment of transportation of baggage and household effects for members of the Armed Forces who relocate due to foreclosure of leased housing.CommentsClose CommentsPermalink

Sec. 2831. Short title.CommentsClose CommentsPermalink





Sec. 2832. Approvals by Department of Housing and Urban Development shall by notice establish any additional requirements that may be necessary to immediately carry out the provisions of this subtitle. The notice shall take effect upon issuance.CommentsClose CommentsPermalink





Sec. 2833. Project approvals by rural housing service.CommentsClose CommentsPermalink





Sec. 2834. Use of FHA loans with housing tax credits.CommentsClose CommentsPermalink





Sec. 2835. Other HUD programs.CommentsClose CommentsPermalink

Sec. 3009. Hold harmless for reductions in area median gross income.CommentsClose CommentsPermalink





Sec. 3010. Exception to annual current income determination requirement where determination not relevant.CommentsClose CommentsPermalink

Subtitle B--FHA Manufactured Housing Loan Insurance ModernizationSECTION 251. SHORT TITLE.This subtitle may be cited as the `FHA Manufactured Housing Loan Modernization Act of 2008'.SEC. 252. FINDINGS AND PURPOSES.(a) Findings- The Congress finds that--(1) manufactured housing plays a vital role in providing housing for low- and moderate-income families in the United States;(2) the FHA title I insurance program for manufactured home loans traditionally has been a major provider of mortgage insurance for home-only transactions;(3) the manufactured housing market is in the midst of a prolonged downturn which has resulted in a severe contraction of traditional sources of private lending for manufactured home purchases;(4) during past downturns the FHA title I insurance program for manufactured homes has filled the lending void by providing stability until the private markets could recover;(5) in 1992, during the manufactured housing industry's last major recession, over 30,000 manufactured home loans were insured under title I;(6) in 2006, fewer than 1,500 manufactured housing loans were insured under title I;(7) the loan limits for title I manufactured housing loans have not been adjusted for inflation since 1992; and(8) these problems with the title I program have resulted in an atrophied market for manufactured housing loans, leaving American families who have the most difficulty achieving homeownership without adequate financing options for home-only manufactured home purchases.(b) Purposes- The purposes of this subtitle are--(1) to provide adequate funding for FHA-insured manufactured housing loans for low- and moderate-income homebuyers during all economic cycles in the manufactured housing industry;(2) to modernize the FHA title I insurance program for manufactured housing loans to enhance participation by Ginnie Mae and the private lending markets; and(3) to adjust the low loan limits for title I manufactured home loan insurance to reflect the increase in costs since such limits were last increased in 1992 and to index the limits to inflation.SEC. 253. EXCEPTION TO LIMITATION ON FINANCIAL INSTITUTION PORTFOLIO.The second sentence of section 2(a) of the National Housing Act (12 U.S.C. 1703(a)) is amended--(1) by striking `In no case' and inserting `Other than in connection with a manufactured home or a lot on which to place such a home (or both), in no case'; and(2) by striking `:Provided, That with' and inserting `. With'.SEC. 254. INSURANCE BENEFITS.(a) In General- Subsection (b) of section 2 of the National Housing Act (12 U.S.C. 1703(b)), is amended by adding at the end the following new paragraph:

`(8) INSURANCE BENEFITS FOR MANUFACTURED HOUSING LOANS- Any contract of insurance with respect to loans, advances of credit, or purchases in connection with a manufactured home or a lot on which to place a manufactured home (or both) for a financial institution that is executed under this title after the date of the enactment of the by the Secretary shall be conclusive evidence of the eligibility of such financial institution for insurance, and the validity of any contract of insurance so executed shall be incontestable in the hands of the bearer from the date of the execution of such contract, except for fraud or misrepresentation on the part of such institution.'.

(b) Applicability- The amendment made by subsection (a) shall only apply to loans that are registered or endorsed for insurance after the date of the enactment of this Act.SEC. 255. MAXIMUM LOAN LIMITS.(a) Dollar Amounts- Paragraph (1) of section 2(b) of the National Housing Act (12 U.S.C. 1703(b)(1)) is amended--(1) in clause (ii) of subparagraph (A), by striking `$17,500' and inserting `$25,090';(2) in subparagraph (C) by striking `$48,600' and inserting `$69,678';(3) in subparagraph (D) by striking `$64,800' and inserting `$92,904';(4) in subparagraph (E) by striking `$16,200' and inserting `$23,226'; and(5) by realigning subparagraphs (C), (D), and (E) 2 ems to the left so that the left margins of such subparagraphs are aligned with the margins of subparagraphs (A) and (B).(b) Annual Indexing- Subsection (b) of section 2 of the National Housing Act (12 U.S.C. 1703(b)), as amended by the preceding provisions of this subtitle, is further amended by adding at the end the following new paragraph:

`(9) ANNUAL INDEXING OF MANUFACTURED HOUSING LOANS- The Secretary shall develop a method of indexing in order to annually adjust the loan limits established in subparagraphs (A)(ii), (C), (D), and (E) of this subsection. Such index shall be based on the manufactured housing price data collected by the United States Census Bureau. The Secretary shall establish such index no later than one year after the date of the enactment of the FHA Manufactured Housing Loan Modernization Act of 2008.'.

(c) Technical and Conforming Changes- Paragraph (1) of section 2(b) of the National Housing Act (12 U.S.C. 1703(b)(1)) is amended--(1) by striking `No' and inserting `Except as provided in the last sentence of this paragraph, no'; and(2) by adding after and below subparagraph (G) the following:

`The Secretary shall, by regulation, annually increase the dollar amount limitations in subparagraphs (A)(ii), (C), (D), and (E) (as such limitations may have been previously adjusted under this sentence) in accordance with the index established pursuant to paragraph (9).'.

SEC. 256. INSURANCE PREMIUMS.Subsection (f) of section 2 of the National Housing Act (12 U.S.C. 1703(f)) is amended--(1) by inserting `(1) Premium Charges- ' after `(f)'; and(2) by adding at the end the following new paragraph:

`(2) Manufactured Home Loans- Notwithstanding paragraph (1), in the case of a loan, advance of credit, or purchase in connection with a manufactured home or a lot on which to place such a home (or both), the premium charge for the insurance granted under this section shall be paid by the borrower under the loan or advance of credit, as follows:`(A) At the time of the making of the loan, advance of credit, or purchase, a single premium payment in an amount not to exceed 2.25 percent of the amount of the original insured principal obligation.`(B) In addition to the premium under subparagraph (A), annual premium payments during the term of the loan, advance, or obligation purchased in an amount not exceeding 1.0 percent of the remaining insured principal balance (excluding the portion of the remaining balance attributable to the premium collected under subparagraph (A) and without taking into account delinquent payments or prepayments).`(C) Premium charges under this paragraph shall be established in amounts that are sufficient, but do not exceed the minimum amounts necessary, to maintain a negative credit subsidy for the program under this section for insurance of loans, advances of credit, or purchases in connection with a manufactured home or a lot on which to place such a home (or both), as determined based upon risk to the Federal Government under existing underwriting requirements.`(D) The Secretary may increase the limitations on premium payments to percentages above those set forth in subparagraphs (A) and (B), but only if necessary, and not in excess of the minimum increase necessary, to maintain a negative credit subsidy as described in subparagraph (C).'.

SEC. 257. TECHNICAL CORRECTIONS.(a) Dates- Subsection (a) of section 2 of the National Housing Act (12 U.S.C. 1703(a)) is amended--(1) by striking `on and after July 1, 1939,' each place such term appears; and(2) by striking `made after the effective date of the Housing Act of 1954'.(b) Authority of Secretary- Subsection (c) of section 2 of the National Housing Act (12 U.S.C. 1703(c)) is amended to read as follows:

`(c) Handling and Disposal of Property-`(1) AUTHORITY OF SECRETARY- Notwithstanding any other provision of law, the Secretary may--`(A) deal with, complete, rent, renovate, modernize, insure, or assign or sell at public or private sale, or otherwise dispose of, for cash or credit in the Secretary's discretion, and upon such terms and conditions and for such consideration as the Secretary shall determine to be reasonable, any real or personal property conveyed to or otherwise acquired by the Secretary, in connection with the payment of insurance heretofore or hereafter granted under this title, including any evidence of debt, contract, claim, personal property, or security assigned to or held by him in connection with the payment of insurance heretofore or hereafter granted under this section; and`(B) pursue to final collection, by way of compromise or otherwise, all claims assigned to or held by the Secretary and all legal or equitable rights accruing to the Secretary in connection with the payment of such insurance, including unpaid insurance premiums owed in connection with insurance made available by this title.`(2) ADVERTISEMENTS FOR PROPOSALS- Section 3709 of the Revised Statutes shall not be construed to apply to any contract of hazard insurance or to any purchase or contract for services or supplies on account of such property if the amount thereof does not exceed $25,000.`(3) DELEGATION OF AUTHORITY- The power to convey and to execute in the name of the Secretary, deeds of conveyance, deeds of release, assignments and satisfactions of mortgages, and any other written instrument relating to real or personal property or any interest therein heretofore or hereafter acquired by the Secretary pursuant to the provisions of this title may be exercised by an officer appointed by the Secretary without the execution of any express delegation of power or power of attorney. Nothing in this subsection shall be construed to prevent the Secretary from delegating such power by order or by power of attorney, in the Secretary's discretion, to any officer or agent the Secretary may appoint.'.

SEC. 258. REVISION OF UNDERWRITING CRITERIA.(a) In General- Subsection (b) of section 2 of the National Housing Act (12 U.S.C. 1703(b)), as amended by the preceding provisions of this subtitle, is further amended by adding at the end the following new paragraph:`(10) FINANCIAL SOUNDNESS OF MANUFACTURED HOUSING PROGRAM- The Secretary shall establish such underwriting criteria for loans and advances of credit in connection with a manufactured home or a lot on which to place a manufactured home (or both), including such loans and advances represented by obligations purchased by financial institutions, as may be necessary to ensure that the program under this title for insurance for financial institutions against losses from such loans, advances ofSingle Family Housing

Sec. 3021. Temporary liberalization of tax-exempt housing bond rules.CommentsClose CommentsPermalink





Sec. 3022. Repeal of alternative minimum tax limitations on tax-exempt housing bonds, low-income housing tax credit, and purchases is financially sound.'.(b) Timing- Not later than the expirationrehabilitation credit.CommentsClose CommentsPermalink





Sec. 3023. Bonds guaranteed by Federal home loan banks eligible for treatment as tax-exempt bonds.CommentsClose CommentsPermalink





Sec. 3024. Modification of rules pertaining to FIRPTA nonforeign affidavits.CommentsClose CommentsPermalink





Sec. 3025. Modification of definition of tax-exempt use property for purposes of the 6-month period beginning on the date of the enactment of this Act, the Secretary of Housing and Urban Development shall revise the existing underwriting criteria for the program referred to in paragraph (10) of section 2(b) of the National Housing Act (as added by subsection (a) of this section) in accordance with the requirements of such paragraph.SEC. 259. REQUIREMENT OF SOCIAL SECURITY ACCOUNT NUMBER FOR ASSISTANCE.Section 2 of the National Housing Act (12 U.S.C. 1703) is amended by adding at the end the following new subsection:

`(j) Requirement of Social Security Account Number for Financing- No insurance shall be granted under this section with respect to any obligation representing any loan, advance of credit, or purchase by a financial institution unless the borrower to which the loan or advance of credit was made has a valid social security number.'.

SEC. 260. GAO STUDY OF MITIGATION OF TORNADO RISKS TO MANUFACTURED HOMES.The Comptroller General of the United States shall assess how the Secretary of Housing and Urban Development utilizes the FHA manufactured housing loan insurance program under title I of the National Housing Act, the community development block grant program under title I of the Housing and Community Development Act of 1974, and other programs and resources available to the Secretary to mitigate the risks to manufactured housing residents and communities resulting from tornados. The Comptroller General shall submit to the Congress a report on the conclusions and recommendations of the assessment conducted pursuant to this section not later than the expiration of the 12-month period beginning on the date of the enactment of this Actrehabilitation credit.CommentsClose CommentsPermalink




Sec. 3026. Extension of special rule for mortgage revenue bonds for residences located in disaster areas.CommentsClose CommentsPermalink





Sec. 3027. Transfer of funds appropriated to carry out 2008 recovery rebates for individuals.CommentsClose CommentsPermalink

Sec. 3071. Effective dates.CommentsClose CommentsPermalink

TITLE III--REFORM OF GOVERNMENT-SPONSORED ENTITIES FOR HOUSING FINANCESEC. 3VENUE PROVISIONS

SEC. 1001. SHORT TITLE.

This title may be cited as the `Federal Housing Finance Reform Act of 2008'division may be cited as the ‘Federal Housing Finance Regulatory Reform Act of 2008’.CommentsClose CommentsPermalink

SEC. 31002. DEFINITIONS.

Section 1303 of the Housing and Community Development Act of 1992 (a) Federal Safety and Soundness Act Definitions- Section 1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4502) is amended--CommentsClose CommentsPermalink





(1) in paragraph (7), by striking `an enterprise' and inserting `a regulated entity';(2) by striking `the enterprise' each place such term appears (except in paragraphs (4) and (18)) and inserting `the regulated entity';(3) in paragraph (5), by striking `Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' and inserting `Federal Housing Finance Agency';(4) in each of paragraphs each of paragraphs (8), (9), (10), and (19), by striking `Secretary'‘Secretary’ each place that term appears and inserting `Director';(5) in paragraph (13), by inserting `, with respect to an enterprise,' after `means';(6‘Director’;CommentsClose CommentsPermalink





(2) by redesignating paragraphs (16) through (19) as paragraphs (20) through (23), respectively;(71) through (24), respectively;CommentsClose CommentsPermalink





(3) by striking paragraphs (14) and (15) and inserting the following new paragraphs:`(183) through (15) and inserting the following:CommentsClose CommentsPermalink





‘(19) OFFICE OF FINANCE- The term ‘Office of Finance’ means the Office of Finance of the Federal Home Loan Bank System (or any successor thereto).CommentsClose CommentsPermalink





‘(20) REGULATED ENTITY- The term `regulated entity' means--`(A) the Federal National ‘regulated entity’ means--CommentsClose CommentsPermalink





‘(A) the Federal National Mortgage Association and any affiliate thereof;CommentsClose CommentsPermalink





`‘(B) the Federal Home Loan Mortgage Corporation and any affiliate thereof; andCommentsClose CommentsPermalink





`(C) each Federal home loan bank.`(19) REGULATED ‘(C) any Federal Home Loan Bank.’; CommentsClose CommentsPermalink





(4) by redesignating paragraphs (11) and (12) as paragraphs (17) and (18), respectively;CommentsClose CommentsPermalink





(5) by redesignating paragraph (7) as paragraph (12);CommentsClose CommentsPermalink





(6) by redesignating paragraphs (8) through (10) as paragraphs (14) through (16), respectively;CommentsClose CommentsPermalink





(7) in paragraph (5)--CommentsClose CommentsPermalink





(A) by striking ‘(5)’ and inserting ‘(9)’; andCommentsClose CommentsPermalink





(B) by striking ‘Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development’ and inserting ‘Federal Housing Finance Agency’;CommentsClose CommentsPermalink





(8) by redesignating paragraph (6) as paragraph (10);CommentsClose CommentsPermalink





(9) by redesignating paragraphs (2) through (4) as paragraphs (5) through (7), respectively;CommentsClose CommentsPermalink





(10) by inserting after paragraph (7), as redesignated, the following:CommentsClose CommentsPermalink





‘(8) DEFAULT; IN DANGER OF DEFAULT-CommentsClose CommentsPermalink





‘(A) DEFAULT- The term ‘default’ means, with respect to a regulated entity, any adjudication or other official determination by any court of competent jurisdiction, or the Agency, pursuant to which a conservator, receiver, limited-life regulated entity, or legal custodian is appointed for a regulated entity.CommentsClose CommentsPermalink





‘(B) IN DANGER OF DEFAULT- The term ‘in danger of default’ means a regulated entity with respect to which, in the opinion of the Agency--CommentsClose CommentsPermalink





‘(i) the regulated entity is not likely to be able to pay the obligations of the regulated entity in the normal course of business; orCommentsClose CommentsPermalink





‘(ii) the regulated entity--CommentsClose CommentsPermalink





‘(I) has incurred or is likely to incur losses that will deplete all or substantially all of its capital; andCommentsClose CommentsPermalink





‘(II) there is no reasonable prospect that the capital of the regulated entity will be replenished.’;CommentsClose CommentsPermalink





(11) by inserting after paragraph (1) the following:CommentsClose CommentsPermalink





‘(2) AGENCY- The term ‘Agency’ means the Federal Housing Finance Agency established under section 1311.CommentsClose CommentsPermalink





‘(3) AUTHORIZING STATUTES- The term ‘authorizing statutes’ means--CommentsClose CommentsPermalink





‘(A) the Federal National Mortgage Association Charter Act;CommentsClose CommentsPermalink





‘(B) the Federal Home Loan Mortgage Corporation Act; andCommentsClose CommentsPermalink





‘(C) the Federal Home Loan Bank Act.CommentsClose CommentsPermalink





‘(4) BOARD- The term ‘Board’ means the Federal Housing Finance Oversight Board established under section 1313A.’;CommentsClose CommentsPermalink





(12) by inserting after paragraph (10), as redesignated by this section, the following:CommentsClose CommentsPermalink





‘(11) ENTITY-AFFILIATED PARTY- The term `regulated entity-affiliated party' means--`‘entity-affiliated party’ means--CommentsClose CommentsPermalink





‘(A) any director, officer, employee, or agent for, a regulated entity, or controlling shareholder of an enterprise;`tockholder of, or agent for, a regulated entity;CommentsClose CommentsPermalink





‘(B) any shareholder, affiliate, consultant, or joint venture partner of a regulated entity, and any other person, as determined by the Director (by regulation or on a case-by-case basis) that participates in the conduct of the affairs of a regulated entity, except that a shareholder of a regulated entity shall not be considerprovided that a member of a Federal Home Loan Bank shall not be deemed to have participated in the affairs of that regulated entityBank solely by reasonvirtue of being a member or customer of the regulated entity;`shareholder of, and obtaining advances from, that Bank;CommentsClose CommentsPermalink





‘(C) any independent contractor for a regulated entity (including any attorney, appraiser, or accountant), if--CommentsClose CommentsPermalink





`‘(i) the independent contractor knowingly or recklessly participates in--CommentsClose CommentsPermalink





`(I) any violation of any law or regulation;` ‘(I) any violation of any law or regulation; CommentsClose CommentsPermalink





‘(II) any breach of fiduciary duty; orCommentsClose CommentsPermalink





`‘(III) any unsafe or unsound practice; andCommentsClose CommentsPermalink





`‘(ii) such violation, breach, or practice caused, or is likely to cause, more than a minimal financial loss to, or a significant adverse effect on, the regulated entity;CommentsClose CommentsPermalink





and`‘(D) any not-for-profit corporation that receives its principal funding, on an ongoing basis, from any regulated entity.'.(8) by redesignating paragraphs (8) through (13) as paragraphs (12) through (17), respectively; and(9) by inserting after paragraph (7) the following new paragraph:

`(11) FEDERAL HOME LOAN BANK- The term `Federal home loan bank' means a bank established under the authority of the Federal Home Loan Bank Act.';

(10) by redesignating paragraphs (2) through (7) as paragraphs (5) through (10), respectively; and(11) by inserting after paragraph (1) the following new paragraphs:

`(2) AGENCY- The term `Agency' means the Federal Housing Finance Agency.`(3) AUTHORIZING STATUTES- The term `authorizing statutes' means--`(A) the Federal National Mortgage Association Charter Act;`(B) the Federal Home Loan Mortgage Corporation Act; and`(C) the Federal Home Loan Bank Act.`(4) BOARD- The term `Board' means the Federal Housing Enterprise Board established under section 1313B.'.

Subtitle A--Reform of Regulation of Enterprises and Federal Home Loan BanksCHAPTER 1--IMPROVEMENT OF SAFETY AND SOUNDNESSSEC. 31; andCommentsClose CommentsPermalink




‘(E) the Office of Finance.’;CommentsClose CommentsPermalink





(13) by inserting after paragraph (12), as redesignated by this section, the following:CommentsClose CommentsPermalink





‘(13) LIMITED-LIFE REGULATED ENTITY- The term ‘limited-life regulated entity’ means an entity established by the Agency under section 1367(i) with respect to a Federal Home Loan Bank in default or in danger of default or with respect to an enterprise in default or in danger of default.’; andCommentsClose CommentsPermalink





(14) by adding at the end the following:CommentsClose CommentsPermalink





‘(25) VIOLATION- The term ‘violation’ includes any action (alone or in combination with another or others) for or toward causing, bringing about, participating in, counseling, or aiding or abetting a violation.’.CommentsClose CommentsPermalink





(b) References in This Act- As used in this Act, unless otherwise specified--CommentsClose CommentsPermalink





(1) the term ‘Agency’ means the Federal Housing Finance Agency;CommentsClose CommentsPermalink





(2) the term ‘Director’ means the Director of the Agency; andCommentsClose CommentsPermalink





(3) the terms ‘enterprise’, ‘regulated entity’, and ‘authorizing statutes’ have the same meanings as in section 1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by this Act.CommentsClose CommentsPermalink

SEC. 1101. ESTABLISHMENT OF THE FEDERAL HOUSING FINANCE AGENCY.

(a) In General- The Housing and Community DevelopmentThe Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 et seq.) is amended by striking sections 1311 and 1312 and inserting the following:CommentsClose CommentsPermalink

`‘SEC. 1311. ESTABLISHMENT OF THE FEDERAL HOUSING FINANCE AGENCY.

`‘(a) Establishment- There is established the Federal Housing Finance Agency, which shall be an independent agency of the Federal Government.CommentsClose CommentsPermalink





`‘(b) General Supervisory and Regulatory Authority-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- Each regulated entity shall, to the extent provided in this title, be subject to the supervision and regulation of the Agency.CommentsClose CommentsPermalink





`‘(2) AUTHORITY OVER FANNIE MAE, FREDDIE MAC, AND FEDERAL HOME LOAN BANKS- The Director of the Federal Housing Finance AgencyTHE FEDERAL HOME LOAN BANKS, AND THE OFFICE OF FINANCE- The Director shall have general supervisory and regulatory authority over each regulated entity and the Office of Finance, and shall exercise such general regulatory and supervisory authority, including such duties and authorities set forth under section 1313 of this Act, to ensure that the purposes of this Act, the , to ensure that the purposes of this Act, the authorizing statutes, and any other applicable law are carried out.CommentsClose CommentsPermalink





The Director shall have the same supervisory and regulatory authority over any joint office of the Federal home loan banks, including the Office of Finance of the Federal Home Loan Banks, as the Director has over the individual Federal home loan banks.`‘(c) Savings Provision- The authority of the Director to take actions under subtitles B and C shall not in any way limit the general supervisory and regulatory authority granted to the Director.` under subsection (b).CommentsClose CommentsPermalink

‘SEC. 1312. DIRECTOR.

`‘(a) Establishment of Position- There is established the position of the Director of the Federal Housing Finance Agency, who shall be the head of the Agency.`Agency, who shall be the head of the Agency.CommentsClose CommentsPermalink





‘(b) Appointment; Term-CommentsClose CommentsPermalink





`‘(1) APPOINTMENT- The Director shall be appointed by the President, by and with the advice and consent of the Senate, from among individuals who are citizens of the United States, have a demonstrated understanding of financial management or oversight, and have a demonstrated understanding of capital markets, including the mortgage securities markets and housing finance.CommentsClose CommentsPermalink





`(2) TERM AND REMOVAL- The Director shall be appointed for a term of 5 years and may be removed by the President only for cause.` ‘(2) TERM- The Director shall be appointed for a term of 5 years, unless removed before the end of such term for cause by the President. CommentsClose CommentsPermalink





‘(3) VACANCY- A vacancy in the position of Director that occurs before the expiration of the term for which a Director was appointed shall be filled in the manner established under paragraph (1), and the Director appointed to fill such vacancy shall be appointed only for the remainder of such term.CommentsClose CommentsPermalink





`‘(4) SERVICE AFTER END OF TERM- An individual may serve as the Director after the expiration of the term for which appointed until a successor has been appointed.CommentsClose CommentsPermalink





`‘(5) TRANSITIONAL PROVISION- Notwithstanding paragraphs (1) and (2), during the period beginning on the effective date of the Federal Housing Finance Regulatory Reform Act of 2008, and ending on the date on which the Director is appointed and (2), the Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development shall serve as the Director until a successor has been appointed under paragraph (1).`(c)confirmed, the person serving as the Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development on that effective date shall act for all purposes as, and with the full powers of, the Director.CommentsClose CommentsPermalink





‘(c) Deputy Director of the Division of Enterprise Regulation-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- The Agency shall have a Deputy Director of the Division of Enterprise Regulation, who shall be appoindesignated by the Director from among individuals who are citizens of the United States, and have a demonstrated understanding of financial management or oversight and, and have a demonstrated understanding of mortgage securities markets and housing finance.CommentsClose CommentsPermalink





`‘(2) FUNCTIONS- The Deputy Director of the Division of Enterprise Regulation shall have such functions, powers, and duties with respect to the oversight of the enterprises as the Director shall prescribe.CommentsClose CommentsPermalink





`(d) Deputy Director of the Division of Federal Home Loan Bank Regulation-` ‘(d) Deputy Director Of The Division Of Federal Home Loan Bank Regulation- CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Agency shall have a Deputy Director of the Division of Federal Home Loan Bank Regulation, who shall be appoindesignated by the Director from among individuals who are citizens of the United States, have a demonstrated understanding of financial management or oversight and of the Federal Home Loan Bank System and housing finance.`, and have a demonstrated understanding of the Federal Home Loan Bank System and housing finance.CommentsClose CommentsPermalink





‘(2) FUNCTIONS- The Deputy Director of the Division of Federal Home Loan Bank Regulation shall have such functions, powers, and duties with respect to the oversight of the Federal home loan banks as the Director shall prescribe.`Home Loan Banks as the Director shall prescribe.CommentsClose CommentsPermalink





‘(e) Deputy Director for Housing-`(1) IN GENERAL- The Agency shall have a Deputy Director for Housing, who shall be appoin Mission and Goals-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Agency shall have a Deputy Director for Housing Mission and Goals, who shall be designated by the Director from among individuals who are citizens of the United States, and have a demonstrated understanding of the housing markets and housing finance and of community and economic development.`.CommentsClose CommentsPermalink





‘(2) FUNCTIONS- The Deputy Director for Housing Mission and Goals shall have such functions, powers, and duties with respect to the oversight of the housing mission and goals of the enterprises, and with respect to oversight of the housing finance and community and economic development mission of the Federal home loan banks, as the Director shall prescribe.`(f) Home Loan Banks, as the Director shall prescribe.CommentsClose CommentsPermalink





‘(3) CONSIDERATIONS- In exercising such functions, powers, and duties, the Deputy Director for Housing Mission and Goals shall consider the differences between the enterprises and the Federal Home Loan Banks, including those described in section 1313(d).CommentsClose CommentsPermalink





‘(f) Acting Director- In the event of the death, resignation, sickness, or absence of the Director, the President shall designate either the Deputy Director of the Division of Enterprise Regulation, the Deputy Director of the Division of Federal Home Loan Bank Regulation, or the Deputy Director for Housing Mission and Goals, to serve as acting Director until the return of the Director, or the appointment of a successor pursuant to subsection (b).CommentsClose CommentsPermalink





‘(g) Limitations- The Director and each of the Deputy Directors may not--CommentsClose CommentsPermalink





`‘(1) have any direct or indirect financial interest in any regulated entity or regulated entity-affiliated party;CommentsClose CommentsPermalink





`‘(2) hold any office, position, or employment in any regulated entity or regulated entity-affiliated party; or`entity-affiliated party; orCommentsClose CommentsPermalink





‘(3) have served as an executive officer or director of any regulated entity, or regulated entity-affiliated party, at any time during the 3-year period ending on the date of appointment of such individual as Director or Deputy Director.`(g) Ombudsman- The Director shall establish the position of the Ombudsman in the Agency. The Director shall provide that the Ombudsman will consider complaints and appeals from any regulated entity and any person that has a business relationship with a regulated entity and shall specify the duties and authority of the Ombudsman.'.(b) Appointment of Director- Notwithstanding any other provision of law or of this title, the President may, any time after the date of the enactment of this Act, appoint an individual to serve as the Director of the Federal Housing Finance Agency, as such office is established by the amendment made by subsection (a). This subsection shall take effect on the date of the enactment of this Act or entity-affiliated party at any time during the 3-year period preceding the date of appointment or designation of such individual as Director or Deputy Director, as applicable.’.CommentsClose CommentsPermalink

SEC. 311102. DUTIES AND AUTHORITIES OF THE DIRECTOR.

(a) In General- The Housing and Community DevelopmentSection 1313 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4513) is amended by striking section 1313 and inserting the following new sections:`to read as follows:CommentsClose CommentsPermalink

‘SEC. 1313. DUTIES AND AUTHORITIES OF DIRECTOR.

`(a) Duties-` ‘(a) Duties- CommentsClose CommentsPermalink





‘(1) PRINCIPAL DUTIES- The principal duties of the Director shall be--CommentsClose CommentsPermalink





`‘(A) to oversee the prudential operations of each regulated entity and any joint office of the Federal Home Loan Banks; and`(B) to ensure that--`; andCommentsClose CommentsPermalink





‘(B) to ensure that--CommentsClose CommentsPermalink





‘(i) each regulated entity operates in a safe and sound manner, including maintenance of adequate capital and internal controls;CommentsClose CommentsPermalink





`‘(ii) the operations and activities of each regulated entity foster liquid, efficient, competitive, and resilient national housing finance markets that minimize the cost of housing finance (including activities relating to mortgages on housing for low- and moderate-income families involving a reasonable economic return that may be less than the return earned on other activities);CommentsClose CommentsPermalink





`(iii) each regulated entity‘(iii) each regulated entity complies with this title and the rules, regulations, guidelines, and orders issued under this title and the authorizing statutes;CommentsClose CommentsPermalink





and`(iv) each regulated entity‘(iv) each regulated entity carries out its statutory mission only through activities that are authorized under and consistent with this title and the authorizing statutes.`; andCommentsClose CommentsPermalink





‘(v) the activities of each regulated entity and the manner in which such regulated entity is operated are consistent with the public interest.CommentsClose CommentsPermalink





‘(2) SCOPE OF AUTHORITY- The authority of the Director shall include the authority--CommentsClose CommentsPermalink





`‘(A) to review and, if warranted based on the principal duties described in paragraph (1), reject any acquisition or transfer of a controlling interest in an enterprise; and` regulated entity; andCommentsClose CommentsPermalink





‘(B) to exercise such incidental powers as may be necessary or appropriate to fulfill the duties and responsibilities of the Director in the supervision and regulation of each regulated entity.CommentsClose CommentsPermalink





`(b) Delegation of Authority- The Director may‘(b) Delegation of Authority- The Director may delegate to officers or employees of the Agency, including each of the Deputy Directors,and employees of the Agency any of the functions, powers, or duties of the Director, as the Director considers appropriate.CommentsClose CommentsPermalink





`(c) Litigation Authority-` ‘(c) Litigation Authority- CommentsClose CommentsPermalink





‘(1) IN GENERAL- In enforcing any provision of this title, any regulation or order prescribed under this title, or any other provision of law, rule, regulation, or order, or in any other action, suit, or proceeding to which the Director is a party or in which the Director is interested, and in the administration of conservatorships and receiverships, the Director may act in the Director'’s own name and through the Director'’s own attorneys, or request that the Attorney General of the United States act on behalf of the Director.`(2) CONSULTATION WITH ATTORNEY GENERAL- The Director shall provide notice to, and consult with, the Attorney General of the United States before taking an action under paragraph (1) of this subsection or under section 1344(a), 1345(d), 1348(c), 1372(e), 1375(a), 1376(d), or 1379D(c), except that, if the Director determines that any delay caused by such prior notice and consultation may adversely affect the safety and soundness responsibilities of the Director under this title, the Director shall notify the Attorney General as soon as reasonably possible after taking such action.`(3.CommentsClose CommentsPermalink





‘(2) SUBJECT TO SUIT- Except as otherwise provided by law, the Director shall be subject to suit (other than suits on claims for money damages) by a regulated entity or director or officer thereof with respect to any matter under this title or any other applicable provision of law, rule, order, or regulation under this title, in the United States district court for the judicial district in which the regulated entity has its principal place of business, or in the United States District Court for the District of Columbia, and the Director may be served with process in the manner prescribed by the Federal Rules of Civil Procedure.`SEC. 1313A. PRUDENTIAL MANAGEMENT AND OPERATIONS STANDARDS.`(a) Standards- The Director shall establish standards, by regulation, guideline, or order, for each regulated entity relating to--`(1) adequacy of internal controls and information systems, including information security and privacy policies and practices, taking into account the nature and scale of business operations;`(2) independence and adequacy of internal audit systems;`(3) management of credit and counterparty risk, including systems to identify concentrations of credit risk and prudential limits to restrict exposure of the regulated entity to a single counterparty or groups of related counterparties;`(4) management of interest rate risk exposure;`(5) management of market risk, including standards that provide for systems that accurately measure, monitor, and control market risks and, as warranted, that establish limitations on market risk;`(6) adequacy and maintenance of liquidity and reserves;`(7) management of any asset and investment portfolio;`(8) investments and acquisitions by a regulated entity, to ensure that they are consistent with the purposes of this Act and the authorizing statutes;`(9) maintenance of adequate records, in accordance with consistent accounting policies and practices that enable the Director to evaluate the financial condition of the regulated entity;`(10) issuance of subordinated debt by that particular regulated entity, as the Director considers necessary;`(11) overall risk management processes, including adequacy of oversight by senior management and the board of directors and of processes and policies to identify, measure, monitor, and control material risks, including reputational risks, and for adequate, well-tested business resumption plans for all major systems with remote site facilities to protect against disruptive events; and`(12) such other operational and management standards as the Director determines to be appropriate.`(b) Failure To Meet Standards-`(1) PLAN REQUIREMENT-`(A) IN GENERAL- If the Director determines that a regulated entity fails to meet any standard established under subsection (a)--`(i) if such standard is established by regulation, the Director shall require the regulated entity to submit an acceptable plan to the Director within the time allowed under subparagraph (C); and`(ii) if such standard is established by guideline, the Director may require the regulated entity to submit a plan described in clause (i).`(B) CONTENTS- Any plan required under subparagraph (A) shall specify the actions that the regulated entity will take to correct the deficiency. If the regulated entity is undercapitalized, the plan may be a part of the capital restoration plan for the regulated entity under section 1369C.`(C) DEADLINES FOR SUBMISSION AND REVIEW- The Director shall by regulation establish deadlines that--`(i) provide the regulated entities with reasonable time to submit plans required under subparagraph (A), and generally require a regulated entity to submit a plan not later than 30 days after the Director determines that the entity fails to meet any standard established under subsection (a); and`(ii) require the Director to act on plans expeditiously, and generally not later than 30 days after the plan is submitted.`(2) REQUIRED ORDER UPON FAILURE TO SUBMIT OR IMPLEMENT PLAN- If a regulated entity fails to submit an acceptable plan within the time allowed under paragraph (1)(C), or fails in any material respect to implement a plan accepted by the Director, the following shall apply:`(A) REQUIRED CORRECTION OF DEFICIENCY- The Director shall, by order, require the regulated entity to correct the deficiency.`(B) OTHER AUTHORITY- The Director may, by order, take one or more of the following actions until the deficiency is corrected:`(i) Prohibit the regulated entity from permitting its average total assets (as such term is defined in section 1316(b)) during any calendar quarter to exceed its average total assets during the preceding calendar quarter, or restrict the rate at which the average total assets of the entity may increase from one calendar quarter to another.`(ii) Require the regulated entity--`(I) in the case of an enterprise, to increase its ratio of core capital to assets.`(II) in the case of a Federal home loan bank, to increase its ratio of total capital (as such term is defined in section 6(a)(5) of the Federal Home Loan Bank Act (12 U.S.C. 1426(a)(5)) to assets.`(iii) Require the regulated entity to take any other action that the Director determines will better carry out the purposes of this section than any of the actions described in this subparagraph.`(3) MANDATORY RESTRICTIONS- In complying with paragraph (2), the Director shall take one or more of the actions described in clauses (i) through (iii) of paragraph (2)(B) if--`(A) the Director determines that the regulated entity fails to meet any standard prescribed under subsection (a);`(B) the regulated entity has not corrected the deficiency; and`(C) during the 18-month period before the date on which the regulated entity first failed to meet the standard, the entity underwent extraordinary growth, as defined by the Director.`(c) Other Enforcement Authority Not Affected- The authority of the Director under this section is in addition to any other authority of the Director.'’.CommentsClose CommentsPermalink





(b) Independence in Congressional Testimony and Recommendations- Section 111 of Public Law 93-495 (12 U.S.C. 250) is amended by striking `the Federal Housing Finance Board' and inserting `the Director of the Federal Housing Finance Agency'‘the Federal Housing Finance Board’ and inserting ‘the Director of the Federal Housing Finance Agency’.CommentsClose CommentsPermalink

SEC. 313. FEDERAL HOUSING ENTERPRISE1103. FEDERAL HOUSING FINANCE OVERSIGHT BOARD.

(a) In General- Title XIII of the Housing and Community Developmenthe Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 et seq.) is amended by inserting after section 1313A, as added by the preceding provisions of this title, the following new section:`SEC. 1313B. FEDERAL HOUSING ENTERPRISE BOARD.` the following:CommentsClose CommentsPermalink

‘SEC. 1313A. FEDERAL HOUSING FINANCE OVERSIGHT BOARD.

‘(a) In General- There is established the Federal Housing EnterpriseFinance Oversight Board, which shall advise the Director with respect to overall strategies and policies in carrying out the duties of the Director under this title.CommentsClose CommentsPermalink





`‘(b) Limitations- The Board may not exercise any executive authority, and the Director may not delegate to the Board any of the functions, powers, or duties of the Director.CommentsClose CommentsPermalink





`‘(c) Composition- The Board shall be comprised of 34 members, of whom--CommentsClose CommentsPermalink





`(1) one member shall be the Secretary of the Treasury;`(2) one member shall be the Secretary of Housing and Urban Development; and`(3) one member shall be the Director, who shall serve as the Chairperson of the Board.`(d) Meetings-` ‘(1) 1 member shall be the Secretary of the Treasury; CommentsClose CommentsPermalink





‘(2) 1 member shall be the Secretary of Housing and Urban Development;CommentsClose CommentsPermalink





‘(3) 1 member shall be the Chairman of the Securities and Exchange Commission; andCommentsClose CommentsPermalink





‘(4) 1 member shall be the Director, who shall serve as the Chairperson of the Board.CommentsClose CommentsPermalink





‘(d) Meetings-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Board shall meet upon notice by the Director, but in no event shall the Board meet less frequently than once every 3 months.CommentsClose CommentsPermalink





`‘(2) SPECIAL MEETINGS- Either the Secretary of the Treasury or the Secretary of Housing and Urban Development, the Secretary of Housing and Urban Development, or the Chairman of the Securities and Exchange Commission may, upon giving written notice to the Director, require a special meeting of the Board.CommentsClose CommentsPermalink





`‘(e) Testimony- On an annual basis, the Board shall testify before Congress regarding--CommentsClose CommentsPermalink





`‘(1) the safety and soundness of the regulated entities;CommentsClose CommentsPermalink





`‘(2) any material deficiencies in the conduct of the operations of the regulated entities;CommentsClose CommentsPermalink





`‘(3) the overall operational status of the regulated entities;CommentsClose CommentsPermalink





`‘(4) an evaluation of the performance of the regulated entities in carrying out their respective missions;CommentsClose CommentsPermalink





`‘(5) operations, resources, and performance of the Agency; andCommentsClose CommentsPermalink





`‘(6) such other matters relating to the Agency and its fulfillment of its mission, as the Board determines appropriate.'’.CommentsClose CommentsPermalink





(b) Annual Report of the Director- Section 1319B(a) of the Housing and Community DevelopmentFederal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4521 (a)) is amended--(1) in paragraph (3), by striking `and' at the end; and(2) by striking paragraph (4) and inserting the following new paragraphs:`(4) an(a)) is amended--CommentsClose CommentsPermalink





(1) by striking ‘enterprise’ each place that term appears and inserting ‘regulated entity’;CommentsClose CommentsPermalink





(2) by striking ‘enterprises’ each place that term appears and inserting ‘regulated entities’;CommentsClose CommentsPermalink





(3) in paragraph (3), by striking ‘; and’ and inserting a semicolon;CommentsClose CommentsPermalink





(4) in paragraph (4), by striking ‘1994.’ and inserting ‘1994; and’; andCommentsClose CommentsPermalink





(5) by adding at the end the following:CommentsClose CommentsPermalink





‘(5) the assessment of the Board or any of its members with respect to--CommentsClose CommentsPermalink





`‘(A) the safety and soundness of the regulated entities;CommentsClose CommentsPermalink





`‘(B) any material deficiencies in the conduct of the operations of the regulated entities;CommentsClose CommentsPermalink





`‘(C) the overall operational status of the regulated entities; andCommentsClose CommentsPermalink





`‘(D) an evaluation of the performance of the regulated entities in carrying out their missions;`(5respective missions;CommentsClose CommentsPermalink





‘(6) operations, resources, and performance of the Agency;`(6) a description of the demographic makeup of the workforce of the Agency and the actions taken pursuant to section 1319A(b) to provide for diversity in the workforce; and` andCommentsClose CommentsPermalink





‘(7) such other matters relating to the Agency and itsthe fulfillment of its mission.'’.CommentsClose CommentsPermalink

SEC. 311104. AUTHORITY TO REQUIRE REPORTS BY REGULATED ENTITIES.

Section 1314 of the Housing and Community Development Act of 1992 (a) In General- Section 1314 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4514) is amended--CommentsClose CommentsPermalink





(1) in the section heading, by striking `enterprises' and inserting `regulated entities';(2‘enterprises’ and inserting ‘regulated entities’;CommentsClose CommentsPermalink





(2) by striking ‘an enterprise’ each place that term appears and inserting ‘a regulated entity’;CommentsClose CommentsPermalink





(3) by striking ‘the enterprise’ and inserting ‘the regulated entity’;CommentsClose CommentsPermalink





(4) in subsection (a)--CommentsClose CommentsPermalink





(A) in the subsection heading, by striking `Special Reports and Reports of Financial Condition' and inserting `by striking the subsection heading and all that follows through ‘and operations’ in paragraph (1) and inserting the following:CommentsClose CommentsPermalink





‘(a) Regular and Special Reports';(B) in paragraph (1)--(i) in the paragraph heading, by striking `FINANCIAL CONDITION' and inserting `-CommentsClose CommentsPermalink





‘(1) REGULAR REPORTS'; and(ii) by striking `reports of financial condition and operations' and inserting `regular reports on the condition (including financial- The Director may require, by general or specific orders, a regulated entity to submit regular reports, including financial statements determined on a fair value basis, on the condition (including financial condition), management, activities, or operations of the regulated entity, as the Director considers appropriate'; and(C) in paragraph (2), after `submit special reports' insert `’; andCommentsClose CommentsPermalink





(B) in paragraph (2)--CommentsClose CommentsPermalink





(i) by inserting ‘, by general or specific orders,’ after ‘may also require’; andCommentsClose CommentsPermalink





(ii) by striking ‘whenever’ and inserting ‘on any of the topics specified in paragraph (1) or such other topics'; and(3) by adding at the end the following new subsection:`(c) Reports of Fraudulent Financial Transactions-`(1) REQUIREMENT TO REPORT- The Director shall require a regulated entity to submit to the Director a timely report upon discovery by the regulated entity that it has purchased or sold a fraudulent loan or financial instrument or suspects a possible fraud relating to a purchase or sale of any loan or financial instrument. The Director shall require the regulated entities to establish and maintainany other relevant topics, if’; andCommentsClose CommentsPermalink





(5) by adding at the end the following:CommentsClose CommentsPermalink





‘(c) Penalties for Failure To Make Reports-CommentsClose CommentsPermalink





‘(1) VIOLATIONS- It shall be a violation of this section for any regulated entity--CommentsClose CommentsPermalink





‘(A) to fail to make, transmit, or publish any report or obtain any information required by the Director under this section, section 309(k) of the Federal National Mortgage Association Charter Act, section 307(c) of the Federal Home Loan Mortgage Corporation Act, or section 20 of the Federal Home Loan Bank Act, within the period of time specified in such provision of law or otherwise by the Director; orCommentsClose CommentsPermalink





‘(B) to submit or publish any false or misleading report or information under this section.CommentsClose CommentsPermalink





‘(2) PENALTIES-CommentsClose CommentsPermalink





‘(A) FIRST TIER-CommentsClose CommentsPermalink





‘(i) IN GENERAL- A violation described in paragraph (1) shall be subject to a penalty of not more than $2,000 for each day during which such violation continues, in any case in which--CommentsClose CommentsPermalink





‘(I) the subject regulated entity maintains procedures designed to discover any such transactions.`(2) PROTECTION FROM LIABILITY FOR REPORTS-`(A) IN GENERAL- If areasonably adapted to avoid any inadvertent error and the violation was unintentional and a result of such an error; orCommentsClose CommentsPermalink





‘(II) the violation was an inadvertent transmittal or publication of any report which was minimally late.CommentsClose CommentsPermalink





‘(ii) BURDEN OF PROOF- For purposes of this subparagraph, the regulated entity shall have the burden of proving that the error was inadvertent or that a report was inadvertently transmitted or published late.CommentsClose CommentsPermalink





‘(B) SECOND TIER- A violation described in paragraph (1) shall be subject to a penalty of not more than $20,000 for each day during which such violation continues or such false or misleading information is not corrected, in any case that is not addressed in subparagraph (A) or (C).CommentsClose CommentsPermalink





‘(C) THIRD TIER- A violation described in paragraph (1) shall be subject to a penalty of not more than $1,000,000 per day for each day during which such violation continues or such false or misleading information is not corrected, in any case in which the subject regulated entity makes a report pursuant to paragraph (1), or a regulated entity-affiliated party makes, or requires another to make, such a report, and such report is made in a good faith effort to comply with the requirements of paragraph (1), such regulated entity or regulated entity-affiliated party shall not be liable to any person under any law or regulation of the United States, any constitution, law, or regulation of any State or political subdivision of any State, or under any contract or other legally enforceable agreement (including any arbitration agreement), for such report or for any failure to provide notice of such report to the person who is the subject of such report or any other person identified in the report.`(B) RULE OF CONSTRUCTION- Subparagraph (A) shall not be construed as creating--`(i) any inference that the term `person', as used in such subparagraph, may be construed more broadly than its ordinary usage so as to include any government or agency of government; or`(ii) any immunity against, or otherwise affecting, any civil or criminal action brought by any government or agency of government to enforce any constitution, law, or regulation of such government or agency.'committed such violation knowingly or with reckless disregard for the accuracy of any such information or report.CommentsClose CommentsPermalink





‘(3) ASSESSMENTS- Any penalty imposed under this subsection shall be in lieu of a penalty under section 1376, but shall be assessed and collected by the Director in the manner provided in section 1376 for penalties imposed under that section, and any such assessment (including the determination of the amount of the penalty) shall be otherwise subject to the provisions of section 1376.CommentsClose CommentsPermalink





‘(4) HEARING- A regulated entity against which a penalty is assessed under this section shall be afforded an agency hearing if the regulated entity submits a request for a hearing not later than 20 days after the date of the issuance of the notice of assessment. Section 1374 shall apply to any such proceedings.’.CommentsClose CommentsPermalink





(b) Conforming Amendment- The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 et seq.) is amended by striking sections 1327 and 1328.CommentsClose CommentsPermalink

SEC. 315. DISCLOSURE OF INCOME AND CHARITABLE CONTRIBUTIONS BY ENTERPRISES.Section 1314 of the Housing and Community Development Act of 1992 1105. EXAMINERS AND ACCOUNTANTS; AUTHORITY TO CONTRACT FOR REVIEWS OF REGULATED ENTITIES; OMBUDSMAN.

(a) In General- Section 1317 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4514), as amended by the preceding provisions of this title, is further amended by adding at the end the following new subsections:`(d) Disclosure of Charitable Contributions by Enterprises-`(1) REQUIRED DISCLOSURE- The Director shall, by regulation, require each enterprise to submit a report annually, in a format designated by the Director, containing the following information:`(A) TOTAL VALUE- The total value of contributions made by the enterprise to nonprofit organizations during its previous fiscal year.`(B) SUBSTANTIAL CONTRIBUTIONS- If the value of contributions made by the enterprise to any nonprofit organization during its previous fiscal year exceeds the designated amount, the name of that organization and the value of contributions.`(C) SUBSTANTIAL CONTRIBUTIONS TO INSIDER-AFFILIATED CHARITIES- Identification of each contribution whose value exceeds the designated amount that were made by the enterprise during the enterprise's previous fiscal year to any nonprofit organization of which a director, officer, or controlling person of the enterprise, or a spouse thereof, was a director or trustee, the name of such nonprofit organization, and the value7) is amended--CommentsClose CommentsPermalink





(1) in subsection (a), by striking ‘enterprise’ each place that term appears and inserting ‘regulated entity’;CommentsClose CommentsPermalink





(2) in subsection (b)--CommentsClose CommentsPermalink





(A) by inserting ‘of a regulated entity’ after ‘under this section’; andCommentsClose CommentsPermalink





(B) by striking ‘to determine the condition of an enterprise for the purpose of ensuring its financial safety and soundness’ and inserting ‘or appropriate’;CommentsClose CommentsPermalink





(3) in subsection (c), in the second sentence, by inserting before the period ‘to conduct examinations under this section’;CommentsClose CommentsPermalink





(4) by redesignating subsections (d) through (f) as subsections (e) through (g), respectively; andCommentsClose CommentsPermalink





(5) by inserting after subsection (c) the following:CommentsClose CommentsPermalink





‘(d) Inspector General- There shall be within the Agency an Inspector General, who shall be appointed in accordance with section 3(a) of the contribution.`(2) DEFINITIONS- For purposes of this subsection--`(A) the term `designated amount' means such amount as may be designated by the Director by regulation, consistent with the public interest and the protection of investors for purposes of this subsection; and`(B) the Director may, by such regulations as the Director deems necessary or appropriate in the public interest, define the terms officer and controlling person.`(3) PUBLIC AVAILABILITY- The Director shall make the information submitted pursuant to this subsection publicly available.`(e) Disclosure of Income- Each enterprise shall include, in each annual report filed under section 13 of the Securities Exchange Act of 1934 (15Inspector General Act of 1978.’.CommentsClose CommentsPermalink





(b) Direct Hire Authority To Hire Accountants, Economists, and Examiners- Section 1317 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 ( 12 U.S.C. 78m), the income reported by the issuer to the Internal Revenue Service for the most recent taxable year. Such income shall--`(1) be presented in a prominent location in each such report and in a manner that permits a ready comparison of such income to income otherwise required to be included in such reports under regulations issued under such section; and`(2) be submitted to the Securities and Exchange Commission in a form and manner suitable for entry into the EDGAR system of such Commission for public availability under such system.'4517 ) is amended by adding at the end the following: CommentsClose CommentsPermalink





‘(h) Appointment of Accountants, Economists, and Examiners-CommentsClose CommentsPermalink





‘(1) APPLICABILITY- This section shall apply with respect to any position of examiner, accountant, economist, and specialist in financial markets and in technology at the Agency, with respect to supervision and regulation of the regulated entities, that is in the competitive service.CommentsClose CommentsPermalink





‘(2) APPOINTMENT AUTHORITY- The Director may appoint candidates to any position described in paragraph (1)--CommentsClose CommentsPermalink





‘(A) in accordance with the statutes, rules, and regulations governing appointments in the excepted service; andCommentsClose CommentsPermalink





‘(B) notwithstanding any statutes, rules, and regulations governing appointments in the competitive service.’.CommentsClose CommentsPermalink





(c) Amendments to Inspector General Act- Section 11 of the Inspector General Act of 1978 (5 U.S.C. App.) is amended--CommentsClose CommentsPermalink





(1) in paragraph (1), by inserting ‘; the Director of the Federal Housing Finance Agency’ after ‘Social Security Administration’; andCommentsClose CommentsPermalink





(2) in paragraph (2), by inserting ‘, the Federal Housing Finance Agency’ after ‘Social Security Administration’.CommentsClose CommentsPermalink





(d) Authority To Contract for Reviews of Regulated Entities- Section 1319 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4519) is amended--CommentsClose CommentsPermalink





(1) in the section heading, by striking ‘enterprises by rating organization’ and inserting ‘regulated entities’; andCommentsClose CommentsPermalink





(2) by striking ‘enterprises’ and inserting ‘regulated entities’.CommentsClose CommentsPermalink





(e) Office of the Ombudsman- Section 1317 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4517) is amended by adding at the end the following:CommentsClose CommentsPermalink





‘(i) Ombudsman- The Director shall establish, by regulation, an Office of the Ombudsman within the Agency, which shall be responsible for considering complaints and appeals, from any regulated entity and any person that has a business relationship with a regulated entity, regarding any matter relating to the regulation and supervision of such regulated entity by the Agency. The regulation issued by the Director under this subsection shall specify the authority and duties of the Office of the Ombudsman.’.CommentsClose CommentsPermalink

SEC. 311106. ASSESSMENTS.

Section 1316 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4516) is amended--CommentsClose CommentsPermalink





(1) by striking subsection (a) and inserting the following new subsection:`:CommentsClose CommentsPermalink





‘(a) Annual Assessments- The Director shall establish and collect from the regulated entities annual assessments in an amount not exceeding the amount sufficient to provide for reasonable costs (including administrative costs) and expenses of the Agency, including--CommentsClose CommentsPermalink





`‘(1) the expenses of any examinations under section 1317 of this Act and under section 20 of the Federal Home Loan Bank Act;CommentsClose CommentsPermalink





`‘(2) the expenses of obtaining any reviews and credit assessments under section 1319;CommentsClose CommentsPermalink





`‘(3) such amounts in excess of actual expenses for any given year as deemed necessary by the Director to maintain a working capital fund in accordance with subsection (e); andCommentsClose CommentsPermalink





`(4) the wind up of the affairs of the Office of Federal Housing Enterprise Oversight and the Federal Housing Finance Board under subtitle C of the Federal Housing Finance Reform Act of 2008.'‘(4) the windup of the affairs of the Office of Federal Housing Enterprise Oversight and the Federal Housing Finance Board under title III of the Federal Housing Finance Regulatory Reform Act of 2008.’;CommentsClose CommentsPermalink





(2) in subsection (b)--CommentsClose CommentsPermalink





(A) in the subsection heading, by striking `Enterprises' and inserting `Regulated Entities';(B) by realigningby realigning the margins of paragraph (2) two ems from the left margin, so as to align the left margin of such paragraph with the left margins of paragraph (1);CommentsClose CommentsPermalink





(C) in paragraph (1)--(i) by striking `Each enterprise' and inserting `Each regulated entity';(ii) by striking `each enterprise' and inserting `each regulated entity'; and(iii) by striking `both enterprises' and inserting `all of the regulated entities'; and(D) in paragraph (3)--(i) in subparagraph (B), by striking `subparagraph (A)' and inserting `clause (i)';(ii) by redesignating subparagraphs (A), (B), and (C) as clauses (i), (iiB) by redesignating paragraphs (2) and (3) as paragraphs (3) and (ii), respectively, and realigning such clauses, as so redesignated, so as to be indented 6 ems from the left margin;(iii) by striking the matter that precedes clause (i), as so redesignated, and inserting the following:`(3) DEFINITION OF TOTAL ASSETS- For purposes of this section, the term `total assets' means as follows:`(A) ENTERPRISES- With respect to an enterprise, the sum of--'; and(iv) by adding at the end the following new subparagraph:`(B) FEDERAL HOME LOAN BANKS- With respect to a Federal home loan bank, the total assets of4), respectively; andCommentsClose CommentsPermalink





(C) by inserting after paragraph (1) the Bank, as determined by the Director in accordance with generally accepted accounting principles.';(3) by striking subsection (c) and inserting the following new subsection:`following:CommentsClose CommentsPermalink





‘(2) SEPARATE TREATMENT OF FEDERAL HOME LOAN BANK AND ENTERPRISE ASSESSMENTS- Assessments collected from the enterprises shall not exceed the amounts sufficient to provide for the costs and expenses described in subsection (a) relating to the enterprises. Assessments collected from the Federal Home Loan Banks shall not exceed the amounts sufficient to provide for the costs and expenses described in subsection (a) relating to the Federal Home Loan Banks.’;CommentsClose CommentsPermalink





(3) by striking subsection (c) and inserting the following:CommentsClose CommentsPermalink





‘(c) Increased Costs of Regulation-CommentsClose CommentsPermalink





`‘(1) INCREASE FOR INADEQUATE CAPITALIZATION- The semiannual payments made pursuant to subsection (b) by any regulated entity that is not classified (for purposes of subtitle B) as adequately capitalized may be increased, as necessary, in the discretion of the Director to pay additional estimated costs of regulation of the regulated entity.CommentsClose CommentsPermalink





`‘(2) ADJUSTMENT FOR ENFORCEMENT ACTIVITIES- The Director may adjust the amounts of any semiannual payments for an assessment under subsection (a) that are to be paid pursuant to subsection (b) by a regulated entity, as necessary in the discretion of the Director, to ensure that the costs of enforcement activities under this Act for a regulated entity are borne only by such regulated entity.CommentsClose CommentsPermalink





`‘(3) ADDITIONAL ASSESSMENT FOR DEFICIENCIES- If at any time, as a result of increased costs of regulation of a regulated entity that is not classified (for purposes of subtitle B) as adequately capitalized or as the result of supervisory or enforcement activities under this Act for a regulated entity, the amount available from any semiannual payment made by such regulated entity pursuant to subsection (b) is insufficient to cover the costs of the Agency with respect to such entity, the Director may make and collect from such regulated entity an immediate assessment to cover the amount of such deficiency for the semiannual period. If, at the end of any semiannual period during which such an assessment is made, any amount remains from such assessment, such remaining amount shall be deducted from the assessment for such regulated entity for the following semiannual period.';(4) in subsection (d), by striking `If' and inserting `’;CommentsClose CommentsPermalink





(4) in subsection (d), by striking ‘If’ and inserting ‘Except with respect to amounts collected pursuant to subsection (a)(3), if'’; andCommentsClose CommentsPermalink





(5) by striking subsections (e) through (g) and inserting the following new subsections:`:CommentsClose CommentsPermalink





‘(e) Working Capital Fund- At the end of each year for which an assessment under this section is made, the Director shall remit to each regulated entity any amount of assessment collected from such regulated entity that is attributable to subsection (a)(3) and is in excess of the amount the Director deems necessary to maintain a working capital fund.CommentsClose CommentsPermalink





`‘(f) Treatment of Assessments-CommentsClose CommentsPermalink





`‘(1) DEPOSIT- Amounts received by the Director from assessments under this section may be deposited by the Director in the manner provided in section 5234 of the Revised Statutes of the United States (12 U.S.C. 192) for monies deposited by the Comptroller of the Currency.CommentsClose CommentsPermalink





`‘(2) NOT GOVERNMENT FUNDS- The amounts received by the Director from any assessment under this section shall not be construed to be Government or public funds or appropriated money.CommentsClose CommentsPermalink





`‘(3) NO APPORTIONMENT OF FUNDS- Notwithstanding any other provision of law, the amounts received by the Director from any assessment under this section shall not be subject to apportionment for the purpose of chapter 15 of title 31, United States Code, or under any otherauthority.` authority.CommentsClose CommentsPermalink





‘(4) USE OF FUNDS- The Director may use any amounts received by the Director from assessments under this section for compensation of the Director and other employees of the Agency and for all other expenses of the Director and the Agency.CommentsClose CommentsPermalink





`‘(5) AVAILABILITY OF OVERSIGHT FUND AMOUNTS- Notwithstanding any other provision of law, any amounts remaining in the Federal Housing Enterprises Oversight Fund established under this section (as in effect before the effective date under section 365 of the Federal Housing Finance Reform Act of 2008)gulatory Reform Act of 2008, and any amounts remaining from assessments on the Federal Home Loan bBanks pursuant to section 18(b) of the Federal Home Loan Bank Act (12 U.S.C. 1438(b)), shall, upon such effective date, be treated for purposes of this subsection as amounts received from assessments under this section.CommentsClose CommentsPermalink





`‘(6) TREASURY INVESTMENTS-CommentsClose CommentsPermalink





`‘(A) AUTHORITY- The Director may request the Secretary of the Treasury to invest such portions of amount received by the Director from assessments paid under this section that, in the Director's received by the Director from assessments paid under this section that, in the Director’s discretion, are not required to meet the current working needs of the Agency.CommentsClose CommentsPermalink





`‘(B) GOVERNMENT OBLIGATIONS- Pursuant to a request under subparagraph (A), the Secretary of the Treasury shall invest such amounts in gGovernment obligations guaranteed as to principal and interest by the United States with maturities suitable to the needs of the Agency and bearing interest at a rate determined by the Secretary of the Treasury taking into consideration current market yields on outstanding marketable obligations of the United States of comparable maturity.CommentsClose CommentsPermalink





`(g) Budget and Financial Management-` ‘(g) Budget and Financial Management- CommentsClose CommentsPermalink





‘(1) FINANCIAL OPERATING PLANS AND FORECASTS- The Director shall provide to the Director of the Office of Management and Budget copies of the Director'’s financial operating plans and forecasts, as prepared by the Director in the ordinary course of the Agency'’s operations, and copies of the quarterly reports of the Agency'’s financial condition and results of operations, as prepared by the Director in the ordinary course of the Agency's operations.`’s operations.CommentsClose CommentsPermalink





‘(2) FINANCIAL STATEMENTS- The Agency shall prepare annually a statement of--CommentsClose CommentsPermalink





‘(A) assets and liabilities and surplus or deficit;CommentsClose CommentsPermalink





a statement of income and expenses; and a statement of sources and application of funds.` ‘(B) income and expenses; and CommentsClose CommentsPermalink





‘(C) sources and application of funds.CommentsClose CommentsPermalink





‘(3) FINANCIAL MANAGEMENT SYSTEMS- The Agency shall implement and maintain financial management systems that--CommentsClose CommentsPermalink





‘(A) comply substantially with Federal financial management systems requirements, and applicable Federal accounting standards, and that uses; andCommentsClose CommentsPermalink





‘(B) use a general ledger system that accounts for activity at the transaction level.CommentsClose CommentsPermalink





`‘(4) ASSERTION OF INTERNAL CONTROLS- The Director shall provide to the Comptroller General of the United States an assertion as to the effectiveness of the internal controls that apply to financial reporting by the Agency, using the standards established insection 3512(c) of title 31, United States Code.` section 3512(c) of title 31, United States Code.CommentsClose CommentsPermalink





‘(5) RULE OF CONSTRUCTION- This subsection may not be construed as implying any obligation on the part of the Director to consult with or obtain the consent or approval of the Director of the Office of Management and Budget with respect to any reports, plans, forecasts, plan, forecast, or other information referred to in paragraph (1) or any jurisdiction or oversight over the affairs or operations of the Agency.CommentsClose CommentsPermalink





`(h) Audit of Agency-` ‘(h) Audit of Agency- CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Comptroller General shall annually audit the financial transactions of the Agency in accordance with the U.S.nited States generally accepted government auditing standards as may be prescribed by the Comptroller General of the United States. The audit shall be conducted at the place or places where accounts of the Agency are normally kept. The representatives of the Government Accountability Office shall have access to the personnel and to all books, accounts, documents, papers, records (including electronic records), reports, files, and all other papers, automated data, things, or property belonging to or under the control of or used or employed by the Agency pertaining to its financial transactions and necessary to facilitate the audit, and such representatives shall be afforded full facilities for verifying transactions with the balances or securities held by depositories, fiscal agents, and custodians. All such books, accounts, documents, records, reports, files, papers, and property of the Agency shall remain in possession and custody of the Agency. The Comptroller General may obtain and duplicate any such books, accounts, documents, records, working papers, automated data and files, or other information relevant to such audit without cost to the Comptroller General and the Comptroller General'’s right of access to such information shall be enforceable pursuant tosection 716(c) of title 31, United States Code.` section 716(c) of title 31, United States Code.CommentsClose CommentsPermalink





‘(2) REPORT- The Comptroller General shall submit to the Congress a report of each annual audit conducted under this subsection. The report to the Congress shall set forth the scope of the audit and shall include the statement of assets and liabilities and surplus or deficit, the statement of income and expenses, the statement of sources and application of funds, and such comments and information as may be deemed necessary to inform Congress of the financial operations and condition of the Agency, together with such recommendations with respect thereto as the Comptroller General may deem advisable. A copy of each report shall be furnished to the President and to the Agency at the time submitted to the Congress.CommentsClose CommentsPermalink





`‘(3) ASSISTANCE AND COSTS- For the purpose of conducting an audit under this subsection, the Comptroller General may, in the discretion of the Comptroller General, employ by contract, without regard tosection 5 of title 41, United States Code section 3709 of the Revised Statutes of the United States (41 U.S.C. 5), professional services of firms and organizations of certified public accountants for temporary periods or for special purposes. Upon the request of the Comptroller General, the Director of the Agency shall transfer to the Government Accountability Office from funds available, the amount requested by the Comptroller General to cover the full costs of any audit and report conducted by the Comptroller General. The Comptroller General shall credit funds transferred to the account established for salaries and expenses of the Government Accountability Office, and such amount shall be available upon receipt and without fiscal year limitation to cover the full costs of the audit and report.'’.CommentsClose CommentsPermalink

SEC. 317. EXAMINERS AND ACCOUNTANTS.(a) Examinations- Section 1317 of the Housing and Community Development Act of 1992 1107. REGULATIONS AND ORDERS.

Section 1319G of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4517) is amended--(1) in subsection (a), by adding after the period at the end the following: `Each examination under this subsection of a regulated entity shall include a review of the procedures required to be established and maintained by the regulated entity pursuant to section 1314(c) (relating to fraudulent financial transactions) and the report regarding each such examination shall describe any problems with such procedures maintained by the regulated entity.';(2) in subsection (b)--(A) by inserting `of a regulated entity' after `under this section'; and(B) by striking `to determine the condition of an enterprise for the purpose of ensuring its financial safety and soundness' and inserting `or appropriate'; and(3) in subsection (c)--(A) in the second sentence, by inserting `to conduct examinations under this section' before the period; and(B) in the third sentence, by striking `from amounts available in the Federal Housing Enterprises Oversight Fund'.(b) Enhanced Authority To Hire Examiners and Accountants- Section 1317 of the Housing and Community Development Act of 1992 26) is amended--CommentsClose CommentsPermalink





(1) by striking subsection (a) and inserting the following:CommentsClose CommentsPermalink





‘(a) Authority- The Director shall issue any regulations, guidelines, or orders necessary to carry out the duties of the Director under this title or the authorizing statutes, and to ensure that the purposes of this title and the authorizing statutes are accomplished.’; andCommentsClose CommentsPermalink





(2) by striking subsection (c).CommentsClose CommentsPermalink

(a) In General- Subtitle B of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4517) is amended611 et seq.) is amended--CommentsClose CommentsPermalink





(1) by striking the subtitle designation and heading and inserting the following:CommentsClose CommentsPermalink

andCommentsClose CommentsPermalink





(2) by adding at the end the following new subsection:

`(g) Appointment of Accountants, Economists, Specialists, and Examiners-`(1) APPLICABILITY- This section applies with respect to any position of examiner, accountant, specialist in financial markets, specialist in information technology, and economist at the Agency, with respect to supervision and regulation of the regulated entities, that is in the competitive service.`(2) APPOINTMENT AUTHORITY- The Director may appoint candidates to any position described in paragraph (1)--`(A) in accordance with the statutes, rules, and regulations governing appointments in the excepted service; and`(B) notwithstanding any statutes, rules, and regulations governing appointments in the competitive service.`(3) RULE OF CONSTRUCTION- The appointment of a candidate to a position under the authority of this subsection shall not be considered to cause such position to be converted from the competitive service to the excepted service.'.

(c) Repeal- Section 20ection:CommentsClose CommentsPermalink

Section 1362 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4612) is amended--CommentsClose CommentsPermalink





(1) in subsection (a), by striking ‘In General’ and inserting ‘Enterprises’; andCommentsClose CommentsPermalink





(2) by striking subsection (b) and inserting the following:CommentsClose CommentsPermalink





‘(b) Federal Home Loan Banks- For purposes of this subtitle, the minimum capital level for each Federal Home Loan Bank shall be the minimum capital required to be maintained to comply with the leverage requirement for the bank established under section 6(a)(2) of the Federal Home Loan Bank Act (12 U.S.C. 1440) is amended--(1) by striking the section heading and inserting the following: `EXAMINATIONS AND GAO AUDITS';(2) in the third sentence, by striking `the Board and' each place such term appears; and(3) by striking the first two sentences and inserting the following: `The Federal home loan banks shall be subject to examinations by the Director to the extent provided in26(a)(2)).CommentsClose CommentsPermalink





‘(c) Establishment of Revised Minimum Capital Levels- Notwithstanding subsections (a) and (b) and notwithstanding the capital classifications of the regulated entities, the Director may, by regulations issued under section 1317 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (129G, establish a minimum capital level for the enterprises, for the Federal Home Loan Banks, or for both the enterprises and the banks, that is higher than the level specified in subsection (a) for the enterprises or the level specified in subsection (b) for the Federal Home Loan Banks, to the extent needed to ensure that the regulated entities operate in a safe and sound manner.CommentsClose CommentsPermalink





‘(d) Authority To Require Temporary Increase-CommentsClose CommentsPermalink





‘(1) IN GENERAL- Notwithstanding subsections (a) and (b) and any minimum capital level established pursuant to subsection (c), the Director may, by order, increase the minimum capital level for a regulated entity on a temporary basis, when the Director determines that such an increase is necessary and consistent with the prudential regulation and the safe and sound operations of a regulated entity.CommentsClose CommentsPermalink





‘(2) RESCISSION- The Director shall rescind any temporary minimum capital level established under paragraph (1) when the Director determines that the circumstances or facts no longer justify the temporary minimum capital level.CommentsClose CommentsPermalink





‘(3) REGULATIONS REQUIRED- The Director shall issue regulations establishing--CommentsClose CommentsPermalink





‘(A) standards for the imposition of a temporary increase in minimum capital under paragraph (1);CommentsClose CommentsPermalink





‘(B) the standards and procedures that the Director will use to make the determination referred to in paragraph (2); andCommentsClose CommentsPermalink





‘(C) a reasonable time frame for periodic review of any temporary increase in minimum capital for the purpose of making the determination referred to in paragraph (2).CommentsClose CommentsPermalink





‘(e) Authority To Establish Additional Capital and Reserve Requirements for Particular Purposes- The Director may, at any time by order or regulation, establish such capital or reserve requirements with respect to any product or activity of a regulated entity, as the Director considers appropriate to ensure that the regulated entity operates in a safe and sound manner, with sufficient capital and reserves to support the risks that arise in the operations and management of the regulated entity.CommentsClose CommentsPermalink





‘(f) Periodic Review- The Director shall periodically review the amount of core capital maintained by the enterprises, the amount of capital retained by the Federal Home Loan Banks, and the minimum capital levels established for such regulated entities pursuant to this section.’.CommentsClose CommentsPermalink

The Securities Exchange Act of 1934 ( 15 U.S.C. 4517).'78a et seq.) is amended by adding at the end the following: CommentsClose CommentsPermalink

‘SEC. 38. FEDERAL NATIONAL MORTGAGE ASSOCIATION, FEDERAL HOME LOAN MORTGAGE CORPORATION, FEDERAL HOME LOAN BANKS.

‘(a) Federal National Mortgage Association and Federal Home Loan Mortgage Corporation- No class of equity securities of the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation shall be treated as an exempted security for purposes of section 12, 13, 14, or 16.CommentsClose CommentsPermalink





‘(b) Federal Home Loan Banks-CommentsClose CommentsPermalink





‘(1) REGISTRATION- Each Federal Home Loan Bank shall register a class of its common stock under section 12(g), not later than 120 days after the date of enactment of the Federal Housing Finance Regulatory Reform Act of 2008, and shall thereafter maintain such registration and be treated for purposes of this title as an ‘issuer’, the securities of which are required to be registered under section 12, regardless of the number of members holding such stock at any given time.CommentsClose CommentsPermalink





‘(2) STANDARDS RELATING TO AUDIT COMMITTEES- Each Federal Home Loan Bank shall comply with the rules issued by the Commission under section 10A(m).CommentsClose CommentsPermalink





‘(c) Definitions- For purposes of this section, the following definitions shall apply:CommentsClose CommentsPermalink





‘(1) FEDERAL HOME LOAN BANK; MEMBER- The terms ‘Federal Home Loan Bank’ and ‘member’, have the same meanings as in section 2 of the Federal Home Loan Bank Act.CommentsClose CommentsPermalink





‘(2) FEDERAL NATIONAL MORTGAGE ASSOCIATION- The term ‘Federal National Mortgage Association’ means the corporation created by the Federal National Mortgage Association Charter Act.CommentsClose CommentsPermalink





‘(3) FEDERAL HOME LOAN MORTGAGE CORPORATION- The term ‘Federal Home Loan Mortgage Corporation’ means the corporation created by the Federal Home Loan Mortgage Corporation Act.’.CommentsClose CommentsPermalink

SEC. 3181113. PROHIBITION AND WITHHOLDING OF EXECUTIVE COMPENSATION.

(a) In General- Section 1318 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518) is amended--CommentsClose CommentsPermalink





(1) in the section heading, by striking `of excessive' and inserting `and withholding of executive';(2‘of excessive’ and inserting ‘and withholding of executive’;CommentsClose CommentsPermalink





(2) in subsection (a)--CommentsClose CommentsPermalink





(A) by striking ‘enterprise’ and inserting ‘regulated entity’; andCommentsClose CommentsPermalink





(B) by striking ‘enterprises’ and inserting ‘regulated entities’;CommentsClose CommentsPermalink





(3) by redesignating subsection (b) as subsection (d); andCommentsClose CommentsPermalink





(34) by inserting after subsection (a) the following new subsections:`:CommentsClose CommentsPermalink





‘(b) Factors- In making any determination under subsection (a), the Director may take into consideration any factors the Director considers relevant, including any wrongdoing on the part of the executive officer, and such wrongdoing shall include any fraudulent act or omission, breach of trust or fiduciary duty, violation of law, rule, regulation, order, or written agreement, and insider abuse with respect to the regulated entity. The approval of an agreement or contract pursuant to section 309(d)(3)(B) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a(d)(3)(B)) or section 303(h)(2) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1452(h)(2)) shall not preclude the Director from making any subsequent determination under subsection (a).CommentsClose CommentsPermalink





`‘(c) Withholding of Compensation- In carrying out subsection (a), the Director may require a regulated entity to withhold any payment, transfer, or disbursement of compensation to an executive officer, or to place such compensation in an escrow account, during the review of the reasonableness and comparability of compensation.'’.CommentsClose CommentsPermalink





(b) Conforming Amendments-CommentsClose CommentsPermalink





(1) FANNIE MAE- Section 309(d) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a(d)) is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





`‘(4) Notwithstanding any other provision of this section, the corporation shall not transfer, disburse, or pay compensation to any executive officer, or enter into an agreement with such executive officer, without the approval of the Director, for matters being reviewed under section 1318 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518).'’.CommentsClose CommentsPermalink





(2) FREDDIE MAC- Section 303(h) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1452(h)) is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





`(4) Notwithstanding any other provision of this section, the Corporation shall not‘(4) Notwithstanding any other provision of this section, the Corporation shall not transfer, disburse, or pay compensation to any executive officer, or enter into an agreement with such executive officer, without the approval of the Director, for matters being reviewed under section 1318 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518).'’.CommentsClose CommentsPermalink





(3) FEDERAL HOME LOAN BANKS- Section 7 of the Federal Home Loan Bank Act (12 U.S.C. 1427) is amended by adding at the end the following new subsection:CommentsClose CommentsPermalink





`‘(l) Withholding of Compensation- Notwithstanding any other provision of this section, a Federal home loan bHome Loan Bank shall not transfer, disburse, or pay compensation to any executive officer, or enter into an agreement with such executive officer, without the approval of the Director, for matters being reviewed under section 1318 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518).'’.CommentsClose CommentsPermalink

SEC. 319. REVIEWS OF REGULATED ENTITI1114. LIMIT ON GOLDEN PARACHUTES.

Section 1319 of the Housing and Community Development Act of 1992 8 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4519) is amended--(1) by striking the section designation and heading and inserting the following:

`SEC. 1319. REVIEWS OF REGULATED ENTITIES.';

and(2) by striking `is a nationally recognized' and all that follows through `1934' and inserting the following: `the Director considers appropriate, including an entity that is registered under section 15 of the Securities Exchange Act of 1934 (158) is amended by adding at the end the following:CommentsClose CommentsPermalink




‘(e) Authority To Regulate or Prohibit Certain Forms of Benefits to Affiliated Parties-CommentsClose CommentsPermalink





‘(1) GOLDEN PARACHUTES AND INDEMNIFICATION PAYMENTS- The Director may prohibit or limit, by regulation or order, any golden parachute payment or indemnification payment.CommentsClose CommentsPermalink





‘(2) FACTORS TO BE TAKEN INTO ACCOUNT- The Director shall prescribe, by regulation, the factors to be considered by the Director in taking any action pursuant to paragraph (1), which may include such factors as--CommentsClose CommentsPermalink





‘(A) whether there is a reasonable basis to believe that the affiliated party has committed any fraudulent act or omission, breach of trust or fiduciary duty, or insider abuse with regard to the regulated entity that has had a material effect on the financial condition of the regulated entity;CommentsClose CommentsPermalink





‘(B) whether there is a reasonable basis to believe that the affiliated party is substantially responsible for the insolvency of the regulated entity, the appointment of a conservator or receiver for the regulated entity, or the troubled condition of the regulated entity (as defined in regulations prescribed by the Director);CommentsClose CommentsPermalink





‘(C) whether there is a reasonable basis to believe that the affiliated party has materially violated any applicable provision of Federal or State law or regulation that has had a material effect on the financial condition of the regulated entity;CommentsClose CommentsPermalink





‘(D) whether the affiliated party was in a position of managerial or fiduciary responsibility; andCommentsClose CommentsPermalink





‘(E) the length of time that the party was affiliated with the regulated entity, and the degree to which--CommentsClose CommentsPermalink





‘(i) the payment reasonably reflects compensation earned over the period of employment; andCommentsClose CommentsPermalink





‘(ii) the compensation involved represents a reasonable payment for services rendered.CommentsClose CommentsPermalink





‘(3) CERTAIN PAYMENTS PROHIBITED- No regulated entity may prepay the salary or any liability or legal expense of any affiliated party if such payment is made--CommentsClose CommentsPermalink





‘(A) in contemplation of the insolvency of such regulated entity, or after the commission of an act of insolvency; andCommentsClose CommentsPermalink





‘(B) with a view to, or having the result of--CommentsClose CommentsPermalink





‘(i) preventing the proper application of the assets of the regulated entity to creditors; orCommentsClose CommentsPermalink





‘(ii) preferring one creditor over another.CommentsClose CommentsPermalink





‘(4) GOLDEN PARACHUTE PAYMENT DEFINED-CommentsClose CommentsPermalink





‘(A) IN GENERAL- For purposes of this subsection, the term ‘golden parachute payment’ means any payment (or any agreement to make any payment) in the nature of compensation by any regulated entity for the benefit of any affiliated party pursuant to an obligation of such regulated entity that--CommentsClose CommentsPermalink





‘(i) is contingent on the termination of such party’s affiliation with the regulated entity; andCommentsClose CommentsPermalink





‘(ii) is received on or after the date on which--CommentsClose CommentsPermalink





‘(I) the regulated entity became insolvent;CommentsClose CommentsPermalink





‘(II) any conservator or receiver is appointed for such regulated entity; orCommentsClose CommentsPermalink





‘(III) the Director determines that the regulated entity is in a troubled condition (as defined in the regulations of the Director).CommentsClose CommentsPermalink





‘(B) CERTAIN PAYMENTS IN CONTEMPLATION OF AN EVENT- Any payment which would be a golden parachute payment but for the fact that such payment was made before the date referred to in subparagraph (A)(ii) shall be treated as a golden parachute payment if the payment was made in contemplation of the occurrence of an event described in any subclause of such subparagraph.CommentsClose CommentsPermalink





‘(C) CERTAIN PAYMENTS NOT INCLUDED- For purposes of this subsection, the term ‘golden parachute payment’ shall not include--CommentsClose CommentsPermalink





‘(i) any payment made pursuant to a retirement plan which is qualified (or is intended to be qualified) under section 401 of the Internal Revenue Code of 1986, or other nondiscriminatory benefit plan;CommentsClose CommentsPermalink





‘(ii) any payment made pursuant to a bona fide deferred compensation plan or arrangement which the Director determines, by regulation or order, to be permissible; orCommentsClose CommentsPermalink





‘(iii) any payment made by reason of the death or disability of an affiliated party.CommentsClose CommentsPermalink





‘(5) OTHER DEFINITIONS- For purposes of this subsection, the following definitions shall apply:CommentsClose CommentsPermalink





‘(A) INDEMNIFICATION PAYMENT- Subject to paragraph (6), the term ‘indemnification payment’ means any payment (or any agreement to make any payment) by any regulated entity for the benefit of any person who is or was an affiliated party, to pay or reimburse such person for any liability or legal expense with regard to any administrative proceeding or civil action instituted by the Agency which results in a final order under which such person--CommentsClose CommentsPermalink





‘(i) is assessed a civil money penalty;CommentsClose CommentsPermalink





‘(ii) is removed or prohibited from participating in conduct of the affairs of the regulated entity; orCommentsClose CommentsPermalink





‘(iii) is required to take any affirmative action to correct certain conditions resulting from violations or practices, by order of the Director.CommentsClose CommentsPermalink





‘(B) LIABILITY OR LEGAL EXPENSE- The term ‘liability or legal expense’ means--CommentsClose CommentsPermalink





‘(i) any legal or other professional expense incurred in connection with any claim, proceeding, or action;CommentsClose CommentsPermalink





‘(ii) the amount of, and any cost incurred in connection with, any settlement of any claim, proceeding, or action; andCommentsClose CommentsPermalink





‘(iii) the amount of, and any cost incurred in connection with, any judgment or penalty imposed with respect to any claim, proceeding, or action.CommentsClose CommentsPermalink





‘(C) PAYMENT- The term ‘payment’ includes--CommentsClose CommentsPermalink





‘(i) any direct or indirect transfer of any funds or any asset; andCommentsClose CommentsPermalink





‘(ii) any segregation of any funds or assets for the purpose of making, or pursuant to an agreement to make, any payment after the date on which such funds or assets are segregated, without regard to whether the obligation to make such payment is contingent on--CommentsClose CommentsPermalink





‘(I) the determination, after such date, of the liability for the payment of such amount; orCommentsClose CommentsPermalink





‘(II) the liquidation, after such date, of the amount of such payment.CommentsClose CommentsPermalink





‘(6) CERTAIN COMMERCIAL INSURANCE COVERAGE NOT TREATED AS COVERED BENEFIT PAYMENT- No provision of this subsection shall be construed as prohibiting any regulated entity from purchasing any commercial insurance policy or fidelity bond, except that, subject to any requirement described in paragraph (5)(A)(iii), such insurance policy or bond shall not cover any legal or liability expense of the regulated entity which is described in paragraph (5)(A).’.CommentsClose CommentsPermalink

Part 1 of subtitle C of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 ( 12 U.S.C. 78a) as a nationally registered statistical rating organization'4631 et seq.), as amended by this Act, is amended by adding at the end the following: CommentsClose CommentsPermalink

‘SEC. 1379E. REPORTING OF FRAUDULENT LOANS.

‘(a) Requirement to Report- The Director shall require a regulated entity to submit to the Director a timely report upon discovery by the regulated entity that it has purchased or sold a fraudulent loan or financial instrument, or suspects a possible fraud relating to the purchase or sale of any loan or financial instrument. The Director shall require each regulated entity to establish and maintain procedures designed to discover any such transactions.CommentsClose CommentsPermalink





‘(b) Protection From Liability for Reports- Any regulated entity that, in good faith, makes a report pursuant to subsection (a), and any entity-affiliated party, that, in good faith, makes or requires another to make any such report, shall not be liable to any person under any provision of law or regulation, any constitution, law, or regulation of any State or political subdivision of any State, or under any contract or other legally enforceable agreement (including any arbitration agreement) for such report or for any failure to provide notice of such report to the person who is the subject of such report or any other persons identified in the report.’.CommentsClose CommentsPermalink

SEC. 3201116. INCLUSION OF MINORITIES AND WOMEN; DIVERSITY IN AGENCY WORKFORCE.

Section 1319A of the Housing and Community Development Act of 1992 (12 U.S.C. 4520) is amended--CommentsClose CommentsPermalink





(1) in the section heading, by striking `‘equal opportunity in solicitation of contracts' and inserting `’ and inserting ‘minority and women inclusion; diversity requirements';(2) in subsection (a), by striking `(a) In General- Each enterprise' and inserting `(e) ’;CommentsClose CommentsPermalink





(2) in subsection (a), by striking ‘(a) In General- Each enterprise’ and inserting ‘(e) Outreach- Each regulatedentity' entity’; andCommentsClose CommentsPermalink





(3) by striking subsection (b);CommentsClose CommentsPermalink





(4) by inserting before subsection (e), as so redesignated by paragraph (2) of this section, the following new subsections:CommentsClose CommentsPermalink





`(a) Office of ‘(a) Office of Minority and Women Inclusion- Each regulated entity shall establish an Office of Minority and Women Inclusion, or designate an office of the entity, that shall be responsible for carrying out this section and all matters of the entity relating to diversity in management, employment, and business activities in accordance with such standards and requirements as the Director shall establish.CommentsClose CommentsPermalink





`(b) ‘(b) Inclusion in All Levels of Business Activities- Each regulated entity shall develop and implement standards and procedures to ensure, to the maximum extent possible, the inclusion and utilization of minorities (as such term is defined in section 1204(c) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1811 note)) and women, and minority- and women-owned businesses (as such terms are defined in section 21A(r)(4) of the Federal Home Loan Bank Act (12 U.S.C. 1441a(r)(4)) (including financial institutions, investment banking firms, mortgage banking firms, asset management firms, broker-dealers, financial services firms, underwriters, accountants, brokers, investment consultants, and providers of legal services) in all business and activities of the regulated entity at all levels, including in procurement, insurance, and all types of contracts (including contracts for the issuance or guarantee of any debt, equity, or mortgage-related securities, the management of its mortgage and securities portfolios, the making of its equity investments, the purchase, sale and servicing of single- and multi-family mortgage loans, and the implementation of its affordable housing program and initiatives). The processes established by each regulated entity for review and evaluation for contract proposals and to hire service providers shall include a component that gives consideration to the diversity of the applicant.CommentsClose CommentsPermalink





`‘(c) Applicability- This section shall apply to all contracts of a regulated entity for services of any kind, including services that require the services of investment banking, asset management entities, broker-dealers, financial services entities, underwriters, accountants, investment consultants, and providers of legal services.CommentsClose CommentsPermalink





`‘(d) Inclusion in Annual Reports- Each regulated entity shall include, in the annual report submitted by the entity to the Director pursuant to section 309(k) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a(k)), section 307(c) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1456(c)), and section 20 of the Federal Home Loan Bank Act (12 U.S.C. 1440), as applicable, detailed information describing the actions taken by the entity pursuant to this section, which shall include a statement of the total amounts paid by the entity to third party contractors since the last such report and the percentage of such amounts paid to businesses described in subsection (b) of this section.'’; andCommentsClose CommentsPermalink





(5) by adding at the end the following new subsection:CommentsClose CommentsPermalink





`(f)‘(f) Diversity in Agency Workforce- The Agency shall take affirmative steps to seek diversity in its workforce at all levels of the agency consistent with the demographic diversity of the United States, which shall include--CommentsClose CommentsPermalink





`‘(1) heavily recruiting at historically Black colleges and universities, Hispanic-serving institutions, women'’s colleges, and colleges that typically serve majority minority populations;CommentsClose CommentsPermalink





`‘(2) sponsoring and recruiting at job fairs in urban communities, and placing employment advertisements in newspapers and magazines oriented toward women and people of color;CommentsClose CommentsPermalink





`‘(3) partnering with organizations that are focused on developing opportunities for minorities and women to place talented young minorities and women in industry internships, summer employment, and full-time positions; andCommentsClose CommentsPermalink





`‘(4) where feasible, partnering with inner-city high schools, girls'’ high schools, and high schools with majority minority populations to establish or enhance financial literacy programs and provide mentoring.'’.CommentsClose CommentsPermalink

SEC. 321. REGULATIONS AND ORDERS.Section 1319G of the Housing and Community Development Act of 1992 (12 U.S.C. 4526) is amended--(1) by striking subsection (a) and inserting the following new subsection:`1117. TEMPORARY AUTHORITY FOR PURCHASE OF OBLIGATIONS OF REGULATED ENTITIES BY SECRETARY OF TREASURY.

(a) Authority- The Director shall issue any regulations, guidelines, and orders necessary to carry out the duties of the Director under this title and each of the authorizing statutes to ensure that the purposes of this title and such statutes are accomplished.';(2) in subsection (b), by inserting `, this title, or any of the authorizing statutes' after `under this section'; and(3) by striking subsection (c).SEC. 322. NON-WAIVER OF PRIVILEGES.Part 1 of subtitle A of title XIII of the Housing and Community Development Act of 1992Fannie Mae- Section 304 of the Federal National Mortgage Association Charter Act (12 U.S.C. 45111719) is amended by adding at the end the following new section:

`SEC. 1319H. PRIVILEGES NOT AFFECTED BY DISCLOSURE.`(a) In General- The submission by any person of any information to the Agency for any purpose in the course of any supervisory or regulatory process of the Agency shall not be construed as waiving, destroying, or otherwise affecting any privilege such person may claim with respect to such information under Federal or State law as to any person or entity other than the Agency.`(b) Rule of Construction- No provision of subsection (a) may be construed as implying or establishing that--`(1) any person waives any privilege applicable to information that is submitted or transferred under any circumstance to which subsection (a) does not apply; or`(2) any person would waive any privilege applicable to any information by submitting the information to the Agency, but for this subsection.'.

SEC. 323. RISK-BASED CAPITAL REQUIREMENTS.(a) In General- Section 1361 of the Housing and Community Development Act of 1992 (12 U.S.C. 4611) is amended to read as follows:`SEC. 1361. RISK-BASED CAPITAL LEVELS FOR REGULATED ENTITIES.`(a) In General-`(1) ENTERPRISES- The Director shall, by regulation, establish risk-based capital requirements for the enterprises to ensure that the enterprises operate in a safe and sound manner, maintaining sufficient capital and reserves to support the risks that arise in the operations and management of the enterprises.`(2) FEDERAL HOME LOAN BANKS- The Director shall establish risk-based capital standards under section 6 of the Federal Home Loan Bank Act for the Federal home loan banks.`(b) Confidentiality of Information- Any person that receives any book, record, or information from the Director or a regulated entity to enable the risk-based capital requirements established under this section to be applied shall--`(1)ubsection:CommentsClose CommentsPermalink




‘(g) Temporary Authority of Treasury to Purchase Obligations and Securities; Conditions-CommentsClose CommentsPermalink





‘(1) AUTHORITY TO PURCHASE-CommentsClose CommentsPermalink





‘(A) GENERAL AUTHORITY- In addition to the authority under subsection (c) of this section, the Secretary of the Treasury is authorized to purchase any obligations and other securities issued by the corporation under any section of this Act, on such terms and conditions as the Secretary may determine and in such amounts as the Secretary may determine. Nothing in this subsection requires the corporation to issue obligations or securities to the Secretary without mutual agreement between the Secretary and the corporation. Nothing in this subsection permits or authorizes the Secretary, without the agreement of the corporation, to engage in open market purchases of the common securities of the corporation.CommentsClose CommentsPermalink





‘(B) EMERGENCY DETERMINATION REQUIRED- In connection with any use of this authority, the Secretary must determine that such actions are necessary to--CommentsClose CommentsPermalink





‘(i) provide stability to the financial markets;CommentsClose CommentsPermalink





‘(ii) prevent disruptions in the availability of mortgage finance; andCommentsClose CommentsPermalink





‘(iii) protect the taxpayer.CommentsClose CommentsPermalink





‘(C) CONSIDERATIONS- To protect the taxpayers, the Secretary of the Treasury shall take into consideration the following in connection with exercising the authority contained in this paragraph:CommentsClose CommentsPermalink





‘(i) The need for preferences or priorities regarding payments to the Government.CommentsClose CommentsPermalink





‘(ii) Limits on maturity or disposition of obligations or securities to be purchased.CommentsClose CommentsPermalink





‘(iii) The corporation’s plan for the orderly resumption of private market funding or capital market access.CommentsClose CommentsPermalink





‘(iv) The probability of the corporation fulfilling the terms of any such obligation or other security, including repayment.CommentsClose CommentsPermalink





‘(v) The need to maintain the confidentiality of the book, record, or information in a manner that is generally consistent with the level of confidentiality established for the material by the Director or the regulated entity; and`(2) be exempt fromsection 552 of title 5, United States Code, with respect to the book, record, or information.`(c) No Limitation- Nothing in this section shall limit the authority of the Director to require other reports or undertakings, or take other action, in furtherance of the responsibilities of the Director under this Act.'.(b) Federal Home Loan Banks Risk-Based Capital- Section 6(a)(3) of the Federal Home Loan Bank Act (12 U.S.C. 1426(a)(3)) is amended--(1) by striking subparagraph (A) and inserting the following new subparagraph:`(A) RISK-BASED CAPITAL STANDARDS- The Director shall, by regulation, establish risk-based capital standards for the Federal home loan banks to ensure that the Federal home loan banks operate in a safe and sound manner, with sufficient permanent capital and reserves to support the risks that arise in the operations and management of the Federal home loans banks.'; and(2) in subparagraph (B), by striking `(A)(ii)' and inserting `(A)'.SEC. 324. MINIMUM AND CRITICAL CAPITAL LEVELS.(a) Minimum Capital Level- Section 1362 of the Housing and Community Development Act of 1992 (12 U.S.C. 4612) is amended--(1) in subsection (a), by striking `In General' and inserting `Enterprises'; and(2) by striking subsection (b) and inserting the following new subsections:`(b) Federal Home Loan Banks- For purposes of this subtitle, the minimum capital level for each Federal home loan bank shall be the minimum capital required to be maintained to comply with the leverage requirement for the bank established under section 6(a)(2) of the Federal Home Loan Bank Act (12 U.S.C. 1426(a)(2)).`(c) Establishment of Revised Minimum Capital Levels- Notwithstanding subsections (a) and (b) and notwithstanding the capital classifications of the regulated entities, the Director may, by regulations issued under section 1319G, establish a minimum capital level for the enterprises, for the Federal home loan banks, or for both the enterprises and the banks, that is higher than the level specified in subsection (a) for the enterprises or the level specified in subsection (b) for the Federal home loan banks, to the extent needed to ensure that the regulated entities operate in a safe and sound manner.`(d) Authority To Require Temporary Increase- Notwithstanding subsections (a) and (b) and any minimum capital level established pursuant to subsection (c), the Director may, by order, increase the minimum capital level for a regulated entity on a temporary basis for such period as the Director may provide if the Director--`(1) makes any determination specified in subparagraphs (A) through (C) of section 1364(c)(1);`(2) determines that the regulated entity has violated any of the prudential standards established pursuant to section 1313A and, as a result of such violation, determines that an unsafe and unsound condition exists; or`(3) determines that an unsafe and unsound condition exists, except that a temporary increase in minimum capital imposed on a regulated entity pursuant to this paragraph shall not remain in place for a period of more than 6 months unless the Director makes a renewed determination of the existence of an unsafe and unsound condition.`(e) Authority To Establish Additional Capital and Reserve Requirements for Particular Programs- The Director may, at any time by order or regulation, establish such capital or reserve requirements with respect to any program or activity of a regulated entity as the Director considers appropriate to ensure that the regulated entity operates in a safe and sound manner, with sufficient capital and reserves to support the risks that arise in the operations and management of the regulated entity.`(f) Periodic Review- The Director shall periodically review the amount of core capital maintained by the enterprises, the amount of capital retained by the Federal home loan banks, and the minimum capital levels established for such regulated entities pursuant to this section. The Director shall rescind any temporary minimum capital level increase if the Director determines that the circumstances or facts justifying the temporary increase are no longer present.'rporation’s status as a private shareholder-owned company.CommentsClose CommentsPermalink





‘(vi) Restrictions on the use of corporation resources, including limitations on the payment of dividends and executive compensation and any such other terms and conditions as appropriate for those purposes.CommentsClose CommentsPermalink





‘(D) REPORTS TO CONGRESS- Upon exercise of this authority, the Secretary shall report to the Committees on the Budget, Financial Services, and Ways and Means of the House of Representatives and the Committees on the Budget, Finance, and Banking, Housing, and Urban Affairs of the Senate as to the necessity for the purchase and the determinations made by the Secretary under subparagraph (B) and with respect to the considerations required under subparagraph (C), and the size, terms, and probability of repayment or fulfillment of other terms of such purchase.CommentsClose CommentsPermalink





‘(2) RIGHTS; SALE OF OBLIGATIONS AND SECURITIES-CommentsClose CommentsPermalink





‘(A) EXERCISE OF RIGHTS- The Secretary of the Treasury may, at any time, exercise any rights received in connection with such purchases.CommentsClose CommentsPermalink





‘(B) SALE OF OBLIGATION AND SECURITIES- The Secretary of the Treasury may, at any time, subject to the terms of the security or otherwise upon terms and conditions and at prices determined by the Secretary, sell any obligation or security acquired by the Secretary under this subsection.CommentsClose CommentsPermalink





‘(C) APPLICATION OF SUNSET TO PURCHASED OBLIGATIONS OR SECURITIES- The authority of the Secretary of the Treasury to hold, exercise any rights received in connection with, or sell, any obligations or securities purchased is not subject to the provisions of paragraph (4).CommentsClose CommentsPermalink





‘(3) FUNDING- For the purpose of the authorities granted in this subsection, the Secretary of the Treasury may use the proceeds of the sale of any securities issued under chapter 31 of Title 31, and the purposes for which securities may be issued under chapter 31 of Title 31 are extended to include such purchases and the exercise of any rights in connection with such purchases. Any funds expended for the purchase of, or modifications to, obligations and securities, or the exercise of any rights received in connection with such purchases under this subsection shall be deemed appropriated at the time of such purchase, modification, or exercise.CommentsClose CommentsPermalink





‘(4) TERMINATION OF AUTHORITY- The authority under this subsection (g), with the exception of paragraphs (2) and (3) of this subsection, shall expire December 31, 2009.CommentsClose CommentsPermalink





‘(5) AUTHORITY OF THE DIRECTOR WITH RESPECT TO EXECUTIVE COMPENSATION- The Director shall have the power to approve, disapprove, or modify the executive compensation of the corporation, as defined under Regulation S-K, 17 C.F.R. 229.’.CommentsClose CommentsPermalink





(b) Critical Capital Levels-(1) IN GENERAL- Section 1363 of the Housing and Community Development Act of 1992 Freddie Mac- Section 306 of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 4613) is amended--(A) by striking `For' and inserting `(a) Enterprises- For'; and(B) by adding at the end the following new subsection:`(b) Federal Home Loan Banks-`(1) IN GENERAL- For purposes of this subtitle, the critical capital level for each Federal home loan bank shall be such amount of capital as the Director shall, by regulation require.`(2) CONSIDERATION OF OTHER CRITICAL CAPITAL LEVELS- In establishing the critical capital level under paragraph (1) for the Federal home loan banks, the Director shall take due consideration of the critical capital level established under subsection (a) for the enterprises, with such modifications as the Director determines to be appropriate1455) is amended by adding at the end the following new subsection:CommentsClose CommentsPermalink





‘(l) Temporary Authority of Treasury to reflect the difference in operations between the banks and the enterprises.'.(2) REGULATIONS- Not later than the expirationPurchase Obligations and Securities; Conditions-CommentsClose CommentsPermalink





‘(1) AUTHORITY TO PURCHASE-CommentsClose CommentsPermalink





‘(A) GENERAL AUTHORITY- In addition to the authority under subsection (c) of this section, the Secretary of the Treasury is authorized to purchase any obligations and other securities issued by the Corporation under any section of this Act, on such terms and conditions as the Secretary may determine and in such amounts as the Secretary may determine. Nothing in this subsection requires the Corporation to issue obligations or securities to the Secretary without mutual agreement between the Secretary and the Corporation. Nothing in this subsection permits or authorizes the Secretary, without the agreement of the 180-day period beginning on the effective date under section 365, the Director of the Federal Housing Finance Agency shall issue regulations pursuant to section 1363(b) of the Housing and Community Development Act of 1992 (as added by paragraph (1) of this subsection) establishing the critical capital level under such section.SEC. 325. REVIEW OF AND AUTHORITY OVER ENTERPRISE ASSETS AND LIABILITIES.(a) In General- Subtitle B of title XIII of the Housing and Community Development Act of 1992 (12 U.S.C. 4611 et seq.) is amended--(1) by striking the subtitle designation and heading and inserting the following:

`Subtitle B--Required Capital Levels for Regulated Entities, Special Enforcement Powers, and Reviews of Assets and Liabilities';

and(2) by adding at the end the following new section:`SEC. 1369E. REVIEWS OF ENTERPRISE ASSETS AND LIABILITIES.`(a) In General- The Director shall, by regulation, establish standards by which the portfolio holdings, or rate of growth of the portfolio holdings, of the enterprises will be deemed to be consistent with the mission and the safe and sound operations of the enterprises. In developing such standards, the Director shall consider--`(1) the size or growth of the mortgage market;`(2) the need for the portfolio in maintaining liquidity or stability of the secondary mortgage market (including the market for the mortgage-backed securities the enterprises issue);`(3) the need for an inventory of mortgages in connection with securitizations;`(4) the need for the portfolio to directly support the affordable housing mission of the enterprises;`(5) the liquidity needs of the enterprises;`(6) any potential risks posed to the enterprises by the nature of the portfolio holdings; and`(7) any additional factors that the Director determines to be necessary to carry out the purpose under the first sentence of this subsection to establish standards for assessing whether the portfolio holdings are consistent with the mission and safe and sound operations of the enterprises.`(b) Temporary Adjustments- The Director may, by order, make temporary adjustments to the established standards for an enterprise or both enterprises, such as during times of economic distress or market disruption.`(c) Authority To Require Disposition or Acquisition- The Director shall monitor the portfolio of each enterprise. Pursuant to subsection (a) and notwithstanding the capital classifications of the enterprises, the Director may, by order, require an enterprise, under such terms and conditions as the Director determines to be appropriate, to dispose of or acquire any asset, if the Director determines that such action is consistent with the purposes of this Act or any of the authorizing statutes.'.(b) Regulations- Not later than the expirationCorporation, to engage in open market purchases of the common securities of the Corporation.CommentsClose CommentsPermalink




‘(B) EMERGENCY DETERMINATION REQUIRED- In connection with any use of this authority, the Secretary must determine that such actions are necessary to--CommentsClose CommentsPermalink





‘(i) provide stability to the financial markets;CommentsClose CommentsPermalink





‘(ii) prevent disruptions in the availability of mortgage finance; andCommentsClose CommentsPermalink





‘(iii) protect the taxpayer.CommentsClose CommentsPermalink





‘(C) CONSIDERATIONS- To protect the taxpayers, the Secretary of the Treasury shall take into consideration the following in connection with exercising the authority contained in this paragraph:CommentsClose CommentsPermalink





‘(i) The need for preferences or priorities regarding payments to the Government.CommentsClose CommentsPermalink





‘(ii) Limits on maturity or disposition of obligations or securities to be purchased.CommentsClose CommentsPermalink





‘(iii) The Corporation’s plan for the orderly resumption of private market funding or capital market access.CommentsClose CommentsPermalink





‘(iv) The probability of the Corporation fulfilling the terms of any such obligation or other security, including repayment.CommentsClose CommentsPermalink





‘(v) The need to maintain the Corporation’s status as a private shareholder-owned company.CommentsClose CommentsPermalink





‘(vi) Restrictions on the use of Corporation resources, including limitations on the payment of dividends and executive compensation and any such other terms and conditions as appropriate for those purposes.CommentsClose CommentsPermalink





‘(D) REPORTS TO CONGRESS- Upon exercise of this authority, the Secretary shall report to the Committees on the Budget, Financial Services, and Ways and Means of the House of Representatives and the Committees on the Budget, Finance, and Banking, Housing, and Urban Affairs of the 180-day period beginning on the effective date under section 365, the Director of the Federal Housing Finance Agency shall issue regulations pursuant to section 1369E(a) of the Housing and Community Development Act of 1992 (as added by subsection (a) of this section) establishing the portfolio holdings standards under such section.SEC. 326. CORPORATE GOVERNANCE OF ENTERPRISES.The Housing and Community Development Act of 1992 is amended by inserting before section 1323 (12 U.S.C. 4543) the following new section:`SEC. 1322A. CORPORATE GOVERNANCE OF ENTERPRISES.`(a) Board of Directors-`(1) INDEPENDENCE- A majority of seated members of the board of directors of each enterprise shall be independent board members, as defined under rules set forth by the New York Stock Exchange, as such rules may be amended from time to time.`(2) FREQUENCY OF MEETINGS- To carry out its obligations and duties under applicable laws, rules, regulations, and guidelines, the board of directors of an enterprise shall meet at least eight times a year and not less than once a calendar quarter.`(3) NON-MANAGEMENT BOARD MEMBER MEETINGS- The non-management directors of an enterprise shall meet at regularly scheduled executive sessions without management participation.`(4) QUORUM; PROHIBITION ON PROXIES- For the transaction of business, a quorum of the board of directors of an enterprise shall beSenate as to the necessity for the purchase and the determinations made by the Secretary under subparagraph (B) and with respect to the considerations required under subparagraph (C), and the size, terms, and probability of repayment or fulfillment of other terms of such purchase.CommentsClose CommentsPermalink





‘(2) RIGHTS; SALE OF OBLIGATIONS AND SECURITIES-CommentsClose CommentsPermalink





‘(A) EXERCISE OF RIGHTS- The Secretary of the Treasury may, at any time, exercise any rights received in connection with such purchases.CommentsClose CommentsPermalink





‘(B) SALE OF OBLIGATION AND SECURITIES- The Secretary of the Treasury may, at any time, subject to the terms of the security or otherwise upon terms and conditions and at least a majority of the seated board of directors and a board member may not vote by proxy.`(5) INFORMATION- The management of an enterprise shall provide a board member of the enterprise prices determined by the Secretary, sell any obligation or security acquired by the Secretary under this subsection.CommentsClose CommentsPermalink





‘(C) APPLICATION OF SUNSET TO PURCHASED OBLIGATIONS OR SECURITIES- The authority of the Secretary of the Treasury to hold, exercise any rights received in connection with, or sell, any obligations or securities purchased is not subject to the provisions of paragraph (4).CommentsClose CommentsPermalink





‘(3) FUNDING- For the purpose of the authorities granted in this subsection, the Secretary of the Treasury may use the proceeds of the sale of any securities issued under chapter 31 of Title 31, and the purposes for which securities may be issued under chapter 31 of Title 31 are extended to include such purchases and the exercise of any rights in connection with such adequate and appropriate information that a reasonable board member would find important to the fulfillment of his or her fiduciary duties and obligations.`(6) ANNUAL REVIEW- At least annually, the board of directors of each enterprise shall review, with appropriate professional assistance, the requirements of laws, rules, regulations, and guidelines that are applicable to its activities and duties.`(b) Committees of Boards of Directors-`(1) FREQUENCY OF MEETINGS- Any committee of the board of directors of an enterprise shall meet with sufficient frequency to carry out its obligations and duties under applicable laws, rules, regulations, and guidelines.`(2) REQUIRED COMMITTEES- Each enterprise shall provide for the establishment, however styled, of the following committees of the board of directors:`(A) Audit committee.`(B) Compensation committee.`(C) Nominating/corporate governance committee.Such committees shall be in compliance with the charter, independence, composition, expertise, duties, responsibilities, and other requirements set forth under section 10A(m) of the Securities Exchange Act of 1934 (15 U.S.C. 78j-1(m)), with respect to the audit committee, and under rules issued by the New York Stock Exchange, as such rules may be amended from time to time.`(c) Compensation-`(1) IN GENERAL- The compensation of board members, executive officers, and employees of an enterprise--`(A) shall not be in excess of that which is reasonable and appropriate;`(B) shall be commensurate with the duties and responsibilities of such persons;`(C) shall be consistent with the long-term goals of the enterprise;`(D) shall not focus solely on earnings performance, but shall take into account risk management, operational stability and legal and regulatory compliance as well; and`(E) shall be undertaken in a manner that complies with applicable laws, rules, and regulations.`(2) REIMBURSEMENT- If an enterprise is required to prepare an accounting restatement due to the material noncompliance of the enterprise, as a result of misconduct, with any financial reporting requirement under the securities laws, the chief executive officer and chief financial officer of the enterprise shall reimburse the enterprise as provided under section 304 of the Sarbanes-Oxley Act of 2002 (15purchases. Any funds expended for the purchase of, or modifications to, obligations and securities, or the exercise of any rights received in connection with such purchases under this subsection shall be deemed appropriated at the time of such purchase, modification, or exercise.CommentsClose CommentsPermalink





‘(4) TERMINATION OF AUTHORITY- The authority under this subsection (l), with the exception of paragraphs (2) and (3) of this subsection, shall expire December 31, 2009.CommentsClose CommentsPermalink





‘(5) AUTHORITY OF THE DIRECTOR WITH RESPECT TO EXECUTIVE COMPENSATION- The Director shall have the power to approve, disapprove, or modify the executive compensation of the Corporation, as defined under Regulation S-K, 17 C.F.R. 229.’.CommentsClose CommentsPermalink





(c) Federal Home Loan Banks- Section 11 of the Federal Home Loan Bank Act ( 12 U.S.C. 7243). This provision does not otherwise limit the authority of the Agency to employ remedies available to it under its enforcement authorities.`(d) Code of Conduct and Ethics-`(1) IN GENERAL- An enterprise shall establish and administer a written code of conduct and ethics that is reasonably designed to assure the ability of board members, executive officers, and employees of the enterprise1431 ) is amended by adding at the end the following new subsection: CommentsClose CommentsPermalink





‘(l) Temporary Authority of Treasury to discharge their duties and responsibilities, on behalf of the enterprise, in an objective and impartial manner, and that includes standards required under section 406 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7264) and other applicable laws, rules, and regulations.`(2) REVIEW- Not less than once every three years, an enterprise shall review the adequacy of its code of conduct and ethics for consistency with practices appropriate to the enterprise and make any appropriate revisions to such code.`(e) Conduct and Responsibilities of Board of Directors- The board of directors of an enterprise shall be responsible for directing the conduct and affairs of the enterprise in furtherance of the safe and sound operation of the enterprise and shall remain reasonably informed of the condition, activities, and operations of the enterprise. The responsibilities of the board of directors shall include having in place adequate policies and procedures to assure its oversight of, among other matters, the following:`(1) Corporate strategy, major plans of action, risk policy, programs for legal and regulatory compliance and corporate performance, including prudent plans for growth and allocation of adequate resources to manage operations risk.`(2) Hiring and retention of qualified executive officers and succession planning for such executive officers.`(3) Compensation programs of the enterprise.`(4) Integrity of accounting and financial reporting systems of the enterprise, including independent audits and systems of internal control.`(5) Process and adequacy of reporting, disclosures, and communications to shareholders, investors, and potential investors.`(6) Extensions of credit to board members and executive officers.`(7) Responsiveness of executive officers in providing accurate and timely reports to Federal regulators and in addressing the supervisory concerns of Federal regulators in a timely and appropriate manner.`(f) Prohibition of Extensions of Credit- An enterprise may not directly or indirectly, including throughPurchase Obligations; Conditions-CommentsClose CommentsPermalink





‘(1) AUTHORITY TO PURCHASE-CommentsClose CommentsPermalink





‘(A) GENERAL AUTHORITY- In addition to the authority under subsection (i) of this section, the Secretary of the Treasury is authorized to purchase any obligations issued by any Federal Home Loan Bank under any section of this Act, on such terms and conditions as the Secretary may determine and in such amounts as the Secretary may determine. Nothing in this subsection requires a Federal Home Loan Bank to issue obligations or securities to the Secretary without mutual agreement between the Secretary and the Federal Home Loan Bank. Nothing in this subsection permits or authorizes the Secretary, without the agreement of the Federal Home Loan Bank, to engage in open market purchases of the common securities of any Federal Home Loan Bank.CommentsClose CommentsPermalink





‘(B) EMERGENCY DETERMINATION REQUIRED- In connection with any use of this authority, the Secretary must determine that such actions are necessary to--CommentsClose CommentsPermalink





‘(i) provide stability to the financial markets;CommentsClose CommentsPermalink





‘(ii) prevent disruptions in the availability of mortgage finance; andCommentsClose CommentsPermalink





‘(iii) protect the taxpayer.CommentsClose CommentsPermalink





‘(C) CONSIDERATIONS- To protect the taxpayers, the Secretary of the Treasury shall take into consideration the following in connection with exercising the authority contained in this paragraph:CommentsClose CommentsPermalink





‘(i) The need for preferences or priorities regarding payments to the Government.CommentsClose CommentsPermalink





‘(ii) Limits on maturity or disposition of obligations or securities to be purchased.CommentsClose CommentsPermalink





‘(iii) The Federal Home Loan Bank’s plan for the orderly resumption of private market funding or capital market access.CommentsClose CommentsPermalink





‘(iv) The probability of the Federal Home Loan Bank fulfilling the terms of any such obligation or other security, including repayment.CommentsClose CommentsPermalink





‘(v) The need to maintain the Federal Home Loan Bank’s status as a private shareholder-owned company.CommentsClose CommentsPermalink





‘(vi) Restrictions on the use of Federal Home Loan Bank resources, including limitations on the payment of dividends and executive compensation and any such other terms and conditions as appropriate for those purposes.CommentsClose CommentsPermalink





‘(D) REPORTS TO CONGRESS- Upon exercise of this authority, the Secretary shall report to the Committees on the Budget, Financial Services, and Ways and Means of the House of Representatives and the Committees on the Budget, Finance, and Banking, Housing, and Urban Affairs of the Senate as to the necessity for the purchase and the determinations made by the Secretary under subparagraph (B) and with respect to the considerations required under subparagraph (C), and the size, terms, and probability of repayment or fulfillment of other terms of such purchase.CommentsClose CommentsPermalink





‘(2) RIGHTS; SALE OF OBLIGATIONS AND SECURITIES-CommentsClose CommentsPermalink





‘(A) EXERCISE OF RIGHTS- The Secretary of the Treasury may, at any time, exercise any rights received in connection with such purchases.CommentsClose CommentsPermalink





‘(B) SALE OF OBLIGATIONS- The Secretary of the Treasury may, at any subsidiary, extend or maintain credit, arrange for the extension of credit, or renew an extension of credit, in the form of a personal loan to or for any board member or executive officertime, subject to the terms of the enterprise, as provided by section 13(k) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(k)).`(g) Certification of Disclosures- The chief executive officer and the chief financial officer of an enterprise shall review each quarterly report and annual report issued by the enterprise and such reports shall include certifications by such officers as required by section 302 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7241).`(h) Change of Audit Partner- An enterprise may not accept audit services from an external auditing firm if the lead or coordinating audit partner who has primary responsibility for the external audit of the enterprise, or the external audit partner who has responsibility for reviewing the external audit has performed audit services for the enterprise in each of the five previous fiscal years.`(i) Compliance Program-`(1) REQUIREMENT- Each enterprise shall establish and maintain a compliance program that is reasonably designed to assure that the enterprise complies with applicable laws, rules, regulations, and internal controls.`(2) COMPLIANCE OFFICER- The compliance program of an enterprise shall be headed by a compliance officer, however styled, who reports directly to the chief executive officer of the enterprise. The compliance officer shall report regularly to the board of directors or an appropriate committee of the board of directors on compliance with and the adequacy of current compliance policies and procedures of the enterprise, and shall recommend any adjustments to such policies and procedures that the compliance officer considers necessary and appropriate.`(j) Risk Management Program-`(1) REQUIREMENT- Each enterprise shall establish and maintain a risk management program that is reasonably designed to manage the risks of the operations of the enterprise.`(2) RISK MANAGEMENT OFFICER- The risk management program of an enterprisesecurity or otherwise upon terms and conditions and at prices determined by the Secretary, sell any obligation acquired by the Secretary under this subsection.CommentsClose CommentsPermalink





‘(C) APPLICATION OF SUNSET TO PURCHASED OBLIGATIONS- The authority of the Secretary of the Treasury to hold, exercise any rights received in connection with, or sell, any obligations purchased is not subject to the provisions of paragraph (4).CommentsClose CommentsPermalink





‘(3) FUNDING- For the purpose of the authorities granted in this subsection, the Secretary of the Treasury may use the proceeds of the sale of any securities issued under chapter 31 of Title 31, and the purposes for which securities may be issued under chapter 31 of Title 31 are extended to include such purchases and the exercise of any rights in connection with such purchases. Any funds expended for the purchase of, or modifications to, obligations and securities, or the exercise of any rights received in connection with such purchases under this subsection shall be headed by a risk management officer, however styled, who reports directly to the chief executive officer of the enterprise. The risk management officer shall report regularly to the board of directors or an appropriate committee of the board of directors on compliance with and the adequacy of current risk management policies and procedures of the enterprise, and shall recommend any adjustments to such policies and procedures that the risk management officer considers necessary and appropriate.`(k) Compliance With Other Laws-`(1) DEREGISTERED OR UNREGISTERED COMMON STOCK- If an enterprise deregisters or has not registered its common stock with the Securities and Exchange Commission under the Securities Exchange Act of 1934, the enterprise shall comply or continue to comply with sections 10A(m) and 13(k) of the Securities Exchange Act of 1934 (15 U.S.C. 78j-1(m), 78m(k)) and sections 302, 304, and 406 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7241, 7243, 7264), subject to such requirements as provided by subsection (l) of this section.`(2) REGISTERED COMMON STOCK- An enterprise that has its common stock registered with the Securities and Exchange Commission shall maintain such registered status, unless it provides 60 days prior written notice to the Director stating its intent to deregister and its understanding that it will remain subject to the requirements of the sections of the Securities Exchange Act of 1934 and the Sarbanes-Oxley Act of 2002, subject to such requirements as provided by subsection (l) of this section.`(l) Other Matters- The Director may from time to time establish standards, by regulation, order, or guideline, regarding such other corporate governance matters of the enterprises as the Director considers appropriate.`(m) Modification of Standards- In connection with standards of Federal or State law (including the Revised Model Corporation Act) or New York Stock Exchange rules that are made applicable to an enterprise by section 1710.10 of the Director's rules (12 CFR 1710.10) and by subsections (a), (b), (g), (i), (j), and (k) of this section, the Director, in the Director's sole discretion, may modify the standards contained in this section or in part 1710 of the Director's rules (12 CFR Part 1710) in accordance withsection 553 of title 5, United States Code, and upon written notice to the enterprise.'.SEC. 327. REQUIRED REGISTRATION UNDER SECURITIES EXCHANGE ACT OF 1934.The Housing and Community Development Act of 1992 is amended by adding after section 1322A, as added by the preceding provisions of this title, the following new section:

`SEC. 1322B. REQUIRED REGISTRATION UNDER SECURITIES EXCHANGE ACT OF 1934.`(a) In General- Each regulated entity shall register at least one class of the capital stock of such regulated entity, and maintain such registration with the Securities and Exchange Commission, under the Securities Exchange Act of 1934.`(b) Enterprises- Each enterprise shall comply with sections 14 and 16 of the Securities Exchange Act of 1934.'.

SEC. 328. LIAISONdeemed appropriated at the time of such purchase, modification, or exercise.CommentsClose CommentsPermalink




‘(4) TERMINATION OF AUTHORITY- The authority under this subsection (l), with the exception of paragraphs (2) and (3) of this subsection, shall expire December 31, 2009.CommentsClose CommentsPermalink





‘(5) AUTHORITY OF THE DIRECTOR WITH RESPECT TO EXECUTIVE COMPENSATION- The Director shall have the power to approve, disapprove, or modify the executive compensation of the Federal Home Loan Bank, as defined under Regulation S-K, 17 C.F.R. 229.’.CommentsClose CommentsPermalink

SEC. 1118. CONSULTATION BETWEEN THE DIRECTOR OF THE FEDERAL HOUSING FINANCE AGENCY AND THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM TO ENSURE FINANCIAL INSTITUTIONS EXAMINATION COUNCIL.Section 1007 of the Federal Financial Institutions Examination Council Act of 1978MARKET STABILITY .

Subsection (a) of section 1313 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 3306) is amended--(1) in the section heading, by inserting after `STATE' the following: `AND FEDERAL HOUSING FINANCE AGENCY'; and(2) by inserting after `financial institutions' the following: `, and one representative of the Federal Housing Finance Agency,'.SEC. 329. GUARANTEE FEE STUDY.(a) In General- The Director of the Federal Housing Finance Agency, in consultation with the heads of the federal banking agencies, shall, not later than 18 months after the date of the enactment of this Act, submit to the Congress a study concerning the pricing, transparency and reporting of the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, and the Federal home loan banks with regard to guarantee fees and concerning analogous practices, transparency and reporting requirements (including advances pricing practices by the Federal Home Loan Banks) of other participants in the business of mortgage purchases and securitization.(b) Factors- The study required by this section shall examine various factors such as credit risk, counterparty risk considerations, economic value considerations, and volume considerations used by the regulated entities (as such term is defined in section 1303 of the Housing and Community Development Act of 1992) included in the study in setting the amount of fees they charge.(c) Contents of Report- The report required under subsection (a) shall identify and analyze--(1) the factors used by each enterprise (as such term is defined in section 1303 of the Housing and Community Development Act of 1992) in determining the amount of4513), as amended by the preceding provisions of this Act, is further amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





‘(3) COORDINATION WITH THE CHAIRMAN OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM-CommentsClose CommentsPermalink





‘(A) CONSULTATION- The Director shall consult with, and consider the views of, the Chairman of the Board of Governors of the Federal Reserve System, with respect to the risks posed by the regulated entities to the financial system, prior to issuing any proposed or final regulations, orders, and guidelines with respect to the exercise of the additional authority provided in this Act regarding prudential management and operations standards, safe and sound operations of, and capital requirements and portfolio standards applicable to the regulated entities (as such term is defined in section 1303). The Director also shall consult with the Chairman regarding any decision to place a regulated entity into conservatorship or receivership.CommentsClose CommentsPermalink





‘(B) INFORMATION SHARING- To facilitate the consultative process, the Director shall share information with the Board of Governors of the Federal Reserve System on a regular, periodic basis as determined by the Director and the Board regarding the guarantee fees it charges;(2) the total revenue the enterprises earn from guarantee fees;(3) the total costs incurred by the enterprises for providing guarantees;(4) the average guarantee fee charged by the enterprises;(5) an analysis of how and why the guarantee fees charged differ from such fees charged during the previous year;(6) a breakdown of the revenue and costs associated with providing guarantees, based on product type and risk classifications; and(7) other relevant information on guarantee fees with other participants in the mortgage and securitization business.(d) Protection of Information- Nothing in this section may be construed to require or authorize the Director of the Federal Housing Finance Agency, in connection with the study mandated by this section,capital, asset and liabilities, financial condition, and risk management practices of the regulated entities as well as any information related to financial market stability.CommentsClose CommentsPermalink





‘(C) TERMINATION OF CONSULTATION REQUIREMENT- The requirement of the Director to disclose information of the enterprises or other organization that is confidential or proprietary.(e) Effective Date- This section shall take effect on the date of the enactment of this Act.SEC. 330. CONFORMING AMENDMENTS.(a) 1992 Act- Part 1 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (12 U.S.C. 4511 et seq.), as amended by the preceding provisions of this title, is further amended--(1) by striking `an enterprise' each place such term appears in such part (except in sections 1313(a)(2)(A), 1313A(b)(2)(B)(ii)(I), and 1316(b)(3)) and inserting `a regulated entity';(2) by striking `the enterprise' each place such term appears in such part (except in section 1316(b)(3)) and inserting `the regulated entity';(3) by striking `the enterprises' each place such term appears in such part (except in sections 1312(c)(2), and 1312(e)(2)) and inserting `the regulated entities';(4) by striking `each enterprise' each place such term appears in such part and inserting `each regulated entity';(5) by striking `Office' each place such term appears in such part (except in sections 1311(b)(2), 1312(b)(5), 1315(b), and 1316(a)(4), (g), and (h), 1317(c), and 1319A(a)) and inserting `Agency';(6) in section 1315 (12 U.S.C. 4515)--(A) in subsection (a)--(i) in the subsection heading, by striking `Office Personnel' and inserting `In General'; and(ii) by striking `The' and inserting `Subject to subtitle C of the Federal Housing Finance Reform Act of 2008, the';(B) by striking subsections (d) and (f); and(C) by redesignating subsection (e) as subsection (d);(7) in section 1319B (12 U.S.C. 4521), by striking `Committee on Banking, Finance and Urban Affairs' each place such term appears and inserting `Committee on Financial Services'; and(8) in section 1319F (12 U.S.C. 4525), striking all that follows `United States Code' and inserting `, the Agency shall be considered an agency responsible for the regulation or supervision of financial institutions.'.(b) Amendments to Fannie Mae Charter Act- The Federal National Mortgage Association Charter Act (12 U.S.C. 1716 et seq.) is amended--(1) by striking `Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' each place such term appears, and inserting `Director of the Federal Housing Finance Agency', in--(A) section 303(c)(2) (12 U.S.C. 1718(c)(2));(B) section 309(d)(3)(B) (12 U.S.C. 1723a(d)(3)(B)); and(C) section 309(k)(1); and(2) in section 309--(A) in subsections (d)(3)(A) and (n)(1), by striking `Banking, Finance and Urban Affairs' each place such term appears and inserting `Financial Services'; and(B) in subsection (m)--(i) in paragraph (1), by striking `Secretary' the second place such term appears and inserting `Director';(ii) in paragraph (2), by striking `Secretary' the second place such term appears and inserting `Director'; and(iii) by striking `Secretary' each other place such term appears and inserting `Director of the Federal Housing Finance Agency'; and(C) in subsection (n), by striking `Secretary' each place such term appears and inserting `Director of the Federal Housing Finance Agency'.(c) Amendments to Freddie Mac Act- The Federal Home Loan Mortgage Corporation Act is amended--(1) by striking `Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' each place such term appears, and inserting `Director of the Federal Housing Finance Agency', in--(A) section 303(b)(2) (12 U.S.C. 1452(b)(2));(B) section 303(h)(2) (12 U.S.C. 1452(h)(2)); and(C) section 307(c)(1) (12 U.S.C. 1456(c)(1));(2) in sections 303(h)(1) and 307(f)(1) (12 U.S.C. 1452(h)(1), 1456(f)(1)), by striking `Banking, Finance and Urban Affairs' each place such term appears and inserting `Financial Services';(3) in section 306(i) (12 U.S.C. 1455(i))--(A) by striking `1316(c)' and inserting `306(c)'; and(B) by striking `section 106' and inserting `section 1316'; and(4) in section 307 (12 U.S.C. 1456))--(A) in subsection (e)--(i) in paragraph (1), by striking `Secretary' the second place such term appears and inserting `Director';(ii) in paragraph (2), by striking `Secretary' the second place such term appears and inserting `Director'; and(iii) by striking `Secretary' each other place such term appears and inserting `Director of the Federal Housing Finance Agency'; and(B) in subsection (f), by striking `Secretary' each place such term appears and inserting `Director of the Federal Housing Finance Agency'.CHAPTER 2--IMPROVEMENT OF MISSION SUPERVISIONSEC. 33consult with the Board of Governors of the Federal Reserve System under this paragraph shall expire at the conclusion of December 31, 2009.’.CommentsClose CommentsPermalink

SEC. 1121. TRANSFER OF PRODUCTGRAM APPROVAL AND HOUSING GOAL OVERSIGHT.

Part 2 of subtitle A of title XIII of the Housing and Community Developmenthe Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4541 et seq.) is amended--CommentsClose CommentsPermalink





(1) by striking the designation and heading for the part and inserting the following:CommentsClose CommentsPermalink

`PART 2--PRODUCT APPROVAL BY DIRECTOR, CORPORATE GOVERNANCE, AND ESTABLISHMENT OF HOUSING GOALS';

and(2) by striking sections ‘PART 2--ADDITIONAL AUTHORITIES OF THE DIRECTOR’;

andCommentsClose CommentsPermalink





(2) by striking sections 1321 and 1322.CommentsClose CommentsPermalink

SEC. 3321122. ASSUMPTION BY THE DIRECTOR OF CERTAIN OTHER HUD RESPONSIBILITIES.

SEC. 1123. REVIEW OF ENTERPRISE PRODUCTS.

(a) In General- Part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 is amended by inserting before section 1323Part 2 of subtitle A of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4543) the following new section:`1 et seq.) is amended by inserting before section 1323 the following:CommentsClose CommentsPermalink

‘SEC. 1321. PRIOR APPROVAL AUTHORITY FOR PRODUCTS OF ENTERPRISES.`.

‘(a) In General- The Director shall require each enterprise to obtain the approval of the Director for any product of the enterprise before initially offering the product.CommentsClose CommentsPermalink





`‘(b) Standard for Approval- In considering any request for approval of a product pursuant to subsection (a), the Director shall make a determination that--CommentsClose CommentsPermalink





`‘(1) in the case of a product of the Federal National Mortgage Association, the Director determines that the product is authorized under paragraph (2), (3), (4), or (5) of section 302(b) or section 304 of the Federal National Mortgage Association Charter Act, (12 U.S.C. 1717(b), 1719);CommentsClose CommentsPermalink





`(2) in the case of a product of the Federal Home Loan Mortgage Corporation, the Director determines that‘(2) in the case of a product of the Federal Home Loan Mortgage Corporation, the product is authorized under paragraph (1), (4), or (5) of section 305(a) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a));CommentsClose CommentsPermalink





`(3) the product is in the public interest;` ‘(3) the product is in the public interest; and CommentsClose CommentsPermalink





‘(4) the product is consistent with the safety and soundness of the enterprise or the mortgage finance system; and`(5) the product does not materially impair the efficiency of the mortgage finance system.`.CommentsClose CommentsPermalink





‘(c) Procedure for Approval-CommentsClose CommentsPermalink





`‘(1) SUBMISSION OF REQUEST- An enterprise shall submit to the Director a written request for approval of a product that describes the product in such form as prescribed by order or regulation of the Director.CommentsClose CommentsPermalink





`‘(2) REQUEST FOR PUBLIC COMMENT- Immediately upon receipt of a request for approval of a product, as required under paragraph (1), the Director shall publish notice of such request and of the period for public comment pursuant to paragraph (3) regarding the product, and a description of the product proposed by the request. The Director shall give interested parties the opportunity to respond in writing to the proposed product.CommentsClose CommentsPermalink





`‘(3) PUBLIC COMMENT PERIOD- During the 30-day period beginning on the date of publication pursuant to paragraph (2) of a request for approval of a product, the Director shall receive public comments regarding the proposed product.CommentsClose CommentsPermalink





`‘(4) OFFERING OF PRODUCT-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- Not later than 30 days after the close of the public comment period described in paragraph (3), the Director shall approve or deny the product, specifying the grounds for such decision in writing.CommentsClose CommentsPermalink





`‘(B) FAILURE TO ACT- If the Director fails to act within the 30-day period described in subparagraph (A), the enterprise may offer the product.`(d) Expedited Review-`(1) DETERMINATION AND NOTICE- If an enterprise determines that any new activity, service, undertaking, or offering is not a product, as defined in subsection (f), the enterprise shall provide written notice to the Director prior to the commencement of such activity, service, undertaking, or offering.`(2) DIRECTOR DETERMINATION OF APPLICABLE PROCEDURE- Immediately upon receipt of any notice pursuant to paragraph (1), the Director shall make a determination under paragraph (3).`(3) DETERMINATION AND TREATMENT AS PRODUCT- If the Director determines that any new activity, service, undertaking, or offering consists of, relates to, or involves a product--`(A) the Director shall notify the enterprise of the determination;`(B) the new activity, service, undertaking, or offering described in the notice under paragraph (1) shall be considered a product for purposes of this section; and`(C) the enterprise shall withdraw its request or submit a written request for approval of the product pursuant to subsection (c).`(en the enterprise may offer the product.CommentsClose CommentsPermalink





‘(C) TEMPORARY APPROVAL- The Director may, subject to the rules of the Director, provide for temporary approval of the offering of a product without a public comment period, if the Director finds that the existence of exigent circumstances makes such delay contrary to the public interest.CommentsClose CommentsPermalink





‘(d) Conditional Approval- The Director may conditionally approveIf the Director approves the offering of any product by an enterprise, and may establishthe Director may establish terms, conditions, or limitations with respect to such product with which the enterprise must comply in order to offer such product.CommentsClose CommentsPermalink





`(f) Definition of Product- For purposes of this section, the term `product' does not include--`(1 ‘(e) Exclusions- CommentsClose CommentsPermalink





‘(1) IN GENERAL- The requirements of subsections (a) through (d) do not apply with respect to--CommentsClose CommentsPermalink





‘(A) the automated loan underwriting system of an enterprise in existence as of the date of the enactment of the Federal Housing Financeenactment of the Federal Housing Finance Regulatory Reform Act of 2008, including any upgrade to the technology, operating system, or software to operate the underwriting system;CommentsClose CommentsPermalink





or`(2‘(B) any modification to the mortgage terms and conditions or mortgage underwriting criteria relating to the mortgages that are purchased or guaranteed by an enterprise:Provided, T, provided that such modifications do not alter the underlying transaction so as to include services or financing, other than residential mortgage financing, or create significant new exposure to risk for the enterprise or the holder of the mortgage.`(g) ; orCommentsClose CommentsPermalink





‘(C) any other activity that is substantially similar, as determined by rule of the Director to--CommentsClose CommentsPermalink





‘(i) the activities described in subparagraphs (A) and (B); andCommentsClose CommentsPermalink





‘(ii) other activities that have been approved by the Director in accordance with this section.CommentsClose CommentsPermalink





‘(2) EXPEDITED REVIEW-CommentsClose CommentsPermalink





‘(A) ENTERPRISE NOTICE- For any new activity that an enterprise considers not to be a product, the enterprise shall provide written notice to the Director of such activity, and may not commence such activity until the date of receipt of a notice under subparagraph (B) or the expiration of the period described in subparagraph (C). The Director shall establish, by regulation, the form and content of such written notice.CommentsClose CommentsPermalink





‘(B) DIRECTOR DETERMINATION- Not later than 15 days after the date of receipt of a notice under subparagraph (A), the Director shall determine whether such activity is a product subject to approval under this section. The Director shall, immediately upon so determining, notify the enterprise.CommentsClose CommentsPermalink





‘(C) FAILURE TO ACT- If the Director fails to determine whether such activity is a product within the 15-day period described in subparagraph (B), the enterprise may commence the new activity in accordance with subparagraph (A).CommentsClose CommentsPermalink





‘(f) No Limitation- Nothing in this section shallmay be deemed to restrict--`construed to restrict--CommentsClose CommentsPermalink





‘(1) the safety and soundness authority of the Director over all new and existing products or activities; orCommentsClose CommentsPermalink





`(2) the authority of the ‘(2) the authority of the Director to review all new and existing products or activities to determine that such products or activities are consistent with the statutory mission of the enterprise.'.(b) Conforming Amendments-(1) FANNIE MAE- Section 302(b)(6) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1717(b)(6)) is amended--(A) by striking `implement any new program' and inserting `initially offer any product';(B) by striking `section 1303' and inserting `section 1321(f)'; and(C) by striking `before obtaining the approval of the Secretary under section 1322' and inserting `except in accordance with section 1321'.(2) FREDDIE MAC- Section 305(c) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1454(c)) is amended--(A) by striking `implement any new program' and inserting `initially offer any product';(B) by striking `section 1303' and inserting `section 1321(f)'; and(C) by striking `before obtaining the approval of the Secretary under section 1322' and inserting `except in accordance with section 1321'.(3) 1992 ACT- Section 1303 of the Housing and Community Development Act of 1992 (12 U.S.C. 4502), as amended by the preceding provisions of this title, is further amended--(A) by striking paragraph (17) (relating to the definition of `new program'); and(B) by redesignating paragraphs (18) through (23) as paragraphs (17) through (22), respectivelyan enterprise.’.CommentsClose CommentsPermalink

SEC. 3331124. CONFORMING LOAN LIMITS.

(a) Fannie Mae-CommentsClose CommentsPermalink





(1) GENERAL LIMIT- Section 302(b)(2) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1717(b)(2)) is amended--(1) in the second sentence, by redesignating clause (A) through (C) as clauses (i) through (iii), respectively;(2) in the third sentence, by striking `clause (A)' and inserting `clause (i)';(3) in the 4th sentence, by striking `the Resolution Trust Corporation,';(4) by striking the 7th and 8th sentences and inserting the following new sentences: `For 2008, such limitations shall not exceed‘Such limitations shall not exceed $417,000 for a mortgage secured by a single-family residence, $533,850 for a mortgage secured by a 2-family residence, $645,300 for a mortgage secured by a 3-family residence, and $801,950 for a mortgage secured by a 4-family residence, except that such maximum limitations shall be adjusted effective January 1 of each year beginning with 2009after the effective date of the Federal Housing Finance Regulatory Reform Act of 2008, subject to the limitations in this paragraph. Each adjustment shall be made by adding to or subtracting from each such amount (as it may have beeneach such amount (as it may have been previously adjusted) a percentage thereof equal to the percentage increase or decrease, during the most recent 12-month or four4-quarter period ending before the time of determining such annual adjustment, in the housing price index maintained by the Director of the Federal Housing Finance Agency (pursuant to section 1322 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4541)).'.(5) by inserting `(A)' after `(2)'; and(6) by adding at the end the following new subparagraph:`(B)(i) Notwithstanding subparagraph (A), for mortgages originated on or after January 1, 2009, the limitation on the maximum original principal obligation of a mortgage that may be purchased by the corporation shall be the higher of--`(I) the limitation determined under subparagraph (A) for a residence of the applicable size; or`(II) 125 percent of the area median price for a residence of the applicable size, but in no case to exceed 175 percent of the limitation determined under subparagraph (A) for a residence of the applicable size.`(ii) The areas and area median prices used for purposes of the determination under this subparagraph shall be the areas and area median prices used by the Secretary of Housing and Urban Development in determining the applicable limits under section 203(b)(2) of the National Housing If the change in such house price index during the most recent 12-month or 4-quarter period ending before the time of determining such annual adjustment is a decrease, then no adjustment shall be made for the next year, and the next adjustment shall take into account prior declines in the house price index, so that any adjustment shall reflect the net change in the house price index since the last adjustment. Declines in the house price index shall be accumulated and then reduce increases until subsequent increases exceed prior declines.’.CommentsClose CommentsPermalink





(2) HIGH-COST AREA LIMIT- Section 302(b)(2) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1709(b)(2)). A mortgage that is eligible for purchase by the corporation at the time the mortgage is originated under this subparagraph shall be eligible for such purchase for the duration of the term of the mortgage.'17(b)(2)) is amended by adding after the period at the end the following: ‘Such foregoing limitations shall also be increased, with respect to properties of a particular size located in any area for which 115 percent of the median house price for such size residence exceeds the foregoing limitation for such size residence, to the lesser of 150 percent of such limitation for such size residence or the amount that is equal to 115 percent of the median house price in such area for such size residence.’.CommentsClose CommentsPermalink





(3) EFFECTIVE DATE- The amendments made by paragraphs (1) and (2) of this subsection shall take effect upon the expiration of the date described in section 201(a) of the Economic Stimulus Act of 2008 (Public Law 110-185).CommentsClose CommentsPermalink





(b) Freddie Mac-CommentsClose CommentsPermalink





(1) GENERAL LIMIT- Section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) is amended--(1) in the first sentence, by redesignating clause (A) through (C) as clauses (i) through (iii), respectively;(2) in the second sentence, by striking `clause (A)' and inserting `clause (i)';(3) in the third sentence by striking `the Resolution Trust Corporation';(4) by striking the 6th and 7th sentence and inserting the following new sentences: `For 2008, such limitations shall not exceeds and inserting the following new sentences: ‘Such limitations shall not exceed $417,000 for a mortgage secured by a single-family residence, $533,850 for a mortgage secured by a 2-family residence, $645,300 for a mortgage secured by a 3-family residence, and $801,950 for a mortgage secured by a 4-family residence, except that such maximum limitations shall be adjusted effective January 1 of each year beginning with 2009after the effective date of the Federal Housing Finance Regulatory Reform Act of 2008, subject to the limitations in this paragraph. Each adjustment shall be made by adding to or subtracting from each such amount (as it may have beeneach such amount (as it may have been previously adjusted) a percentage thereof equal to the percentage increase or decrease, during the most recent 12-month or four4-quarter period ending before the time of determining such annual adjustment, in the housing price index maintained by the Director of the Federal Housing Finance Agency (pursuant to section 1322 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4541)).';(5) by inserting `(A)' after `(2)'; and(6) by adding at the end the following new subparagraph:`(B)(i) Notwithstanding subparagraph (A), for mortgages originated on or after January 1, 2009, the limitation on the maximum original principal obligation of a mortgage that may be purchased by the Corporation shall be the higher of--`(I) the limitation determined under subparagraph (A) for a residence of the applicable size; or`(II) 125 percent of the area median price for a residence of the applicable size, but in no case to exceed 175 percent of the limitation determined under subparagraph (A) for a residence of the applicable size.`(ii) The areas and area median prices used for purposes of the determination under this subparagraph shall be the areas and area median prices used by the Secretary of Housing and Urban Development in determining the applicable limits under section 203(b)(2) of the National Housing If the change in such house price index during the most recent 12-month or 4-quarter period ending before the time of determining such annual adjustment is a decrease, then no adjustment shall be made for the next year, and the next adjustment shall take into account prior declines in the house price index, so that any adjustment shall reflect the net change in the house price index since the last adjustment. Declines in the house price index shall be accumulated and then reduce increases until subsequent increases exceed prior declines.’.CommentsClose CommentsPermalink





(2) HIGH-COST AREA LIMIT- Section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1709(b)(2)). A mortgage that is eligible for purchase by the Corporation at the time the mortgage is originated under this subparagraph shall be eligible for such purchase for the duration of the term of the mortgage.'.(c454(a)(2)) is amended by adding after the period at the end the following: ‘Such foregoing limitations shall also be increased, with respect to properties of a particular size located in any area for which 115 percent of the median house price for such size residence exceeds the foregoing limitation for such size residence, to the lesser of 150 percent of such limitation for such size residence or the amount that is equal to 115 percent of the median house price in such area for such size residence.’.CommentsClose CommentsPermalink





(3) EFFECTIVE DATE- The amendments made by paragraphs (1) and (2) of this subsection shall take effect upon the expiration of the date described in section 201(a) of the Economic Stimulus Act of 2008 (Public Law 110-185).CommentsClose CommentsPermalink





(c) Sense of Congress- It is the sense of the Congress that the securitization of mortgages by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation plays an important role in providing liquidity to the United States housing markets. Therefore, the Congress encourages the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation to securitize mortgages acquired under the increased conforming loan limits established under this Act.CommentsClose CommentsPermalink





(d) Housing Price Index- Subpart A of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (as amended by the preceding provisions of this titlePart 2 of subtitle A of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4541 et seq.) is amended by inserting after section 1321 (as added by the preceding provisions of this title) the following new section:`section 1123 of this Act) the following new section:CommentsClose CommentsPermalink

‘SEC. 1322. HOUSING PRICE INDEX.

`(a) In General- ‘The Director shall establish and maintain a method of assessing the national average 1-family house price for use for adjusting the conforming loan limitations of the enterprises. In establishing such method, the Director shall take into consideration the monthly survey of all major lenders conducted by the Federal Housing Finance Agency to determine the national average 1-family house price, the House Price Index maintained by the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development before the effective date under section 365 of the Federal Housing Finance Reform Act of 2008, any appropriate of the Federal Housing Finance Regulatory Reform Act of 2008, any appropriate house price indexes of the Bureau of the Census of the Department of Commerce, and any other indexes or measures that the Director considers appropriate.`(b) GAO Audit-`(1) IN GENERAL- At such times as are required under paragraph (2), the Comptroller General of the United States shall conduct an audit of the methodology established by the Director under subsection (a) to determine whether the methodology established is an accurate and appropriate means of measuring changes to the national average 1-family house price.`(2) TIMING- An audit referred to in paragraph (1) shall be conducted and completed not later than the expiration of the 180-day period that begins upon each of the following dates:`(A) ESTABLISHMENT- The date upon which such methodology is initially established under subsection (a) in final form by the Director.`(B) MODIFICATION OR AMENDMENT- Each date upon which any modification or amendment to such methodology is adopted in final form by the Director.`(3) REPORT- Within 30 days of the completion of any audit conducted under this subsection, the Comptroller General shall submit a report detailing the results and conclusions of the audit to the Director, the Committee on Financial Services of the House of Representatives, and the Committee on Banking, Housing, and Urban Affairs of the Senate.'.(d) Sense of Congress- It is the sense of the Congress that the securitization of mortgages by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation plays an important role in providing liquidity to the United States housing markets. Therefore, the Congress encourages the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation to securitize mortgages acquired under the increased conforming loan limits established by the amendments made by this section, to the extent that such securitizations can be effected in a timely and efficient manner that does not impose additional costs for mortgages originated, purchased, or securitized under the existing limits or interfere with the goal of adding liquidity to the market.(e) Effective Date- The amendments made by this section shall take effect on, and shall apply beginning on, January 1, 2009’.CommentsClose CommentsPermalink

SEC. 3341125. ANNUAL HOUSING REPORT REGARDING REGULATED ENTITIES.(a) In General- The Housing and Community Development Act of 1992 is amended by striking section 1324.

(a) Repeal- Section 1324 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4544) and inserting the following new section:`is hereby repealed.CommentsClose CommentsPermalink





(b) Annual Housing Report- The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 is amended by inserting after section 1323 the following:CommentsClose CommentsPermalink

‘SEC. 1324. ANNUAL HOUSING REPORT REGARDING REGULATED ENTITIES.`.

‘(a) In General- After reviewing and analyzing the reports submitted under section 309(n) of the Federal National Mortgage Association Charter Act, and section 307(f) of the Federal Home Loan Mortgage Corporation Act, and section 10(j)(11) of the Federal Home Loan Bank Act (12 U.S.C. 1430(j)(11)), the Director shall submit a report, not later than October 30 of each year, to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate, on the activities of each regulated entity.`(b) Contents- The report shall--`(1) discuss the extent to which--`(A, on the activities of each enterprise.CommentsClose CommentsPermalink





‘(b) Contents- The report required under subsection (a) shall--CommentsClose CommentsPermalink





‘(1) discuss--CommentsClose CommentsPermalink





‘(A) the extent to and manner in which--CommentsClose CommentsPermalink





‘(i) each enterprise is achieving the annual housing goals established under subpart B of this part;`(B) each enterprise is complying with section 1337;`(C) each Federal home loan bank is complying with section 10(j) of the Federal Home Loan Bank Act; and`(D) each regulated entity;CommentsClose CommentsPermalink





‘(ii) each enterprise is complying with its duty to serve underserved markets, as established under section 1335;CommentsClose CommentsPermalink





‘(iii) each enterprise is complying with section 1337;CommentsClose CommentsPermalink





‘(iv) each enterprise received credit towards achieving each of its goals resulting from a transaction or activity pursuant to section 1331(b)(2); andCommentsClose CommentsPermalink





‘(v) each enterprise is achieving the purposes of the regulated entityenterprise established by law;`(2) andCommentsClose CommentsPermalink





‘(B) the actions that each enterprise could undertake to promote and expand the purposes of the enterprise;CommentsClose CommentsPermalink





‘(2) aggregate and analyze relevant data on income to assess the compliance by of each enterprise with the housing goals established under subpart B;CommentsClose CommentsPermalink





`‘(3) aggregate and analyze data on income, race, and gender by census tract and other relevant classifications, and compare such data with larger demographic, housing, and economic trends;CommentsClose CommentsPermalink





`(4) examine actions that--`(A) each enterprise has undertaken or could undertake to promote and expand the annual goals established under subpart B and the purposes of the enterprise established by law; and`(B) each Federal home loan bank has taken or could undertake to promote and expand the community investment program and affordable housing program of the bank established under subsections (i) and (j) of section 10 of the Federal Home Loan Bank Act;`(5) examine the primary and secondary multifamily housing mortgage markets and describe--`(A) the availability and liquidity of mortgage credit;`(B) the status of efforts to provide standard credit terms and underwriting guidelines for multifamily housing and to securitize such mortgage products; and`(C) any factors inhibiting such standardization and securitization;`(6) examine actions each regulated entity has undertaken and could undertake to promote and expand opportunities for first-time homebuyers, including the use of alternative credit scoring;`(7) describe any actions taken under section 1325(5) with respect to originators found to violate fair lending procedures;`(8) discuss and analyze existing conditions and trends, including conditions and trends relating to pricing, in the housing markets and mortgage markets; and`(9‘(4) identify the extent to which each enterprise is involved in mortgage purchases and secondary market activities involving subprime loans (as identified in accordance with the regulations issued pursuant to section 334(b) of the Federal Housing Finance Reform Act of 2008) andand nontraditional loans;CommentsClose CommentsPermalink





‘(5) compare the characteristics of subprime loans purchased and securitized by the enterprises to other loans purchased and securitized by the enterprises.`(c)and nontraditional loans both purchased and securitized by each enterprise to other loans purchased and securitized by each enterprise; andCommentsClose CommentsPermalink





‘(6) compare the characteristics of high-cost loans purchased and securitized, where such securities are not held on portfolio to loans purchased and securitized, where such securities are either retained on portfolio or repurchased by the enterprise, including such characteristics as--CommentsClose CommentsPermalink





‘(A) the purchase price of the property that secures the mortgage;CommentsClose CommentsPermalink





‘(B) the loan-to-value ratio of the mortgage, which shall reflect any secondary liens on the relevant property;CommentsClose CommentsPermalink





‘(C) the terms of the mortgage;CommentsClose CommentsPermalink





‘(D) the creditworthiness of the borrower; andCommentsClose CommentsPermalink





‘(E) any other relevant data, as determined by the Director.CommentsClose CommentsPermalink





‘(c) Data Collection and Reporting-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- To assist the Director in analyzing the matters described in subsection (b) and establishing the methodology described in section 1322, the Director shall conduct, on a monthly basis, a survey of mortgage markets in accordance with this subsection.CommentsClose CommentsPermalink





`‘(2) DATA POINTS- Each monthly survey conducted by the Director under paragraph (1) shall collect data on--CommentsClose CommentsPermalink





`(A) the characteristics of individual mortgages that are eligible for purchase by the enterprises and the characteristics of individual mortgages that are not eligible for purchase by the enterprises ‘(A) the characteristics of individual mortgages that are eligible for purchase by the enterprises and the characteristics of individual mortgages that are not eligible for purchase by the enterprises including, in both cases, information concerning--CommentsClose CommentsPermalink





`‘(i) the price of the house that secures the mortgage;CommentsClose CommentsPermalink





`‘(ii) the loan-to-value ratio of the mortgage, which shall reflect any secondary liens on the relevant property;CommentsClose CommentsPermalink





`(iii) the terms of the mortgage;` ‘(iii) the terms of the mortgage; CommentsClose CommentsPermalink





‘(iv) the creditworthiness of the borrower or borrowers; andCommentsClose CommentsPermalink





`(v) whether the mortgage, in the case of a conforming mortgage, was purchased by an enterprise; and`(B ‘(v) whether the mortgage, in the case of a conforming mortgage, was purchased by an enterprise; CommentsClose CommentsPermalink





‘(B) the characteristics of individual subprime and nontraditional mortgages that are eligible for purchase by the enterprises and the characteristics of borrowers under such mortgages, including the creditworthiness of such borrowers and determination whether such borrowers would qualify for prime lending; andCommentsClose CommentsPermalink





‘(C) such other matters as the Director determines to be appropriate.CommentsClose CommentsPermalink





`‘(3) PUBLIC AVAILABILITY- The Director shall make any data collected by the Director in connection with the conduct of a monthly survey available to the public in a timely manner, provided that the Director may modify the data released to the public to ensure that the data--CommentsClose CommentsPermalink





‘(A) is not released in an identifiable form.`; andCommentsClose CommentsPermalink





‘(B) is not otherwise obtainable from other publicly available data sets.CommentsClose CommentsPermalink





‘(4) DEFINITION- For purposes of this subsection, the term `identifiable form'‘identifiable form’ means any representation of information that permits the identity of a borrower to which the information relates to be reasonably inferred by either direct or indirect means.'.(b) Standards for Subprime Loans- The Director shall, not later than one year after the effective date under section 365, by regulations issued under section 1316G of the Housing and Community Development Act of 1992, establish standards by which mortgages purchased and mortgages purchased and securitized shall be characterized as subprime for the purpose of, and only for the purpose of, complying with the reporting requirement under section 1324(b)(9) of such Act’.CommentsClose CommentsPermalink

SEC. 335. ANNUAL REPORTS BY REGULATED ENTITIES ON AFFORDABLE HOUSING STOCK.The Housing and Community Development Act of 1992 is amended by inserting after section 1328 (12 U.S.C. 4548) the following new section:

`SEC. 1329. ANNUAL REPORTS ON AFFORDABLE HOUSING STOCK.`(a) In General- To obtain information helpful in applying the formula under section 1337(c)(2) for the affordable housing program under such section and for other appropriate uses, the regulated entities shall conduct, or provide for the conducting of, a study on an annual basis to determine the levels of affordable housing inventory, and the changes in such levels, in communities throughout the United States.`(b) Contents- The annual study under this section shall determine, for the United States, each State, and each community within each State--`(1) the level of affordable housing inventory, including affordable rental dwelling units and affordable homeownership dwelling units;`(2) any changes to the level of such inventory during the 12-month period of the study under this section, including--`(A) any additions to such inventory, disaggregated by the category of such additions (including new construction or housing conversion);`(B) any subtractions from such inventory, disaggregated by the category of such subtractions (including abandonment, demolition, or upgrade to market-rate housing);`(C) the number of new affordable dwelling units placed in service; and`(D) the number of affordable housing dwelling units withdrawn from service;`(3) the types of financing used to build any dwelling units added to such inventory level and the period during which such units are required to remain affordable;`(4) any excess demand for affordable housing, including the number of households on rental housing waiting lists and the tenure of the wait on such lists; and`(5) such other information as the Director may require.`(c) Report- For each annual study conducted pursuant to this section, the regulated entities shall submit to the Congress, and make publicly available, a report setting forth the findings of the study.`(d) Regulations and Timing- The Director shall, by regulation, establish requirements for the studies and reports under this section, including deadlines for the submission of such annual reports and standards for determining affordable housing.'.

SEC. 336. MORTGAGOR IDENTIFICATION REQUIREMENTS FOR MORTGAGES OF REGULATED ENTITIES.(a) In General- Subpart A of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (12 U.S.C. 4541 et seq.), as amended by the preceding provisions of this title, is further amended by adding at the end the following new section:`SEC. 1330. MORTGAGOR IDENTIFICATION REQUIREMENTS FOR MORTGAGES OF REGULATED ENTITIES.`(a) Limitation- The Director shall by regulation establish standards, and shall enforce compliance with such standards, that--`(1) prohibit the enterprises from the purchase, service, holding, selling, lending on the security of, or otherwise dealing with any mortgage on a one- to four-family residence that will be used as the principal residence of the mortgagor that does not meet the requirements under subsection (b); and`(2) prohibit the Federal home loan banks from providing any advances to a member for use in financing, and from accepting as collateral for any advance to a member, any mortgage on a one- to four-family residence that will be used as the principal residence of the mortgagor that does not meet the requirements under subsection (b).`(b) Identification Requirements- The requirements under this subsection with respect to a mortgage are that the mortgagor have, at the time of settlement on the mortgage, a Social Security account number.'.(b) Fannie Mae- Section 304 of the Federal National Mortgage Association Charter Act (11126. PUBLIC USE DATABASE.

Section 1323 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 ( 42 U.S.C. 1719) is amended by adding at the end the following new subsection:`(g) Prohibition Regarding Mortgagor Identification Requirement- Nothing in this Act may be construed to authorize the corporation to purchase, service, hold, sell, lend on the security of, or otherwise deal with any mortgage that4543 ) is amended-- CommentsClose CommentsPermalink





(1) in subsection (a)--CommentsClose CommentsPermalink





(A) by striking ‘(a) In General- The Secretary’ and inserting the corporation is prohibited from so dealing with under the standards issued under section 1330 of the Housing and Community Development Act of 1992 by the Director of the Federal Housing Finance Agency.'.(c) Freddie Mac- Section 305 of the Federal Home Loan Mortgage Corporation Actfollowing:CommentsClose CommentsPermalink





‘(a) Availability-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Director’; andCommentsClose CommentsPermalink





(B) by adding at the end the following new paragraph:CommentsClose CommentsPermalink





‘(2) CENSUS TRACT LEVEL REPORTING- Such data shall include the data elements required to be reported under the Home Mortgage Disclosure Act of 1975, at the census tract level.’;CommentsClose CommentsPermalink





(2) in subsection (b)(2), by inserting before the period at the end the following: ‘or with subsection (a)(2)’; andCommentsClose CommentsPermalink





(3) by adding at the end the following new subsection:CommentsClose CommentsPermalink





‘(d) Timing- Data submitted under this section by an enterprise in connection with a provision referred to in subsection (a) shall be made publicly available in accordance with this section not later than September 30 of the year following the year to which the data relates.’.CommentsClose CommentsPermalink

Section 1326 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 1454) is amended by adding at the end the following new subsection:`(d) Prohibition Regarding Mortgagor Identification Requirements- Nothing in this Act may be construed to authorize the Corporation to purchase, service, hold, sell, lend on the security of, or otherwise deal with any mortgage that the Corporation is prohibited from so dealing with under the standards issued under section 1330 of the Housing and Community Development Act of 1992 by the Director of the Federal Housing Finance Agency.'.(d) Federal Home Loan Banks- Section 10(a) of the Federal Home Loan Bank Act4546) is amended--CommentsClose CommentsPermalink





(1) in subsection (a), by striking ‘The Director’ and inserting ‘Subject to subsection (d), the Director’; andCommentsClose CommentsPermalink





(2) by adding at the end the following:CommentsClose CommentsPermalink





‘(d) Mortgage Information- Subject to privacy considerations, as described in section 304(j) of the Home Mortgage Disclosure Act of 1975 (12 U.S.C. 1430(a)) is amended--(1) by redesignating paragraph (6) as paragraph (7); and(2) by inserting after paragraph (5) the following new paragraph:`(6) PROHIBITION REGARDING MORTGAGOR IDENTIFICATION REQUIREMENTS- Nothing in this Act may be construed to authorize a Federal Home Loan Bank to provide any advance to a member for use in financing, or accept as collateral for an advance under this section, any mortgage that a Bank is prohibited from so accepting under the standards issued under section 1330 of the Housing and Community Development Act of 1992 by the Director of the Federal Housing Finance Agency.'2803(j)), the Director shall, by regulation or order, provide that certain information relating to single family mortgage data of the enterprises shall be disclosed to the public, in order to make available to the public--CommentsClose CommentsPermalink





‘(1) the same data from the enterprises that is required of insured depository institutions under the Home Mortgage Disclosure Act of 1975; andCommentsClose CommentsPermalink





‘(2) information collected by the Director under section 1324(b)(6).’.CommentsClose CommentsPermalink

SEC. 3371128. REVISION OF HOUSING GOALS.

(a) Housing Goals- The Housing and Community Development Act of 1992 is amended by striking sectionsRepeal- Sections 1331 through 1334 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4561-4) and inserting the following new sections:` through 4564) are hereby repealed.CommentsClose CommentsPermalink





(b) Housing Goals- The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 is amended by inserting before section 1335 the following:CommentsClose CommentsPermalink

‘SEC. 1331. ESTABLISHMENT OF HOUSING GOALS.

`(a) In General- The Director shall establish, effective for the first year that begins after the effective date under section 365 of the Federal Housing Finance Reform Act of 2008‘(a) In General- The Director shall, by regulation, establish effective for 2010 and each year thereafter, annual housing goals, with respect to the mortgage purchases by the enterprises, as follows:CommentsClose CommentsPermalink





`(1) SINGLE ‘(1) SINGLE-FAMILY HOUSING GOALS- Three single-family housing goals under section 1332.`Four single-family housing goals under section 1332.CommentsClose CommentsPermalink





‘(2) MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOALS- A- One multifamily special affordable housing goal under section 1333.CommentsClose CommentsPermalink





`(b ‘(b) Timing- The Director shall, by regulation, establish an annual deadline by which the Director shall establish the annual housing goals under this subpart for each year, taking into consideration the need for the enterprises to reasonably and sufficiently plan their operations and activities in advance, including operations and activities necessary to meet such annual goals. CommentsClose CommentsPermalink





‘(c) Transition- The annual housing goals effective for 2008 pursuant to this subpart, as in effect before the enactment of the Federal Housing Finance Regulatory Reform Act of 2008, shall remain in effect for 2009, except that not later than the expiration of the 270-day period beginning on the date of the enactment of such Act, the Director shall review such goals applicable for 2009 to determine the feasibility of such goals given the market conditions current at such time and, after seeking public comment for a period not to exceed 30 days, may make appropriate adjustments consistent with such market conditions.CommentsClose CommentsPermalink





‘(d) Eliminating Interest Rate Disparities-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- Upon request by the Director, an enterprise shall provide to the Director, in a form determined by the Director, data the Director may review to determine whether there exist disparities in interest rates charged on mortgages to borrowers who are minorities as compared with comparable mortgages to borrowers of similar creditworthiness who are not minorities.CommentsClose CommentsPermalink





`‘(2) REMEDIAL ACTIONS UPON PRELIMINARY FINDING- Upon a preliminary finding by the Director that a pattern of disparities in interest rates with respect to any lender or lenders exists pursuant to the data provided by an enterprise in paragraph (1), the Director shallCommentsClose CommentsPermalink

--`(A) 731X CommentsClose CommentsPermalink

‘(A) refer the preliminary finding to the appropriate regulatory or enforcement agency for further review;` andCommentsClose CommentsPermalink





‘(B) require the enterprise to submit additional data with respect to any lender or lenders, as appropriate and to the extent practicable, to the Director who shall submit any such additional data to the regulatory or enforcement agency for appropriate action; and`(C) require the enterprise to undertake remedial actions, as appropriate, pursuant to section 1325(5) (12 U.S.C. 4545(5)).`.CommentsClose CommentsPermalink





‘(3) ANNUAL REPORT TO CONGRESS- The Director shall submit to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report describing the actions taken, and being taken, by the Director to carry out this subsection. No such report shall identify any lender or lenders who have not been found to have engaged in discriminatory lending practices pursuant to a final adjudication on the record, and after opportunity for an administrative hearing, in accordance with subchapter II of chapter 5 of title 5, United States Code.CommentsClose CommentsPermalink





`‘(4) PROTECTION OF IDENTITY OF INDIVIDUALS- In carrying out this subsection, the Director shall ensure that no property-related or financial information that would enable a borrower to be identified shall be made public.CommentsClose CommentsPermalink

‘SEC. 1332. SINGLE-FAMILY HOUSING GOALS.

`(a) In General- The Director shall establish annual goals for the purchase by each enterpri ‘(a) In General- The Director shall, by regulation, establish annual goals for the purchase by each enterprise of the following types of mortgages for the following categories of families: CommentsClose CommentsPermalink





‘(1) PURCHASE-MONEY MORTGAGES- A goal for purchase of conventional, conforming, single-family, purchase money mortgages financing owner-occupied and rental housing for each of the followinghousing for each of the following categories of families:CommentsClose CommentsPermalink





`(1‘(A) Low-income families.CommentsClose CommentsPermalink





`(2‘(B) Families that reside in low-income areas.CommentsClose CommentsPermalink





`(3‘(C) Very low-income families.CommentsClose CommentsPermalink





`(b) Refinance Subgoal-`(1) IN GENERAL- The Director shall establish a separate subgoal within each goal under subsection (a)(1) for the purchase by each enterprise of mortgages for low-income families on single family housing‘(2) REFINANCING MORTGAGES- A goal for purchase of conventional, conforming mortgages on owner-occupied, single-family housing for low-income families that are given to pay off or prepay an existing loan secured by the same property.CommentsClose CommentsPermalink





The Director shall, for each year, determine whether each enterprise has complied with the subgoal under this subsection in the same manner provided under this section for determining compliance with the housing goals.`(2) ENFORCEMENT- For purposes of section 1336, the subgoal established under paragraph (1) of this subsection shall be considered to be a housing goal established under this section. Such subgoal shall not be enforceable under any other provision of this title (including subpart C of this part) other than section 1336 or under any provision of the Federal National Mortgage Association Charter Act or the Federal Home Loan Mortgage Corporation Act.`(c ‘(b) Goals as a Percentage of Total Mortgage Purchases- The goals established under paragraphs (1) and (2) of subsection (a) shall be established as a percentage of the total number of conventional, conforming, single-family, owner-occupied, purchase money mortgages purchased by the enterprise, or as percentage of the total number of conventional, single-family, owner-occupied refinance mortgages purchased by the enterprise, as applicable, that are mortgages for the types of families specified in paragraphs (1) and (2) of subsection (a). CommentsClose CommentsPermalink





‘(c) Single-Family, Owner-Occupied Rental Housing Units- The Director shall require each enterprise to report the number of rental housing units affordable to low-income families each year which are contained in mortgages purchased by the enterprise financing 2- to 4-unit single-family, owner-occupied properties and may, by regulation, establish additional requirements relating to such units.CommentsClose CommentsPermalink





‘(d) Determination of Compliance-CommentsClose CommentsPermalink





The Director ‘(1) IN GENERAL- The Director shall determine, for each year that the housing goals under this section are in effect pursuant to section 1331(a), whether each enterprise has complied with the single-family housing goals established under this section for such year.each such goal established under subsection (a) of this section and any additional requirements which may be established under subsection (c) of this section.CommentsClose CommentsPermalink





‘(2) PURCHASE-MONEY MORTGAGE GOALS- An enterprise shall be considered to be in compliance with such a goal for a year only if, for each of the types of families described in subsection (a)a housing goal under subparagraph (A), (B), or (C) of subsection (a)(1) for a year only if, for the type of family described in such subparagraph, the percentage of the number of conventional, conforming, single-family, owner-occupied or rental, as applicable, purchase money mortgages purchased by each, purchase money mortgages purchased by the enterprise in such year that serve such families, meets or exceeds the target for the year for such type of family that is established under subsection (d).`(de).CommentsClose CommentsPermalink





‘(3) REFINANCE GOAL- An enterprise shall be considered to be in compliance with the refinance goal under subsection (a)(2) for a year only if the percentage of the number of conventional, conforming, single-family, owner-occupied refinance mortgages purchased by the enterprise in such year that serve low-income families meets or exceeds the target for the year that is established under subsection (e).CommentsClose CommentsPermalink





‘(e) Annual Targets-CommentsClose CommentsPermalink





`(1) IN GENERAL- Except as provided in paragraph (2), for each of the types of families described in subsection (a), the target under this subsection for a year shall be the average percentage, for the ‘(1) IN GENERAL- The Director shall, by regulation, establish annual targets for each goal and subgoal under this section, provided that the Director shall not set prospective targets longer than three years. In establishing such targets, the Director shall not consider segments of the market determined to be unacceptable or contrary to good lending practices, inconsistent with safety and soundness, or unauthorized for purchase by the enterprises. CommentsClose CommentsPermalink





‘(2) GOALS TARGETS-CommentsClose CommentsPermalink





‘(A) CALCULATION- The Director shall calculate, for each of the types of families described in subsection (a), the percentage, for each of the three years that most recently precede such year and for which information under the Home Mortgage Disclosure Act of 1975 is publicly available,--CommentsClose CommentsPermalink





‘(i) of the number of conventional, conforming, single-family, owner-occupied or rental, as applicable, purchase money mortgages originated in such year that serves such type of family, orCommentsClose CommentsPermalink





‘(ii) the number of conventional, conforming, single-family, owner-occupied refinance mortgages originated in such year that serve low-income families,CommentsClose CommentsPermalink





as applicable, as determined by the Director using the information obtained and determined pursuant to paragraphs (3) and (4).`(2) AUTHORITY TO INCREASE TARGETS-`(A) IN GENERAL- The Director may, for any year, establish by regulation, for any or all of the types of families described in subsection (a), percentage targets that are higher than the percentages for such year determined pursuant to paragraph (1), to reflect expected changes in market performance related to such information under the Home Mortgage Disclosure Act of 1975.`(B) FACTORS- In establishing any targets pursuant to subparagraph (A), the Director shall consider the following factors:`(i) National housing needs.`4) and (5).CommentsClose CommentsPermalink





‘(B) ESTABLISHMENT OF GOAL TARGETS- The Director shall, by regulation, establish targets for each of the goal categories, taking into consideration the calculations under subparagraph (A) and the following factors:CommentsClose CommentsPermalink





‘(i) National housing needs.CommentsClose CommentsPermalink





‘(ii) Economic, housing, and demographic conditions.`, including expected market developments.CommentsClose CommentsPermalink





‘(iii) The performance and effort of the enterprises toward achieving the housing goals under this section in previous years.CommentsClose CommentsPermalink





`(iv) The size of the conventional mortgage market serving each of the types of families described in subsection (a) relative to the size of the overall conventional mortgage market.`(‘(iv) The ability of the enterprise to lead the industry in making mortgage credit available.CommentsClose CommentsPermalink





`(v ‘(v) Such other reliable mortgage data as may be available. CommentsClose CommentsPermalink





‘(vi) The size of the purchase money conventional mortgage market, or refinance conventional mortgage market, as applicable, serving each of the types of families described in subsection (a), relative to the size of the overall purchase money mortgage market or the overall refinance mortgage market, respectively.CommentsClose CommentsPermalink





‘(vii) The need to maintain the sound financial condition of the enterprises.CommentsClose CommentsPermalink





`(3) ‘(3) AUTHORITY TO ADJUST TARGETS- The Director may, by regulation, adjust the percentage targets previously established by regulation pursuant to paragraph (2)(B) for any year, to reflect subsequent available data and market developments. CommentsClose CommentsPermalink





‘(4) HMDA INFORMATION- The Director shall annually obtain information submitted in compliance with the Home Mortgage Disclosure Act of 1975 regarding conventional, conforming, single-family, owner-occupied or rental, as applicable, purchase money mortgages originated and purchased for the previous year.`(4, purchase money and refinance mortgages originated and purchased for the previous year.CommentsClose CommentsPermalink





‘(5) CONFORMING MORTGAGES- In determining whether a mortgage is a conforming mortgage for purposes of this paragraph, the Director shall consider the original principal balance of the mortgage loan to be the principal balance as reported in the information referred to in paragraph (34), as rounded to the nearest thousand dollars.CommentsClose CommentsPermalink





`(e‘(f) Notice of Determination and Enterprise Comment-CommentsClose CommentsPermalink





`‘(1) NOTICE- Within 30 days of making a determination under subsection (c) regarding a compliance ofd) regarding compliance of an enterprise for a year with a housing goal established under this section and before any public disclosure thereof, the Director shall provide notice of the determination to the enterprise, which shall include an analysis and comparison, by the Director, of the performance of the enterprise for the year and the targets for the year under subsection (d).`e).CommentsClose CommentsPermalink





‘(2) COMMENT PERIOD- The Director shall provide each enterprise an opportunity to comment on the determination during the 30-day period beginning upon receipt by the enterprise of the notice.CommentsClose CommentsPermalink





`(f‘(g) Use of Borrower Income- In monitoring the performance of each enterprise pursuant to the housing goals under this section and evaluating such performance (for purposes of section 1336), the Director shall consider a mortgagor's income to be such income at the time of ’s income to be such income at the time of origination of the mortgage.CommentsClose CommentsPermalink





`(g‘(h) Consideration of Units in Single-Family Rental Housing- In establishing any goal under this subpart, the Director may take into consideration the number of housing units financed by any mortgage on single-family rental housing purchased by an enterprise.`Properties With Rental Units- Mortgages financing two- to four-unit owner-occupied properties shall count toward the achievement of the single-family housing goals under this section, if such properties otherwise meet the requirements under this section, notwithstanding the use of one or more units for rental purposes.CommentsClose CommentsPermalink





‘(i) Goals Credit- The Director shall determine whether an enterprise shall receive full, partial, or no credit for a transaction toward achievement of any of the housing goals established pursuant to section 1332 and 1333. In making any such determination, the Director shall consider whether a transaction or activity of an enterprise is substantially equivalent to a mortgage purchase and either (1) creates a new market, or (2) adds liquidity to an existing market. No credit toward the achievement of the housing goals and subgoals established under this section may be given to the purchase of mortgages, including any transaction or activity of an enterprise determined to be substantially equivalent to a mortgage purchase, that is determined to be unacceptable or contrary to good lending practices, inconsistent with safety and soundness, or unauthorized for purchase by the enterprises, pursuant to regulations issued by the Director.CommentsClose CommentsPermalink

‘SEC. 1333. MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOAL.

`(a) Establishment-`(1) IN GENERAL- The Director shall establish, by regulation, an annual goal for the purchase by each enterprise of each of the following types of mortgages on multifamily housing:`(A) Mortgages that finance dwelling units for low-income families.`(B) Mortgages that finance dwelling units for very low-income families.`(C) Mortgages ‘(a) Establishment of Goal- CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Director shall, by regulation, establish a single annual goal, by either unit or dollar volume, of purchases by each enterprise of mortgages on multifamily housing that finance dwelling units assisted by the low-income housing tax credit under section 42 of the Internal Revenue Code of 1986.`ffordable to low-income families.CommentsClose CommentsPermalink





‘(2) ADDITIONAL REQUIREMENTS FOR UNITS AFFORDABLE TO VERY LOW-INCOME FAMILIES- When establishing the goal under this section, the Director shall establish additional requirements for the purchase by each enterprise of mortgages on multifamily housing that finance dwelling units affordable to very low-income families.CommentsClose CommentsPermalink





‘(3) REPORTING ON SMALLER PROJECTS- The Director shall establish, within the goal under this section, additional requirements for the purchase by each enterprise of mortgages described in paragraph (1) for multifamily housing projectsPERTIES- The Director shall require each enterprise to report on the purchase by each enterprise of multifamily housing of a smaller or limited size, which may be based on the number of dwelling units in the project or the amount of the mortgage, or both, and shall include multifamily housing projects of such smaller sizes as are typical among such projects that serve rural areas.`(3 that is affordable to low-income families, which may be based on multifamily projects of 5 to 50 units (as such numbers may be adjusted by the Director) or on mortgages of up to $5,000,000 (as such amount may be adjusted by the Director), and may, by regulation, establish such aditional requirements related to such units.CommentsClose CommentsPermalink





‘(4) FACTORS- In establishing the goal under this section relating to mortgages on multifamily housing for an enterprise for a year, the Director shall consider--`and additional requirements under this section, the Director shall not consider segments of the market determined to be inconsistent with safety and soundness or unauthorized for purchase by the enterprises, and shall take into consideration--CommentsClose CommentsPermalink





‘(A) national multifamily mortgage credit needs;` and the ability of the enterprise to provide additional liquidity and stability for the multifamily mortgage market;CommentsClose CommentsPermalink





‘(B) the performance and effort of the enterprise in making mortgage credit available for multifamily housing in previous years;CommentsClose CommentsPermalink





`‘(C) the size of the multifamily mortgage market;` for housing affordable to low-income and very low-income families, including the size of the multifamily markets for housing of a smaller or limited size;CommentsClose CommentsPermalink





‘(D) the ability of the enterprise to lead the industry in makingmarket in making multifamily mortgage credit available, especially for underserved markets, such as for small multifamily projects of 5 to 50 units, multifamily properties in need of rehabilitation, and multifamily properties located in rural areas; and`(Emultifamily housing described in paragraphs (1) and (2);CommentsClose CommentsPermalink





‘(E) the availability of public subsidies; andCommentsClose CommentsPermalink





‘(F) the need to maintain the sound financial condition of the enterprise.CommentsClose CommentsPermalink





`(b)‘(b) Units Financed by Housing Finance Agency Bonds- The Director shall give full credit toward the achievement of the multifamily special affordable housing goal under this section (for purposes of section 1336) to dwelling units in multifamily housing that otherwise qualifies under such goal and that is financed by tax-exempt or taxable bonds issued by a State or local housing finance agency, but only if such bonds--`if such bonds, in whole or in part--CommentsClose CommentsPermalink





‘(1) are secured by a guarantee of the enterprise; orCommentsClose CommentsPermalink





`(2) are not‘(2) are purchased by the enterprise, except that the Director may give less than full credit for purchases of investment grade and are purchased by the enterprise.`(c) Use of Tenant Income or Rentbonds, to the extent that such purchases do not provide a new market or add liquidity to an existing market.CommentsClose CommentsPermalink





‘(c) Measurement of Performance- The Director shall monitor the performance of each enterprise in meeting the goals established under this section and shall evaluate such performance (for purposes of section 1336) based on--`(1) the income of the prospective or actual tenants of the property, where such data are available; or`(2) where the data referred to in paragraph (1) are not available, whether the rent levels affordable to low-income and very low-income families.re affordable. A rent level shall be considered to be affordable for purposes of this subsection for an income category referred to in this subsection if it does not exceed 30 percent of thelow-income families if it does not exceed 30 percent of the maximum income level of such income category, with appropriate adjustments for unit size as measured by the number of bedrooms.CommentsClose CommentsPermalink





`‘(d) Determination of Compliance- The Director shall, for each year that the housing goal under this section is in effect pursuant to section 1331(a), determine determine, for each year that the housing goal under this section is in effect pursuant to section 1331(a), whether each enterprise has complied with such goal and the additional requirements under subsection (a)(2).CommentsClose CommentsPermalink

`‘SEC. 1334. DISCRETIONARY ADJUSTMENT OF HOUSING GOALS.

`‘(a) Authority- An enterprise may petition the Director in writing at any time during a year to reduce the level of any goal for such year established pursuant to this subpart.`or subgoal for such year established pursuant to this subpart.CommentsClose CommentsPermalink





‘(b) Standard for Reduction- The Director may reduce the level for a goal pursuant to such a petition only if--`(1) market and economic conditions or the financial condition of the enterprise require such action; or`or subgoal pursuant to such a petition only if--CommentsClose CommentsPermalink





‘(1) market and economic conditions or the financial condition of the enterprise require such action; orCommentsClose CommentsPermalink





‘(2) efforts to meet the goal or subgoal would result in the constraint of liquidity, over-investment in certain market segments, or other consequences contrary to the intent of this subpart, or section 301(3) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1716(3)) or section 301(b)(3) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1451 note), as applicable.CommentsClose CommentsPermalink





`‘(c) Determination- The Director shall, promptly upon receipt of a petition regarding a reduction, seek public comment on the reduction for a period of 30 days. The Director shall make a determination regarding any proposed reduction within 30 days of receipt of the petition regarding the reduction. The Director may extend such period for a single additional after the expiration of such public comment period. The Director may extend such determination period for a single additional 15-day period, but only if the Director requests additional information from the enterprise. A denial by the Director to reduce the level of any goal under this section may be appealed to the United States District Court for the District of Columbia or the United States district court in the jurisdiction in which the headquarters of an enterprise is located.'.(b’.CommentsClose CommentsPermalink





(c) Conforming Amendments- The Housing and Community Development Act of 1992 is amendedCommentsClose CommentsPermalink

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(1) in section 1335(a) (12 U.S.C. 4565(a)), in the matter preceding paragraph (1), by striking `‘low- and moderate-income housing goal' and all that follows through `section 1334' and inserting `housing goals established under this subpart'’ and all that follows through ‘section 1334’ and inserting ‘housing goals established under this subpart’; andCommentsClose CommentsPermalink





(2) in section 1336(a)(1) (12 U.S.C. 4566(a)(1)), by striking `‘sections 1332, 1333, and 1334,' and inserting `this subpart'.(c’ and inserting ‘this subpart’.CommentsClose CommentsPermalink





(d) Definitions- Section 1303 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4502), as amended by the preceding provisions of this title, is further amended--(1) in paragraph (22) (relating to the definition of `very low-income'), by striking `60 percent' each place such term appears and inserting `50 percent';(2) by redesignating paragraphs (19) through (22) as paragraphs (23) through (26), respectively;(3) by inserting after paragraph (18) the following new paragraph:`(22) RURAL AREA- The term `rural area' has the meaning given such term in section 520 of the Housing Act of 1949 (42 U.S.C. 1490), except that such term includes micropolitan areas and tribal trust lands.'.(4) by redesignating paragraphs (13) through (18) as paragraphs (16) through (21), respectively;(5) by inserting after paragraph (12) the following new paragraph:`(15) is amended--CommentsClose CommentsPermalink





(1) by striking paragraph (24), as so designated by section 1002 of this Act, and inserting the following:CommentsClose CommentsPermalink





‘(24) VERY LOW-INCOME-CommentsClose CommentsPermalink





‘(A) IN GENERAL- The term ‘very low-income’ means--CommentsClose CommentsPermalink





‘(i) in the case of owner-occupied units, families having incomes not greater than 50 percent of the area median income; andCommentsClose CommentsPermalink





‘(ii) in the case of rental units, families having incomes not greater than 50 percent of the area median income, with adjustments for smaller and larger families, as determined by the Director.CommentsClose CommentsPermalink





‘(B) RULE OF CONSTRUCTION- For purposes of section 1338 and 1339, the term ‘very low-income’ means--CommentsClose CommentsPermalink





‘(i) in the case of owner-occupied units, income in excess of 30 percent but not greater than 50 percent of the area median income; andCommentsClose CommentsPermalink





‘(ii) in the case of rental units, income in excess of 30 percent but not greater than 50 percent of the area median income, with adjustments for smaller and larger families, as determined by the Director.’; andCommentsClose CommentsPermalink





(2) by adding at the end the following:CommentsClose CommentsPermalink





‘(26) CONFORMING MORTGAGE- The term ‘conforming mortgage’ means, with respect to an enterprise, a conventional mortgage having an original principal obligation that does not exceed the dollar amount limitation in effect at the time of such origination and applicable to such mortgage, under, as applicable--CommentsClose CommentsPermalink





‘(A) section 302(b)(2) of the Federal National Mortgage Association Charter Act; orCommentsClose CommentsPermalink





‘(B) section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act.CommentsClose CommentsPermalink





‘(27) EXTREMELY LOW-INCOME- The term ‘extremely low-income’ means--CommentsClose CommentsPermalink





‘(A) in the case of owner-occupied units, income not in excess of 30 percent of the area median income; andCommentsClose CommentsPermalink





‘(B) in the case of rental units, income not in excess of 30 percent of the area median income, with adjustments for smaller and larger families, as determined by the Director.CommentsClose CommentsPermalink





‘(28) LOW-INCOME AREA- The term `low income area'‘low-income area’ means a census tract or block numbering area in which the median income does not exceed 80 percent of the median income for the area in which such census tract or block numbering area is located, and, for the purposes of section 1332(a)(21)(B), shall include families having incomes not greater than 100 percent of the area median income who reside in minority census tracts.';(6) by redesignating paragraphs (11) and (12) as paragraphs (13) and (14), respectively;(7) by inserting after paragraph (10) the following new paragraph:`(12) and shall include families having incomes not greater than 100 percent of the area median income who reside in designated disaster areas.CommentsClose CommentsPermalink





‘(29) MINORITY CENSUS TRACT- The term ‘minority census tract’ means a census tract that has a minority population of at least 30 percent and a median family income of less than 100 percent of the area family median income.CommentsClose CommentsPermalink





‘(30) SHORTAGE OF STANDARD RENTAL UNITS BOTH AFFORDABLE AND AVAILABLE TO EXTREMELY LOW-INCOME- The term ` RENTER HOUSEHOLDS-CommentsClose CommentsPermalink





‘(A) IN GENERAL- The term ‘shortage of standard rental units both affordable and available to extremely low-income' means--`(A) in the case of owner-occupied units, income not in excess of 30 percent of the area median income; and`(B) in the case of rental units, income not in excess of 30 percent of the area median income, with adjustments for smaller and larger families, as determined by the Secretary.';(8) by redesignating paragraphs (7) through (10) as paragraphs (8) through (11), respectively; and(9) by inserting after paragraph (6) the following new paragraph:`(7) CONFORMING MORTGAGE- The term `conforming mortgage' means, with respect to an enterprise, a conventional mortgage having an original principal obligation that does not exceed the dollar limitation, in effect at the time of such origination, under, as applicable--`(A) section 302(b)(2) of the Federal National Mortgage Association Charter Act; or`(B) section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act.' renter households’ means the gap between--CommentsClose CommentsPermalink





‘(i) the number of units with complete plumbing and kitchen facilities with a rent that is 30 percent or less of 30 percent of the adjusted area median income as determined by the Director that are occupied by extremely low-income renter households or are vacant for rent; andCommentsClose CommentsPermalink





‘(ii) the number of extremely low-income renter households.CommentsClose CommentsPermalink





‘(B) RULE OF CONSTRUCTION- If the number of units described in subparagraph (A)(i) exceeds the number of extremely low-income households as described in subparagraph (A)(ii), there is no shortage.CommentsClose CommentsPermalink





‘(31) SHORTAGE OF STANDARD RENTAL UNITS BOTH AFFORDABLE AND AVAILABLE TO VERY LOW-INCOME RENTER HOUSEHOLDS-CommentsClose CommentsPermalink





‘(A) IN GENERAL- The term ‘shortage of standard rental units both affordable and available to very low-income renter households’ means the gap between--CommentsClose CommentsPermalink





‘(i) the number of units with complete plumbing and kitchen facilities with a rent that is 30 percent or less of 50 percent of the adjusted area median income as determined by the Director that are occupied by either extremely low- or very low-income renter households or are vacant for rent; andCommentsClose CommentsPermalink





‘(ii) the number of extremely low- and very low-income renter households.CommentsClose CommentsPermalink





‘(B) RULE OF CONSTRUCTION- If the number of units described in subparagraph (A)(i) exceeds the number of extremely low- and very low-income households as described in subparagraph (A)(ii), there is no shortage.’.CommentsClose CommentsPermalink

SEC. 3381129. DUTY TO SERVE UNDERSERVED MARKETS.

(a) Establishment and Evaluation of Performance- Section 1335 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4565) is amended--CommentsClose CommentsPermalink





(1) in the section heading, by inserting `‘duty to serve underserved markets and' before `other'’ before ‘other’;CommentsClose CommentsPermalink





(2) by striking subsection (b);CommentsClose CommentsPermalink





(3) in subsection (a)--CommentsClose CommentsPermalink





(A) in the matter preceding paragraph (1), by inserting `‘and to carry out the duty under subsection (a) of this section' before `, each enterprise shall';(B) in paragraph (3), by inserting `and'’ before ‘, each enterprise shall’;CommentsClose CommentsPermalink





(B) in paragraph (3), by inserting ‘and’ after the semicolon at the end;CommentsClose CommentsPermalink





(C) in paragraph (4), by striking `; and'‘; and’ and inserting a period;CommentsClose CommentsPermalink





(D) by striking paragraph (5); andCommentsClose CommentsPermalink





(E) by redesignating such subsection as subsection (b);CommentsClose CommentsPermalink





(4) by inserting before subsection (b) (as so redesignated by paragraph (3)(E) of this subsection) the following new subsection:CommentsClose CommentsPermalink





`(a) Duty T‘(a) Duty to Serve Underserved Markets-CommentsClose CommentsPermalink





`(1) DUTY- In accordance with the purpose of the enterprises under section 301(3) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1716) and section 301(b)(3) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1451 note) to undertake activities relating to mortgages on housing for very low-, low-, and moderate-income families involving a reasonable economic return that may be less than the return earned on other activities, each enterprise shall have the duty t‘(1) DUTY- To increase the liquidity of mortgage investments and improve the distribution of investment capital available for mortgage financing for underserved markets.`(2) UNDERSERVED MARKETS- To meet its duty under paragraph (1), each enterprise shall comply with the following requirement, each enterprise shall provide leadership to the market in developing loan products and flexible underwriting guidelines to facilitate a secondary market for mortgages for very low-, low-, and moderate-income families with respect to the following underserved markets:CommentsClose CommentsPermalink





`‘(A) MANUFACTURED HOUSING- The enterprise shall lead the industry in developingdevelop loan products and flexible underwriting guidelines to facilitate a secondary market for mortgages on manufactured homes for very low-, low-, and moderate-income families.CommentsClose CommentsPermalink





`‘(B) AFFORDABLE HOUSING PRESERVATION- The enterprise shall lead the industry in developingdevelop loan products and flexible underwriting guidelines to facilitate a secondary market to preserve housing affordable to very low-, low-, and moderate-income families, including housing projects subsidized underCommentsClose CommentsPermalink

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‘(i) the project-based and tenant-based rental assistance programs under section 8 of the United States Housing Act of 1937;CommentsClose CommentsPermalink





`(ii) the program under section‘(ii) the program under section 236 of the National Housing Act;CommentsClose CommentsPermalink





`‘(iii) the below-market interest rate mortgage program under section 221(d)(4) of the National Housing Act;CommentsClose CommentsPermalink





`‘(iv) the supportive housing for the elderly program under section 202 of the Housing Act of 1959;CommentsClose CommentsPermalink





`‘(v) the supportive housing program for persons with disabilities under section 811 of the Cranston-Gonzalez National Affordable Housing Act;CommentsClose CommentsPermalink





`‘(vi) the programs under title IV of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11361 et seq.), but only permanent supportive housing projects subsidized under such programs;CommentsClose CommentsPermalink





and`‘(vii) the rural rental housing program under section 515 of the Housing Act of 1949.`(C) RURAL AND OTHER UNDERSERVED;CommentsClose CommentsPermalink





‘(viii) the low-income housing tax credit under section 42 of the Internal Revenue Code of 1986; andCommentsClose CommentsPermalink





‘(ix) comparable state and local affordable housing programs.CommentsClose CommentsPermalink





‘(C) RURAL MARKETS- The enterprise shall lead the industry in developingdevelop loan products and flexible underwriting guidelines to facilitate a secondary market for mortgages on housing for very low-, and low-, and moderate-income families in rural areas, and for mortgages for housing for any other underserved market for very low-, low-, and moderate-income families that the Secretary identifies as lacking adequate credit through conventional lending sources. Such underserved markets may be identified by borrower type, market segment, or geographic area.'.’; andCommentsClose CommentsPermalink





(5) by adding at the end the following new subsection:`(c)s:CommentsClose CommentsPermalink





‘(c) Additional Categories- The Director may submit recommendations to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate for the establishment of additional categories under subsection (a), provided that the Director makes a preliminary determination that any such category is important to the mission of the enterprises, that the category is an underserved market, and that the establishment of such category is warranted.CommentsClose CommentsPermalink





‘(d) Evaluation and Reporting of Compliance-CommentsClose CommentsPermalink





`(1) IN GENERAL- Not later than 6 months after the effective date under section 365 of the Federal Housing Finance Reform Act of 2008, the Director shall establish‘(1) IN GENERAL- The Director shall, by regulation, establish effective for 2010 and thereafter a manner for evaluating whether, and the extent to which, the enterprises have complied with the duty under subsection (a) to serve underserved markets and for rating the extent of such compliance. Using such method, the Director shall, for each yea2010 and each year thereafter, evaluate such compliance and rate the performance of each enterprise as to extent of compliance. The Director shall include such evaluation and rating for each enterprise for a year in the report for that year submitted pursuant to section 1319B(a).CommentsClose CommentsPermalink





`‘(2) SEPARATE EVALUATIONS- In determining whether an enterprise has complied with the duty referred to in paragraph (1), the Director shall separately evaluate whether the enterprise has complied with such duty with respect to each of the underserved markets identified in subsection (a), taking into considerationCommentsClose CommentsPermalink

--`(A) the 731X CommentsClose CommentsPermalink

‘(A) the development of loan products and, more flexible underwriting guidelines;`(B) the extent of , and other innovative approaches to providing financing to each of such underserved markets;CommentsClose CommentsPermalink





‘(B) the extent of outreach to qualified loan sellers and other market participants in each of such underserved markets;CommentsClose CommentsPermalink





and`(C)‘(C) the volume of loans purchased in each of such underserved markets relative to the market opportunities available to the enterprise, except that the Director shall not establish specific quantitative targets nor evaluate the enterprises based solely on the volume of loans purchased in each of such; andCommentsClose CommentsPermalink





‘(D) the amount of investments and grants in projects which assist in meeting the needs of such underserved markets.CommentsClose CommentsPermalink





`‘(3) MANUFACTURED HOUSING MARKET- In determining whether an enterprise has complied with the duty under subparagraph (A) of subsection (a)(21), the Director may consider loans secured by both real and personal property.CommentsClose CommentsPermalink





'‘(4) PROHIBITION OF CONSIDERATION OF AFFORDABLE HOUSING FUND GRANTS FOR MEETING DUTY TO SERVE- In determining whether an enterprise has complied with the duty referred to in paragraph (1), the Director may not consider any affordable housing fund grant amounts used under section 1337 for eligible activities under subsection (g) of such section.’.CommentsClose CommentsPermalink





(b) Enforcement- Subsection (a) of section 1336 of the Housing and Community Development Act of 1992 (12 U.S.C. 4566(a)) is amended--CommentsClose CommentsPermalink





(1) in paragraph (1), by inserting `‘and with the duty under section 1335(a) of each enterprise with respect to underserved markets,' before `as provided in this section'’ before ‘as provided in this section’; andCommentsClose CommentsPermalink





(2) by adding at the end of such subsection, as amended by the preceding provisions of this subtitle, the following new paragraph:`title, the following new paragraph:CommentsClose CommentsPermalink





‘(4) ENFORCEMENT OF DUTY TO PROVIDE MORTGAGE CREDIT TO UNDERSERVED MARKETS- The duty under section 1335(a) of each enterprise to serve underserved markets (as determined in accordance with section 1335(c)) shall be enforceable under this section to the same extent and under the same provisions that the housing goals established under this subpart are enforceable. Such duty shall be enforceable only under this section, except that such duty shall not be subject to subsection (c)(7) of this section and shall not be enforceable under any other provision of this title (including subpart C of this part) other than this section or under any provision of the Federal National Mortgage Association Charter Act or the Federal Home Loan Mortgage Corporation Act.'.SEC. 339. MONITORING AND ENFORCING COMPLIANCE WITH HOUSING GOALS.(a’.CommentsClose CommentsPermalink





(c) Additional Credit for Certain Mortgages- Section 1336(a) of the Housing and Community Development Act of 1992 (12 U.S.C. 4566(a)) is amendedCommentsClose CommentsPermalink

--(1) in paragraph (2), by inserting `, except as provided in paragraph (4),' after `which' 731X CommentsClose CommentsPermalink

(1) in paragraph (2), by inserting ‘, except as provided in paragraph (5),’ after ‘which’; andCommentsClose CommentsPermalink





(2) by adding at the end the following new paragraph:CommentsClose CommentsPermalink





`(5) ADDITIONAL CREDIT- The Director shall assign more than 125 percent‘(5) ADDITIONAL CREDIT- The Director may assign additional credit toward achievement, under this section, of the housing goals for mortgage purchase activities of the enterprises that comply with the requirements of such goals and support--`(A) housing that meets energy efficiency or other environmental standards that are established by a Federal, State, or local governmental authority with respect to the geographic area where the housing is located or are otherwise widely recognized; or`(B) housing that includes a licensed childcare center. The availability of additional credit under this paragraph shall not be used to increase any housing goal, subgoal, or target established under this subpart.'.(b) Monitoring and Enforcement- Section 1336 of the Housing and Community Development Act of 1992 ’.CommentsClose CommentsPermalink

(a) In General- Section 1336 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4566) is amended--(1) in subsection (b)--(A) in the subsection heading, by inserting `Preliminary' before `Determination';(B) by striking paragraph (1) and inserting the following new paragraph:` by striking subsections (b) and (c) and inserting the following:CommentsClose CommentsPermalink





‘(b) Notice and Preliminary Determination of Failure To Meet Goals-CommentsClose CommentsPermalink





‘(1) NOTICE- If the Director preliminarily determines that an enterprise has failed, or that there is a substantial probability that an enterprise will fail, to meet any housing goal established under thisunder this subpart, the Director shall provide written notice to the enterprise of such a preliminary determination, the reasons for such determination, and the information on which the Director based the determination.CommentsClose CommentsPermalink





';(C) in paragraph (2)--(i) in subparagraph (A), by inserting `finally' before `determining';(ii) by striking subparagraphs (B) and (C) and inserting the following new subparagraph:`(B) EXTENSION OR SHORTENING OF PERIOD- The Director may--`(i) ‘(2) RESPONSE PERIOD- CommentsClose CommentsPermalink





‘(A) IN GENERAL- During the 30-day period beginning on the date on which an enterprise is provided notice under paragraph (1), the enterprise may submit to the Director any written information that the enterprise considers appropriate for consideration by the Director in finally determining whether such failure has occurred or whether the achievement of such goal was or is feasible.CommentsClose CommentsPermalink





‘(B) EXTENDED PERIOD- The Director may extend the period under subparagraph (A) for good cause for not more than 30 additional days; and`(ii).CommentsClose CommentsPermalink





‘(C) SHORTENED PERIOD- The Director may shorten the period under subparagraph (A) for good cause.CommentsClose CommentsPermalink





'; and(iii) by redesignating subparagraph (D) as subparagraph (C); and(D) in paragraph (3)--(i) in subparagraph (A), by striking `determine' and inserting ` ‘(D) FAILURE TO RESPOND- The failure of an enterprise to provide information during the 30-day period under this paragraph (as extended or shortened) shall waive any right of the enterprise to comment on the proposed determination or action of the Director. CommentsClose CommentsPermalink





‘(3) CONSIDERATION OF INFORMATION AND FINAL DETERMINATION-CommentsClose CommentsPermalink





‘(A) IN GENERAL- After the expiration of the response period under paragraph (2), or upon receipt of information provided during such period by the enterprise, whichever occurs earlier, the Director shall issue a final determination of';(ii) in subparagraph (B), by inserting `final' before `determinations'; and(iii) in subparagraph (C)--(I) by striking `Committee on Banking, Finance and Urban Affairs' and inserting `Committee on Financial Services'; and(II) by inserting `final' before `determination' each place such term appears; and(2) in subsection (c)--(A) by striking the subsection designation and heading and all that follows through the end of paragraph (1) and inserting the following:`(c)n--CommentsClose CommentsPermalink





‘(i) whether the enterprise has failed, or there is a substantial probability that the enterprise will fail, to meet the housing goal; andCommentsClose CommentsPermalink





‘(ii) whether (taking into consideration market and economic conditions and the financial condition of the enterprise) the achievement of the housing goal was or is feasible.CommentsClose CommentsPermalink





‘(B) CONSIDERATIONS- In making a final determination under subparagraph (A), the Director shall take into consideration any relevant information submitted by the enterprise during the response period.CommentsClose CommentsPermalink





‘(C) NOTICE- The Director shall provide written notice, including a response to any information submitted during the response period, to the enterprise, the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Committee on Financial Services of the House of Representatives, of--CommentsClose CommentsPermalink





‘(i) each final determination under this paragraph that an enterprise has failed, or that there is a substantial probability that the enterprise will fail, to meet a housing goal;CommentsClose CommentsPermalink





‘(ii) each final determination that the achievement of a housing goal was or is feasible; andCommentsClose CommentsPermalink





‘(iii) the reasons for each such final determination.CommentsClose CommentsPermalink





‘(c) Cease and Desist Orders, Civil Money Penalties, and Remedies Including Housing Plans-CommentsClose CommentsPermalink





`‘(1) REQUIREMENT- If the Director finds, pursuant to subsection (b), that there is a substantial probability that an enterprise will fail, or has actually failed, to meet any housing goal under this subpart, and that the achievement of the housing goal was or is feasible, the Director may require that the enterprise submit a housing plan under this subsection. If the Director makes such a finding and the enterprise refuses to submit such a plan, submits an unacceptable plan, or fails to comply with the plan or the Director finds that the enterprise has failed to meet any housing goal under this subpart, in addition to requiring an enterprise to submit a housing plan, the Director may issue a cease and desist order in accordance with section 1341, and impose civil money penalties in accordance with section 1345, or order other remedies as set forth in paragraph (7) of this subsection.';(B) in paragraph (2)--(i) by striking `CONTENTS- Each housing plan' and inserting `.CommentsClose CommentsPermalink





‘(2) HOUSING PLAN- If the Director requires a housing plan under this section, such a plan'; and(ii) in subparagraph (B), by inserting `ubsection, such a plan shall be--CommentsClose CommentsPermalink





‘(A) a feasible plan describing the specific actions the enterprise will take--CommentsClose CommentsPermalink





‘(i) to achieve the goal for the next calendar year; andCommentsClose CommentsPermalink





‘(ii) if the Director determines that there is a substantial probability that the enterprise will fail to meet a goal in the current year, to make such improvements and changes in its operations' after `improvements';(C) in paragraph (3)--(i) by inserting `comply with any remedial action or' before `submit a housing plan'; and(ii) by striking `under subsection (b)(3) that a housing plan is required';(D) in paragraph (4), by striking the first two sentences and inserting the following: ` as are reasonable in the remainder of such year; andCommentsClose CommentsPermalink





‘(B) sufficiently specific to enable the Director to monitor compliance periodically.CommentsClose CommentsPermalink





‘(3) DEADLINE FOR SUBMISSION- The Director shall establish a deadline for an enterprise to submit a housing plan to the Director, which may not be more than 45 days after the enterprise is provided notice. The Director may extend the deadline to the extent that the Director determines necessary. Any extension of the deadline shall be in writing and for a time certain.CommentsClose CommentsPermalink





‘(4) APPROVAL- The Director shall review each submission by an enterprise, including a housing plan submitted under this subsection, and, not later than 30 days after submission, approve or disapprove the plan or other action. The Director may extend the period for approval or disapproval for a single additional 30-day period if the Director determines such extension necessary.'; and(E) by adding at the end the following new paragraph:`(7) ADDITIONAL REMEDIES FOR FAILURE TO MEET GOALS- In addition to ordering a housing plan under this section, issuingit necessary. The Director shall approve any plan that the Director determines is likely to succeed, and conforms with the Federal National Mortgage Association Charter Act or the Federal Home Loan Mortgage Corporation Act (as applicable), this title, and any other applicable provision of law.CommentsClose CommentsPermalink





‘(5) NOTICE OF APPROVAL AND DISAPPROVAL- The Director shall provide written notice to any enterprise submitting a housing plan of the approval or disapproval of the plan (which shall include the reasons for any disapproval of the plan) and of any extension of the period for approval or disapproval.CommentsClose CommentsPermalink





‘(6) RESUBMISSION- If the initial housing plan submitted by an enterprise under this section is disapproved, the enterprise shall submit an amended plan acceptable to the Director not later than 15 days after such disapproval, or such longer period that the Director determines is in the public interest.CommentsClose CommentsPermalink





‘(7) CEASE AND DESIST ORDERS; CIVIL MONEY PENALTIES- Solely with respect to the housing goals established under sections 1332(a) and 1333(a)(1), if the Director requires an enterprise to submit a housing plan under this subsection and the enterprise refuses to submit such a plan, submits an unacceptable plan, or fails to comply with the plan, the Director may issue a cease and desist orders under section 1341, and ordering in accordance with section 1341, impose civil money penalties under section 1345, the Director may seek other actions when an enterprise fails to meet a goal, and exercise appropriate enforcement authority available to the Director under this Act to prohibit the enterprise from initially offering any product (as such term is defined in section 1321(f)in accordance with section 1345, exercise other appropriate enforcement authority or seek other appropriate actions.’.CommentsClose CommentsPermalink





(b) Conforming Amendment- The heading for subpart C of part 2 of subtitle A of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 is amended to read as follows:CommentsClose CommentsPermalink

‘SEC. 1341. CEASE AND DESIST PROCEEDINGS.

‘(a) Grounds for Issuance- The Director may issue and serve a notice of charges under this section upon an enterprise if the Director determines that--CommentsClose CommentsPermalink





‘(1) the enterprise has failed to submit a report under section 1327, following a notice of such failure, an opportunity for comment by the enterprise, and a final determination by the Director;CommentsClose CommentsPermalink





‘(2) the enterprise has failed to submit the information required under subsection (m) or engaging in any new activities, services, undertakings, and offerings and to order the enterprise to suspend products and activities, services, undertakings, and offerings pending its achievement of the goal.'.SEC. 340. AFFORDABLE HOUSING FUND.(a) In General- The Housing and Community Development Act of 1992 is amended by striking sections 1337 and 1338(n) of section 309 of the Federal National Mortgage Association Charter Act, or subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act;CommentsClose CommentsPermalink





‘(3) solely with respect to the housing goals established under sections 1332(a) and 1333(a)(1), the enterprise has failed to submit a housing plan that complies with section 1336(c) within the applicable period; orCommentsClose CommentsPermalink





‘(4) solely with respect to the housing goals established under sections 1332(a) and 1333(a)(1), the enterprise has failed to comply with a housing plan under section 1336(c).CommentsClose CommentsPermalink





‘(b) Procedure-CommentsClose CommentsPermalink





‘(1) NOTICE OF CHARGES- Each notice of charges issued under this section shall contain a statement of the facts constituting the alleged conduct and shall fix a time and place at which a hearing will be held to determine on the record whether an order to cease and desist from such conduct should issue.CommentsClose CommentsPermalink





‘(2) ISSUANCE OF ORDER- If the Director finds on the record made at a hearing described in paragraph (1) that any conduct specified in the notice of charges has been established (or the enterprise consents pursuant to section 1342(a)(4)), the Director may issue and serve upon the enterprise an order requiring the enterprise to--CommentsClose CommentsPermalink





‘(A) submit a report under section 1327;CommentsClose CommentsPermalink





‘(B) solely with respect to the housing goals established under sections 1332(a) and 1333(a)(1), submit a housing plan in compliance with section 1336(c);CommentsClose CommentsPermalink





‘(C) solely with respect to the housing goals established under sections 1332(a) and 1333(a)(1), comply with the housing plan in compliance with section 1336(c); orCommentsClose CommentsPermalink





‘(D) provide the information required under subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act, or subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act.CommentsClose CommentsPermalink





‘(c) Effective Date- An order under this section shall become effective upon the expiration of the 30-day period beginning on the date of service of the order upon the enterprise (except in the case of an order issued upon consent, which shall become effective at the time specified therein), and shall remain effective and enforceable as provided in the order, except to the extent that the order is stayed, modified, terminated, or set aside by action of the Director or otherwise, as provided in this subpart.’.CommentsClose CommentsPermalink





(d) Civil Money Penalties-CommentsClose CommentsPermalink





(1) REPEAL- Section 1345 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4562 note) and inserting the following new section:`SEC. 133785) is hereby repealed.CommentsClose CommentsPermalink





(2) CIVIL MONEY PENALTIES- The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 is amended by inserting after section 1344 the following:CommentsClose CommentsPermalink

SEC. 1131. AFFORDABLE HOUSING FUND.`PROGRAMS.

(a) Establishment and Purpose- The Director, in consultation with the Secretary of Housing and Urban Development, shall establish and manage an affordable housing fund in accordance with this section, which shall be funded with amounts allocated by the enterprises under subsection (b). The purpose of the affordable housing fund shall be to provide formula grants to grantees for use--`(1) to increase homeownership for extremely low-and very low-income families;`(2) to increase investment in housing in low-income areas, and areas designated as qualified census tracts or an area of chronic economic distress pursuant to section 143(j) of the Internal Revenue Code of 1986 (26Repeal- Section 1337 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 143(j));`(3) to increase and preserve the supply of rental and owner-occupied housing for extremely low- and very low-income families;`(4) to increase investment in public infrastructure development in connection with housing assisted under this section; and`(5) to leverage investments from other sources in affordable housing and in public infrastructure development in connection with housing assisted under this section.`(b)4567) is hereby repealed.CommentsClose CommentsPermalink





(b) Annual Housing Report- The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 1301 et seq.) is amended by inserting after section 1336 the following:CommentsClose CommentsPermalink

‘SEC. 1337. AFFORDABLE HOUSING ALLOCATIONS.

‘(a) Set Aside and Allocation of Amounts by Enterprises-`(1) IN GENERAL- In accordance with regulations issued by the Director under subsection (m) and subject to paragraph (2) of this subsection and subsection (i)(5), each enterprise shall allocate to the affordable housing fund established under subsection (a), in each of the years 2008 through 2012, an amount equal to 1 Subject to subsection (b), in each fiscal year--CommentsClose CommentsPermalink





‘(1) the Federal Home Loan Mortgage Corporation shall--CommentsClose CommentsPermalink





‘(A) set aside an amount equal to 4.2 basis points for each dollar of the average total mortgage portfolio of the enterprise during the preceding year.`(2) SUSPENSION OF CONTRIBUTIONSunpaid principal balance of its total new business purchases; andCommentsClose CommentsPermalink





‘(B) allocate or otherwise transfer--CommentsClose CommentsPermalink





‘(i) 65 percent of such amounts to the Secretary of Housing and Urban Development to fund the Housing Trust Fund established under section 1338; andCommentsClose CommentsPermalink





‘(ii) 35 percent of such amounts to fund the Capital Magnet Fund established pursuant to section 1339; andCommentsClose CommentsPermalink





‘(2) the Federal National Mortgage Association shall--CommentsClose CommentsPermalink





‘(A) set aside an amount equal to 4.2 basis points for each dollar of unpaid principal balance of its total new business purchases; andCommentsClose CommentsPermalink





‘(B) allocate or otherwise transfer--CommentsClose CommentsPermalink





‘(i) 65 percent of such amounts to the Secretary of Housing and Urban Development to fund the Housing Trust Fund established under section 1338; andCommentsClose CommentsPermalink





‘(ii) 35 percent of such amounts to fund the Capital Magnet Fund established pursuant to section 1339.CommentsClose CommentsPermalink





‘(b) Suspension of Contributions- The Director shall temporarily suspend the allocation under paragraph (1) by an enterprise to the affordable housing fundallocations under subsection (a) by an enterprise upon a finding by the Director that such allocations--CommentsClose CommentsPermalink





`(A‘(1) are contributing, or would contribute, to the financial instability of the enterprise;CommentsClose CommentsPermalink





`(B‘(2) are causing, or would cause, the enterprise to be classified as undercapitalized; orCommentsClose CommentsPermalink





`(C‘(3) are preventing, or would prevent, the enterprise from successfully completing a capital restoration plan under section 1369C.CommentsClose CommentsPermalink





`(3) 5-year SUNSET AND REPORT-`(A) SUNSET- The enterprises shall not be required to make allocations to the affordable housing fund in 2012 or in any year thereafter.`(B) REPORT ON PROGRAM CONTINUANCE- Not later than June 30, 2011, the Director shall submit to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report making recommendations on whether the program under this section, including the requirement for the enterprises to make allocations to the affordable housing fund, should be extended and on any modifications for the program.`(4) PROHIBITION OF PASS-THROUGH OF COST OF ALLOCATIONS‘(c) Prohibition of Pass-Through of Cost of Allocations- The Director shall, by regulation, prohibit each enterprise from redirecting such coststhe costs of any allocation required under this section, through increased charges or fees, or decreased premiums, or in any other manner, to the originators of mortgages purchased or securitized by the enterprise.CommentsClose CommentsPermalink





`(c) Affordable Housing Needs Formulas-`(1) ALLOCATION FOR 2008-`(A) ALLOCATION PERCENTAGES FOR LOUISIANA AND MISSISSIPPI- For purposes of subsection (d)(1)(A), the allocation percentages for 2008 for the grantees under this section for such year shall be as follows:`(i) The allocation percentage for the Louisiana Housing Finance Agency shall be 75 percent.`(ii) The allocation percentage for the Mississippi Development Authority shall be 25 percent.`(B) USE IN DISASTER AREAS- Affordable housing grant amounts for 2008 shall be used only as provided in subsection (g) only for such eligible activities in areas that were subject to a declaration by the President of a major disaster or emergency under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.) in connection with Hurricane Katrina or Rita of 2005.`(2) ALLOCATION FORMULA FOR OTHER YEARS- The Secretary of Housing and Urban Development shall, by regulation, establish a formula to allocate, among the ‘(d) Enforcement of Requirements on Enterprise- Compliance by the enterprises with the requirements under this section shall be enforceable under subpart C. Any reference in such subpart to this part or to an order, rule, or regulation under this part specifically includes this section and any order, rule, or regulation under this section. CommentsClose CommentsPermalink





‘(e) Required Amount for HOPE Reserve Fund- Of the aggregate amount allocated under subsection (a), 25 percent shall be deposited into a fund established in the Treasury of the United States by the Secretary of the Treasury for such purpose.CommentsClose CommentsPermalink





‘(f) Limitation- No funds under this title may be used in conjunction with property taken by eminent domain, unless eminent domain is employed only for a public use, except that, for purposes of this section, public use shall not be construed to include economic development that primarily benefits any private entity.CommentsClose CommentsPermalink

‘SEC. 1338. HOUSING TRUST FUND.

‘(a) Establishment and Purpose-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Secretary of Housing and Urban Development (in this section referred to as the ‘Secretary’) shall establish and manage a Housing Trust Fund, which shall be funded with amounts allocated by the enterprises under section 1337 and any amounts as are or may be appropriated, transferred, or credited to such Housing Trust Fund under any other provisions of law. The purpose of the Housing Trust Fund under this section is to provide grants to States (as such term is defined in section 1303) and federally recognized Indian tribes, the amounts provided by the enterprises in each year referred to subsection (b)(1), other than 2008, to the affordable housing fund established under this section. The formula shall be based on the following factors, with respect to each State and tribe:`(A) The ratio of the population of the State or federally recognized Indian tribe to the aggregate population of all the States and tribes.`(B) The percentage of families in the State or federally recognized Indian tribe that pay more than 50 percent of their annual income for housing costs.`(C) The percentage of persons in the State or federally recognized Indian tribe that are members of extremely low- orfor use--CommentsClose CommentsPermalink





‘(A) to increase and preserve the supply of rental housing for extremely low- and very low-income families.`(D) The cost of developing or carrying out rehabilitation of housing in the State or for the federally recognized Indian tribe.`(E) The percentage of families in the State or federally recognized Indian tribe that live in substandard housing.`(F) The percentage of housing stock in the State or for the federally recognized Indian tribe that is extremely old housing.`(G) Any other factors that the Secretary determines to be appropriate.`(3) FAILURE TO ESTABLISH- If, in any year referred to in subsection (b)(1), other than 2008, the regulations establishing the formula required under paragraph (2) of this subsection have not been issued by the date that the Director determines the amounts described in, including homeless families; andCommentsClose CommentsPermalink





‘(B) to increase homeownership for extremely low- and very low-income families.CommentsClose CommentsPermalink





‘(2) FEDERAL ASSISTANCE- For purposes of the application of Federal civil rights laws, all assistance provided from the Housing Trust Fund shall be considered Federal financial assistance.CommentsClose CommentsPermalink





‘(b) Allocations for HOPE Bond Payments-CommentsClose CommentsPermalink





‘(1) IN GENERAL- Notwithstanding subsection (d)(1) to be available for affordable housing fund grants in such year, for purposes of such year any amounts for a State (as such term is definc), to help address the mortgage crisis, of the amounts allocated pursuant to clauses (i) and (ii) of section 1337(a)(1)(B) and clauses (i) and (ii) of section 1337(a)(2)(B) in excess of amounts described in section 1303 of this Act) that would otherwise be determined under subsection (d) by applying the formula established pursuant to paragraph (2) of this subsection shall be determined instead by applying, for such State, the percentage that is equal to the percentage of the total amounts made available for such year for allocation under subtitle A of title II of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12741 et seq.) that are allocated in such year, pursuant to such subtitle, to such State (including any insular area or unit of general local government, as such terms are defined in section 104 of such Act (42 U.S.C. 12704), that is treated as a State under 37(e)--CommentsClose CommentsPermalink





‘(A) 100 percent of such excess shall be used to reimburse the Treasury for payments made pursuant to section 1303 of this Act) and to participating jurisdictions and other eligible entities within such State.`(d) Allocation of Formula Amount; Grants-`(1) FORMULA AMOUNT- For each year referred to in subsection (b)(1), the Director shall determine the formula amount under this section for each grantee, which shall be the amount determined for such grantee--`(A) for 2008, by applying the allocation percentages under subparagraph (A) of subsection (c)(1) to the sum of the total amounts allocated by the enterprises to the affordable housing fund for such year, less any amounts used pursuant to subsection (i)(1); and`(B) for any other year referred to in subsection (b)(1) (other than 2008), by applying the formula established pursuant to paragraph (2) of subsection (c) to the sum of the total amounts allocated by the enterprises to the affordable housing fund for such year and any recaptured amounts available pursuant to subsection (i)(4), less any amounts used pursuant to subsection (i)(1).`(2) NOTICE- In each year referred to in subsection (b)(1), not later than 60 days after the date that the Director determines the amounts described in 257(w)(1)(C) of the National Housing Act in calendar year 2009;CommentsClose CommentsPermalink





‘(B) 50 percent of such excess shall be used to reimburse the Treasury for such payments in calendar year 2010; andCommentsClose CommentsPermalink





‘(C) 25 percent of such excess shall be used to reimburse the Treasury for such payments in calendar year 2011.CommentsClose CommentsPermalink





‘(2) EXCESS FUNDS- At the termination of the HOPE for Homeowners Program established under section 257 of the National Housing Act, if amounts used to reimburse the Treasury under paragraph (1) to be available for affordable housing fund grants to grantees in such year, the Director shall cause to be published in the Federal Register a notice that such amounts shall be so available.`(3) GRANT AMOUNT-`(A) IN GENERAL- For each year referred to in subsection (b)(1), the Director shall make a grant from amounts in the affordable housing fund to each grantee in an amount that is, except as provided in subparagraph (B), equal to the formula amount under this section for the grantee. A granteeexceed the total net cost to the Government of the HOPE for Homeowners Program, such amounts shall be used for their original purpose, as described in paragraphs (1)(B) and (2)(B) of section 1337(a).CommentsClose CommentsPermalink





‘(3) TREASURY FUND- The amounts referred to in subparagraphs (A) through (C) of paragraph (1) shall be deposited into a fund established in the Treasury of the United States by the Secretary of the Treasury for such purpose.CommentsClose CommentsPermalink





‘(c) Allocation for Housing Trust Fund in Fiscal Year 2010 and Subsequent Years-CommentsClose CommentsPermalink





‘(1) IN GENERAL- Except as provided in subsection (b), the Secretary shall distribute the amounts allocated for the Housing Trust Fund under this section to provide affordable housing as described in this subsection.CommentsClose CommentsPermalink





‘(2) PERMISSIBLE DESIGNEES- A State receiving grant amounts under this subsection may designate a State housing finance agency, housing and community development entity, tribally designated housing entity (as such term is defined in section 4 of the Native American Housing Assistance and Self-Determination Act of 1997 (25 U.S.C. 4103)) or other qualified instrumentality of the grante, or any other qualified instrumentality of the State to receive such grant amounts.CommentsClose CommentsPermalink





`(B) REDUCTION FOR FAILURE TO OBTAIN RETURN OF MISUSED FUNDS- If in any year a grantee fails to obtain reimbursement or return of the full amount required under subsection (j)(1)(B) to be reimbursed or returned to the grantee during such year--`(i) except as provided in clause (ii)--`(I) the amount of the grant for the grantee for the succeeding year, as determined pursuant to subparagraph (A), shall be reduced by the amount by which such amounts required to be reimbursed or returned exceed the amount actually reimbursed or returned; and`(II) the amount of the grant for the succeeding year for each other grantee whose grant is not reduced pursuant to subclause ‘(3) DISTRIBUTION TO STATES BY NEEDS-BASED FORMULA- CommentsClose CommentsPermalink





‘(A) IN GENERAL- The Secretary shall, by regulation, establish a formula within 12 months of the date of enactment of the Federal Housing Finance Regulatory Reform Act of 2008, to distribute amounts made available under this subsection to each State to provide affordable housing to extremely low- and very low-income households.CommentsClose CommentsPermalink





‘(B) BASIS FOR FORMULA- The formula required under subparagraph (A) shall include the following:CommentsClose CommentsPermalink





‘(i) The ratio of the shortage of standard rental units both affordable and available to extremely low-income renter households in the State to the aggregate shortage of standard rental units both affordable and available to extremely low-income renter households in all the States.CommentsClose CommentsPermalink





‘(ii) The ratio of the shortage of standard rental units both affordable and available to very low-income renter households in the State to the aggregate shortage of standard rental units both affordable and available to very low-income renter households in all the States.CommentsClose CommentsPermalink





‘(iii) The ratio of extremely low-income renter households in the State living with either (I) incomplete kitchen or plumbing facilities, (II) more than 1 person per room, or (III) paying more than 50 percent of income for housing costs, to the aggregate number of extremely low-income renter households living with either (IV) incomplete kitchen or plumbing facilities, (V) more than 1 person per room, or (VI) paying more than 50 percent of income for housing costs in all the States.CommentsClose CommentsPermalink





‘(iv) The ratio of very low-income renter households in the State paying more than 50 percent of income on rent relative to the aggregate number of very low-income renter households paying more than 50 percent of income on rent in all the States.CommentsClose CommentsPermalink





‘(v) The resulting sum calculated from the factors described in clauses (i) through (iv) shall be multiplied by the relative cost of construction in the State. For purposes of this subclause, the term ‘cost of construction’--CommentsClose CommentsPermalink





‘(I) means the cost of construction or building rehabilitation in the State relative to the national cost of construction or building rehabilitation; andCommentsClose CommentsPermalink





‘(II) shall be calculated such that values higher than 1.0 indicate that the State’s construction costs are higher than the national average, a value of 1.0 indicates that the State’s construction costs are exactly the same as the national average, and values lower than 1.0 indicate that the State’s cost of construction are lower than the national average.CommentsClose CommentsPermalink





‘(C) PRIORITY- The formula required under subparagraph (A) shall give priority emphasis and consideration to the factor described in subparagraph (B)(i).CommentsClose CommentsPermalink





‘(4) ALLOCATION OF GRANT AMOUNTS-CommentsClose CommentsPermalink





‘(A) NOTICE- Not later than 60 days after the date that the Secretary determines the formula amounts described in paragraph (3), the Secretary shall caused to be published in the Federal Register a notice that such amounts shall be so available.CommentsClose CommentsPermalink





‘(B) GRANT AMOUNT- In each fiscal year other than fiscal year 2009, the Secretary shall make a grant to each State in an amount that is equal to the formula amount determined under paragraph (3) for that State.CommentsClose CommentsPermalink





‘(C) MINIMUM STATE ALLOCATIONS- If the formula amount determined under paragraph (3) for a fiscal year would allocate less than $3,000,000 to any of the 50 States of the United States or the District of Columbia, the allocation for such State of the United States or the District of Columbia shall be $3,000,000, and the increase shall be increased by the amount determined by applying the formula established pursuant to subsection (c)(2) to the total amount of all reductions for all grantees for such year pursuant to subclause (I); or`(ii) in any case in which such failure to obtain reimbursement or return occurs during a year immediately preceding a year in which grants under this subsection will not be made, the grantee shall pay to the Director for reallocation among the other grantees an amount equal to the amount of the reduction for the grantee that would otherwise apply under clause (i)(I).`(e) Grantee Allocation Plans-`(1) IN GENERAL- For each year that a grantee receives affordable housing fund grant amounts, the grantee shall establish an allocation plan in accordance with this subsection, which shall be a plan for the distribution of such grant amounts of the grantee for such year that--`(A) isdeducted pro rata from the allocations made to all other of the States (as such term is defined in section 1303).CommentsClose CommentsPermalink





‘(5) ALLOCATION PLANS REQUIRED-CommentsClose CommentsPermalink





‘(A) IN GENERAL- For each year that a State or State designated entity receives a grant under this subsection, the State or State designated entity shall establish an allocation plan. Such plan shall--CommentsClose CommentsPermalink





‘(i) set forth a plan for the distribution of grant amounts received by the State or State designated entity for such year;CommentsClose CommentsPermalink





‘(ii) be based on priority housing needs, as determined by the granteeState or State designated entity in accordance with the regulations established under subsection (m)(2)(C);`(B) complies with subsection (f); and`(C) includes performance goals, benchmarks, and timetables for the grantee for the production, preservation, and rehabilitation of affordable rental and homeownership housing with such grant amounts that comply with the requirements established by the Directorg)(2)(D);CommentsClose CommentsPermalink





‘(iii) comply with paragraph (6); andCommentsClose CommentsPermalink





‘(iv) include performance goals that comply with the requirements established by the Secretary pursuant to subsection (m)(2)(F).`(2g)(2).CommentsClose CommentsPermalink





‘(B) ESTABLISHMENT- In establishing an allocation plan, a grantee shall under this paragraph, a State or State designated entity shall--CommentsClose CommentsPermalink





‘(i) notify the public of the establishment of the plan,;CommentsClose CommentsPermalink





‘(ii) provide an opportunity for public comments regarding the plan,;CommentsClose CommentsPermalink





‘(iii) consider any public comments received, and regarding the plan; andCommentsClose CommentsPermalink





‘(iv) make the completed plan available to the public.CommentsClose CommentsPermalink





`(3‘(C) CONTENTS- An allocation plan of a grantee shall State or State designated entity under this paragraph shall set forth the requirements for eligible recipients under subsection (h) to apply to the grantee to receive assistance from affordable housing fundparagraph (8) to apply for such grant amounts, including a requirement that each such application include--CommentsClose CommentsPermalink





`(A‘(i) a description of the eligible activities to be conducted using such assistance; andCommentsClose CommentsPermalink





`(B‘(ii) a certification by the eligible recipient applying for such assistance that any housing units assisted with such assistance will comply with the requirements under this section.CommentsClose CommentsPermalink





`(f) Selection of Activities Funded Using Affordable Housing Fund Grant Amounts- Affordable housing fund grant amounts of a grantee‘(6) SELECTION OF ACTIVITIES FUNDED USING HOUSING TRUST FUND GRANT AMOUNTS- Grant amounts received by a State or State designated entity under this subsection may be used, or committed for use, only for activities that--CommentsClose CommentsPermalink





`(1) are eligible under subsection (g‘(A) are eligible under paragraph (7) for such use;CommentsClose CommentsPermalink





`(2) comply with the applicable allocation plan under subsection (e) of the grantee; and`(3 ‘(B) comply with the applicable allocation plan of the State or State designated entity under paragraph (5); and CommentsClose CommentsPermalink





‘(C) are selected for funding by the granteeState or State designated entity in accordance with the process and criteria for such selection established pursuant to subsection (m)(2)(C).`(g) Eligible Activities- Affordable housing fund grant amounts of a granteeg)(2)(D).CommentsClose CommentsPermalink





‘(7) ELIGIBLE ACTIVITIES- Grant amounts allocated to a State or State designated entity under this subsection shall be eligible for use, or for commitment for use, only for assistance for--CommentsClose CommentsPermalink





`(1‘(A) the production, preservation, and rehabilitation of rental housing, including housing under the programs identified in section 1335(a)(2)(B), except that such grant amounts may be used and for operating costs, except that not less than 75 percent of such grant amounts shall be used for the benefit only of extremely low-income families or families with incomes at or below the poverty line (as such term is defined in section 673 of the Omnibus Budget Reconciliation Act of 1981 (42 U.S.C. 9902), including any revision required by such section) applicable to a family of the size involved, and not more than 25 percent for the benefit only of extremely low- and very low-income families;`(2 andCommentsClose CommentsPermalink





‘(B) the production, preservation, and rehabilitation of housing for homeownership, including such forms as down payment assistance, closing cost assistance, and assistance for interest- rate buy-downs, that--CommentsClose CommentsPermalink





`(A‘(i) is available for purchase only for use as a principal residence by families that qualify both as--CommentsClose CommentsPermalink





`(i‘(I) extremely low- and very-low low-income families at the times described in subparagraphs (A) through (C) of section 215(b)(2) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12745(b)(2)); andCommentsClose CommentsPermalink





`(ii‘(II) first-time homebuyers, as such term is defined in section 104 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12704), except that any reference in such section to assistance under title II of such Act shall for purposes of this subsection be considered to refer to assistance from affordable housing fund grant amounts;CommentsClose CommentsPermalink





`(B‘(ii) has an initial purchase price that meets the requirements of section 215(b)(1) of the Cranston-Gonzalez National Affordable Housing Act;CommentsClose CommentsPermalink





`(C) is subject to the same‘(iii) is subject to the same resale restrictions established under section 215(b)(3) of the Cranston-Gonzalez National Affordable Housing Act and applicable to the participating jurisdiction that is the State in which such housing is located; andCommentsClose CommentsPermalink





`(D‘(iv) is made available for purchase only by, or in the case of assistance under this paragraph, is made available only to,subsection, is made available only to homebuyers who have, before purchase--`(i) completed a program of counseling with respect to the responsibilities and financial management involved in homeownership that is approved by the Director; except that the Director may, at the request of a State, waive the requirements of this subparagraph with respect to a geographic area or areas within the State if: (I) the travel time or distance involved in providing counseling with respect to such area or areas, as otherwise required under this subparagraph, on an in-person basis is excessive or the cost of such travel is prohibitive; and (II) the State provides alternative forms of counseling for such area or areas, which may include interactive telephone counseling, on-line counseling, interactive video counseling, and interactive home study counseling and a program of financial literacy and education to promote an understanding of consumer, economic, and personal finance issues and concepts, including saving for retirement, managing credit, long-term care, and estate planning and education on predatory lending, identity theft, and financial abuse schemes relating to homeownership that is approved by the Director, except that entities providing such counseling shall not discriminate against any particular form of housing; and`(ii) demonstrated, in accordance with regulations as the Director shall issue setting forth requirements for sufficient evidence, that they are lawfully present in the United States; and`(3) public infrastructure development activities in connection with housing activities funded under paragraph (1) or (2).`(h) Eligible Recipients- Affordable housing fund grant amounts of a grantee completed a program of independent financial education and counseling from an eligible organization that meets the requirements of section 132 of the Federal Housing Finance Regulatory Reform Act of 2008.CommentsClose CommentsPermalink





‘(8) TENANT PROTECTIONS AND PUBLIC PARTICIPATION- All amounts from the Trust Fund shall be allocated in accordance with, and any eligible activities carried out in whole or in part with grant amounts under this subtitle (including housing provided with such grant amounts) shall comply with and be operated in compliance with--CommentsClose CommentsPermalink





‘(A) laws relating to tenant protections and tenant rights to participate in decision making regarding their residences;CommentsClose CommentsPermalink





‘(B) laws requiring public participation, including laws relating to Consolidated Plans, Qualified Allocation Plans, and Public Housing Agency Plans; andCommentsClose CommentsPermalink





‘(C) fair housing laws and laws regarding accessibility in federally assisted housing, including section 504 of the Rehabilitation Act of 1973.CommentsClose CommentsPermalink





‘(9) ELIGIBLE RECIPIENTS- Grant amounts allocated to a State or State designated entity under this subsection may be provided only to a recipient that is an organization, agency, or other entity (including a for-profit entity, a nonprofit entity, and a faith-based organization) that--`(1 or a nonprofit entity) that--CommentsClose CommentsPermalink





‘(A) has demonstrated experience and capacity to conduct an eligible activity under (gparagraph (7), as evidenced by its ability to--CommentsClose CommentsPermalink





`(A‘(i) own, construct or rehabilitate, manage, and operate an affordable multifamily rental housing development;CommentsClose CommentsPermalink





`(B‘(ii) design, construct or rehabilitate, and market affordable housing for homeownership;`(C orCommentsClose CommentsPermalink





‘(iii) provide forms of assistance, such as down payments, closing costs, or interest- rate buy-downs, for purchasers; or`(D) construct related public infrastructure development activities in connection with such housing activities;`(2 for purchasers;CommentsClose CommentsPermalink





‘(B) demonstrates the ability and financial capacity to undertake, comply, and manage the eligible activity;CommentsClose CommentsPermalink





`(3‘(C) demonstrates its familiarlity with the requirements of any other Federal, State, or local housing program that will be used in conjunction with such grant amounts to ensure compliance with all applicable requirements and regulations of such programs; andCommentsClose CommentsPermalink





`(4‘(D) makes such assurances to the grantee as the DirectorState or State designated entity as the Secretary shall, by regulation, require to ensure that the recipient will comply with the requirements of this subsection during the entire period that begins upon selection of the recipient to receive such grant amounts and ending upon the conclusion of all activities under subsection (gparagraph (8) that are engaged in by the recipient and funded with such grant amounts.CommentsClose CommentsPermalink





`(i) Limitations on Use-`(1) REQUIRED AMOUNT FOR REFCORP- Of the aggregate amount allocated pursuant to subsection (b) in each year to the affordable housing fund, 25 percent shall be used as provided in section 21B(f)(2)(E) of the Federal Home Loan Bank Act (12 U.S.C. 1441b(f)(2)(E)).`(2 ‘(10) LIMITATIONS ON USE- CommentsClose CommentsPermalink





‘(A) REQUIRED AMOUNT FOR HOMEOWNERSHIP ACTIVITIES- Of the aggregate amount of affordable housing fund grant amounts provided in each year to a grantee, not lessallocated to a State or State designated entity under this subsection not more than 10 percent shall be used for activities under paragraph (2) of subsection (g).`(3) MAXIMUM AMOUNT FOR PUBLIC INFRASTRUCTURE DEVELOPMENT ACTIVITIES IN CONNECTION WITH AFFORDABLE HOUSING ACTIVITIES- Of the aggregate amount of affordable housing fund grant amounts provided in each year to a grantee, not more than 12.5 percent may be used for activities under paragraph (3) of subsection (g).`(4)subparagraph (B) of paragraph (7).CommentsClose CommentsPermalink





‘(B) DEADLINE FOR COMMITMENT OR USE- Any affordable housing fund grant amounts of a granteeGrant amounts allocated to a State or State designated entity under this subsection shall be used or committed for use within two years of the date of that such grant amounts are made available to the grantee. The Director shall recapture into the affordable housing fund2 years of the date that such grant amounts are made available to the State or State designated entity. The Secretary shall recapture any such amounts not so used or committed for use and allocate such amounts under subsection (d)(1) in the first year after such recapture.`(5reallocate such amounts under this subsection in the first year after such recapture.CommentsClose CommentsPermalink





‘(C) USE OF RETURNS- The Director shall, by regulationSecretary shall, by regulation, provide that any return on a loan or other investment of any affordable housing fund grant amounts of a granteegrant amount used by a State or State designated entity to provide a loan under this subsection shall be treated, for purposes of availability to and use by the grantee, as affordable housing fund grant amounts.`(6) State or State designated entity, as a grant amount authorized under this subsection.CommentsClose CommentsPermalink





‘(D) PROHIBITED USES- The Director shall--`(A) by regulation,Secretary shall, by regulation--CommentsClose CommentsPermalink





‘(i) set forth prohibited uses of affordable housing fund grant amounts, which shall include use for--`(igrant amounts allocated under this subsection, which shall include use for--CommentsClose CommentsPermalink





‘(I) political activities;CommentsClose CommentsPermalink





`(ii) advocacy;`(iii ‘(II) advocacy; CommentsClose CommentsPermalink





‘(III) lobbying, whether directly or through other parties;CommentsClose CommentsPermalink





`(iv) counseling services;`(v ‘(IV) counseling services; CommentsClose CommentsPermalink





‘(V) travel expenses; andCommentsClose CommentsPermalink





`(vi‘(VI) preparing or providing advice on tax returns;CommentsClose CommentsPermalink





`(B) by regulation, provide and for the purposes of this subparagraph, the prohibited use of funds for political activities includes influencing the selection, nomination, election, or appointment of one or more candidates to any Federal, State or local office as codified in section 501 of the Internal Revenue Code of 1986 (26 U.S.C. 501); CommentsClose CommentsPermalink





‘(ii) provide that, except as provided in subparagraph (C), affordable housing fund grant amounts of a grantee may not be used for in clause (iii), grant amounts of a State or State designated entity may not be used for administrative, outreach, or other costs of--CommentsClose CommentsPermalink





`(i) the grantee; or`(ii) any ‘(I) the State or State designated entity; or CommentsClose CommentsPermalink





‘(II) any other recipient of such grant amounts; andCommentsClose CommentsPermalink





`(C) by regulation, limit the amount of any affordable housing fund grant amounts of the grantee for a year that may be used for administrative costs of the grantee‘(iii) limit the amount of any grant amounts for a year that may be used by the State or State designated entity for administrative costs of carrying out the program required under this section to a percentage of such grant amounts of the grantee for such ubsection, including home ownership counseling, to a percentage of such grant amounts of the State or State designated entity for such year, which may not exceed 10 percent.CommentsClose CommentsPermalink





`(7‘(E) PROHIBITION OF CONSIDERATION OF USE FOR MEETING HOUSING GOALS OR DUTY TO SERVE- In determining compliance with the housing goals under this subpart and the duty to serve underserved markets under section 1335, the Director may not consider any affordable housing fund grant amounts used under this section for eligible activities under subsection (gparagraph (7). The Director shall give credit toward the achievement of such housing goals and such duty to serve underserved markets to purchases by the enterprises of mortgages for housing that receives funding from affordable housing fundsuch grant amounts, but only to the extent that such purchases by the enterprises are funded other than with such grant amounts.CommentsClose CommentsPermalink





`(8) ACCEPTABLE IDENTIFICATION REQUIREMENT FOR OCCUPANCY OR ASSISTANCE-`(A) IN GENERAL- Any assistance provided with any affordable housing grant amounts may not be made available to, 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-`(I) A social security card accompanied by a photo identification card issued by the Federal Government or a State Government; or`(II) 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 ofPublic 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).`(B) REGULATIONS- The Director shall, by regulation, require that each grantee and recipient take such actions as the Director considers necessary to ensure compliance with the requirements of subparagraph (A).`(j) ‘(d) Reduction for Failure to Obtain Return of Misused Funds- If in any year a State or State designated entity fails to obtain reimbursement or return of the full amount required under subsection (e)(1)(B) to be reimbursed or returned to the State or State designated entity during such year-- CommentsClose CommentsPermalink





‘(1) except as provided in paragraph (2)--CommentsClose CommentsPermalink





‘(A) the amount of the grant for the State or State designated entity for the succeeding year, as determined pursuant to this section, shall be reduced by the amount by which such amounts required to be reimbursed or returned exceed the amount actually reimbursed or returned; andCommentsClose CommentsPermalink





‘(B) the amount of the grant for the succeeding year for each other State or State designated entity whose grant is not reduced pursuant to subparagraph (A) shall be increased by the amount determined by applying the formula established pursuant to this section to the total amount of all reductions for all State or State designated entities for such year pursuant to subparagraph (A); orCommentsClose CommentsPermalink





‘(2) in any case in which such failure to obtain reimbursement or return occurs during a year immediately preceding a year in which grants under this section will not be made, the State or State designated entity shall pay to the Secretary for reallocation among the other grantees an amount equal to the amount of the reduction for the entity that would otherwise apply under paragraph (1)(A).CommentsClose CommentsPermalink





‘(e) Accountability of Recipients and Grantees-CommentsClose CommentsPermalink





`(1) RECIPIENTS-` ‘(1) RECIPIENTS- CommentsClose CommentsPermalink





‘(A) TRACKING OF FUNDS- The Director shall--`(i) require each granteeSecretary shall--CommentsClose CommentsPermalink





‘(i) require each State or State designated entity to develop and maintain a system to ensure that each recipient of assistance from affordable housing fund grant amounts of the granteeunder this section uses such amounts in accordance with this section, the regulations issued under this section, and any requirements or conditions under which such amounts were provided; andCommentsClose CommentsPermalink





`‘(ii) establish minimum requirements for agreements, between the granteeState or State designated entity and recipients, regarding assistance from the affordable housing fund grant amounts of the grantee, which shall include--`(I) appropriate continuing financial and project under this section, which shall include--CommentsClose CommentsPermalink





‘(I) appropriate periodic financial and project reporting, record retention, and audit requirements for the duration of the grantassistance to the recipient to ensure compliance with the limitations and requirements of this section and the regulations under this section; andCommentsClose CommentsPermalink





`(II) any other requirements that the Director‘(II) any other requirements that the Secretary determines are necessary to ensure appropriate grant administration and compliance.CommentsClose CommentsPermalink





`‘(B) MISUSE OF FUNDS-CommentsClose CommentsPermalink





`‘(i) REIMBURSEMENT REQUIREMENT- If any recipient of assistance from affordable housing fund grant amounts of a granteeunder this section is determined, in accordance with clause (ii), to have used any such amounts in a manner that is materially in violation of this section, the regulations issued under this section, or any requirements or conditions under which such amounts were provided, the grantee shallState or State designated entity shall require that, within 12 months after the determination of such misuse, the recipient shall reimburse the grantee for such State or State designated entity for such misused amounts and return to the grantee any amounts from the affordable housing fund grant amounts of the granteeState or State designated entity any such amounts that remain unused or uncommitted for use. The remedies under this clause are in addition to any other remedies that may be available under law.CommentsClose CommentsPermalink





`‘(ii) DETERMINATION- A determination is made in accordance with this clause if the determination is--`(I) made by the Director; or`(II)(aa) made by the grantee;`(bb) the grantee made by the Secretary or made by the State or State designated entity, provided that--CommentsClose CommentsPermalink





‘(I) the State or State designated entity provides notification of the determination to the DirectorSecretary for review, in the discretion of the Director, of the determination; and`(cc) the Director does notSecretary, of the determination; andCommentsClose CommentsPermalink





‘(II) the Secretary does not subsequently reverse the determination.CommentsClose CommentsPermalink





`(2) GRANTEES-`(A) REPORT-`(i) IN GENERAL- The Director shall require each grantee receiving affordable housing fund grant amounts for a year ‘(2) GRANTEES- CommentsClose CommentsPermalink





‘(A) REPORT-CommentsClose CommentsPermalink





‘(i) IN GENERAL- The Secretary shall require each State or State designated entity receiving grant amounts in any given year under this section to submit a report, for such year, to the Director that--`Secretary that--CommentsClose CommentsPermalink





‘(I) describes the activities funded under this section during such year with the affordable housing fund grant amounts of the grantee; and`(II) the manner in which the granteesuch grant amounts; andCommentsClose CommentsPermalink





‘(II) the manner in which the State or State designated entity complied during such year with theany allocation plan established pursuant to subsection (e) for the grantee.`(ii) c).CommentsClose CommentsPermalink





‘(ii) PUBLIC AVAILABILITY- The DirectorSecretary shall make such reports pursuant to this subparagraph publicly available.CommentsClose CommentsPermalink





`‘(B) MISUSE OF FUNDS- If the DirectorSecretary determines, after reasonable notice and opportunity for hearing, that a granteeState or State designated entity has failed to comply substantially with any provision of this section and until the Director, and until the Secretary is satisfied that there is no longer any such failure to comply, the Director shall--`Secretary shall--CommentsClose CommentsPermalink





‘(i) reduce the amount of assistance under this section to the grantee by an amount equal to the amount affordable housing fund grant amounts which were not used in accordance with this section;`(ii) require the grantee to repay the Director an amount equal to the amount of the amount affordable housing fund grant amounts whichState or State designated entity by an amount equal to the amount of grant amounts which were not used in accordance with this section;CommentsClose CommentsPermalink





` ‘(ii) require the State or State designated entity to repay the Secretary any amount of the grant which was not used in accordance with this section; CommentsClose CommentsPermalink





‘(iii) limit the availability of assistance under this section to the grantee to activities orState or State designated entity to activities or recipients not affected by such failure to comply; orCommentsClose CommentsPermalink





`‘(iv) terminate any assistance under this section to the grantee.`(k) Capital Requirements- The utilization or commitment of amounts from the affordable housing fund shall not be subject to the risk-based capital requirements established pursuant to section 1361(a).`(lState or State designated entity.CommentsClose CommentsPermalink





‘(f) Definitions- For purposes of this section, the following definitions shall apply:CommentsClose CommentsPermalink





`(1) AFFORDABLE HOUSING FUND GRANT AMOUNTS- The term `affordable housing fund grant amounts' means amounts from the affordable housing fund established under subsection (a) that are provided to a grantee pursuant to subsection (d)(3).`(2) GRANTEE- The term `grantee' means--`(A) with respect to 2008, the Louisiana Housing Finance Agency and the Mississippi Development Authority; and`(B) with respect to the years referred to in subsection (b)(1), other than 2008, each State (as such term is defined in section 1303) and each federally recognized Indian tribe.`(3) RECIPIENT- The term `recipient' means an entity meeting the requirements under subsection (h) ‘(1) EXTREMELY LOW-INCOME RENTER HOUSEHOLD- The term ‘extremely low-income renter household’ means a household whose income is not in excess of 30 percent of the area median income, with adjustments for smaller and larger families, as determined by the Secretary. CommentsClose CommentsPermalink





‘(2) RECIPIENT- The term ‘recipient’ means an individual or entity that receives assistance from a grantee from affordable housing fund grant amounts of the grantee.`(4) TOTAL MORTGAGE PORTFOLIO- The term `total mortgage portfolio' means, with respect to a year, the sum, for all mortgages outstanding during that year in any form, including whole loans, mortgage-backed securities, participation certificates, or other structured securities backed by mortgages, of the dollar amount of the unpaid outstanding principal balances under such mortgages. Such term includes all such mortgages or securitized obligations, whether retained in portfolio, or sold in any form. The Director is authorized to promulgate rules further defining such term as necessary to implement this section andState or State designated entity from amounts made available to the State or State designated entity under this section.CommentsClose CommentsPermalink





‘(3) SHORTAGE OF STANDARD RENTAL UNITS BOTH AFFORDABLE AND AVAILABLE TO EXTREMELY LOW-INCOME RENTER HOUSEHOLDS-CommentsClose CommentsPermalink





‘(A) IN GENERAL- The term ‘shortage of standard rental units both affordable and available to address market developments.`(5) VERY-LOW extremely low-income renter households’ means for any State or other geographical area the gap between--CommentsClose CommentsPermalink





‘(i) the number of units with complete plumbing and kitchen facilities with a rent that is 30 percent or less of 30 percent of the adjusted area median income as determined by the Secretary that are occupied by extremely low-income renter households or are vacant for rent; andCommentsClose CommentsPermalink





‘(ii) the number of extremely low-income renter households.CommentsClose CommentsPermalink





‘(B) RULE OF CONSTRUCTION- If the number of units described in subparagraph (A)(i) exceeds the number of extremely low-income households as described in subparagraph (A)(ii), there is no shortage.CommentsClose CommentsPermalink





‘(4) SHORTAGE OF STANDARD RENTAL UNITS BOTH AFFORDABLE AND AVAILABLE TO VERY LOW-INCOME FAMILY- The term `RENTER HOUSEHOLDS-CommentsClose CommentsPermalink





‘(A) IN GENERAL- The term ‘shortage of standard rental units both affordable and available to very low-income family'renter households’ means for any State or other geographical area the gap between--CommentsClose CommentsPermalink





‘(i) the number of units with complete plumbing and kitchen facilities with a rent that is 30 percent or less of 50 percent of the adjusted area median income as determined by the Secretary that are occupied by very low-income renter households or are vacant for rent; andCommentsClose CommentsPermalink





‘(ii) the number of very low-income renter households.CommentsClose CommentsPermalink





‘(B) RULE OF CONSTRUCTION- If the number of units described in subparagraph (A)(i) exceeds the number of very low-income households as described in subparagraph (A)(ii), there is no shortage.CommentsClose CommentsPermalink





‘(5) VERY LOW-INCOME FAMILY- The term ‘very low-income family’ has the meaning given such term in section 1303, except that such term includes any family that resides in a rural area that has an income that does not exceed the poverty line (as such term is defined in section 673(2) of the Omnibus Budget Reconciliation Act of 1981 (42 U.S.C. 9902(2)), including any revision required by such section) applicable to a family of the size involved.CommentsClose CommentsPermalink





`(m) Regulations-`(1) IN GENERAL- The Director, in consultation with the Secretary of Housing and Urban Development, shall issue regulations to carry out this section.`(2) ‘(6) VERY LOW-INCOME RENTER HOUSEHOLDS- The term ‘very low-income renter households’ means a household whose income is in excess of 30 percent but not greater than 50 percent of the area median income, with adjustments for smaller and larger families, as determined by the Secretary. CommentsClose CommentsPermalink





‘(g) Regulations-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Secretary shall issue regulations to carry out this section.CommentsClose CommentsPermalink





‘(2) REQUIRED CONTENTS- The regulations issued under this subsection shall include--CommentsClose CommentsPermalink





`(A) a requirement that the Director ensure that the program of each grantee for use of affordable housing fund grant amounts of the grantee‘(A) a requirement that the Secretary ensure that the use of grant amounts under this section by States or State designated entities is audited not less than annually to ensure compliance with this section;CommentsClose CommentsPermalink





`(B) authority for the Director‘(B) authority for the Secretary to audit, provide for an audit, or otherwise verify a grantee's activities, to ensure compliance with this section;`(CState or State designated entity’s activities to ensure compliance with this section;CommentsClose CommentsPermalink





‘(C) a requirement that, for the purposes of subparagraphs (A) and (B), any financial statement submitted by a grantee or recipient to the Secretary shall be reviewed by an independent certified public accountant in accordance with Statements on Standards for Accounting and Review Services, issued by the American Institute of Certified Public Accountants;CommentsClose CommentsPermalink





‘(D) requirements for a process for application to, and selection by, each grantee for activities meeting the grantee'State or State designated entity for activities meeting the State or State designated entity’s priority housing needs to be funded with affordable housing fund grant amounts of the granteegrant amounts under this section, which shall provide for priority in funding to be based upon--CommentsClose CommentsPermalink





`(i) greatest impact;`(i‘(i) geographic diversity;CommentsClose CommentsPermalink





`(i‘(ii) ability to obligate amounts and undertake activities so funded in a timely manner;CommentsClose CommentsPermalink





`(iv‘(iii) in the case of rental housing projects under subsection (g)(1), the extent to which rents for units in the project c)(7)(A), the extent to which rents for units in the project funded are affordable, especially for extremely low-income families;CommentsClose CommentsPermalink





`(‘(iv) in the case of rental housing projects under subsection (g)(1), the extent of thec)(7)(A), the extent of the duration for which such rents will remain affordable;CommentsClose CommentsPermalink





`(vi) the extent to which the application ‘(v) the extent to which the application makes use of other funding sources; andCommentsClose CommentsPermalink





`(vi‘(vi) the merits of an applicant'’s proposed eligible activity;CommentsClose CommentsPermalink





`(D) requirements to ensure that amounts provided to a grantee from the affordable housing fund‘(E) requirements to ensure that grant amounts provided to a State or State designated entity under this section that are used for rental housing under subsection (g)(1) are used only for c)(7)(A) are used only for the benefit of extremely low- and very-low income families;`(E) limitations on public infrastructure development activities that are eligible pursuant to subsection (g)(3) for funding with affordable housing fund grant amounts and requirements for the connection between such activities and housing activities funded under paragraph (1) or (2) of subsection (g); and`(F) requirements and standards for establishment, by grantees (including the grantees for 2008 pursuant to subsection (l)(2)(A)), low-income families; andCommentsClose CommentsPermalink





‘(F) requirements and standards for establishment, by a State or State designated entity, for use of grant amounts in 2009 and subsequent years of performance goals, benchmarks, and timetables for the production, preservation, and rehabilitation of affordable rental and homeownership housing with affordable housing fund grant amounts.`(n) Enforcement of Requirements on Enterprise- Compliance by the enterprises with the requirements under this section shall be enforceable under subpart C. Any reference in such subpart to this part or to an order, rule, or regulation under this part specifically includes this section and any order, rule, or regulation under this section.`(osuch grant amounts.CommentsClose CommentsPermalink





‘(h) Affordable Housing Trust Fund- If, after the enactment of the Federal Housing Finance Reform Act of 2008, in any date of enactment of the Federal Housing Finance Regulatory Reform Act of 2008, in any year, there is enacted any provision of Federal law establishing an affordable housing trust fund other than under this title for use only for grants to provide affordable rental housing and affordable homeownership opportunities, and the subsequent year is a year referred to in subsection (b)(1), the Directorc), the Secretary shall in such subsequent year and any remaining years referred to in subsection (b)(1c) transfer to such affordable housing trust fund the aggregate amount allocated pursuant to subsection (b) in such year to the affordable housing fund under this section, less any amounts used pursuant to subsection (i)(1). For such subsequent and remaining years, the provisions of subsections (c) and (d) shall not applyc) in such year. Notwithstanding any other provision of law, assistance provided using amounts transferred to such affordable housing trust fund pursuant to this subsection may not be used for any of the activities specified in clauses (i) through (vi) of subsection (i)(6). Nothing in this subsection shall be construed to alter the terms and conditions of the affordable housing fund under this section or to extend the life of such fund.`(p)c)(9)(D).CommentsClose CommentsPermalink





‘(i) Funding Accountability and Transparency- Any grant under this section to a grantee from the affordable housing fund established under subsection (a), any assistance provided to a recipient by a grantee from affordable housing fund grant amounts, and any by a State or State designated entity, any assistance provided to a recipient by a State or State designated entity, and any grant, award, or other assistance from an affordable housing trust fund referred to in subsection (oh) shall be considered a Federal award for purposes of the Federal Funding Accountability and Transparency Act of 2006 (31 U.S.C. 6101 note). Upon the request of the Director of the Office of Management and Budget, the Director of the Federal Housing Finance AgencSecretary shall obtain and provide such information regarding any such grants, assistance, and awards as the Director of the Office of Management and Budget considers necessary to comply with the requirements of such Act, as applicable pursuant to the preceding sentence.'.(b) Timely Establishment of Affordable Housing Needs Formula-(1) IN GENERAL- The Secretary of Housing and Urban Development shall, not later than the effective date under section 365 of this title, issue the regulations establishing the affordable, pursuant to the preceding sentence.CommentsClose CommentsPermalink

‘SEC. 1339. CAPITAL MAGNET FUND.

‘(a) Establishment- There is established in the Treasury of the United States a trust fund to be known as the Capital Magnet Fund, which shall be a special account within the Community Development Financial Institutions Fund.CommentsClose CommentsPermalink





‘(b) Deposits to Trust Fund- The Capital Magnet Fund shall consist of--CommentsClose CommentsPermalink





‘(1) any amounts transferred to the Fund pursuant to section 1337; andCommentsClose CommentsPermalink





‘(2) any amounts as are or may be appropriated, transferred, or credited to such Fund under any other provisions of law.CommentsClose CommentsPermalink





‘(c) Expenditures From Trust Fund- Amounts in the Capital Magnet Fund shall be available to the Secretary of the Treasury to carry out a competitive grant program to attract private capital for and increase investment in--CommentsClose CommentsPermalink





‘(1) the development, preservation, rehabilitation, or purchase of affordable housing for primarily extremely low-, very low-, and low-income families; andCommentsClose CommentsPermalink





‘(2) economic development activities or community service facilities, such as day care centers, workforce development centers, and health care clinics, which in conjunction with affordable housing activities implement a concerted strategy to stabilize or revitalize a low-income area or underserved rural area.CommentsClose CommentsPermalink





‘(d) Federal Assistance- For purposes of the application of Federal civil rights laws, all assistance provided using amounts in the Capital Magnet Fund shall be considered Federal financial assistance.CommentsClose CommentsPermalink





‘(e) Eligible Grantees- A grant under this section may be made, pursuant to such requirements as the Secretary of the Treasury shall establish for experience and success in attracting private financing and carrying out the types of activities proposed under the application of the grantee, only to--CommentsClose CommentsPermalink





‘(1) a Treasury certified community development financial institution; orCommentsClose CommentsPermalink





‘(2) a nonprofit organization having as 1 of its principal purposes the development or management of affordable housing.CommentsClose CommentsPermalink





‘(f) Eligible Uses- Grant amounts awarded from the Capital Magnet Fund pursuant to this section may be used for the purposes described in paragraphs (1) and (2) of subsection (c), including for the following uses:CommentsClose CommentsPermalink





‘(1) To provide loan loss reserves.CommentsClose CommentsPermalink





‘(2) To capitalize a revolving loan fund.CommentsClose CommentsPermalink





‘(3) To capitalize an affordable housing needs formulas in accordance with the provisions of section 1337(c)(2) of the Housing and Community Development Act of 1992, as such section is amended by subsection (a) of this section.(2) EFFECTIVE DATE- This subsection shall take effect on the date of the enactment of this Act.(c) REFCORP Payments- Section 21B(f)(2) of the Federal Home Loan Bank Act (12fund.CommentsClose CommentsPermalink





‘(4) To capitalize a fund to support activities described in subsection (c)(2).CommentsClose CommentsPermalink





‘(5) For risk-sharing loans.CommentsClose CommentsPermalink





‘(g) Applications-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Secretary of the Treasury shall provide, in a competitive application process established by regulation, for eligible grantees under subsection (e) to submit applications for Capital Magnet Fund grants to the Secretary at such time and in such manner as the Secretary shall determine.CommentsClose CommentsPermalink





‘(2) CONTENT OF APPLICATION- The application required under paragraph (1) shall include a detailed description of--CommentsClose CommentsPermalink





‘(A) the types of affordable housing, economic, and community revitalization projects that support or sustain residents of an affordable housing project funded by a grant under this section for which such grant amounts would be used, including the proposed use of eligible grants as authorized under this section;CommentsClose CommentsPermalink





‘(B) the types, sources, and amounts of other funding for such projects; andCommentsClose CommentsPermalink





‘(C) the expected time frame of any grant used for such project.CommentsClose CommentsPermalink





‘(h) Grant Limitation-CommentsClose CommentsPermalink





‘(1) IN GENERAL- Any 1 eligible grantee and its subsidiaries and affiliates may not be awarded more than 15 percent of the aggregate funds available for grants during any year from the Capital Magnet Fund.CommentsClose CommentsPermalink





‘(2) GEOGRAPHIC DIVERSITY-CommentsClose CommentsPermalink





‘(A) GOAL- The Secretary of the Treasury shall seek to fund activities in geographically diverse areas of economic distress, including metropolitan and underserved rural areas in every State.CommentsClose CommentsPermalink





‘(B) DIVERSITY DEFINED- For purposes of this paragraph, geographic diversity includes those areas that meet objective criteria of economic distress developed by the Secretary of the Treasury, which may include--CommentsClose CommentsPermalink





‘(i) the percentage of low-income families or the extent of poverty;CommentsClose CommentsPermalink





‘(ii) the rate of unemployment or underemployment;CommentsClose CommentsPermalink





‘(iii) extent of blight and disinvestment;CommentsClose CommentsPermalink





‘(iv) projects that target extremely low-, very low-, and low-income families in or outside a designated economic distress area; orCommentsClose CommentsPermalink





‘(v) any other criteria designated by the Secretary of the Treasury.CommentsClose CommentsPermalink





‘(3) LEVERAGE OF FUNDS- Each grant from the Capital Magnet Fund awarded under this section shall be reasonably expected to result in eligible housing, or economic and community development projects that support or sustain an affordable housing project funded by a grant under this section whose aggregate costs total at least 10 times the grant amount.CommentsClose CommentsPermalink





‘(4) COMMITMENT FOR USE DEADLINE- Amounts made available for grants under this section shall be committed for use within 2 years of the date of such allocation. The Secretary of the Treasury shall recapture into the Capital Magnet Fund any amounts not so used or committed for use and allocate such amounts in the first year after such recapture.CommentsClose CommentsPermalink





‘(5) PROHIBITED USES- The Secretary shall, by regulation, set forth prohibited uses of grant amounts awarded under this section, which shall include use for--CommentsClose CommentsPermalink





‘(A) political activities;CommentsClose CommentsPermalink





‘(B) advocacy;CommentsClose CommentsPermalink





‘(C) lobbying, whether directly or through other parties;CommentsClose CommentsPermalink





‘(D) counseling services;CommentsClose CommentsPermalink





‘(E) travel expenses; andCommentsClose CommentsPermalink





‘(F) preparing or providing advice on tax returns;CommentsClose CommentsPermalink





and for the purposes of this paragraph, the prohibited use of funds for political activities includes influencing the selection, nomination, election, or appointment of one or more candidates to any Federal, State or local office as codified in section 501 of the Internal Revenue Code of 1986 ( 26 U.S.C. 1441b(f)(2)) is amended--(1) in subparagraph (E), by striking `and (D)' and inserting `(D), and (E)';(2) by redesignating subparagraph (E) as subparagraph (F); and(3) by inserting after subparagraph (D) the following new subparagraph:`(E) PAYMENTS BY FANNIE MAE AND FREDDIE MAC- To the extent that the amounts available pursuant to subparagraphs (A), (B), (C), and (D)501 ). CommentsClose CommentsPermalink





‘(6) ADDITIONAL LOBBYING RESTRICTIONS- No assistance or amounts made available under this section may be expended by an eligible grantee to pay any person to influence or attempt to influence any agency, elected official, officer or employee of a State or local government in connection with the making, award, extension, continuation, renewal, amendment, or modification of any State or local government contract, grant, loan, or cooperative agreement as such terms are defined in section 1352 of title 31, United States Code.CommentsClose CommentsPermalink





‘(7) PROHIBITION OF CONSIDERATION OF USE FOR MEETING HOUSING GOALS OR DUTY TO SERVE- In determining the compliance of the enterprises with the housing goals under this section and the duty to serve underserved markets under section 1335, the Director of the Federal Housing Finance Agency may not consider any Capital Magnet Fund amounts used under this section for eligible activities under subsection (f). The Director of the Federal Housing Finance Agency shall give credit toward the achievement of such housing goals and such duty to serve underserved markets to purchases by the enterprises of mortgages for housing that receives funding from Capital Magnet Fund grant amounts, but only to the extent that such purchases by the enterprises are insufficient to cover the amount of interest payments, each enterprise (as such term is defined in section 1303 of the Housing and Community Development Act of 1992 (42 U.S.C. 4502)) shall transfer to funded other than with such grant amounts.CommentsClose CommentsPermalink





‘(8) ACCOUNTABILITY OF RECIPIENTS AND GRANTEES-CommentsClose CommentsPermalink





‘(A) TRACKING OF FUNDS- The Secretary of the Treasury shall--CommentsClose CommentsPermalink





‘(i) require each grantee to develop and maintain a system to ensure that each recipient of assistance from the Capital Magnet Fund uses such amounts in accordance with this section, the regulations issued under this section, and any requirements or conditions under which such amounts were provided; andCommentsClose CommentsPermalink





‘(ii) establish minimum requirements for agreements, between the grantee and the Capital Magnet Fund, regarding assistance from the Capital Magnet Fund, which shall include--CommentsClose CommentsPermalink





‘(I) appropriate periodic financial and project reporting, record retention, and audit requirements for the duration of the grant to the Funding Corporation in each calendar year the amounts allocated for use under this subparagraph pursuant to section 1337(i)(1) of such Act.'.(d) GAO Report- The Comptroller General shall conduct a study to determinerecipient to ensure compliance with the limitations and requirements of this section and the regulations under this section; andCommentsClose CommentsPermalink





‘(II) any other requirements that the Secretary determines are necessary to ensure appropriate grant administration and compliance.CommentsClose CommentsPermalink





‘(B) MISUSE OF FUNDS- If the Secretary of the Treasury determines, after reasonable notice and opportunity for hearing, that a grantee has failed to comply substantially with any provision of this section and until the Secretary is satisfied that there is no longer any such failure to comply, the Secretary shall--CommentsClose CommentsPermalink





‘(i) reduce the amount of assistance under this section to the grantee by an amount equal to the amount of Capital Magnet Fund grant amounts which were not used in accordance with this section;CommentsClose CommentsPermalink





‘(ii) require the grantee to repay the Secretary any amount of the Capital Magnet Fund grant amounts which were not used in accordance with this section;CommentsClose CommentsPermalink





‘(iii) limit the availability of assistance under this section to the grantee to activities or recipients not affected by such failure to comply; orCommentsClose CommentsPermalink





‘(iv) terminate any assistance under this section to the grantee.CommentsClose CommentsPermalink





‘(i) Periodic Reports-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Secretary of the Treasury shall submit a report, on a periodic basis, to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives describing the activities to be funded under this section.CommentsClose CommentsPermalink





‘(2) REPORTS AVAILABLE TO PUBLIC- The Secretary of the Treasury shall make the reports required under paragraph (1) publicly available.CommentsClose CommentsPermalink





‘(j) Regulations-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Secretary of the Treasury shall issue regulations to carry out this section.CommentsClose CommentsPermalink





‘(2) REQUIRED CONTENTS- The regulations issued under this subsection shall include--CommentsClose CommentsPermalink





‘(A) authority for the Secretary to audit, provide for an audit, or otherwise verify an enterprise’s activities, to ensure compliance with this section;CommentsClose CommentsPermalink





‘(B) a requirement that the Secretary ensure that the allocation of each enterprise is audited not less than annually to ensure compliance with this section;CommentsClose CommentsPermalink





‘(C) a requirement that, for the purposes of subparagraphs (A) and (B), any financial statement submitted by a grantee to the Secretary shall be reviewed by an independent certified public accountant in accordance with Statements on Standards for Accounting and Review Services, issued by the American Institute of Certified Public Accountants; andCommentsClose CommentsPermalink





‘(D) requirements for a process for application to, and selection by, the Secretary for activities to be funded with amounts from the effects that the affordable housing fund established under section 1337 of the Housing and Community Development Act of 1992, as added by the amendment made by subsectionCapital Magnet Fund, which shall provide that--CommentsClose CommentsPermalink





‘(i) funds be fairly distributed to urban, suburban, and rural areas; andCommentsClose CommentsPermalink





‘(ii) selection shall be based upon specific criteria, including a prioritization of funding based upon--CommentsClose CommentsPermalink





‘(I) the ability to use such funds to generate additional investments;CommentsClose CommentsPermalink





‘(II) affordable housing need (taking into account the distinct needs of different regions of the country); andCommentsClose CommentsPermalink





‘(III) ability to obligate amounts and undertake activities so funded in a timely manner.’.CommentsClose CommentsPermalink

(a) of this section, will have on the availability and affordability of credit for homebuyers, including the effects on such credit of the requirement under such section 1337(b) that the Federal National Mortgage Association and Federal Home Loan Mortgage Corporation make allocations of amounts to such fund based on the average total mortgage portfolios, and the extent to which the costs of such allocation requirement will be borne by such entities or will be passed on toGoals- Financial education and counseling under this section shall have the goal of--CommentsClose CommentsPermalink





(1) increasing the financial knowledge and decision making capabilities of prospective homebuyers;CommentsClose CommentsPermalink





(2) assisting prospective homebuyers to develop monthly budgets, build personal savings, finance or plan for major purchases, reduce their debt, improve their financial stability, and set and reach their financial goals;CommentsClose CommentsPermalink





(3) helping prospective homebuyers to improve their credit scores by understanding the relationship between their credit histories and their credit scores; andCommentsClose CommentsPermalink





(4) educating prospective homebuyers about the options available to build savings for short- and long-term goals.CommentsClose CommentsPermalink





(b) Grants-CommentsClose CommentsPermalink





(1) IN GENERAL- The Secretary of the Treasury (in this section referred to as the ‘Secretary’) shall make grants to eligible organizations to enable such organizations to provide a range of financial education and counseling services to prospective homebuyers.CommentsClose CommentsPermalink





Not later than the expiration of the 12-month period beginning on the date of the enactment of this Act, the Comptroller General shall submit a report to the Congress setting forth the results and conclusions of such study. This subsection shall take effect on the date of the enactment of this Act.SEC. 341. CONSISTENCY WITH MISSION.Subpart B of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (2) SELECTION- The Secretary shall select eligible organizations to receive assistance under this section based on their experience and ability to provide financial education and counseling services that result in documented positive behavioral changes. CommentsClose CommentsPermalink





(c) Eligible Organizations-CommentsClose CommentsPermalink





(1) IN GENERAL- For purposes of this section, the term ‘eligible organization’ means an organization that is--CommentsClose CommentsPermalink





(A) certified in accordance with section 106(e)(1) of the Housing and Urban Development Act of 1968 (12 U.S.C. 4561 et seq.) is amended by adding after1701x(e)); orCommentsClose CommentsPermalink





(B) certified by the Office of Financial Education of the Department of the Treasury for purposes of this section, in accordance with paragraph (2).CommentsClose CommentsPermalink





(2) OFE CERTIFICATION- To be certified by the Office of Financial Education for purposes of this section, an eligible organization shall be--CommentsClose CommentsPermalink





(A) a housing counseling agency certified by the Secretary of Housing and Urban Development under section 106(e) of the Housing and Urban Development Act of 1968;CommentsClose CommentsPermalink





(B) a State, local, or tribal government agency;CommentsClose CommentsPermalink





(C) a community development financial institution (as defined in section 1337, as added by the preceding provisions of this title, the following new section:

`SEC. 1338. CONSISTENCY WITH MISSION.`This subpart may not be construed to authorize an enterprise to engage in any program or activity that contravenes or is inconsistent with the Federal National Mortgage Association Charter Act or the Federal Home Loan Mortgage Corporation Act.'.

SEC. 342. ENFORCEMENT03(5) of the Community Development Banking and Financial Institutions Act of 1994 (12 U.S.C. 4702(5)) or a credit union; orCommentsClose CommentsPermalink




(D) any collaborative effort of entities described in any of subparagraphs (A) through (C).CommentsClose CommentsPermalink





(d) Authority for Pilot Projects-CommentsClose CommentsPermalink





(1) IN GENERAL- The Secretary of the Treasury shall authorize not more than 5 pilot project grants to eligible organizations under subsection (c) in order to--CommentsClose CommentsPermalink





(A) carry out the services under this section; andCommentsClose CommentsPermalink





(B) provide such other services that will improve the financial stability and economic condition of low- and moderate-income and low-wealth individuals.CommentsClose CommentsPermalink





(2) GOAL- The goal of the pilot project grants under this subsection is to--CommentsClose CommentsPermalink





(A) identify successful methods resulting in positive behavioral change for financial empowerment; andCommentsClose CommentsPermalink





(B) establish program models for organizations to carry out effective counseling services.CommentsClose CommentsPermalink





(e) Authorization of Appropriations- There are authorized to be appropriated to the Secretary such sums as are necessary to carry out this section and for the provision of additional financial educational services.CommentsClose CommentsPermalink





(f) Study and Report on Effectiveness and Impact-CommentsClose CommentsPermalink





(1) IN GENERAL- The Comptroller General of the United States shall conduct a study on the effectiveness and impact of the grant program established under this section. Not later than 3 years after the date of enactment of this Act, the Comptroller General shall submit a report on the results of such study to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives.CommentsClose CommentsPermalink





(2) CONTENT OF STUDY- The study required under paragraph (1) shall include an evaluation of the following:CommentsClose CommentsPermalink





(A) The effectiveness of the grant program established under this section in improving the financial situation of homeowners and prospective homebuyers served by the grant program.CommentsClose CommentsPermalink





(B) The extent to which financial education and counseling services have resulted in positive behavioral changes.CommentsClose CommentsPermalink





(C) The effectiveness and quality of the eligible organizations providing financial education and counseling services under the grant program.CommentsClose CommentsPermalink





(g) Regulations- The Secretary is authorized to promulgate such regulations as may be necessary to implement and administer the grant program authorized by this section.CommentsClose CommentsPermalink

SEC. 1133. TRANSFER AND RIGHTS OF CERTAIN HUD EMPLOYEES.

(a) Cease-and-Desist Proceedings- Section 1341 of the Housing and Community DevelopmentTransfer- Each employee of the Department of Housing and Urban Development whose position responsibilities primarily involve the establishment and enforcement of the housing goals under subpart B of part 2 of subtitle A of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4581) is amended--(1) by striking61 et seq.) shall be transferred to the Federal Housing Finance Agency for employment, not later than the effective date of the Federal Housing Finance Regulatory Reform Act of 2008, and such transfer shall be deemed a transfer of function for purposes of section 3503 of title 5, United States Code.CommentsClose CommentsPermalink





(b) Guaranteed Positions-CommentsClose CommentsPermalink





(1) IN GENERAL- Each employee transferred under subsection (a) and inserting the following new subsection:`shall be guaranteed a position with the same status, tenure, grade, and pay as that held on the day immediately preceding the transfer.CommentsClose CommentsPermalink





(2) NO INVOLUNTARY SEPARATION OR REDUCTION- An employee transferred under subsection (a)Grounds for Issuance- The Director may issue and serve a notice holding a permanent position on the day immediately preceding the transfer may not be involuntarily separated or reduced in grade or compensation during the 12-month period beginning on the date of transfer, except for cause, or, in the case of a temporary employee, separated in accordance with the terms of the appointment of the employee.CommentsClose CommentsPermalink





(c) Appointment Authority for Excepted and Senior Executive Service Employees-CommentsClose CommentsPermalink





(1) IN GENERAL- In the case of an employee occupying a position in the excepted service or the Senior Executive Service, any appointment authority established under law or by regulations of the Office of Personnel Management for filling such position shall be transferred, subject to paragraph (2).CommentsClose CommentsPermalink





(2) DECLINE OF TRANSFER- The Director may decline a transfer of authority under paragraph (1) to the extent that such authority relates to--CommentsClose CommentsPermalink





(A) a position excepted from the competitive service because of its confidential, policymaking, policy-determining, or policy-advocating character; orCommentsClose CommentsPermalink





(B) a noncareer position in the Senior Executive Service (within the meaning of section 3132(a)(7) of title 5, United States Code).CommentsClose CommentsPermalink





(d) Reorganization- If the Director determines, after the end of the 1-year period beginning on the effective date of the Federal Housing Finance Regulatory Reform Act of 2008, that a reorganization of the combined workforce is required, that reorganization shall be deemed a major reorganization for purposes of charges under this section upon an enterprise if the Director determines--`(1) the enterprise has failed to meet any housing goal established under subpart B, following a written notice and determination of such failure in accordance with section 1336;`(2) the enterprise has failed to submit a report under section 1314, following a notice of such failure, an opportunity for comment by the enterprise, and a final determination by the Director;`(3) the enterprise has failed to submit the information required under subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act, or subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act;`(4) the enterprise has violated any provision of this part or any order, rule or regulation under this part;`(5) the enterprise has failed to submit a housing plan that complies with section 1336(c) within the applicable period; or`(6) the enterprise has failed to comply with a housing plan under section 1336(c).';(2) in subsection (b)(2), by striking `requiring the enterprise to' and all that follows through the end of the paragraph and inserting the following: `requiring the enterprise to--`(A) comply with the goal or goals;`(B) submit a report under section 1314;`(C) comply with any provision this part or any order, rule or regulation under such part;`(D) submit a housing plan in compliance with section 1336(c);`(E) comply with a housing plan submitted under section 1336(c); or`(F) provide the information required under subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act or subsectionaffording affected employee retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.CommentsClose CommentsPermalink





(e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act, as applicable.';(3) in subsection (c), by inserting `date of the' before `service of the order'; and(4) by striking subsection (d).(b) Authority of Director To Enforce Notices and Orders- Section 1344 of the Housing and Community Development Act of 1992 (12 U.S.C. 4584) is amended by striking subsection (a) and inserting the following new subsection:`Employee Benefit Programs-CommentsClose CommentsPermalink





(1) IN GENERAL- Any employee described under subsection (a)Enforcement- The Director may, in the discretion of the Director, apply to the United States District Court for the District of Columbia, or the United States district court within the jurisdiction of which the headquarters of the enterprise is located, for the enforcement of any effective accepting employment with the Agency as a result of a transfer under subsection (a) may retain, for 12 months after the date on which such transfer occurs, membership in any employee benefit program of the Agency or the Department of Housing and Urban Development, as applicable, including insurance, to which such employee belongs on such effective date, if--CommentsClose CommentsPermalink





(A) the employee does not elect to give up the benefit or membership in the program; andCommentsClose CommentsPermalink





(B) the benefit or program is continued by the Director of the Federal Housing Finance Agency.CommentsClose CommentsPermalink





(2) COST DIFFERENTIAL-CommentsClose CommentsPermalink





(A) IN GENERAL- The difference in the costs between the benefits which would have been provided by the Department of Housing and Urban Development and outstanding notice or order issued under section 1341 or 1345, or request that the Attorney General of the United States bring such an action. Such court shall have jurisdiction and power to order and require compliance with such notice or order.'.(c) Civil Money Penalties- Section 1345 of the Housing and Community Development Act of 1992 those provided by this section shall be paid by the Director.CommentsClose CommentsPermalink





(B) HEALTH INSURANCE- If any employee elects to give up membership in a health insurance program or the health insurance program is not continued by the Director, the employee shall be permitted to select an alternate Federal health insurance program not later than 30 days after the date of such election or notice, without regard to any other regularly scheduled open season.CommentsClose CommentsPermalink

(a) In General- Section 1363 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4585613) is amended--CommentsClose CommentsPermalink





(1) by striking subsections (a) and (b) and inserting the following new subsections:`‘For’ and inserting ‘(a) Enterprises- For’; andCommentsClose CommentsPermalink





(2) by adding at the end the following new subsection:CommentsClose CommentsPermalink





‘(b) Federal Home Loan Banks-CommentsClose CommentsPermalink





‘(1) IN GENERAL- For purposes of this subtitle, the critical capital level for each Federal Home Loan Bank shall be such amount of capital as the Director shall, by regulation, require.CommentsClose CommentsPermalink





‘(2) CONSIDERATION OF OTHER CRITICAL CAPITAL LEVELS- In establishing the critical capital level under paragraph (1) for the Federal Home Loan Banks, the Director shall take due consideration of the critical capital level established under subsection (a)Authority- The Director may impose a civil money penalty, in accordance with the provisions of this section, on any enterprise that has failed to--`(1) meet any housing goal established under subpart B, following a written notice and determination of such failure in accordance with section 1336(b);`(2) submit a report under section 1314, following a notice of such failure, an opportunity for comment by the enterprise, and a final determination by the Director;`(3) submit the information required under subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act, or subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act;`(4) comply with any provision of this part or any order, rule or regulation under this part;`(5) submit a housing plan pursuant to section 1336(c) within the required period; or`(6) comply with a housing plan for the enterprise under section 1336(c).` for the enterprises, with such modifications as the Director determines to be appropriate to reflect the difference in operations between the banks and the enterprises.’.CommentsClose CommentsPermalink





(b) Amount of Penalty- The amount of the penalty, as determined by the Director, may not exceed--`(1) for any failure described in paragraph (1), (5), or (6) of subsection (a), $50,000 for each day that the failure occurs; and`(2) for any failure described in paragraph (2), (3), or (4) of subsection (a), $20,000 for each day that the failure occurs.';(2) in subsection (c)--(A) in paragraph (1)--(i) in subparagraph (A), by inserting `and' after the semicolon at the end;(ii) in subparagraph (B), by striking `; and' and inserting a period; and(iii) by striking subparagraph (C); and(B) in paragraph (2), by inserting after the period at the end the following: `In determining the penalty under subsection (a)(1), the Director shall give consideration to the length of time the enterprise should reasonably take to achieve the goal.';(3) in the first sentence of subsection (d)--(A) by striking `request the Attorney General of the United States to' and inserting `, in the discretion of the Director,'; and(B) by inserting `, or request that the Attorney General of the United States bring such an action' before the period at the end;(4) by striking subsection (f); and(5) by redesignating subsection (g) as subsection (f).(d) Enforcement of Subpoenas- Section 1348(c) of the Housing and Community Development Act of 1992 (12 U.S.C. 4588(c)) is amended--(1) by striking `request the Attorney General of the United States to' and inserting `, in the discretion of the Director,'; and(2) by inserting `or request that the Attorney General of the United States bring such an action,' after `District of Columbia,'.(e) Conforming Amendment- The heading for subpart C of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 is amended to read as follows:`Subpart C--Enforcement'Regulations- Not later than the expiration of the 180-day period beginning on the date of enactment of this Act, the Director of the Federal Housing Finance Agency shall issue regulations pursuant to section 1363(b) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (as added by this section) establishing the critical capital level under such section.CommentsClose CommentsPermalink

SEC. 343. CONFORMING AMENDMENTS.Part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (12 U.S.C. 4541 et seq.) is amended--(1) by striking `Secretary' each place such term appears in such part and inserting `Director';(2) in the section heading for section 1323 (12 U.S.C. 4543), by inserting `of enterprises' before the period at the end;(3) by striking section 1327 (12 U.S.C. 4547);(4) by striking section 1328 (12 U.S.C. 4548);(5) by redesignating section 1329 (as amended by section 335) as section 1327;(6) in sections 1345(c)(1)(A), 1346(a), and 1346(b) (12 U.S.C. 4585(c)(1)(A), 4586(a), and 4586(b)), by striking `Secretary's' each place such term appears and inserting `Director's'; and(7) by striking section 1349 (12 U.S.C. 4589).CHAPTER 3--PROMPT CORRECTIVE ACTIONSEC. 3451142. CAPITAL CLASSIFICATIONS.

(a) In General- Section 1364 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4614) is amended--CommentsClose CommentsPermalink





(1) in the heading for subsection (a), by striking `In General' and inserting `Enterprises'. by striking ‘In General’ and inserting ‘Enterprises’;CommentsClose CommentsPermalink





(2) in subsection (c)--CommentsClose CommentsPermalink





(A) by striking `subsection (b)' and inserting `subsection (c)';(B) by striking `enterprises' and inserting `regulated entities'‘subsection (b)’ and inserting ‘subsection (c)’;CommentsClose CommentsPermalink





(B) by striking ‘enterprises’ and inserting ‘regulated entities’; andCommentsClose CommentsPermalink





(C) by striking the last sentence;CommentsClose CommentsPermalink





(3) by redesignating subsections (c) (as so amended by paragraph (2) of this subsection) and (d) as subsections (d) and (f), respectively;CommentsClose CommentsPermalink





(4) by striking subsection (b) and inserting the following new subsections:`(b) Federal Home Loan Banks-`:CommentsClose CommentsPermalink





‘(b) Federal Home Loan Banks-CommentsClose CommentsPermalink





‘(1) ESTABLISHMENT AND CRITERIA- For purposes of this subtitle, the Director shall, by regulation--CommentsClose CommentsPermalink





`‘(A) establish the capital classifications specified under paragraph (2) for the Federal home loan banks;`Home Loan Banks;CommentsClose CommentsPermalink





‘(B) establish criteria for each such capital classification based on the amount and types of capital held by a bank and the risk-based, minimum, and critical capital levels for the banks and taking due consideration of the capital classifications established under subsection (a) for the enterprises, with such modifications as the Director determines to be appropriate to reflect the difference in operations between the banks and the enterprises; andCommentsClose CommentsPermalink





`(C) shall classify the Federal home loan b‘(C) shall classify the Federal Home Loan Banks according to such capital classifications.CommentsClose CommentsPermalink





`‘(2) CLASSIFICATIONS- The capital classifications specified under this paragraph are--CommentsClose CommentsPermalink





`‘(A) adequately capitalized;CommentsClose CommentsPermalink





`(B) undercapitalized;` ‘(B) undercapitalized; CommentsClose CommentsPermalink





‘(C) significantly undercapitalized; andCommentsClose CommentsPermalink





`‘(D) critically undercapitalized.CommentsClose CommentsPermalink





`‘(c) Discretionary Classification-CommentsClose CommentsPermalink





`‘(1) GROUNDS FOR RECLASSIFICATION- The Director may reclassify a regulated entity under paragraph (2) if--CommentsClose CommentsPermalink





`‘(A) at any time, the Director determines in writing that the regulated entity is engaging in conduct that could result in a rapid depletion of core or total capital or, in the case of an enterprise, that the value of the property subject the value of collateral pledged as security has decreased significantly or that the value of the property subject to mortgages held or securitized by the enterpriseby the regulated entity (or securitized in the case of an enterprise) has decreased significantly;CommentsClose CommentsPermalink





`‘(B) after notice and an opportunity for hearing, the Director determines that the regulated entity is in an unsafe or unsound condition; orCommentsClose CommentsPermalink





`(C) pursuant to section ‘(C) pursuant to section 1371(b), the Director deems the regulated entity to be engaging in an unsafe or unsound practice.CommentsClose CommentsPermalink





`‘(2) RECLASSIFICATION- In addition to any other action authorized under this title, including the reclassification of a regulated entity for any reason not specified in this subsection, if the Director takes any action described in paragraph (1), the Director may classify a regulated entity--CommentsClose CommentsPermalink





`‘(A) as undercapitalized, if the regulated entity is otherwise classified as adequately capitalized;CommentsClose CommentsPermalink





`‘(B) as significantly undercapitalized, if the regulated entity is otherwise classified as undercapitalized; andCommentsClose CommentsPermalink





`‘(C) as critically undercapitalized, if the regulated entity is otherwise classified as significantly undercapitalized.'’; andCommentsClose CommentsPermalink





(5) by inserting after subsection (d) (as so redesignated by paragraph (3) of this subsection), the following new subsection:CommentsClose CommentsPermalink





`‘(e) Restriction on Capital Distributions-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- A regulated entity shall make no capital distribution if, after making the distribution, the regulated entity would be undercapitalized.CommentsClose CommentsPermalink





`‘(2) EXCEPTION- Notwithstanding paragraph (1), the Director may permit a regulated entity, to the extent appropriate or applicable, to repurchase, redeem, retire, or otherwise acquire shares or ownership interests if the repurchase, redemption, retirement, or other acquisition--CommentsClose CommentsPermalink





`‘(A) is made in connection with the issuance of additional shares or obligations of the regulated entity in at least an equivalent amount; andCommentsClose CommentsPermalink





`‘(B) will reduce the financial obligations of the regulated entity or otherwise improve the financial condition of the entity.'’.CommentsClose CommentsPermalink





(b) Regulations- Not later than the expiration of the 180-day period beginning on the effective date under section 365date of enactment of this Act, the Director of the Federal Housing Finance Agency shall issue regulations to carry out section 1364(b) of the Housing and Community Development Act of 1992 (as added by paragraph (4) of this subsection), relating to capital classifications for the Federal home loan bFederal Housing Enterprises Financial Safety and Soundness Act of 1992 (as added by this section), relating to capital classifications for the Federal Home Loan Banks.CommentsClose CommentsPermalink

SEC. 3461143. SUPERVISORY ACTIONS APPLICABLE TO UNDERCAPITALIZED REGULATED ENTITIES.

Section 1365 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4615) is amended--CommentsClose CommentsPermalink





(1) in the section heading, by striking `enterprises' and inserting `regulated entities';(2by striking ‘the enterprise’ each place that term appears and inserting ‘the regulated entity’;CommentsClose CommentsPermalink





(2) by striking ‘An enterprise’ each place that term appears and inserting ‘A regulated entity’;CommentsClose CommentsPermalink





(3) by striking ‘an enterprise’ each place that term appears and inserting ‘a regulated entity’;CommentsClose CommentsPermalink





(4) in subsection (a)--CommentsClose CommentsPermalink





(A) by redesignating paragraphs (1) and (2) as paragraphs (2) and (3), respectively;CommentsClose CommentsPermalink





(B) by inserting before paragraph (2), as so redesignated by subparagraph (A) of this paragraph, the following paragraph:`redesignated, the following:CommentsClose CommentsPermalink





‘(1) REQUIRED MONITORING- The Director shall--CommentsClose CommentsPermalink





`‘(A) closely monitor the condition of any regulated entity that is classified as undercapitalized;`(B) undercapitalized regulated entity;CommentsClose CommentsPermalink





‘(B) closely monitor compliance with the capital restoration plan, restrictions, and requirements imposed under this section; and`on an undercapitalized regulated entity under this section; andCommentsClose CommentsPermalink





‘(C) periodically review the plan, restrictions, and requirements applicable to thean undercapitalized regulated entity to determine whether the plan, restrictions, and requirements are achieving the purpose of this section.'; and(C) by inserting at the end the following new paragraphs:`’; andCommentsClose CommentsPermalink





(C) by adding at the end the following:CommentsClose CommentsPermalink





‘(4) RESTRICTION OF ASSET GROWTH- A regulated entity that is classified as undercapitalized shall notn undercapitalized regulated entity shall not permit its average total assets (as such term is defined in section 1316(b) during any calendar during any calendar quarter to exceed its average total assets during the preceding calendar quarter unless--`, unless--CommentsClose CommentsPermalink





‘(A) the Director has accepted the capital restoration plan of the regulated entity;CommentsClose CommentsPermalink





`(B) any increase in total assets is consistent with the plan; and`(C) the ratio of total capital to assets for ‘(B) any increase in total assets is consistent with the capital restoration plan; and CommentsClose CommentsPermalink





‘(C) the ratio of tangible equity to assets of the regulated entity increases during the calendar quarter at a rate sufficient to enable the regulated entity to become adequately capitalized within a reasonable time.CommentsClose CommentsPermalink





`‘(5) PRIOR APPROVAL OF ACQUISITIONS, NEW PRODUCTS, AND NEW ACTIVITIES- A regulated entity that is classified as undercapitalizedn undercapitalized regulated entity shall not, directly or indirectly, acquire any interest in any entity or initially offer any new product (as such term is defined in section 1321(f)) or engage in any new activity, service, undertaking, or offering unless--`unless--CommentsClose CommentsPermalink





‘(A) the Director has accepted the capital restoration plan of the regulated entity, the regulated entity is implementing the plan, and the Director determines that the proposed action is consistent with and will further the achievement of the plan; orCommentsClose CommentsPermalink





`‘(B) the Director determines that the proposed action will further the purpose of this section.';(3ubtitle.’;CommentsClose CommentsPermalink





(5) in subsection (b)--CommentsClose CommentsPermalink





(A) in the subsection heading for subsection (b), by striking `From Undercapitalized to Significantly Undercapitalized'; and(4) by striking subsection (c) and inserting the following new subsection:`, by striking ‘Discretionary’;CommentsClose CommentsPermalink





(B) in the matter preceding paragraph (1), by striking ‘may’ and inserting ‘shall’; andCommentsClose CommentsPermalink





(C) in paragraph (2)--CommentsClose CommentsPermalink





(i) by striking ‘make, in good faith, reasonable efforts necessary to’; andCommentsClose CommentsPermalink





(ii) by striking the period at the end and inserting ‘in any material respect.’; andCommentsClose CommentsPermalink





(6) by striking subsection (c) and inserting the following:CommentsClose CommentsPermalink





‘(c) Other Discretionary Safeguards- The Director may take, with respect to a regulated entity that is classified as undercapitalized, any of the actions n undercapitalized regulated entity, any of the actions authorized to be taken under section 1366 with respect to a regulated entity that is classified as significantly undercapitalized, if the Director determines that such actions are necessary to carry out the purpose of this subtitle.' regulated entity, if the Director determines that such actions are necessary to carry out the purpose of this subtitle.’.CommentsClose CommentsPermalink

SEC. 3471144. SUPERVISORY ACTIONS APPLICABLE TO SIGNIFICANTLY UNDERCAPITALIZED REGULATED ENTITIES.

Section 1366 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4616) is amended--CommentsClose CommentsPermalink





(1) in the section heading, by striking `enterprises' and inserting `regulated entities';(2) in subsection (a)(2)(A), by striking `enterprise' the last place such term appears;(3subsection (a)(2), by striking ‘undercapitalized enterprise’ and inserting ‘undercapitalized’;CommentsClose CommentsPermalink





(2) by striking ‘the enterprise’ each place that term appears and inserting ‘the regulated entity’;CommentsClose CommentsPermalink





(3) by striking ‘An enterprise’ each place that term appears and inserting ‘A regulated entity’;CommentsClose CommentsPermalink





(4) by striking ‘an enterprise’ each place that term appears and inserting ‘a regulated entity’;CommentsClose CommentsPermalink





(5) in subsection (b)--CommentsClose CommentsPermalink





(A) in the subsection heading, by striking `Discretionary Supervisory Actions' and inserting `Specific Actions'.‘Discretionary Supervisory’ and inserting ‘Specific’;CommentsClose CommentsPermalink





(B) in the matter preceding paragraph (1), by striking `may, at any time, take any' and inserting `shall carry out this section by‘may, at any time, take any’ and inserting ‘shall carry out this section by taking, at any time, one or more';(C) by redesignating paragraphs1 or more’;CommentsClose CommentsPermalink





(C) by striking paragraph (6);CommentsClose CommentsPermalink





(D) by redesignating paragraph (5) and (6) as paragraphs (6) and (7), respectively;(D) by inserting after paragraph (4) the following new paragraph:`(5)s paragraph (6);CommentsClose CommentsPermalink





(E) by inserting after paragraph (4) the following:CommentsClose CommentsPermalink





‘(5) IMPROVEMENT OF MANAGEMENT- Take one or more of the following actions:`(A) 1 or more of the following actions:CommentsClose CommentsPermalink





‘(A) NEW ELECTION OF BOARD- Order a new election for the board of directors of the regulated entity.CommentsClose CommentsPermalink





`‘(B) DISMISSAL OF DIRECTORS OR EXECUTIVE OFFICERS- Require the regulated entity to dismiss from office any director or executive officer who had held office for more than 180 days immediately before the date on which the regulated entity became undercapitalized. Dismissal under this subparagraph shall not be construed to be a removal pursuant to the Director's enforcement powers provided in section 1377.`of the Director under section 1377.CommentsClose CommentsPermalink





‘(C) EMPLOY QUALIFIED EXECUTIVE OFFICERS- Require the regulated entity to employ qualified executive officers (who, if the Director so specifies, shall be subject to approval by the Director).'; and(E) by inserting at the end the following new paragraph:`(8)’; andCommentsClose CommentsPermalink





(F) by adding at the end the following:CommentsClose CommentsPermalink





‘(7) OTHER ACTION- Require the regulated entity to take any other action that the Director determines will better carry out the purpose of this section than any of the actions specified in this paragraph.';(4) by redesignatother actions specified in this subsection.’; andCommentsClose CommentsPermalink





(6) by striking subsection (c) as subsection (d); and(5) by inserting after subsection (b) the following new subsection:`(c)nd inserting the following:CommentsClose CommentsPermalink





‘(c) Restriction on Compensation of Executive Officers- A regulated entity that is classified as significantly undercapitalized in accordance with section 1364 may not, without prior written approval by the Director--CommentsClose CommentsPermalink





`(1) pay any bonus to any executive officer; or`(2) provide compensation to any executive ‘(1) pay any bonus to any executive officer; or CommentsClose CommentsPermalink





‘(2) provide compensation to any executive officer at a rate exceeding that officer'se average rate of compensation of that officer (excluding bonuses, stock options, and profit sharing) during the 12 calendar months preceding the calendar month in which the regulated entity became undercapitalized.'significantly undercapitalized.’.CommentsClose CommentsPermalink

SEC. 3481145. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED REGULATED ENTITIES.

(a) In General- Section 1367 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4617) is amended to read as follows:CommentsClose CommentsPermalink

`‘SEC. 1367. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED REGULATED ENTITIES.

`(a) Appointment of‘(a) Appointment of the Agency as Conservator or Receiver-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- Notwithstanding any other provision of Federal or State law, if any of the grounds under paragraph (3) existthe Director may appoint the Agency as conservator or receiver for a regulated entity in the manner provided under paragraph (2) or (4). All references to the conservator or receiver under this section are references to the Agency acting as conservator or receiver.CommentsClose CommentsPermalink





‘(2) DISCRETIONARY APPOINTMENT- The Agency may, at the discretion of the Director, the Director may establish a conservatorship or receivership, as appropriate,be appointed conservator or receiver for the purpose of reorganizing, rehabilitating, or winding up the affairs of a regulated entity.CommentsClose CommentsPermalink





`(2) APPOINTMENT- In any conservatorship or receivership established under this section, the Director shall appoint the Agency as conservator or receiver.`‘(3) GROUNDS FOR APPOINTMENTDISCRETIONARY APPOINTMENT OF CONSERVATOR OR RECEIVER- The grounds for appointing a conservator or receiver for a regulated entity are as follows:`conservator or receiver for any regulated entity under paragraph (2) are as follows:CommentsClose CommentsPermalink





‘(A) ASSETS INSUFFICIENT FOR OBLIGATIONS- The assets of the regulated entity are less than the obligations of the regulated entity to its creditors and others.CommentsClose CommentsPermalink





`‘(B) SUBSTANTIAL DISSIPATION- Substantial dissipation of assets or earnings due to--CommentsClose CommentsPermalink





`(i) any violation of any provision of Federal or State law; or` ‘(i) any violation of any provision of Federal or State law; or CommentsClose CommentsPermalink





‘(ii) any unsafe or unsound practice.CommentsClose CommentsPermalink





`‘(C) UNSAFE OR UNSOUND CONDITION- An unsafe or unsound condition to transact business.CommentsClose CommentsPermalink





`(D) CEASE-AND-‘(D) CEASE AND DESIST ORDERS- Any willful violation of a cease-and- and desist order that has become final.CommentsClose CommentsPermalink





`‘(E) CONCEALMENT- Any concealment of the books, papers, records, or assets of the regulated entity, or any refusal to submit the books, papers, records, or affairs of the regulated entity, for inspection to any examiner or to any lawful agent of the Director.CommentsClose CommentsPermalink





`‘(F) INABILITY TO MEET OBLIGATIONS- The regulated entity is likely to be unable to pay its obligations or meet the demands of its creditors in the normal course of business.CommentsClose CommentsPermalink





`‘(G) LOSSES- The regulated entity has incurred or is likely to incur losses that will deplete all or substantially all of its capital, and there is no reasonable prospect for the regulated entity to become adequately capitalized (as defined in section 1364(a)(1)).CommentsClose CommentsPermalink





`‘(H) VIOLATIONS OF LAW- Any violation of any law or regulation, or any unsafe or unsound practice or condition that is likely to--CommentsClose CommentsPermalink





`‘(i) cause insolvency or substantial dissipation of assets or earnings; orCommentsClose CommentsPermalink





`(ii) weaken the condition of the regulated entity.` ‘(ii) weaken the condition of the regulated entity. CommentsClose CommentsPermalink





‘(I) CONSENT- The regulated entity, by resolution of its board of directors or its shareholders or members, consents to the appointment.CommentsClose CommentsPermalink





`‘(J) UNDERCAPITALIZATION- The regulated entity is undercapitalized or significantly undercapitalized (as defined in section 1364(a)(3) or in regulations issued pursuant to section 1364(b), as applicable), and--`), and--CommentsClose CommentsPermalink





‘(i) has no reasonable prospect of becoming adequately capitalized;CommentsClose CommentsPermalink





`‘(ii) fails to become adequately capitalized, as required by--CommentsClose CommentsPermalink





`‘(I) section 1365(a)(1) with respect to an undercapitalized regulated entity; or` regulated entity; orCommentsClose CommentsPermalink





‘(II) section 1366(a)(1) with respect to a significantly undercapitalized regulated entity;CommentsClose CommentsPermalink





`(iii) ‘(iii) fails to submit a capital restoration plan acceptable to the Agency within the time prescribed under section 1369C; orCommentsClose CommentsPermalink





`‘(iv) materially fails to implement a capital restoration plan submitted and accepted under section 1369C.CommentsClose CommentsPermalink





`‘(K) CRITICAL UNDERCAPITALIZATION- The regulated entity is critically undercapitalized, as defined in section 1364(a)(4) or in regulations issued pursuant to section 1364(b), as applicable.`.CommentsClose CommentsPermalink





‘(L) MONEY LAUNDERING- The Attorney General notifies the Director in writing that the regulated entity has been found guilty of a criminal offense under section 1956 or 1957 of title 18, United States Code, or section 5322 or 5324 of title 31, United States Code.CommentsClose CommentsPermalink





`‘(4) MANDATORY RECEIVERSHIP-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- The Director shall appoint the Agency as receiver for a regulated entity if the Director determines, in writing, that--CommentsClose CommentsPermalink





`‘(i) the assets of the regulated entity are, and during the preceding 360 calendar days have been, less than the obligations of the regulated entity to its creditors and others; orCommentsClose CommentsPermalink





`‘(ii) the regulated entity is not, and during the preceding 360 calendar days has not been, generally paying the debts of the regulated entity (other than debts that are the subject of a bona fide dispute) as such debts become due.CommentsClose CommentsPermalink





`‘(B) PERIODIC DETERMINATION REQUIRED FOR CRITICALLY UNDERCAPITALIZED REGULATED ENTITY- If a regulated entity is critically undercapitalized, the Director shall make a determination, in writing, as to whether the regulated entity meets the criteria specified in clause (i) or (ii) of subparagraph (A)--CommentsClose CommentsPermalink





`‘(i) not later than 30 calendar days after the regulated entity initially becomes critically undercapitalized; andCommentsClose CommentsPermalink





`‘(ii) at least once during each succeeding 30-calendar day period.CommentsClose CommentsPermalink





`‘(C) DETERMINATION NOT REQUIRED IF RECEIVERSHIP ALREADY IN PLACE- Subparagraph (B) shalldoes not apply with respect to a regulated entity in any period during which the Agency serves as receiver for the regulated entity.CommentsClose CommentsPermalink





`‘(D) RECEIVERSHIP TERMINATES CONSERVATORSHIP- The appointment under this section of the Agency as receiver of a regulated entityof the Agency as receiver of a regulated entity under this section shall immediately terminate any conservatorship established under this title for the regulated entity.`for the regulated entity under this title.CommentsClose CommentsPermalink





‘(5) JUDICIAL REVIEW-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- If the Agency is appointed conservator or receiver under this section, the regulated entity may, within 30 days of such appointment, bring an action in the United States District Cdistrict court for the judicial district in which the principal place of businesshome office of such regulated entity is located, or in the United States District Court for the District of Columbia, for an order requiring the Agency to remove itself as conservator or receiver.CommentsClose CommentsPermalink





`‘(B) REVIEW- Upon the filing of an action under subparagraph (A), the court shall, upon the merits, dismiss such action or direct the Agency to remove itself as such conservator or receiver.CommentsClose CommentsPermalink





`‘(6) DIRECTORS NOT LIABLE FOR ACQUIESCING IN APPOINTMENT OF CONSERVATOR OR RECEIVER- The members of the board of directors of a regulated entity shall not be liable to the shareholders or creditors of the regulated entity for acquiescing in or consenting in good faith to the appointment of the Agency as conservator or receiver for that regulated entity.CommentsClose CommentsPermalink





`‘(7) AGENCY NOT SUBJECT TO ANY OTHER FEDERAL AGENCY- When acting as conservator or receiver, the Agency shall not be subject to the direction or supervision of any other agency of the United States or any State in the exercise of the rights, powers, and privileges of the Agency.CommentsClose CommentsPermalink





`‘(b) Powers and Duties of the Agency as Conservator or Receiver-CommentsClose CommentsPermalink





`(1) RULEMAKING AUTHORITY OF THE ‘(1) RULEMAKING AUTHORITY OF THE AGENCY- The Agency may prescribe such regulations as the Agency determines to be appropriate regarding the conduct of conservatorships or receiverships.CommentsClose CommentsPermalink





`(2) GENERAL POWERS-` ‘(2) GENERAL POWERS- CommentsClose CommentsPermalink





‘(A) SUCCESSOR TO REGULATED ENTITY- The Agency shall, as conservator or receiver, and by operation of law, immediately succeed to--CommentsClose CommentsPermalink





`‘(i) all rights, titles, powers, and privileges of the regulated entity, and of any stockholder, officer, or director of such regulated entity with respect to the regulated entity and the assets of the regulated entity; andCommentsClose CommentsPermalink





`‘(ii) title to the books, records, and assets of any other legal custodian of such regulated entity.CommentsClose CommentsPermalink





`‘(B) OPERATE THE REGULATED ENTITY- The Agency may, as conservator or receiver--CommentsClose CommentsPermalink





`‘(i) take over the assets of and operate the regulated entity with all the powers of the shareholders, the directors, and the officers of the regulated entity and conduct all business of the regulated entity;CommentsClose CommentsPermalink





`‘(ii) collect all obligations and money due the regulated entity;CommentsClose CommentsPermalink





`(iii) perform all functions of the regulated entity in the‘(iii) perform all functions of the regulated entity in the name of the regulated entity which are consistent with the appointment as conservator or receiver;CommentsClose CommentsPermalink





and`‘(iv) preserve and conserve the assets and property of such regulated entity.`(C)the regulated entity; andCommentsClose CommentsPermalink





‘(v) provide by contract for assistance in fulfilling any function, activity, action, or duty of the Agency as conservator or receiver.CommentsClose CommentsPermalink





‘(C) FUNCTIONS OF OFFICERS, DIRECTORS, AND SHAREHOLDERS OF A REGULATED ENTITY- The Agency may, by regulation or order, provide for the exercise of any function by any stockholder, director, or officer of any regulated entity for which the Agency has been named conservator or receiver.CommentsClose CommentsPermalink





`‘(D) POWERS AS CONSERVATOR- The Agency may, as conservator, take such action as may be--CommentsClose CommentsPermalink





`‘(i) necessary to put the regulated entity in a sound and solvent condition; andCommentsClose CommentsPermalink





`‘(ii) appropriate to carry on the business of the regulated entity and preserve and conserve the assets and property of the regulated entity, including, if two or more Federal home loan banks have been placed in conservatorship contemporaneously, merging two or more such banks into a single Federal home loan bank.`.CommentsClose CommentsPermalink





‘(E) ADDITIONAL POWERS AS RECEIVER- The Agency may, as receiver,In any case in which the Agency is acting as receiver, the Agency shall place the regulated entity in liquidation and proceed to realize upon the assets of the regulated entity, having due regard to the conditions of the housing finance market.` in such manner as the Agency deems appropriate, including through the sale of assets, the transfer of assets to a limited-life regulated entity established under subsection (i), or the exercise of any other rights or privileges granted to the Agency under this paragraph.CommentsClose CommentsPermalink





‘(F) ORGANIZATION OF NEW REGULATED ENTITIES- The Agency may, as receiverENTERPRISE- The Agency may, as receiver for an enterprise, organize a successor regulated entityenterprise that will operate pursuant to subsection (i).CommentsClose CommentsPermalink





`(G) TRANSFER‘(G) TRANSFER OR SALE OF ASSETS AND LIABILITIES- The Agency may, as conservator or receiver, transfer or sell any asset or liability of the regulated entity in default, and may do so without any approval, assignment, or consent with respect to such transfer. Any Federal home loan bank may, with the approval of the Agency, acquire the assets of any Bank in conservatorship or receivership, and assume the liabilities of such Bank.` or sale.CommentsClose CommentsPermalink





‘(H) PAYMENT OF VALID OBLIGATIONS- The Agency, as conservator or receiver, shall, to the extent of proceeds realized from the performance of contracts or sale of the assets of a regulated entity, pay all valid obligations of the regulated entity in accordance with the prescriptions and limitations of this section.`(I) SUBPOENA AUTHORITY-`(i) IN GENERAL-`(I) IN GENERALthat are due and payable at the time of the appointment of the Agency as conservator or receiver, in accordance with the prescriptions and limitations of this section.CommentsClose CommentsPermalink





‘(I) SUBPOENA AUTHORITY-CommentsClose CommentsPermalink





‘(i) IN GENERAL-CommentsClose CommentsPermalink





‘(I) AGENCY AUTHORITY- The Agency may, as conservator or receiver, and for purposes of carrying out any power, authority, or duty with respect to a regulated entity (including determining any claim against the regulated entity and determining and realizing upon any asset of any person in the course of collecting money due the regulated entity), exercise any power established under section 1348.CommentsClose CommentsPermalink





`‘(II) APPLICABILITY OF LAW- The provisions of section 1348 shall apply with respect to the exercise of any power exercised under this subparagraph in the same manner as such provisions apply under that section.`(ii) AUTHORITY OF DIRECTORunder this subparagraph, in the same manner as such provisions apply under that section.CommentsClose CommentsPermalink





‘(ii) SUBPOENA- A subpoena or subpoena duces tecum may be issued under clause (i) only by, or with the written approval of, the Director, or the designee of the Director.CommentsClose CommentsPermalink





`‘(iii) RULE OF CONSTRUCTION- This subsection shall not be construed to limit any rights that the Agency, in any capacity, might otherwise have under section 1317 or 1379D.`(J) CONTRACTING FOR SERVICES- The Agency may, as conservator or receiver, provide by contract for the carrying out of any of its functions, activities, actions, or duties as conservator or receiver.`(KB.CommentsClose CommentsPermalink





‘(J) INCIDENTAL POWERS- The Agency may, as conservator or receiver--CommentsClose CommentsPermalink





`‘(i) exercise all powers and authorities specifically granted to conservators or receivers, respectively, under this section, and such incidental powers as shall be necessary to carry out such powers; andCommentsClose CommentsPermalink





`‘(ii) take any action authorized by this section, which the Agency determines is in the best interests of the regulated entity or the Agency.CommentsClose CommentsPermalink





` ‘(K) OTHER PROVISIONS- CommentsClose CommentsPermalink





‘(i) SHAREHOLDERS AND CREDITORS OF FAILED REGULATED ENTITY- Notwithstanding any other provision of law, the appointment of the Agency as receiver for a regulated entity pursuant to paragraph (2) or (4) of subsection (a) and its succession, by operation of law, to the rights, titles, powers, and privileges described in subsection (b)(2)(A) shall terminate all rights and claims that the stockholders and creditors of the regulated entity may have against the assets or charter of the regulated entity or the Agency arising as a result of their status as stockholders or creditors, except for their right to payment, resolution, or other satisfaction of their claims, as permitted under subsections (b)(9), (c), and (e).CommentsClose CommentsPermalink





‘(ii) ASSETS OF REGULATED ENTITY- Notwithstanding any other provision of law, for purposes of this section, the charter of a regulated entity shall not be considered an asset of the regulated entity.CommentsClose CommentsPermalink





‘(3) AUTHORITY OF RECEIVER TO DETERMINE CLAIMS-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- The Agency may, as receiver, determine claims in accordance with the requirements of this subsection and any regulations prescribed under paragraph (4).CommentsClose CommentsPermalink





`‘(B) NOTICE REQUIREMENTS- The receiver, in any case involving the liquidation or winding up of the affairs of a closed regulated entity, shall--CommentsClose CommentsPermalink





`‘(i) promptly publish a notice to the creditors of the regulated entity to present their claims, together with proof, to the receiver by a date specified in the notice which shall be not less than 90 days after the date of publication of such notice; andCommentsClose CommentsPermalink





`(ii) ‘(ii) republish such notice approximately 1 month and 2 months, respectively, after the date of publication under clause (i).CommentsClose CommentsPermalink





`‘(C) MAILING REQUIRED- The receiver shall mail a notice similar to the notice published under subparagraph (B)(i) at the time of such publication to any creditor shown on the books of the regulated entity--CommentsClose CommentsPermalink





`‘(i) at the last address of the creditor appearing in such books; orCommentsClose CommentsPermalink





`‘(ii) upon discovery of the name and address of a claimant not appearing on the books of the regulated entity, within 30 days after the discovery of such name and address.CommentsClose CommentsPermalink





`‘(4) RULEMAKING AUTHORITY RELATING TO DETERMINATION OF CLAIMS- Subject to subsection (c), the Director may prescribe regulations regarding the allowance or disallowance of claims by the receiver and providing for administrative determination of claims and review of such determination.CommentsClose CommentsPermalink





`‘(5) PROCEDURES FOR DETERMINATION OF CLAIMS-CommentsClose CommentsPermalink





`‘(A) DETERMINATION PERIOD-CommentsClose CommentsPermalink





`‘(i) IN GENERAL- Before the end of the 180-day period beginning on the date on which any claim against a regulated entity is filed with the Agency as receiver, the Agency shall determine whether to allow or disallow the claim and shall notify the claimant of any determination with respect to such claim.CommentsClose CommentsPermalink





`‘(ii) EXTENSION OF TIME- The period described in clause (i) may be extended by a written agreement between the claimant and the Agency.CommentsClose CommentsPermalink





`‘(iii) MAILING OF NOTICE SUFFICIENT- The notification requirements of clause (i) shall be deemed to be satisfied if the notice of any determination with respect to any claim is mailed to the last address of the claimant which appears--CommentsClose CommentsPermalink





`‘(I) on the books of the regulated entity;CommentsClose CommentsPermalink





`(II) in the claim ‘(II) in the claim filed by the claimant; orCommentsClose CommentsPermalink





`‘(III) in documents submitted in proof of the claim.CommentsClose CommentsPermalink





`‘(iv) CONTENTS OF NOTICE OF DISALLOWANCE- If any claim filed under clause (i) is disallowed, the notice to the claimant shall contain--CommentsClose CommentsPermalink





`‘(I) a statement of each reason for the disallowance; andCommentsClose CommentsPermalink





`‘(II) the procedures available for obtaining agency review of the determination to disallow the claim or judicial determination of the claim.CommentsClose CommentsPermalink





`‘(B) ALLOWANCE OF PROVEN CLAIM- The receiver shall allow any claim received on or before the date specified in the notice published under paragraph (3)(B)(i), or the date specified in the notice required under paragraph (3)(C), by the receiver from any claimant which is proved to the satisfaction of the receiver.CommentsClose CommentsPermalink





`‘(C) DISALLOWANCE OF CLAIMS FILED AFTER END OF FILING PERIOD- Claims filed after the date specified in the notice published under paragraph (3)(B)(i), or the date specified under paragraph (3)(C), shall be disallowed and such disallowance shall be final.CommentsClose CommentsPermalink





`‘(D) AUTHORITY TO DISALLOW CLAIMS-CommentsClose CommentsPermalink





`‘(i) IN GENERAL- The receiver may disallow any portion of any claim by a creditor or claim of security, preference, or priority which is not proved to the satisfaction of the receiver.CommentsClose CommentsPermalink





`‘(ii) PAYMENTS TO LESS THAN FULLY SECURED CREDITORS- In the case of a claim of a creditor against a regulated entity which is secured by any property or other asset of such regulated entity, the receiver--CommentsClose CommentsPermalink





`‘(I) may treat the portion of such claim which exceeds an amount equal to the fair market value of such property or other asset as an unsecured claim against the regulated entity; andCommentsClose CommentsPermalink





`‘(II) may not make any payment with respect to such unsecured portion of the claim, other than in connection with the disposition of all claims of unsecured creditors of the regulated entity.CommentsClose CommentsPermalink





`(iii) EXCEPTIONS- No provision of this paragraph shall apply with respect to ‘(iii) EXCEPTIONS- No provision of this paragraph shall apply with respect to-- CommentsClose CommentsPermalink





‘(I) any extension of credit from any Federal Reserve Bank, Federal home loan bank, or the Treasury of the United States.`(E)Home Loan Bank, or the United States Treasury; orCommentsClose CommentsPermalink





‘(II) any security interest in the assets of the regulated entity securing any such extension of credit.CommentsClose CommentsPermalink





‘(E) NO JUDICIAL REVIEW OF DETERMINATION PURSUANT TO SUBPARAGRAPH (dD)- No court may review the determination of the Agency under subparagraph (D) to disallow a claim.CommentsClose CommentsPermalink





This subparagraph shall not affect the authority of a claimant to obtain de novo judicial review of a claim pursuant to paragraph (6).`(F)‘(F) LEGAL EFFECT OF FILING-CommentsClose CommentsPermalink





`‘(i) STATUTE OF LIMITATION TOLLED- For purposes of any applicable statute of limitations, the filing of a claim with the receiver shall constitute a commencement of an action.CommentsClose CommentsPermalink





`‘(ii) NO PREJUDICE TO OTHER ACTIONS- Subject to paragraph (10), the filing of a claim with the receiver shall not prejudice any right of the claimant to continue any action which was filed before the date of the appointment of the receiver, subject to the determination of claims by the receiver.CommentsClose CommentsPermalink





`‘(6) PROVISION FOR JUDICIAL DETERMINATION OF CLAIMS-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- The claimant may file suit on a claim (or continue an action commenced before the appointment of the receiver) in the district or territorial court of the United States for the district within which the principal place of business of the regulated entity is located or the United States District Court for the District of Columbia (and such court shall have jurisdiction to hear such claim), before the end of the 60-day period beginning on the earlier of--CommentsClose CommentsPermalink





`‘(i) the end of the period described in paragraph (5)(A)(i) with respect to any claim against a regulated entity for which the Agency is receiver; orCommentsClose CommentsPermalink





`‘(ii) the date of any notice of disallowance of such claim pursuant to paragraph (5)(A)(i).CommentsClose CommentsPermalink





`‘(B) STATUTE OF LIMITATIONS- A claim shall be deemed to be disallowed (other than any portion of such claim which was allowed by the receiver), and such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim, if the claimant fails, before the end of the 60-day period described under subparagraph (A), to file suit on such claim (or continue an action commenced before the appointment of the receiver).CommentsClose CommentsPermalink





`‘(7) REVIEW OF CLAIMS-CommentsClose CommentsPermalink





`‘(A) OTHER REVIEW PROCEDURES-CommentsClose CommentsPermalink





`‘(i) IN GENERAL- The Agency shall establish such alternative dispute resolution processes as may be appropriate for the resolution of claims filed under paragraph (5)(A)(i).CommentsClose CommentsPermalink





`‘(ii) CRITERIA- In establishing alternative dispute resolution processes, the Agency shall strive for procedures which are expeditious, fair, independent, and low cost.CommentsClose CommentsPermalink





`‘(iii) VOLUNTARY BINDING OR NONBINDING PROCEDURES- The Agency may establish both binding and nonbinding processes, which may be under this subparagraph, which may be conducted by any government or private party. All parties, including the claimant and the Agency, must agree to the use of the process in a particular case.CommentsClose CommentsPermalink





`‘(B) CONSIDERATION OF INCENTIVES- The Agency shall seek to develop incentives for claimants to participate in the alternative dispute resolution process.CommentsClose CommentsPermalink





`‘(8) EXPEDITED DETERMINATION OF CLAIMS-CommentsClose CommentsPermalink





`‘(A) ESTABLISHMENT REQUIRED- The Agency shall establish a procedure for expedited relief outside of the routine claims process established under paragraph (5) for claimants who--CommentsClose CommentsPermalink





`‘(i) allege the existence of legally valid and enforceable or perfected security interests in assets of any regulated entity for which the Agency has been appointed receiver; andCommentsClose CommentsPermalink





`(ii) ‘(ii) allege that irreparable injury will occur if the routine claims procedure is followed.CommentsClose CommentsPermalink





`‘(B) DETERMINATION PERIOD- Before the end of the 90-day period beginning on the date on which any claim is filed in accordance with the procedures established under subparagraph (A), the Director shall--CommentsClose CommentsPermalink





`(i) determine--` ‘(i) determine-- CommentsClose CommentsPermalink





‘(I) whether to allow or disallow such claim; orCommentsClose CommentsPermalink





`(II) whether such claim ‘(II) whether such claim should be determined pursuant to the procedures established under paragraph (5); andCommentsClose CommentsPermalink





`(ii) ‘(ii) notify the claimant of the determination, and if the claim is disallowed, provide a statement of each reason for the disallowance and the procedure for obtaining agency review or judicial determination.CommentsClose CommentsPermalink





`‘(C) PERIOD FOR FILING OR RENEWING SUIT- Any claimant who files a request for expedited relief shall be permitted to file a suit, or to continue a suit filed before the date of appointment of the receiver, seeking a determination of the rights of the claimant with respect to such security interest after the earlier of--CommentsClose CommentsPermalink





`‘(i) the end of the 90-day period beginning on the date of the filing of a request for expedited relief; orCommentsClose CommentsPermalink





`(ii) the date the Agency denies the claim.` ‘(ii) the date on which the Agency denies the claim. CommentsClose CommentsPermalink





‘(D) STATUTE OF LIMITATIONS- If an action described under subparagraph (C) is not filed, or the motion to renew a previously filed suit is not made, before the end of the 30-day period beginning on the date on which such action or motion may be filed under subparagraph (B), the claim shall be deemed to be disallowed as of the end of such period (other than any portion of such claim which was allowed by the receiver), such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim.CommentsClose CommentsPermalink





`‘(E) LEGAL EFFECT OF FILING-CommentsClose CommentsPermalink





`‘(i) STATUTE OF LIMITATION TOLLED- For purposes of any applicable statute of limitations, the filing of a claim with the receiver shall constitute a commencement of an action.CommentsClose CommentsPermalink





`‘(ii) NO PREJUDICE TO OTHER ACTIONS- Subject to paragraph (10), the filing of a claim with the receiver shall not prejudice any right of the claimant to continue any action that was filed before the appointment of the receiver, subject to the determination of claims by the receiver.CommentsClose CommentsPermalink





`‘(9) PAYMENT OF CLAIMS-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- The receiver may, in the discretion of the receiver, and to the extent that funds are available from the assets of the regulated entity, pay creditor claims, in such manner and amounts as are authorized under this section, which are--CommentsClose CommentsPermalink





`(i) allowed by the receiver;` ‘(i) allowed by the receiver; CommentsClose CommentsPermalink





‘(ii) approved by the Agency pursuant to a final determination pursuant to paragraph (7) or (8); orCommentsClose CommentsPermalink





`(iii) determined by the ‘(iii) determined by the final judgment of any court of competent jurisdiction.CommentsClose CommentsPermalink





`‘(B) AGREEMENTS AGAINST THE INTEREST OF THE AGENCY- No agreement that tends to diminish or defeat the interest of the Agency in any asset acquired by the Agency as receiver under this section shall be valid against the Agency unless such agreement is in writing, and executed by an authorized official of the regulated entity, except that such requirements for qualified financial contracts shall be applied in a manner consistent with reasonable business trading practices in the financial contracts market.` and executed by an authorized officer or representative of the regulated entity.CommentsClose CommentsPermalink





‘(C) PAYMENT OF DIVIDENDS ON CLAIMS- The receiver may, in the sole discretion of the receiver, pay from the assets of the regulated entity dividends on proved claims at any time, and no liability shall attach to the Agency, by reason of any such payment, for failure to pay dividends to a claimant whose claim is not proved at the time of any such payment.CommentsClose CommentsPermalink





`(D) RULEMAKING AUTHORITY OF THE ‘(D) RULEMAKING AUTHORITY OF THE DIRECTOR- The Director may prescribe such rules, including definitions of terms, as the Director deems appropriate to establish a single uniform interest rate for, or to make payments of post-insolvency interest to creditors holding proven claims against the receivership estates of regulated entitiesthe regulated entity, following satisfaction by the receiver of the principal amount of all creditor claims.CommentsClose CommentsPermalink





`‘(10) SUSPENSION OF LEGAL ACTIONS-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- After the appointment of a conservator or receiver for a regulated entity, the conservator or receiver may, in any judicial action or proceeding to which such regulated entity is or becomes a party, request a stay for a period not to exceed--CommentsClose CommentsPermalink





`‘(i) 45 days, in the case of any conservator; andCommentsClose CommentsPermalink





`(ii) ‘(ii) 90 days, in the case of any receiver.CommentsClose CommentsPermalink





`‘(B) GRANT OF STAY BY ALL COURTS REQUIRED- Upon receipt of a request by anythe conservator or receiver under subparagraph (A) for a stay of any judicial action or proceeding in any court with jurisdiction of such action or proceeding, the court shall grant such stay as to all parties.CommentsClose CommentsPermalink





`‘(11) ADDITIONAL RIGHTS AND DUTIES-CommentsClose CommentsPermalink





`‘(A) PRIOR FINAL ADJUDICATION- The Agency shall abide by any final unappealable judgment of any court of competent jurisdiction which was rendered before the appointment of the Agency as conservator or receiver.CommentsClose CommentsPermalink





`‘(B) RIGHTS AND REMEDIES OF CONSERVATOR OR RECEIVER- In the event of any appealable judgment, the Agency as conservator or receiver shall--`(i) have all the --CommentsClose CommentsPermalink





‘(i) shall have all of the rights and remedies available to the regulated entity (before the appointment of such conservator or receiver) and the Agency, including removal to Federal court and all appellate rights; andCommentsClose CommentsPermalink





`(ii) not be required to ‘(ii) shall not be required to post any bond in order to pursue such remedies.CommentsClose CommentsPermalink





`‘(C) NO ATTACHMENT OR EXECUTION- No attachment or execution may issue by any court upon assets in the possession of the receiver.`, or upon the charter, of a regulated entity for which the Agency has been appointed receiver.CommentsClose CommentsPermalink





‘(D) LIMITATION ON JUDICIAL REVIEW- Except as otherwise provided in this subsection, no court shall have jurisdiction over--CommentsClose CommentsPermalink





`‘(i) any claim or action for payment from, or any action seeking a determination of rights with respect to, the assets of any regulatedr charter of any regulated entity for which the Agency has been appointed receiver; orCommentsClose CommentsPermalink





`‘(ii) any claim relating to any act or omission of such regulated entity or the Agency as receiver.CommentsClose CommentsPermalink





`‘(E) DISPOSITION OF ASSETS- In exercising any right, power, privilege, or authority as conservator or receiver in connection with any sale or disposition of assets of a regulated entity for which the Agency has been appointed conservator or receiver, the Agency shall conduct its operations in a manner which maintains stability in the housing finance markets and, to the extent consistent with that goal--`--CommentsClose CommentsPermalink





‘(i) maximizes the net present value return from the sale or disposition of such assets;CommentsClose CommentsPermalink





`‘(ii) minimizes the amount of any loss realized in the resolution of cases; andCommentsClose CommentsPermalink





`‘(iii) ensures adequate competition and fair and consistent treatment of offerors.CommentsClose CommentsPermalink





`‘(12) STATUTE OF LIMITATIONS FOR ACTIONS BROUGHT BY CONSERVATOR OR RECEIVER-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- Notwithstanding any provision of any contract, the applicable statute of limitations with regard to any action brought by the Agency as conservator or receiver shall be--CommentsClose CommentsPermalink





`‘(i) in the case of any contract claim, the longer of--CommentsClose CommentsPermalink





`‘(I) the 6-year period beginning on the date the claim accrues; or`on which the claim accrues; orCommentsClose CommentsPermalink





‘(II) the period applicable under State law; andCommentsClose CommentsPermalink





`‘(ii) in the case of any tort claim, the longer of--CommentsClose CommentsPermalink





`‘(I) the 3-year period beginning on the date the claim accrues; or`(II) the period applicable under State law.`on which the claim accrues; orCommentsClose CommentsPermalink





‘(II) the period applicable under State law.CommentsClose CommentsPermalink





‘(B) DETERMINATION OF THE DATE ON WHICH A CLAIM ACCRUES- For purposes of subparagraph (A), the date on which the statute of limitations begins to run on any claim described in such subparagraph shall be the later of--CommentsClose CommentsPermalink





`‘(i) the date of the appointment of the Agency as conservator or receiver; orCommentsClose CommentsPermalink





`(ii) the date on which the‘(ii) the date on which the cause of action accrues.CommentsClose CommentsPermalink





`‘(13) REVIVAL OF EXPIRED STATE CAUSES OF ACTION-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- In the case of any tort claim described under subparagraph (Bclause (ii) for which the statute of limitations applicable under State law with respect to such claim has expired not more than 5 years before the appointment of the Agency as conservator or receiver, the Agency may bring an action as conservator or receiver on such claim without regard to the expiration of the statute of limitation applicable under State law.`s applicable under State law.CommentsClose CommentsPermalink





‘(B) CLAIMS DESCRIBED- A tort claim referred to under subparagraph (Aclause (i) is a claim arising from fraud, intentional misconduct resulting in unjust enrichment, or intentional misconduct resulting in substantial loss to the regulated entity.CommentsClose CommentsPermalink





`‘(14) ACCOUNTING AND RECORDKEEPING REQUIREMENTS-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- The Agency as conservator or receiver shall, consistent with the accounting and reporting practices and procedures established by the Agency, maintain a full accounting of each conservatorship and receivership or other disposition of a regulated entity in default.CommentsClose CommentsPermalink





`‘(B) ANNUAL ACCOUNTING OR REPORT- With respect to each conservatorship or receivership, the Agency shall make an annual accounting or report available to the Board, the Comptroller General of the United States, the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Committee on Financial Services of the House of Representatives.CommentsClose CommentsPermalink





`‘(C) AVAILABILITY OF REPORTS- Any report prepared under subparagraph (B) shall be made available by the Agency upon request to any shareholder of a regulated entity or any member of the public.CommentsClose CommentsPermalink





`‘(D) RECORDKEEPING REQUIREMENT- After the end of the 6-year period beginning on the date thaton which the conservatorship or receivership is terminated by the Director, the Agency may destroy any records of such regulated entity which the Agency, in the discretion of the Agency, determines to be unnecessary, unless directed not to do so by a court of competent jurisdiction or governmental agency, or prohibited by law.CommentsClose CommentsPermalink





`‘(15) FRAUDULENT TRANSFERS-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- The Agency, as conservator or receiver, may avoid a transfer of any interest of a regulatedn entity-affiliated party, or any person who the conservator or receiver determines isdetermined by the conservator or receiver to be a debtor of the regulated entity, in property, or any obligation incurred by such party or person, that was made within 5 years of the date on which the Agency was appointed conservator or receiver, if such party or person voluntarily or involuntarily made such transfer or incurred such liability with the intent to hinder, delay, or defraud the regulated entity, the Agency, the conservator, or receiver.CommentsClose CommentsPermalink





`‘(B) RIGHT OF RECOVERY- To the extent a transfer is avoided under subparagraph (A), the conservator or receiver may recover, for the benefit of the regulated entity, the property transferred, or, if a court so orders, the value of such property (at the time of such transfer) from--CommentsClose CommentsPermalink





`‘(i) the initial transferee of such transfer or the regulated entity-affiliated party or person for whose benefit such transfer was made; orCommentsClose CommentsPermalink





`‘(ii) any immediate or mediate transferee of any such initial transferee.CommentsClose CommentsPermalink





`‘(C) RIGHTS OF TRANSFEREE OR OBLIGEE- The conservator or receiver may not recover under subparagraph (B) from--CommentsClose CommentsPermalink





`‘(i) any transferee that takes for value, including satisfaction or securing of a present or antecedent debt, in good faith; orCommentsClose CommentsPermalink





`‘(ii) any immediate or mediate good faith transferee of such transferee.CommentsClose CommentsPermalink





`‘(D) RIGHTS UNDER THIS PARAGRAPH- The rights under this paragraph of the conservator or receiver described under subparagraph (A) shall be superior to any rights of a trustee or any other party (other than any party which is a Federal agency) under title 11, United States Code.CommentsClose CommentsPermalink





`‘(16) ATTACHMENT OF ASSETS AND OTHER INJUNCTIVE RELIEF- Subject to paragraph (17), any court of competent jurisdiction may, at the request of the conservator or receiver, issue an order in accordance with Rrule 65 of the Federal Rules of Civil Procedure, including an order placing the assets of any person designated by the Agency or such conservatoconservator or receiver under the control of the court, and appointing a trustee to hold such assets.CommentsClose CommentsPermalink





`‘(17) STANDARDS OF PROOF- Rule 65 of the Federal Rules of Civil Procedure shall apply with respect to any proceeding under paragraph (16) without regard to the requirement of such rule that the applicant show that the injury, loss, or damage is irreparable and immediate.CommentsClose CommentsPermalink





`‘(18) TREATMENT OF CLAIMS ARISING FROM BREACH OF CONTRACTS EXECUTED BY THE RECEIVER OR CONSERVATOR-`CONSERVATOR OR RECEIVER-CommentsClose CommentsPermalink





‘(A) IN GENERAL- Notwithstanding any other provision of this subsection, any final and unappealable judgment for monetary damages entered against a receiver or conservatothe conservator or receiver for the breach of an agreement executed or approved in writing by such receiver or conservatothe conservator or receiver after the date of its appointment, shall be paid as an administrative expense of the receiver or conservator.`conservator or receiver.CommentsClose CommentsPermalink





‘(B) NO LIMITATION OF POWER- Nothing in this paragraph shall be construed to limit the power of a receiver or conservator to exercise any the conservator or receiver to exercise any rights under contract or law, including to terminate, breach, cancel, or otherwise discontinue such agreement.CommentsClose CommentsPermalink





`‘(19) GENERAL EXCEPTIONS-CommentsClose CommentsPermalink





`(A) LIMITATIONS- The rights of a‘(A) LIMITATIONS- The rights of the conservator or receiver appointed under this section shall be subject to the limitations on the powers of a receiver under sections 402 through 407 of the Federal Deposit Insurance Corporation Improvement Act of 1991 (12 U.S.C. 4402 through 4407).CommentsClose CommentsPermalink





`‘(B) MORTGAGES HELD IN TRUST-CommentsClose CommentsPermalink





`(i) IN GENERAL- Any mortgage,‘(i) IN GENERAL- Any mortgage, pool of mortgages, or interest in a pool of mortgages, held in trust, custodial, or agency capacity by a regulated entity for the benefit of persons other than the regulated entity shall not be available to any person other than the regulated entity shall not be available to satisfy the claims of creditors generally.`, except that nothing in this clause shall be construed to expand or otherwise affect the authority of any regulated entity.CommentsClose CommentsPermalink





‘(ii) HOLDING OF MORTGAGES- Any mortgage, pool of mortgages, or interest in a pool of mortgages, described under described in clause (i) shall be held by the conservator or receiver appointed under this section for the beneficial owners of such mortgage, pool of mortgages, or interest in a pool of mortgages in accordance with the terms of the agreementccordance with the terms of the agreement creating such trust, custodial, or other agency arrangement.CommentsClose CommentsPermalink





`‘(iii) LIABILITY OF CONSERVATOR OR RECEIVER- The liability of athe conservator or receiver appointed under this section for damages shall, in the case of any contingent or unliquidated claim relating to the mortgages held in trust, be estimated in accordance set forth in the regulations of the Director.`(c) with the regulations of the Director.CommentsClose CommentsPermalink





‘(c) Priority of Expenses and Unsecured Claims-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- Unsecured claims against a regulated entity, or a receivethe receiver therefor, that are proven to the satisfaction of the receiver shall have priority in the following order:CommentsClose CommentsPermalink





`(A) ‘(A) Administrative expenses of the receiver.CommentsClose CommentsPermalink





`‘(B) Any other general or senior liability of the regulated entity and claims of other Federal home loan banks arising from their payment obligations (including joint and several payment obligations).`(which is not a liability described under subparagraph (C) or (D).CommentsClose CommentsPermalink





‘(C) Any obligation subordinated to general creditors.` (which is not an obligation described under subparagraph (D)).CommentsClose CommentsPermalink





‘(D) Any obligation to shareholders or members arising as a result of their status as shareholder or members.CommentsClose CommentsPermalink





`‘(2) CREDITORS SIMILARLY SITUATED- All creditors that are similarly situated under paragraph (1) shall be treated in a similar manner, except that the Agency may make such other paymentsreceiver may take any action (including making payments) that does not comply with this subsection, if--CommentsClose CommentsPermalink





‘(A) the Director determines that such action is necessary to creditors necessarymaximize the value of the assets of the regulated entity, to maximize the present value return from the sale or disposition or such regulated entity's assetsother disposition of the assets of the regulated entity, or to minimize the amount of any loss realized in the resolution of cases so long as all creditorsupon the sale or other disposition of the assets of the regulated entity; andCommentsClose CommentsPermalink





‘(B) all creditors that are similarly situated under paragraph (1) receive not less than the amount provided underin subsection (e)(2).CommentsClose CommentsPermalink





`(3) DEFINITION- The term `administrative expenses of the receiver' shall include ‘(3) DEFINITION- As used in this subsection, the term ‘administrative expenses of the receiver’ includes-- CommentsClose CommentsPermalink





‘(A) the actual, necessary costs and expenses incurred by the receiver in preserving the assets of the regulated entity or a failed regulated entity or liquidating or otherwise resolving the affairs ofthe regulated entity. Such expenses shall include obligations that are incurred by the receiver after appointment as receiver that the Directo a failed regulated entity; andCommentsClose CommentsPermalink





‘(B) any obligations that the receiver determines are necessary and appropriate to facilitate the smooth and orderly liquidation or other resolution of the regulated entity.CommentsClose CommentsPermalink





`‘(d) Provisions Relating to Contracts Entered Into Before Appointment of Conservator or Receiver-CommentsClose CommentsPermalink





`‘(1) AUTHORITY TO REPUDIATE CONTRACTS- In addition to any other rights a conservator or receiver may have, the conservator or receiver for any regulated entity may disaffirm or repudiate any contract or lease--CommentsClose CommentsPermalink





`‘(A) to which such regulated entity is a party;CommentsClose CommentsPermalink





`‘(B) the performance of which the conservator or receiver, in its sole discretion, determines to be burdensome; andCommentsClose CommentsPermalink





`‘(C) the disaffirmance or repudiation of which the conservator or receiver determines, in its sole discretion, will promote the orderly administration of the affairs of the regulated entity.CommentsClose CommentsPermalink





`‘(2) TIMING OF REPUDIATION- The conservator or receiver shall determine whether or not to exercise the rights of repudiation under this subsection within a reasonable period following such appointment.CommentsClose CommentsPermalink





`‘(3) CLAIMS FOR DAMAGES FOR REPUDIATION-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- Except as otherwise provided under subparagraph (C) and paragraphs (4), (5), and (6), the liability of the conservator or receiver for the disaffirmance or repudiation of any contract pursuant to paragraph (1) shall be--CommentsClose CommentsPermalink





`‘(i) limited to actual direct compensatory damages; andCommentsClose CommentsPermalink





`(ii) determined as of--` ‘(ii) determined as of-- CommentsClose CommentsPermalink





‘(I) the date of the appointment of the conservator or receiver; orCommentsClose CommentsPermalink





`‘(II) in the case of any contract or agreement referred to in paragraph (8), the date of the disaffirmance or repudiation of such contract or agreement.CommentsClose CommentsPermalink





`‘(B) NO LIABILITY FOR OTHER DAMAGES- For purposes of subparagraph (A), the term `‘actual direct compensatory damages' shall not include--`’ shall not include--CommentsClose CommentsPermalink





‘(i) punitive or exemplary damages;CommentsClose CommentsPermalink





`‘(ii) damages for lost profits or opportunity; orCommentsClose CommentsPermalink





`‘(iii) damages for pain and suffering.CommentsClose CommentsPermalink





`‘(C) MEASURE OF DAMAGES FOR REPUDIATION OF FINANCIAL CONTRACTS- In the case of any qualified financial contract or agreement to which paragraph (8) applies, compensatory damages shall be--CommentsClose CommentsPermalink





`‘(i) deemed to include normal and reasonable costs of cover or other reasonable measures of damages utilized in the industries for such contract and agreement claims; andCommentsClose CommentsPermalink





`(ii) paid in accordance with‘(ii) paid in accordance with this subsection and subsection (e), except as otherwise specifically provided in this section.CommentsClose CommentsPermalink





`‘(4) LEASES UNDER WHICH THE REGULATED ENTITY IS THE LESSEE-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- If the conservator or receiver disaffirms or repudiates a lease under which the regulated entity was the lessee, the conservator or receiver shall not be liable for any damages (other than damages determined under subparagraph (B)) for the disaffirmance or repudiation of such lease.CommentsClose CommentsPermalink





`‘(B) PAYMENTS OF RENT- Notwithstanding subparagraph (A), the lessor under a lease to which that subparagraph applies shall--CommentsClose CommentsPermalink





`‘(i) be entitled to the contractual rent accruing before the later of the date--` on which--CommentsClose CommentsPermalink





‘(I) the notice of disaffirmance or repudiation is mailed; orCommentsClose CommentsPermalink





`‘(II) the disaffirmance or repudiation becomes effective, unless the lessor is in default or breach of the terms of the lease;CommentsClose CommentsPermalink





`‘(ii) have no claim for damages under any acceleration clause or other penalty provision in the lease; andCommentsClose CommentsPermalink





`(iii) have a claim for any‘(iii) have a claim for any unpaid rent, subject to all appropriate offsets and defenses, due as of the date of the appointment, which shall be paid in accordance with this subsection and subsection (e).CommentsClose CommentsPermalink





`‘(5) LEASES UNDER WHICH THE REGULATED ENTITY IS THE LESSOR-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- If the conservator or receiver repudiates an unexpired written lease of real property of the regulated entity under which the regulated entity is the lessor and the lessee is not, as of the date of such repudiation, in default, the lessee under such lease may either--CommentsClose CommentsPermalink





`‘(i) treat the lease as terminated by such repudiation; orCommentsClose CommentsPermalink





`‘(ii) remain in possession of the leasehold interest for the balance of the term of the lease, unless the lessee defaults under the terms of the lease after the date of such repudiation.CommentsClose CommentsPermalink





`‘(B) PROVISIONS APPLICABLE TO LESSEE REMAINING IN POSSESSION- If any lessee under a lease described under subparagraph (A) remains in possession of a leasehold interest under clause (ii) of such subparagraph--`(i) the lessee--`bparagraph (A)--CommentsClose CommentsPermalink





‘(i) the lessee--CommentsClose CommentsPermalink





‘(I) shall continue to pay the contractual rent pursuant to the terms of the lease after the date of the repudiation of such lease; andCommentsClose CommentsPermalink





`‘(II) may offset against any rent payment which accrues after the date of the repudiation of the lease, and any damages which accrue after such date due to the nonperformance of any obligation of the regulated entity under the lease after such date; andCommentsClose CommentsPermalink





`‘(ii) the conservator or receiver shall not be liable to the lessee for any damages arising after such date as a result of the repudiation, other than the amount of any offset allowed under clause (i)(II).CommentsClose CommentsPermalink





`‘(6) CONTRACTS FOR THE SALE OF REAL PROPERTY-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- If the conservator or receiver repudiates any contract for the sale of real property and the purchaser of such real property under such contract is in possession, and is not, as of the date of such repudiation, in default, such purchaser may either--CommentsClose CommentsPermalink





`‘(i) treat the contract as terminated by such repudiation; orCommentsClose CommentsPermalink





`‘(ii) remain in possession of such real property.CommentsClose CommentsPermalink





`‘(B) PROVISIONS APPLICABLE TO PURCHASER REMAINING IN POSSESSION- If any purchaser of real property under any contract described under subparagraph (A) remains in possession of such property under clause (ii) of such subparagraph--`(i) the purchaser--`bparagraph (A)--CommentsClose CommentsPermalink





‘(i) the purchaser--CommentsClose CommentsPermalink





‘(I) shall continue to make all payments due under the contract after the date of the repudiation of the contract; andCommentsClose CommentsPermalink





`‘(II) may offset against any such payments any damages which accrue after such date due to the nonperformance (after such date) of any obligation of the regulated entity under the contract; andCommentsClose CommentsPermalink





`(ii) the conservator or receiver shall--` ‘(ii) the conservator or receiver shall-- CommentsClose CommentsPermalink





‘(I) not be liable to the purchaser for any damages arising after such date as a result of the repudiation, other than the amount of any offset allowed under clause (i)(II);CommentsClose CommentsPermalink





`(II) ‘(II) deliver title to the purchaser in accordance with the provisions of the contract; andCommentsClose CommentsPermalink





`(III) have no obligation ‘(III) have no obligation under the contract other than the performance required under subclause (II).CommentsClose CommentsPermalink





`(C)‘(C) ASSIGNMENT AND SALE ALLOWED-CommentsClose CommentsPermalink





`‘(i) IN GENERAL- No provision of this paragraph shall be construed as limiting the right of the conservator or receiver to assign the contract described under subparagraph (A), and sell the property subject to the contract and the provisions of this paragraph.CommentsClose CommentsPermalink





`‘(ii) NO LIABILITY AFTER ASSIGNMENT AND SALE- If an assignment and sale described under clause (i) is consummated, the conservator or receiver shall have no further liability under the contract described under subparagraph (A), or with respect to the real property which was the subject of such contract.CommentsClose CommentsPermalink





`(7) PROVISIONS APPLICABLE TO ‘(7) SERVICE CONTRACTS-CommentsClose CommentsPermalink





`‘(A) SERVICES PERFORMED BEFORE APPOINTMENT- In the case of any contract for services between any person and any regulated entity for which the Agency has been appointed conservator or receiver, any claim of such person for services performed before the appointment of the conservator or the receiver shall be--`receiver shall be--CommentsClose CommentsPermalink





‘(i) a claim to be paid in accordance with subsections (b) and (e); andCommentsClose CommentsPermalink





`(ii) ‘(ii) deemed to have arisen as of the date the conservator or receiver was appointed.`on which the conservator or receiver was appointed.CommentsClose CommentsPermalink





‘(B) SERVICES PERFORMED AFTER APPOINTMENT AND PRIOR TO REPUDIATION- If, in the case of any contract for services described under subparagraph (A), the conservator or receiver accepts performance by the other person before the conservator or receiver makes any determination to exercise the right of repudiation of such contract under this section--CommentsClose CommentsPermalink





`(i) the other party shall be paid under the terms of the contract for the services performed; and` ‘(i) the other party shall be paid under the terms of the contract for the services performed; and CommentsClose CommentsPermalink





‘(ii) the amount of such payment shall be treated as an administrative expense of the conservatorship or receivership.CommentsClose CommentsPermalink





`‘(C) ACCEPTANCE OF PERFORMANCE NO BAR TO SUBSEQUENT REPUDIATION- The acceptance by anythe conservator or receiver of services referred to under subparagraph (B) in connection with a contract described in such subparagraph shall not affect the right of the conservator or receiver to repudiate such contract under this section at any time after such performance.CommentsClose CommentsPermalink





`‘(8) CERTAIN QUALIFIED FINANCIAL CONTRACTS-CommentsClose CommentsPermalink





`‘(A) RIGHTS OF PARTIES TO CONTRACTS- Subject to paragraphs (9) and (10), and notwithstanding any other provision of this Act, any other Federal title (other than subsection (b)(9)(B) of this section), any other Federal law, or the law of any State, no person shall be stayed or prohibited from exercising--CommentsClose CommentsPermalink





`(i) any right such person has‘(i) any right of that person to cause the termination, liquidation, or acceleration of any qualified financial contract with a regulated entity that arises upon the appointment of the Agency as receiver for such regulated entity at any time after such appointment;CommentsClose CommentsPermalink





`‘(ii) any right under any security agreement or arrangement or other credit enhancement relating to one or more qualified financial contracts described in clause (i); or`; orCommentsClose CommentsPermalink





‘(iii) any right to offset or net out any termination value, payment amount, or other transfer obligation arising under or in connection with 1 or more contracts and agreements described in clause (i), including any master agreement for such contracts or agreements.CommentsClose CommentsPermalink





`‘(B) APPLICABILITY OF OTHER PROVISIONS- Paragraph (10) of subsection (bSubsection (b)(10) shall apply in the case of any judicial action or proceeding brought against any receiver referred to under subparagraph (A), or the regulated entity for which such receiver was appointed, by any party to a contract or agreement described under subparagraph (A)(i) with such regulated entity.CommentsClose CommentsPermalink





`‘(C) CERTAIN TRANSFERS NOT AVOIDABLE-CommentsClose CommentsPermalink





`‘(i) IN GENERAL- Notwithstanding paragraph (11) or any other Federal or State laws, or any other provision of Federal or State law relating to the avoidance of preferential or fraudulent transfers, the Agency, whether acting as such or as conservator or receiver of a regulated entity, may not avoid any transfer of money or other property in connection with any qualified financial contract with a regulated entity.CommentsClose CommentsPermalink





`‘(ii) EXCEPTION FOR CERTAIN TRANSFERS- Clause (i) shall not apply to any transfer of money or other property in connection with any qualified financial contract with a regulated entity if the Agency determines that the transferee had actual intent to hinder, delay, or defraud such regulated entity, the creditors of such regulated entity, or any conservator or receiver appointed for such regulated entity.CommentsClose CommentsPermalink





`‘(D) CERTAIN CONTRACTS AND AGREEMENTS DEFINED- In this subsection:`(i) the following definitions shall apply:CommentsClose CommentsPermalink





‘(i) QUALIFIED FINANCIAL CONTRACT- The term `qualified financial contract' means any securities ‘qualified financial contract’ means any securities contract, commodity contract, forward contract, repurchase agreement, swap agreement, and any similar agreement that the Agency determines by regulation, resolution, or order to be a qualified financial contract for purposes of this paragraph.CommentsClose CommentsPermalink





`‘(ii) SECURITIES CONTRACT- The term `securities contract'--`(I) means a contract for the‘securities contract’--CommentsClose CommentsPermalink





‘(I) means a contract for the purchase, sale, or loan of a security, a certificate of deposit, a mortgage loan, or any interest in a mortgage loan, a group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof) or any option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option, and including any repurchase or reverse repurchase transaction on any such security, certificate of deposit, mortgage loan, interest, group or index, or option;CommentsClose CommentsPermalink





`(II) does not include any‘(II) does not include any purchase, sale, or repurchase obligation under a participation in a commercial mortgage loan, unless the Agency determines by regulation, resolution, or order to include any such agreement within the meaning of such term;CommentsClose CommentsPermalink





`‘(III) means any option entered into on a national securities exchange relating to foreign currencies;CommentsClose CommentsPermalink





`‘(IV) means the guarantee by or to any securities clearing agency of any settlement of cash, securities, certificates of deposit, mortgage loans or interests therein, group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof) or option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option;CommentsClose CommentsPermalink





`‘(V) means any margin loan;CommentsClose CommentsPermalink





`‘(VI) means any other agreement or transaction that is similar to any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink





`‘(VII) means any combination of the agreements or transactions referred to in this clause;CommentsClose CommentsPermalink





`‘(VIII) means any option to enter into any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink





`‘(IX) means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), (IV), (V), (VI), (VII), or (VIII), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a securities contract under this clause, except that the master agreement shall be considered to be a securities contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), (IV), (V), (VI), (VII), or (VIII); andCommentsClose CommentsPermalink





`‘(X) means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause.CommentsClose CommentsPermalink





`‘(iii) COMMODITY CONTRACT- The term `commodity contract' means--`‘commodity contract’ means--CommentsClose CommentsPermalink





‘(I) with respect to a futures commission merchant, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade;CommentsClose CommentsPermalink





`‘(II) with respect to a foreign futures commission merchant, a foreign future;CommentsClose CommentsPermalink





`‘(III) with respect to a leverage transaction merchant, a leverage transaction;CommentsClose CommentsPermalink





`‘(IV) with respect to a clearing organization, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization, or commodity option traded on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization;CommentsClose CommentsPermalink





`‘(V) with respect to a commodity options dealer, a commodity option;CommentsClose CommentsPermalink





`(VI) any other agreement ‘(VI) any other agreement or transaction that is similar to any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink





`‘(VII) any combination of the agreements or transactions referred to in this clause;CommentsClose CommentsPermalink





`‘(VIII) any option to enter into any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink





`‘(IX) a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a commodity contract under this clause, except that the master agreement shall be considered to be a commodity contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII); orCommentsClose CommentsPermalink





`‘(X) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause.CommentsClose CommentsPermalink





`‘(iv) FORWARD CONTRACT- The term `forward contract' means--`‘forward contract’ means--CommentsClose CommentsPermalink





‘(I) a contract (other than a commodity contract) for the purchase, sale, or transfer of a commodity or any similar good, article, service, right, or interest which is presently or in the future becomes the subject of dealing in the forward contract trade, or product or byproduct thereof, with a maturity date more than 2 days after the date on which the contract is entered into, including, a repurchase transaction, reverse repurchase transaction, consignment, lease, swap, hedge transaction, deposit, loan, option, allocated transaction, unallocated transaction, or any other similar agreement;CommentsClose CommentsPermalink





`‘(II) any combination of agreements or transactions referred to in subclauses (I) and (III);CommentsClose CommentsPermalink





`‘(III) any option to enter into any agreement or transaction referred to in subclause (I) or (II);CommentsClose CommentsPermalink





`‘(IV) a master agreement that provides for an agreement or transaction referred to in subclauses (I), (II), or (III), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a forward contract under this clause, except that the master agreement shall be considered to be a forward contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), or (III); orCommentsClose CommentsPermalink





`‘(V) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (II), (III), or (IV), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.CommentsClose CommentsPermalink





`‘(v) REPURCHASE AGREEMENT- The term `repurchase agreement' (which definition also applies to‘repurchase agreement’ (including a reverse repurchase agreement)--CommentsClose CommentsPermalink





`‘(I) means an agreement, including related terms, which provides for the transfer of one or more certificates of deposit, mortgage-related securities (as such term is defined in the Securitiessection 3 of the Securities Exchange Act of 1934), mortgage loans, interests in mortgage-related securities or mortgage loans, eligible bankers' acceptances, qualified foreign government securities’ acceptances, qualified foreign government securities (defined for purposes of this clause as a security that is a direct obligation of, or that is fully guaranteed by, the central government of a member of the Organization for Economic Cooperation and Development, as determined by regulation or order adopted by the appropriate Federal banking authority), or securities that are direct obligations of, or that are fully guaranteed by, the United States or any agency of the United States against the transfer of funds by the transferee of such certificates of deposit, eligible bankers'’ acceptances, securities, mortgage loans, or interests with a simultaneous agreement by such transferee to transfer to the transferor thereof certificates of deposit, eligible bankers'’ acceptances, securities, mortgage loans, or interests as described above, at a date certain not later than 1 year after such transfers or on demand, against the transfer of funds, or any other similar agreement;CommentsClose CommentsPermalink





`(II) does not include any‘(II) does not include any repurchase obligation under a participation in a commercial mortgage loan, unless the Agency determines by regulation, resolution, or order to include any such participation within the meaning of such term;CommentsClose CommentsPermalink





`‘(III) means any combination of agreements or transactions referred to in subclauses (I) and (IV);CommentsClose CommentsPermalink





`‘(IV) means any option to enter into any agreement or transaction referred to in subclause (I) or (III);CommentsClose CommentsPermalink





`‘(V) means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a repurchase agreement under this clause, except that the master agreement shall be considered to be a repurchase agreement under this subclause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), or (IV); andCommentsClose CommentsPermalink





`‘(VI) means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.CommentsClose CommentsPermalink





For purposes of this clause, the term `qualified foreign government security' means a security that is a direct obligation of, or that is fully guaranteed by, the central government of a member of the Organization for Economic Cooperation and Development (as determined by regulation or order adopted by the appropriate Federal banking authority).`‘(vi) SWAP AGREEMENT- The term `swap agreement' means--`‘swap agreement’ means--CommentsClose CommentsPermalink





‘(I) any agreement, including the terms and conditions incorporated by reference in any such agreement, which is an interest rate swap, option, future, or forward agreement, including a rate floor, rate cap, rate collar, cross-currency rate swap, and basis swap; a spot, same day-tomorrow, tomorrow-next, forward, or other foreign exchange or precious metals agreement; a currency swap, option, future, or forward agreement; an equity index or equity swap, option, future, or forward agreement; a debt index or debt swap, option, future, or forward agreement; a total return, credit spread or credit swap, option, future, or forward agreement; a commodity index or commodity swap, option, future, or forward agreement; or a weather swap, weather derivative, or weather option;CommentsClose CommentsPermalink





`‘(II) any agreement or transaction that is similar to any other agreement or transaction referred to in this clause and that is of a type that has been, is presently, or in the future becomes, the subject of recurrent dealings in the swap markets (including terms and conditions incorporated by reference in such agreement) and that is a forward, swap, future, or option on one or more rates, currencies, commodities, equity securities or other equity instruments, debt securities or other debt instruments, quantitative measures associated with an occurrence, extent of an occurrence, or contingency associated with a financial, commercial, or economic consequence, or economic or financial indices or measures of economic or financial risk or value;CommentsClose CommentsPermalink





`‘(III) any combination of agreements or transactions referred to in this clause;CommentsClose CommentsPermalink





`‘(IV) any option to enter into any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink





`‘(V) a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement contains an agreement or transaction that is not a swap agreement under this clause, except that the master agreement shall be considered to be a swap agreement under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), or (IV); andCommentsClose CommentsPermalink





`‘(VI) any security agreement or arrangement or other credit enhancement related to any agreements or transactions referred to in subclause (I), (II), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.CommentsClose CommentsPermalink





Such term is applicable for purposes of this subsection only and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any swap agreement under any other statute, regulation, or rule, including the Securities Act of 1933, the Securities Exchange Act of 1934, the Public Utility Holding Company Act of 1935, the Trust Indenture Act of 1939, the Investment Company Act of 1940, the Investment Advisers Act of 1940, the Securities Investor Protection Act of 1970, the Commodity Exchange Act, the Gramm-Leach-Bliley Act, and the Legal Certainty for Bank Products Act of 2000.`‘(vii) TREATMENT OF MASTER AGREEMENT AS ONE AGREEMENT- Any master agreement for any contract or agreement described in any preceding clause of this subparagraph (or any master agreement for such master agreement or agreements), together with all supplements to such master agreement, shall be treated as a single agreement and a single qualified financial contract. If a master agreement contains provisions relating to agreements or transactions that are not themselves qualified financial contracts, the master agreement shall be deemed to be a qualified financial contract only with respect to those transactions that are themselves qualified financial contracts.CommentsClose CommentsPermalink





`(viii) TRANSFER- The term `transfer'‘(viii) TRANSFER- The term ‘transfer’ means every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with property or with an interest in property, including retention of title as a security interest and foreclosure of the regulated entity's equity of redemption.`equity of redemption of the regulated entity.CommentsClose CommentsPermalink





‘(E) CERTAIN PROTECTIONS IN EVENT OF APPOINTMENT OF CONSERVATOR- Notwithstanding any other provision of this Act section, any other Federal law, or the law of any State (other than paragraph (13) of this subsection), any other Federal law, or the law of any State, no person shall be0) of this subsection and subsection (b)(9)(B)), no person shall be stayed or prohibited from exercising--CommentsClose CommentsPermalink





`‘(i) any right such person has to cause the termination, liquidation, or acceleration of any qualified financial contract with a regulated entity in a conservatorship based upon a default under such financial contract which is enforceable under applicable noninsolvency law;CommentsClose CommentsPermalink





`‘(ii) any right under any security agreement or arrangement or other credit enhancement relating to one or more such qualified1 or more such qualified financial contracts; orCommentsClose CommentsPermalink





`‘(iii) any right to offset or net out any termination values, payment amounts, or other transfer obligations arising under or in connection with such qualified financial contracts.CommentsClose CommentsPermalink





`‘(F) CLARIFICATION- No provision of law shall be construed as limiting the right or power of the Agency, or authorizing any court or agency to limit or delay, in any manner, the right or power of the Agency to transfer any qualified financial contract in accordance with paragraphs (9) and (10) of this subsection, or to disaffirm or repudiate any such contract in accordance with subsection (d)(1) of this section.`(G) .CommentsClose CommentsPermalink





‘(G) WALKAWAY CLAUSES NOT EFFECTIVE-CommentsClose CommentsPermalink





`‘(i) IN GENERAL- Notwithstanding the provisions of subparagraphs (A) and (E), and sections 403 and 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991, no walkaway clause shall be enforceable in a qualified financial contract of a regulated entity in default.CommentsClose CommentsPermalink





`(ii) ‘(ii) WALKAWAY CLAUSE DEFINED- For purposes of this subparagraph, the term `walkaway clause'‘walkaway clause’ means a provision in a qualified financial contract that, after calculation of a value of a party's position or an amount ’s position or an amount due to or from 1 of the parties in accordance with its terms upon termination, liquidation, or acceleration of the qualified financial contract, either does not create a payment obligation of a party or extinguishes a payment obligation of a party in whole or in part solely because of such party's status as a nondefaulting party.`the status of such party as a nondefaulting party.CommentsClose CommentsPermalink





‘(9) TRANSFER OF QUALIFIED FINANCIAL CONTRACTS- In making any transfer of assets or liabilities of a regulated entity in default which includes any qualified financial contract, the conservator or receiver for such regulated entity shall either--CommentsClose CommentsPermalink





`(A) transfer to 1 person--`(i) all qualified financial contracts between any person ‘(A) transfer to 1 person-- CommentsClose CommentsPermalink





‘(i) all qualified financial contracts between any person (or any affiliate of such person) and the regulated entity in default;CommentsClose CommentsPermalink





`‘(ii) all claims of such person (or any affiliate of such person) against such regulated entity under any such contract (other than any claim which, under the terms of any such contract, is subordinated to the claims of general unsecured creditors of such regulated entity);CommentsClose CommentsPermalink





`‘(iii) all claims of such regulated entity against such person (or any affiliate of such person) under any such contract; andCommentsClose CommentsPermalink





`(iv) all property securing‘(iv) all property securing, or any other credit enhancement for any contract described in clause (i) or any claim described in clause (ii) or (iii) under any such contract; or`, or any claim described in clause (ii) or (iii) under any such contract; orCommentsClose CommentsPermalink





‘(B) transfer none of the financial contracts, claims, or property referred to under subparagraph (A) (with respect to such person and any affiliate of such person).CommentsClose CommentsPermalink





`‘(10) NOTIFICATION OF TRANSFER-CommentsClose CommentsPermalink





`(A) IN GENERAL- If--` ‘(A) IN GENERAL- The conservator or receiver shall notify any person that is a party to a contract or transfer by 5:00 p.m. (Eastern Standard Time) on the business day following the date of the appointment of the receiver in the case of a receivership, or the business day following such transfer in the case of a conservatorship, if-- CommentsClose CommentsPermalink





‘(i) the conservator or receiver for a regulated entity in default makes any transfer of the assets and liabilities of such regulated entity, and`(ii) the; andCommentsClose CommentsPermalink





‘(ii) such transfer includes any qualified financial contract,the conservator or receiver shall notify any person who is a party to any such contract of such transfer by 5:00 p.m. (eastern time) on the business day following the date of the appointment of the receiver in the case of a receivership, or the business day following such transfer in the case of a conservatorship.`.CommentsClose CommentsPermalink





‘(B) CERTAIN RIGHTS NOT ENFORCEABLE-CommentsClose CommentsPermalink





`‘(i) RECEIVERSHIP- A person who is a party to a qualified financial contract with a regulated entity may not exercise any right that such person has to terminate, liquidate, or net such contract under paragraph (8)(A) of this subsection or sectionunder section 403 or 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991, solely by reason of or incidental to the appointment of a receiver for the regulated entity (or the insolvency or financial condition of the regulated entity for which the receiver has been appointed)--CommentsClose CommentsPermalink





`‘(I) until 5:00 p.m. (eastern time) on the business day following the date of the appointment of the receiver; or`Eastern Standard Time) on the business day following the date of the appointment of the receiver; orCommentsClose CommentsPermalink





‘(II) after the person has received notice that the contract has been transferred pursuant to paragraph (9)(A).CommentsClose CommentsPermalink





`‘(ii) CONSERVATORSHIP- A person who is a party to a qualified financial contract with a regulated entity may not exercise any right that such person has to terminate, liquidate, or net such contract under paragraph (8)(E) of this subsection or sectionunder section 403 or 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991, solely by reason of or incidental to the appointment of a conservator for the regulated entity (or the insolvency or financial condition of the regulated entity for which the conservator has been appointed).CommentsClose CommentsPermalink





`‘(iii) NOTICE- For purposes of this paragraph, the Agency as receiver or conservatoconservator or receiver of a regulated entity shall be deemed to have notified a person who is a party to a qualified financial contract with such regulated entity if the Agency has, if the conservator or receiver has taken steps reasonably calculated to provide notice to such person by the time specified in subparagraph (A).CommentsClose CommentsPermalink





`‘(C) BUSINESS DAY DEFINED- For purposes of this paragraph, the term `business day'‘business day’ means any day other than any Saturday, Sunday, or any day on which either the New York Stock Exchange or the Federal Reserve Bank of New York is closed.CommentsClose CommentsPermalink





`‘(11) DISAFFIRMANCE OR REPUDIATION OF QUALIFIED FINANCIAL CONTRACTS- In exercising the rights of disaffirmance or repudiation of a conservator or receiver with respect to any qualified financial contract to which a regulated entity is a party, the conservator or receiver for such institution shall either--CommentsClose CommentsPermalink





`‘(A) disaffirm or repudiate all qualified financial contracts between--CommentsClose CommentsPermalink





`‘(i) any person or any affiliate of such person; andCommentsClose CommentsPermalink





`(ii) the regulated entity in default; or` ‘(ii) the regulated entity in default; or CommentsClose CommentsPermalink





‘(B) disaffirm or repudiate none of the qualified financial contracts referred to in subparagraph (A) (with respect to such person or any affiliate of such person).CommentsClose CommentsPermalink





`‘(12) CERTAIN SECURITY INTERESTS NOT AVOIDABLE- No provision of this subsection shall be construed as permitting the avoidance of any legally enforceable or perfected security interest in any of the assets of any regulated entity, except where such an interest is taken in contemplation of the insolvency of the regulated entity, or with the intent to hinder, delay, or defraud the regulated entity or the creditors of such regulated entity.CommentsClose CommentsPermalink





`‘(13) AUTHORITY TO ENFORCE CONTRACTS-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- Notwithstanding any provision of a contract providing for termination, default, acceleration, or exercise of rights upon, or solely by reason of, insolvency or the appointment of, or the exercise of rights or powers by, a conservator or receiver, the conservator or receiver may enforce any contract or regulated entity bond, other than a contract for liability insurance for a director or officer, or a contract or a regulated entity bond, entered into by the regulated entity.CommentsClose CommentsPermalink





`‘(B) CERTAIN RIGHTS NOT AFFECTED- No provision of this paragraph may be construed as impairing or affecting any right of the conservator or receiver to enforce or recover under a director's or officer's liability insurance contract or surety for an officer or director, or regulated entity bond under other applicable law.CommentsClose CommentsPermalink





`‘(C) CONSENT REQUIREMENT-CommentsClose CommentsPermalink





`‘(i) IN GENERAL- Except as otherwise provided under this section, no person may exercise any right or power to terminate, accelerate, or declare a default under any contract to which a regulated entity is a party, or to obtain possession of or exercise control over any property of the regulated entity, or affect any contractual rights of the regulated entity, without the consent of the conservator or receiver, as appropriate, for a period of--CommentsClose CommentsPermalink





`‘(I) 45 days after the date of appointment of a conservator; orCommentsClose CommentsPermalink





`‘(II) 90 days after the date of appointment of a receiver.CommentsClose CommentsPermalink





`‘(ii) EXCEPTIONS- This paragraph shall--`(I) not apply to a director's or officer's liability insurance contract;`(II) not apply to the subparagraph shall not--CommentsClose CommentsPermalink





‘(I) apply to a contract for liability insurance for an officer or director;CommentsClose CommentsPermalink





‘(II) apply to the rights of parties to any qualified financial certain qualified financial contracts under subsection (d)(8); andCommentsClose CommentsPermalink





`(III) not be construed as‘(III) be construed as permitting the conservator or receiver to fail to comply with otherwise enforceable provisions of such contracts.CommentsClose CommentsPermalink





`‘(14) SAVINGS CLAUSE- The meanings of terms used in this subsection are applicable for purposes of this subsection only, and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any similar terms under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act of 2000, the securities laws (as that term is defined in section 3(a)(47) of the Securities Exchange Act of 1934), and the Commodity Exchange Act.CommentsClose CommentsPermalink





`(15) EXCEPTION FOR FEDERAL RESERVE AND FEDERAL HOME LOAN BANKS- No provision of this subsection shall apply with respect to--` ‘(15) EXCEPTION FOR FEDERAL RESERVE AND FEDERAL HOME LOAN BANKS- No provision of this subsection shall apply with respect to-- CommentsClose CommentsPermalink





‘(A) any extension of credit from any Federal home loan bHome Loan Bank or Federal Reserve Bank to any regulated entity; orCommentsClose CommentsPermalink





`(B) any security interest in the assets of the regulated entity ‘(B) any security interest in the assets of the regulated entity securing any such extension of credit.CommentsClose CommentsPermalink





`‘(e) Valuation of Claims in Default-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- Notwithstanding any other provision of Federal law or the law of any State, and regardless of the method which the Agency determines to utilize with respect to a regulated entity in default or in danger of default, including transactions authorized under subsection (i), this subsection shall govern the rights of the creditors of such regulated entity.CommentsClose CommentsPermalink





`‘(2) MAXIMUM LIABILITY- The maximum liability of the Agency, acting as receiver or in any other capacity, to any person having a claim against the receiver or the regulated entity for which such receiver is appointed shall equal the lesser of--`(A) the amounbe not more than the amount that such claimant would have received if the Agency had liquidated the assets and liabilities of suchthe regulated entity without exercising the authority of the Agency under subsection (i) of this section; or`(B) the amount of proceeds realized from the performance of contracts or sale of the assets of the regulated entity.`(f) .CommentsClose CommentsPermalink





‘(f) Limitation on Court Action- Except as provided in this section or at the request of the Director, no court may take any action to restrain or affect the exercise of powers or functions of the Agency as a conservator or a receiver.CommentsClose CommentsPermalink





`(g) ‘(g) Liability of Directors and Officers-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- A director or officer of a regulated entity may be held personally liable for monetary damages in any civil action described in paragraph (2) brought by, on behalf of, or at the request or direction of the Agency, which action isand prosecuted wholly or partially for the benefit of the Agency--CommentsClose CommentsPermalink





`‘(A) acting as conservator or receiver of such regulated entity, or`; orCommentsClose CommentsPermalink





‘(B) acting based upon a suit, claim, or cause of action purchased from, assigned by, or otherwise conveyed by such receiver or conservator,.CommentsClose CommentsPermalink





‘(2) ACTIONS ADDRESSED- Paragraph (1) applies in any civil action for gross negligence, including any similar conduct or conduct that demonstrates a greater disregard of a duty of care (than gross negligence)than gross negligence, including intentional tortious conduct, as such terms are defined and determined under applicable State law.CommentsClose CommentsPermalink





`(2‘(3) NO LIMITATION- Nothing in this paragraphsubsection shall impair or affect any right of the Agency under other applicable law.CommentsClose CommentsPermalink





`‘(h) Damages- In any proceeding related to any claim against a director, officer, employee, agent, attorney, accountant, appraiser, or any other party employed by or providing services to a regulated entity, recoverable damages determined to result from the improvident or otherwise improper use or investment of any assets of the regulated entity shall include principal losses and appropriate interest.CommentsClose CommentsPermalink





`‘(i) Limited-Life Regulated Entities-CommentsClose CommentsPermalink





`(1) ORGANIZATION-`(A) PURPOSE- If a regulated entity is in default, or if the Agency anticipates that a regulated entity will default, the Agency may ‘(1) ORGANIZATION- CommentsClose CommentsPermalink





‘(A) PURPOSE- The Agency, as receiver appointed pursuant to subsection (a)--CommentsClose CommentsPermalink





‘(i) may, in the case of a Federal Home Loan Bank, organize a limited-life regulated entity with those powers and attributes of the regulated entity in default or in danger of default thatFederal Home Loan Bank in default or in danger of default as the Director determines necessary, subject to the provisions of this subsection. T, and the Director shall grant a temporary charter to theat limited-life regulated entity, and the limited-life regulated entity shallat limited-life regulated entity may operate subject to that charter.`; andCommentsClose CommentsPermalink





‘(ii) shall, in the case of an enterprise, organize a limited-life regulated entity with respect to that enterprise in accordance with this subsection.CommentsClose CommentsPermalink





‘(B) AUTHORITIES- Upon the creation of a limited-life regulated entity under subparagraph (A), the limited-life regulated entity may--CommentsClose CommentsPermalink





`‘(i) assume such liabilities of the regulated entity that is in default or in danger of default as the Agency may, in its discretion, determine to be appropriate, provided thatexcept that the liabilities assumed shall not exceed the amount of assets ofpurchased or transferred from the regulated entity to the limited-life regulated entity;CommentsClose CommentsPermalink





`‘(ii) purchase such assets of the regulated entity that is in default, or in danger of default, as the Agency may, in its discretion, determine to be appropriate; andCommentsClose CommentsPermalink





`‘(iii) perform any other temporary function which the Agency may, in its discretion, prescribe in accordance with this section.CommentsClose CommentsPermalink





`(2) CHARTER-` ‘(2) CHARTER AND ESTABLISHMENT- CommentsClose CommentsPermalink





‘(A) TRANSFER OF CHARTER-CommentsClose CommentsPermalink





‘(i) FANNIE MAE- If the Agency is appointed as receiver for the Federal National Mortgage Association, the limited-life regulated entity established under this subsection with respect to such enterprise shall, by operation of law and immediately upon its organization--CommentsClose CommentsPermalink





‘(I) succeed to the charter of the Federal National Mortgage Association, as set forth in the Federal National Mortgage Association Charter Act; andCommentsClose CommentsPermalink





‘(II) thereafter operate in accordance with, and subject to, such charter, this Act, and any other provision of law to which the Federal National Mortgage Association is subject, except as otherwise provided in this subsection.CommentsClose CommentsPermalink





‘(ii) FREDDIE MAC- If the Agency is appointed as receiver for the Federal Home Loan Mortgage Corporation, the limited-life regulated entity established under this subsection with respect to such enterprise shall, by operation of law and immediately upon its organization--CommentsClose CommentsPermalink





‘(I) succeed to the charter of the Federal Home Loan Mortgage Corporation, as set forth in the Federal Home Loan Mortgage Corporation Charter Act; andCommentsClose CommentsPermalink





‘(II) thereafter operate in accordance with, and subject to, such charter, this Act, and any other provision of law to which the Federal Home Loan Mortgage Corporation is subject, except as otherwise provided in this subsection.CommentsClose CommentsPermalink





‘(B) INTERESTS IN AND ASSETS AND OBLIGATIONS OF REGULATED ENTITY IN DEFAULT- Notwithstanding subparagraph (A) or any other provision of law--CommentsClose CommentsPermalink





‘(i) a limited-life regulated entity shall assume, acquire, or succeed to the assets or liabilities of a regulated entity only to the extent that such assets or liabilities are transferred by the Agency to the limited-life regulated entity in accordance with, and subject to the restrictions set forth in, paragraph (1)(B);CommentsClose CommentsPermalink





‘(ii) a limited-life regulated entity shall not assume, acquire, or succeed to any obligation that a regulated entity for which a receiver has been appointed may have to any shareholder of the regulated entity that arises as a result of the status of that person as a shareholder of the regulated entity; andCommentsClose CommentsPermalink





‘(iii) no shareholder or creditor of a regulated entity shall have any right or claim against the charter of the regulated entity once the Agency has been appointed receiver for the regulated entity and a limited-life regulated entity succeeds to the charter pursuant to subparagraph (A)CONDITIONS- The Agency may grant a temporary charter if the Agency determines that the continued operation of the regulated entity in default or in danger of default is in the best interest of the national economy and the housing markets.`(B) TREATMENT.CommentsClose CommentsPermalink





‘(C) LIMITED-LIFE REGULATED ENTITY TREATED AS BEING IN DEFAULT FOR CERTAIN PURPOSES- A limited-life regulated entity shall be treated as a regulated entity in default at such times and for such purposes as the Agency may, in its discretion, determine.CommentsClose CommentsPermalink





`(C) MANAGEMENT- A limited-life regulated entity, upon the granting of its charter,‘(D) MANAGEMENT- Upon its establishment, a limited-life regulated entity shall be under the management of a board of directors consisting of not fewer than 5 nor more than 10 members appointed by the Agency.CommentsClose CommentsPermalink





`(D‘(E) BYLAWS- The board of directors of a limited-life regulated entity shall adopt such bylaws as may be approved by the Agency.CommentsClose CommentsPermalink





`‘(3) CAPITAL STOCK-CommentsClose CommentsPermalink





No capital stock need be paid into a limited-life regulated entity by the Agency.`(4) ‘(A) NO AGENCY REQUIREMENT- The Agency is not required to pay capital stock into a limited-life regulated entity or to issue any capital stock on behalf of a limited-life regulated entity established under this subsection. CommentsClose CommentsPermalink





‘(B) AUTHORITY- If the Director determines that such action is advisable, the Agency may cause capital stock or other securities of a limited-life regulated entity established with respect to an enterprise to be issued and offered for sale, in such amounts and on such terms and conditions as the Director may determine, in the discretion of the Director.CommentsClose CommentsPermalink





‘(4) INVESTMENTS- Funds of a limited-life regulated entity shall be kept on hand in cash, invested in obligations of the United States or obligations guaranteed as to principal and interest by the United States, or deposited with the Agency, or any Federal Reserve bank.`reserve bank.CommentsClose CommentsPermalink





‘(5) EXEMPT TAX STATUS- Notwithstanding any other provision of Federal or State law, thea limited-life regulated entity, its franchise, property, and income shall be exempt from all taxation now or hereafter imposed by the United States, by any territory, dependency, or possession thereof, or by any State, county, municipality, or local taxing authority.CommentsClose CommentsPermalink





`‘(6) WINDING UP-CommentsClose CommentsPermalink





`(A) IN GENERAL- Subject to subparagraph (B), unless Congress authorizes the sale of the capital stock of the limited-life regulated entity‘(A) IN GENERAL- Subject to subparagraphs (B) and (C), not later than 2 years after the date of its organization, the Agency shall wind up the affairs of the limited-life regulated entity.`a limited-life regulated entity.CommentsClose CommentsPermalink





‘(B) EXTENSION- The Director may, in the discretion of the Director, extend the status of thea limited-life regulated entity for 3 additional 1-year periods.CommentsClose CommentsPermalink





` ‘(C) TERMINATION OF STATUS AS LIMITED-LIFE REGULATED ENTITY- CommentsClose CommentsPermalink





‘(i) IN GENERAL- Upon the sale by the Agency of 80 percent or more of the capital stock of a limited-life regulated entity, as defined in clause (iv), to 1 or more persons (other than the Agency)--CommentsClose CommentsPermalink





‘(I) the status of the limited-life regulated entity as such shall terminate; andCommentsClose CommentsPermalink





‘(II) the entity shall cease to be a limited-life regulated entity for purposes of this subsection.CommentsClose CommentsPermalink





‘(ii) DIVESTITURE OF REMAINING STOCK, IF ANY-CommentsClose CommentsPermalink





‘(I) IN GENERAL- Not later than 1 year after the date on which the status of a limited-life regulated entity is terminated pursuant to clause (i), the Agency shall sell to 1 or more persons (other than the Agency) any remaining capital stock of the former limited-life regulated entity.CommentsClose CommentsPermalink





‘(II) EXTENSION AUTHORIZED- The Director may extend the period referred to in subclause (I) for not longer than an additional 2 years, if the Director determines that such action would be in the public interest.CommentsClose CommentsPermalink





‘(iii) SAVINGS CLAUSE- Notwithstanding any provision of law, other than clause (ii), the Agency shall not be required to sell the capital stock of an enterprise or a limited-life regulated entity established with respect to an enterprise.CommentsClose CommentsPermalink





‘(iv) APPLICABILITY- This subparagraph applies only with respect to a limited-life regulated entity that is established with respect to an enterprise.CommentsClose CommentsPermalink





‘(7) TRANSFER OF ASSETS AND LIABILITIES-CommentsClose CommentsPermalink





`(A) IN GENERAL-` ‘(A) IN GENERAL- CommentsClose CommentsPermalink





‘(i) TRANSFER OF ASSETS AND LIABILITIES- The Agency, as receiver, may transfer any assets and liabilities of a regulated entity in default, or in danger of default, to the limited-life regulated entity in accordance with and subject to the restrictions of paragraph (1).CommentsClose CommentsPermalink





`‘(ii) SUBSEQUENT TRANSFERS- At any time after a charter is transferred tothe establishment of a limited-life regulated entity, the Agency, as receiver, may transfer any assets and liabilities of suchthe regulated entity in default, or in danger inof default, as the Agency may, in its discretion, determine to be appropriate in accordance with paragraph (1).`and subject to the restrictions of paragraph (1).CommentsClose CommentsPermalink





‘(iii) EFFECTIVE WITHOUT APPROVAL- The transfer of any assets or liabilities of a regulated entity in default, or in danger of default, transferred or in danger of default to a limited-life regulated entity shall be effective without any further approval under Federal or State law, assignment, or consent with respect thereto.CommentsClose CommentsPermalink





`(8) PROCEEDS- To the extent that available proceeds from the limited-life regulated entity exceed amounts required to pay obligations, such proceeds may be paid to the regulated entity in default, or in danger of default.`(9) POWERS-` ‘(iv) EQUITABLE TREATMENT OF SIMILARLY SITUATED CREDITORS- The Agency shall treat all creditors of a regulated entity in default or in danger of default that are similarly situated under subsection (c)(1) in a similar manner in exercising the authority of the Agency under this subsection to transfer any assets or liabilities of the regulated entity to the limited-life regulated entity established with respect to such regulated entity, except that the Agency may take actions (including making payments) that do not comply with this clause, if-- CommentsClose CommentsPermalink





‘(I) the Director determines that such actions are necessary to maximize the value of the assets of the regulated entity, to maximize the present value return from the sale or other disposition of the assets of the regulated entity, or to minimize the amount of any loss realized upon the sale or other disposition of the assets of the regulated entity; andCommentsClose CommentsPermalink





‘(II) all creditors that are similarly situated under subsection (c)(1) receive not less than the amount provided in subsection (e)(2).CommentsClose CommentsPermalink





‘(v) LIMITATION ON TRANSFER OF LIABILITIES- Notwithstanding any other provision of law, the aggregate amount of liabilities of a regulated entity that are transferred to, or assumed by, a limited-life regulated entity may not exceed the aggregate amount of assets of the regulated entity that are transferred to, or purchased by, the limited-life regulated entity.CommentsClose CommentsPermalink





‘(8) REGULATIONS- The Agency may promulgate such regulations as the Agency determines to be necessary or appropriate to implement this subsection.CommentsClose CommentsPermalink





‘(9) POWERS OF LIMITED-LIFE REGULATED ENTITIES-CommentsClose CommentsPermalink





‘(A) IN GENERAL- Each limited-life regulated entity created under this subsection shall have all corporate powers of, and be subject to the same provisions of law as, the regulated entity in default or in danger of default to which it relates, except that--CommentsClose CommentsPermalink





`(i) the Agency may--` ‘(i) the Agency may-- CommentsClose CommentsPermalink





‘(I) remove the directors of a limited-life regulated entity;CommentsClose CommentsPermalink





and`‘(II) fix the compensation of members of the board of directors and senior management, as determined by the Agency in its discretion, of a limited-life regulated entity;`(ii) the Agency may andCommentsClose CommentsPermalink





‘(III) indemnify the representatives for purposes of paragraph (1)(B), and the directors, officers, employees, and agents of a limited-life regulated entity on such terms as the Agency determines to be appropriate; andCommentsClose CommentsPermalink





`(iii) the board of directors of a limited-life regulated entity--` ‘(ii) the board of directors of a limited-life regulated entity-- CommentsClose CommentsPermalink





‘(I) shall elect a chairperson who may also serve in the position of chief executive officer, except that such person shall not serve either as chairperson or as chief executive officer without the prior approval of the Agency; andCommentsClose CommentsPermalink





`‘(II) may appoint a chief executive officer who is not also the chairperson, except that such person shall not serve as chief executive officer without the prior approval of the Agency.CommentsClose CommentsPermalink





`‘(B) STAY OF JUDICIAL ACTION- Any judicial action to which a limited-life regulated entity becomes a party by virtue of its acquisition of any assets or assumption of any liabilities of a regulated entity in default shall be stayed from further proceedings for a period of up to 45 daysnot longer than 45 days, at the request of the limited-life regulated entity. Such period may be modified upon the consent of all parties.CommentsClose CommentsPermalink





`(10) OBTAINING OF CREDIT AND INCURRING OF DEBT-`(A) IN GENERAL- The ‘(10) NO FEDERAL STATUS- CommentsClose CommentsPermalink





‘(A) AGENCY STATUS- A limited-life regulated entity is not an agency, establishment, or instrumentality of the United States.CommentsClose CommentsPermalink





‘(B) EMPLOYEE STATUS- Representatives for purposes of paragraph (1)(B), interim directors, directors, officers, employees, or agents of a limited-life regulated entity are not, solely by virtue of service in any such capacity, officers or employees of the United States. Any employee of the Agency or of any Federal instrumentality who serves at the request of the Agency as a representative for purposes of paragraph (1)(B), interim director, director, officer, employee, or agent of a limited-life regulated entity shall not--CommentsClose CommentsPermalink





‘(i) solely by virtue of service in any such capacity lose any existing status as an officer or employee of the United States for purposes of title 5, United States Code, or any other provision of law; orCommentsClose CommentsPermalink





‘(ii) receive any salary or benefits for service in any such capacity with respect to a limited-life regulated entity in addition to such salary or benefits as are obtained through employment with the Agency or such Federal instrumentality.CommentsClose CommentsPermalink





‘(11) AUTHORITY TO OBTAIN CREDIT-CommentsClose CommentsPermalink





‘(A) IN GENERAL- A limited-life regulated entity may obtain unsecured credit and incur ssue unsecured debt in the ordinary course of business.`.CommentsClose CommentsPermalink





‘(B) INABILITY TO OBTAIN CREDIT- If the limited-life regulated entity is a limited-life regulated entity is unable to obtain unsecured credit or issue unsecured debt, the Director may authorize the obtaining of credit or the incurring of debt--`ssuance of debt by the limited-life regulated entity--CommentsClose CommentsPermalink





‘(i) with priority over any or all administrative expenses;`of the obligations of the limited-life regulated entity;CommentsClose CommentsPermalink





‘(ii) secured by a lien on property that is not otherwise subject to a lien; or`of the limited-life regulated entity that is not otherwise subject to a lien; orCommentsClose CommentsPermalink





‘(iii) secured by a junior lien on property that is subject to a lien.`(C) LIMITATIONS-`of the limited-life regulated entity that is subject to a lien.CommentsClose CommentsPermalink





‘(C) LIMITATIONS-CommentsClose CommentsPermalink





‘(i) IN GENERAL- The Director, after notice and a hearing, may authorize the obtaining of credit or the incurring of debtssuance of debt by a limited-life regulated entity that is secured by a senior or equal lien on property of the limited-life regulated entity that is subject to a lien (other than mortgages that collateralize the mortgage-backed securities issued or guaranteed by the regulated entity) only if--`an enterprise) only if--CommentsClose CommentsPermalink





‘(I) the limited-life regulated entity is unable to obtain such credit otherwise; and`therwise obtain such credit or issue such debt; andCommentsClose CommentsPermalink





‘(II) there is adequate protection of the interest of the holder of the lien on the property with respect to which such senior or equal lien is proposed to be granted.CommentsClose CommentsPermalink





`(ii‘(D) BURDEN OF PROOF- In any hearing under this subsection, the Director has the burden of proof on the issue of adequate protection.CommentsClose CommentsPermalink





`(D‘(12) EFFECT ON DEBTS AND LIENS- The reversal or modification on appeal of an authorization under this paragraph to obtain credit or incursubsection to obtain credit or issue debt, or of a grant under this section of a priority or a lien, does not affect the validity of any debt so incurrssued, or any priority or lien so granted, to an entity that extended such credit in good faith, whether or not such entity knew of the pendency of the appeal, unless such authorization and the incurringssuance of such debt, or the granting of such priority or lien, were stayed pending appeal.CommentsClose CommentsPermalink





`(11) ISSUANCE OF PREFERRED DEBT- A limited-life regulated entity may, subject to the approval of the Director and subject to such terms and conditions as the Director may prescribe, issue notes, bonds, or other debt obligations of a class to which all other debt obligations of the limited-life regulated entity shall be subordinate in right and payment.`(12) NO FEDERAL STATUS-`(A) AGENCY STATUS- A limited-life regulated entity is not an agency, establishment, or instrumentality of the United States.`(B) EMPLOYEE STATUS- Representatives for purposes of paragraph (1)(B), interim directors, directors, officers, employees, or agents of a limited-life regulated entity are not, solely by virtue of service in any such capacity, officers or employees of the United States. Any employee of the Agency or of any Federal instrumentality who serves at the request of the Agency as a representative for purposes of paragraph (1)(B), interim director, director, officer, employee, or agent of a limited-life regulated entity shall not--`(i) solely by virtue of service in any such capacity lose any existing status as an officer or employee of the United States for purposes of title 5, United States Code, or any other provision of law; or`(ii) receive any salary or benefits for service in any such capacity with respect to a limited-life regulated entity in addition to such salary or benefits as are obtained through employment with the Agency or such Federal instrumentality.`(13) ADDITIONAL POWERS- In addition to any other powers granted under this subsection, a limited-life regulated entity may--`(A) extend a maturity date or change in an interest rate or other term of outstanding securities;`(B) issue securities of the limited-life regulated entity, for cash, for property, for existing securities, or in exchange for claims or interests, or for any other appropriate purposes; and`(C) take any other action not inconsistent with this section.`(j) Other‘(j) Other Agency Exemptions-CommentsClose CommentsPermalink





When acting as a receiver, the following provisions shall apply with respect to the Agency:`(1) EXEMPTION FROM ‘(1) APPLICABILITY- The provisions of this subsection shall apply with respect to the Agency in any case in which the Agency is acting as a conservator or a receiver. CommentsClose CommentsPermalink





‘(2) TAXATION- The Agency, including its franchise, its capital, reserves, and surplus, and its income, shall be exempt from all taxation imposed by any State, country, municipality, or local taxing authority, except that any real property of the Agency shall be subject to State, territorial, county, municipal, or local taxation to the same extent according to its value as other real property is taxed, except that, notwithstanding the failure of any person to challenge an assessment under State law of the value of such property, and the tax thereon, shall be determined as of the period for which such tax is imposed.CommentsClose CommentsPermalink





`(2) EXEMPTION FROM ATTACHMENT AND LIENS‘(3) PROPERTY PROTECTION- No property of the Agency shall be subject to levy, attachment, garnishment, foreclosure, or sale without the consent of the Agency, nor shall any involuntary lien attach to the property of the Agency.CommentsClose CommentsPermalink





`(3) EXEMPTION FROM‘(4) PENALTIES AND FINES- The Agency shall not be liable for any amounts in the nature of penalties or fines, including those arising from the failure of any person to pay any real property, personal property, probate, or recording tax or any recording or filing fees when due.CommentsClose CommentsPermalink





`‘(k) Prohibition of Charter Revocation- In no case may athe receiver appointed pursuant to this section revoke, annul, or terminate the charter of a regulated entity.`(l) Preservation of Bankruptcy Law - Nothing in this Act shall be construed to modify, impair, or supersede the operation of any provision of title 11 of the United States Code, or the operation of any provision of title 28 of such Code that relates to cases under such title 11, except as otherwise provided in section 1367(b) of this Act and except that a regulated entity may not be a debtor under such title 11.'n enterprise.’.CommentsClose CommentsPermalink





(b) Technical and Conforming Amendments-(1) HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1992- Subtitle B of title XIII of the Housing and Community Development Act of 1992 is amended by striking sections 1369 (12 U.S.C. 4619), 1369A (12 U.S.C. 4620), and 1369B The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4621).(2) FEDERAL HOME LOAN BANKS- Section 25 of the Federal Home Loan Bank Act501 et seq.) is amended--CommentsClose CommentsPermalink





(1) in section 1368 (12 U.S.C. 1445) is amended to read as follows:

`SEC. 25. SUCCESSION OF FEDERAL HOME LOAN BANKS.`Each Federal Home Loan Bank shall have succession until it is voluntarily merged with another Bank under this Act, or until it is merged, reorganized, rehabilitated, liquidated, or otherwise wound up by the Director in accordance with the provisions of section 1367 of the Housing and Community Development Act of 1992, or by further Act of Congress.'.

SEC. 349. CONFORMING AMENDMENTS.Title XIII of the Housing and Community Development Act of 1992, as amended by the preceding provisions of this title, is further amended--(1) in sections 13654618)--CommentsClose CommentsPermalink




(A) by striking ‘an enterprise’ each place that term appears and inserting ‘a regulated entity’; andCommentsClose CommentsPermalink





(B) by striking ‘the enterprise’ each place that term appears and inserting ‘the regulated entity’;CommentsClose CommentsPermalink





(2) in section 1369C (12 U.S.C. 4615) through22), by striking ‘enterprise’ each place that term appears and inserting ‘regulated entity’;CommentsClose CommentsPermalink





(3) in section 1369D (12 U.S.C. 4623), but not including section 1367 (12 U.S.C. 4617) as amended by section 349 of this title--(A) by striking `An enterprise' each place such term appears and inserting `A regulated entity';(B) by striking `an enterprise' each place such term appears and inserting `a regulated entity'; and(C) by striking `the enterprise' each place such term appears and inserting `the regulated entity';(2) in section 1366 (12 U.S.C. 4616)--(A) in subsection (b)(7), by striking `section 1369 (excluding subsection (a)(1) and (2))' and inserting `section 1367'--CommentsClose CommentsPermalink





(A) by striking ‘an enterprise’ each place that term appears and inserting ‘a regulated entity’; andCommentsClose CommentsPermalink





(B) in subsection (d), by striking `the enterprises' and inserting `the regulated entities';(3) in section 1368(d) (12 U.S.C. 4618(d)), by striking `Committee on Banking, Finance and Urban Affairs' and inserting `Committee on Financial Services';(4) in section 1369Ca)(1), by striking ‘An enterprise’ and inserting ‘A regulated entity’; andCommentsClose CommentsPermalink





(4) by striking sections 1369, 1369A, and 1369B (12 U.S.C. 4622)--(A) in subsection (a)(4), by striking `activities (including existing and new programs)' and inserting `activities, services, undertakings, and offerings (including existing and new products (as such term is defined in section 1321(f))'; and(B) in subsection (c), by striking `any enterprise' and inserting `any regulated entity'; and(5) in subsections (a) and (d) of section 1369D, by striking `section 1366 or 1367 or action under section 1369)' each place such phrase appears and inserting `section 1367)'.CHAPTER 4--ENFORCEMENT ACTIONSSEC. 351. CEASE-AND-19, 4620, and 4621).CommentsClose CommentsPermalink

SEC. 1151. CEASE AND DESIST PROCEEDINGS.

Section 1371 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4631) is amended--CommentsClose CommentsPermalink





(1) by striking subsections (a) and (b) and inserting the following new subsections:`:CommentsClose CommentsPermalink





‘(a) Issuance for Unsafe or Unsound Practices and Violations of Rules or Laws-CommentsClose CommentsPermalink





‘(1) AUTHORITY OF DIRECTOR- If, in the opinion of the Director, a regulated entity or any regulated entity-affiliated party is engaging or has engaged, or the Director has reasonable cause to believe that the regulated entity or any regulated entity-affiliated party is about to engage, in an unsafe or unsound practice in conducting the business of the regulated entity or the Office of Finance, or is violating or has violated, or the Director has reasonable cause to believe that the regulated entity or any regulated entity-affiliated party is about to violate, a law, rule, or regulationregulation, or order, or any condition imposed in writing by the Director in connection with the granting of any application or other request by the regulated entity or the Office of Finance or any written agreement entered into with the Director, the Director may issue and serve upon the regulated entity or suchentity-affiliated party a notice of charges in respect thereof.CommentsClose CommentsPermalink





The Director may‘(2) LIMITATION- The Director may not, pursuant to this section, enforce compliance with any housing goal established under subpart B of part 2 of subtitle A of this title, with section 1336 or 1337 of this title, with subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a(m), (n)), with subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1456(e), (f)), or with paragraph (5) of section 10(j) of the Federal Home Loan Bank Act (12 U.S.C. 1430(j)).CommentsClose CommentsPermalink





`‘(b) Issuance for Unsatisfactory Rating- If a regulated entity receives, in its most recent report of examination, a less-than-satisfactory rating for asset quality, management, earnings, or liquidity, the Director may (if the deficiency is not corrected) deem the regulated entity to be engaging in an unsafe or unsound practice for purposes of this subsection.';(2) in subsection (c)(2), by striking `enterprise, executive officer, or director' and inserting `regulated entity or regulated entity-affiliated party'; and(3subsection (a).’;CommentsClose CommentsPermalink





(2) in subsection (c)--CommentsClose CommentsPermalink





(A) in paragraph (1), by inserting before the period at the end the following: ‘, unless the party served with a notice of charges shall appear at the hearing personally or by a duly authorized representative, the party shall be deemed to have consented to the issuance of the cease and desist order’; andCommentsClose CommentsPermalink





(B) in paragraph (2)--CommentsClose CommentsPermalink





(i) by striking ‘or director’ and inserting ‘director, or entity-affiliated party’; andCommentsClose CommentsPermalink





(ii) by inserting ‘or entity-affiliated party’ before ‘consents’;CommentsClose CommentsPermalink





(3) in each of subsections (c), (d), and (e)--CommentsClose CommentsPermalink





(A) by striking ‘the enterprise’ each place that term appears and inserting ‘the regulated entity’;CommentsClose CommentsPermalink





(B) by striking ‘an enterprise’ each place that term appears and inserting ‘a regulated entity’; andCommentsClose CommentsPermalink





(C) by striking ‘conduct’ each place that term appears and inserting ‘practice’;CommentsClose CommentsPermalink





(4) in subsection (d)--CommentsClose CommentsPermalink





(A) in the matter preceding paragraph (1), by striking `enterprise, executive officer, or director' and inserting `regulated entity or regulated entity-affiliated party';(B) in paragraph (1)--CommentsClose CommentsPermalink





(i) by striking `an executive officer or a director' and inserting `a regulated entity affiliated party'; and(ii) by inserting `(including reimbursement of compensation under section 1318)' after `reimbursement';(C) in paragraph (6), by striking `and' at the end;(D) by redesignating paragraph (7) as paragraph (8); and(E) by inserting after paragraph (6) the following new paragraph:`(7) to effect an attachment on a regulated entity or regulated entity-affiliated party subject to an order under this section or section 1372; and'‘or director’ and inserting ‘director, or entity-affiliated party’; andCommentsClose CommentsPermalink





(ii) by inserting ‘to require a regulated entity or entity-affiliated party’ after ‘includes the authority’;CommentsClose CommentsPermalink





(B) in paragraph (1)--CommentsClose CommentsPermalink





(i) by striking ‘to require an executive officer or a director to’; andCommentsClose CommentsPermalink





(ii) by striking ‘loss’ and all that follows through ‘person’ and inserting ‘loss, if’;CommentsClose CommentsPermalink





(iii) in subparagraph (A), by inserting ‘such entity or party or finance facility’ before ‘was’; andCommentsClose CommentsPermalink





(iv) by striking subparagraph (B) and inserting the following:CommentsClose CommentsPermalink





‘(B) the violation or practice involved a reckless disregard for the law or any applicable regulations or prior order of the Director;’; andCommentsClose CommentsPermalink





(C) in paragraph (4), by inserting ‘loan or’ before ‘asset’;CommentsClose CommentsPermalink





(5) in subsection (e), by inserting ‘or entity-affiliated party’--CommentsClose CommentsPermalink





(A) before ‘or any executive’; andCommentsClose CommentsPermalink





(B) before the period at the end; andCommentsClose CommentsPermalink





(6) in subsection (f)--CommentsClose CommentsPermalink





(A) by striking ‘enterprise’ and inserting ‘regulated entity, finance facility,’; andCommentsClose CommentsPermalink





(B) by striking ‘or director’ and inserting ‘director, or entity-affiliated party’.CommentsClose CommentsPermalink

SEC. 31152. TEMPORARY CEASE-AND- AND DESIST PROCEEDINGS.

Section 1372 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4632) is amended--CommentsClose CommentsPermalink





(1) by striking subsection (a) and inserting the following new subsection:`:CommentsClose CommentsPermalink





‘(a) Grounds for Issuance-CommentsClose CommentsPermalink





Whenever the Director determines that the violation or threatened violation or the unsafe or unsound practice or practice‘(1) IN GENERAL- If the Director determines that the actions specified in the notice of charges served upon the regulated entity or any regulateda regulated entity or any entity-affiliated party pursuant to section 1371(a), or the continuation thereof, is likely to cause insolvency or significant dissipation of assets or earnings of the regulatedat entity, or is likely to weaken the condition of the regulatedat entity prior to the completion of the proceedings conducted pursuant to sections 1371 and 1373, the Director may--CommentsClose CommentsPermalink





‘(A) issue a temporary order requiring the regulated entity or suchat regulated entity or entity-affiliated party to cease and desist from any such violation or practice and; andCommentsClose CommentsPermalink





‘(B) require that regulated entity or entity-affiliated party to take affirmative action to prevent or remedy such insolvency, dissipation, condition, or prejudice pending completion of such proceedings.CommentsClose CommentsPermalink





Such order may include any requirement authorized under section 1371(d).';(2) in subsection (b), by striking `enterprise, executive officer, or director' and inserting `regulated entity or regulated entity-affiliated party';(3) in subsection (d)--(A) by striking `An enterprise, executive officer, or director' and inserting `A regulated entity or regulated entity-affiliated party'; and(B) by striking `the enterprise, executive officer, or director' and inserting `the regulated entity or regulated entity-affiliated party'; and(4) by striking subsection (e) and in inserting the following new subsection:

`(e) Enforcement- In the case of violation or threatened violation of, or failure to obey, a temporary cease-and-desist order issued pursuant to this section, the Director may apply to the United States District Court for the District of Columbia or the United States district court within the jurisdiction of which the headquarters of the regulated entity is located, for an injunction to enforce such order, and, if the court determines that there has been such violation or threatened violation or failure to obey, it shall be the duty of the court to issue such injunction.'.

SEC. 353. PREJUDGMENT ATTACHMENT.The Housing and Community Development Act of 1992 is amended by inserting after section 1375 (12 U.S.C. 4635) the following new section:

`SEC. 1375A. PREJUDGMENT ATTACHMENT.`(a) In General- In any action brought pursuant to this title, or in actions brought in aid of, or to enforce an order in, any administrative or other civil action for money damages, restitution, or civil money penalties brought pursuant to this title, the court may, upon application of the Director or Attorney General, as applicable, issue a restraining order that--`(1) prohibits any person subject to the proceeding from withdrawing, transferring, removing, dissipating, or disposing of any funds, assets or other property; and`(2) appoints a person on a temporary basis to administer the restraining order.`(b) Standard-`(1) SHOWING- Rule 65 of the Federal Rules of Civil Procedure shall apply with respect to any proceeding under subsection (a) without regard to the requirement of such rule that the applicant show that the injury, loss, or damage is irreparable and immediate.`(2) STATE PROCEEDING- If, in the case of any proceeding in a State court, the court determines that rules of civil procedure available under the laws of such State provide substantially similar protections to a party's right to due process as Rule 65 (as modified with respect to such proceeding by paragraph (1)), the relief sought under subsection (a) may be requested under the laws of such State.'.

SEC. 354. ENFORCEMENT AND JURISDICTION.Section 1375 of the Housing and Community Development Act of 1992 (12 U.S.C. 4635) is amended--(1) by striking subsection (a) and inserting the following new subsection:

`(a) Enforcement- The Director may, in the discretion of the Director, apply to the United States District Court for the District of Columbia, or the United States district court within the jurisdiction of which the headquarters of the regulated entity is located, for the enforcement of any effective and outstanding notice or order issued under this subtitle or subtitle B, or request that the Attorney General of the United States bring such an action. Such court shall have jurisdiction and power to order and require compliance with such notice or order.'; and

(2) in subsection (b), by striking `or 1376' and inserting `1376, or 1377'.SEC. 355. CIVIL MONEY PENALTIES.Section 1376 of the Housing and Community Development Act of 1992 (12 U.S.C. 4636) is amended--(1) in subsection (a)--(A) in the matter preceding paragraph (1), by striking `, or any executive officer or director' and inserting `or any regulated-entity affiliated party'; and(B) in paragraph (1)--(i) by striking `the Federal National Mortgage Association Charter Act, the Federal Home Loan Mortgage Corporation Act' and inserting `any provision of any of the authorizing statutes';(ii) by striking `or Act' and inserting `or statute';(iii) by striking `or subsection' and inserting `, subsection'; and(iv) by inserting `, or paragraph (5) or (12) of section 10(j) of the Federal Home Loan Bank Act' before the semicolon at the end;(2) by striking subsection (b) and inserting the following new subsection:`(b) Amount of Penalty-`‘(2) ADDITIONAL REQUIREMENTS- An order issued under paragraph (1)FIRST TIER- Any regulated entity which, or any regulated entity-affiliated party who--`(A) violates any provision of this title, any provision of any of the authorizing statutes, or any order, condition, rule, or regulation under any such title or statute, except that the Director may not, pursuant to this section, enforce compliance with any housing goal established under subpart B of part 2 of subtitle A of this title, with section 1336 or 1337 of this title, with may include any requirement authorized under subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723a(m), (n)), with subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1456(e), (f)), or with paragraph (5) or (12) of section 10(j) of the Federal Home Loan Bank Act;`(B) violates any final or temporary order or notice issued pursuant to this title;`(C) violates any condition imposed in writing by the Director in connection with the grant of any application or other request by such regulated entity; or`(D) violates any written agreement between the regulated entity and the Director,shall forfeit and pay a civil money penalty of not more than $10,000 for each day during which such violation continues.`(2) SECOND TIER- Notwithstanding paragraph (1)--`(A) if a regulated entity, or a regulated entity-affiliated party--`(i) commits any violation described in any subparagraph of paragraph (1);`(ii) recklessly engages in an unsafe or unsound practice in conducting the affairs of such regulated entity; or`(iii) breaches any fiduciary duty; and`(B) the violation, practice, or breach--`(i) is part of a pattern of misconduct;`(ii) causes or is likely to cause more than a minimal loss to such regulated entity; or`(iii) results in pecuniary gain or other benefit to such party,the regulated entity or regulated entity-affiliated party shall forfeit and pay a civil penalty of not more than $50,000 for each day during which such violation, practice, or breach continues.`(3) THIRD TIER- Notwithstanding paragraphs (1) and (2), any regulated entity which, or any regulated entity-affiliated party who--`(A) knowingly--`(i) commits any violation or engages in any conduct described in any subparagraph of paragraph (1);`(ii) engages in any unsafe or unsound practice in conducting the affairs of such regulated entity; or`(iii) breaches any fiduciary duty; and`(B) knowingly or recklessly causes a substantial loss to such regulated entity or a substantial pecuniary gain or other benefit to such party by reason of such violation, practice, or breach,shall forfeit and pay a civil penalty in an amount not to exceed the applicable maximum amount determined under paragraph (4) for each day during which such violation, practice, or breach continues.`(4) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN PARAGRAPH (3)- The maximum daily amount of any civil penalty which may be assessed pursuant to paragraph (3) for any violation, practice, or breach described in such paragraph is--`(A) in the case of any person other than a regulated entity, an amount not to exceed $2,000,000; and`(B) in the case of any regulated entity, $2,000,000.';(3) in subsection (c)(1)(B), by striking `enterprise, executive officer, or director' and inserting `regulated entity or regulated entity-affiliated party';(4) in subsection (d), by striking the first sentence and inserting the following: `If a regulated entity or regulated entity-affiliated party fails to comply with an order of the Director imposing a civil money penalty under this section, after the order is no longer subject to review as provided under subsection (c)(1) and section 1374, the Director may, in the discretion of the Director, bring an action in the United States District Court for the District of Columbia, or the United States district court within the jurisdiction of which the headquarters of the regulated entity is located, to obtain a monetary judgment against the regulated entity or regulated entity affiliated party and such other relief as may be available, or request tha1371(d).’;CommentsClose CommentsPermalink




(2) in subsection (b)--CommentsClose CommentsPermalink





(A) by striking ‘or director’ and inserting ‘director, or entity-affiliated party’; andCommentsClose CommentsPermalink





(B) by striking ‘enterprise’ each place that term appears and inserting ‘regulated entity’;CommentsClose CommentsPermalink





(3) in subsection (c), by striking ‘enterprise’ each place that term appears and inserting ‘regulated entity’;CommentsClose CommentsPermalink





(4) in subsection (d)--CommentsClose CommentsPermalink





(A) by striking ‘or director’ each place that term appears and inserting ‘director, or entity-affiliated party’; andCommentsClose CommentsPermalink





(B) by striking ‘An enterprise’ and inserting ‘A regulated entity’; andCommentsClose CommentsPermalink





(5) in subsection (e)--CommentsClose CommentsPermalink





(A) by striking ‘request the Attorney General of the United States bring such an action.'; and(5) in subsection (g), by striking `subsection (b)(3)' and inserting `this section, unless authorized by the Director by rule, regulation, or order'.SEC. 356to’; andCommentsClose CommentsPermalink





(B) by striking ‘or may, under the direction and control of the Attorney General, bring such action’.CommentsClose CommentsPermalink

SEC. 1153. REMOVAL AND PROHIBITION AUTHORITY.

(a) In General- Subtitle C of title XIII of the Housing and Community Development Act of 1992Part 1 of subtitle C of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4631 et seq.) is amended--CommentsClose CommentsPermalink





(1) by redesignating sections 1377, 1378, 1379, 1379A, and through 1379B (12 U.S.C. 4637-41) as sections 1379, 1379A, 1379B, 1379C, and641) as sections 1379 through 1379D, respectively; andCommentsClose CommentsPermalink





(2) by inserting after section 1376 (12 U.S.C. 4636) the following new section:`:CommentsClose CommentsPermalink

‘SEC. 1377. REMOVAL AND PROHIBITION AUTHORITY.

`‘(a) Authority To Issue Order-CommentsClose CommentsPermalink





Whenever the Director determines that--`(1) any regulated entity-affiliated party ‘(1) IN GENERAL- The Director may serve upon a party described in paragraph (2), or any officer, director, or management of the Office of Finance a written notice of the intention of the Director to suspend or remove such party from office, or prohibit any further participation by such party, in any manner, in the conduct of the affairs of the regulated entity. CommentsClose CommentsPermalink





‘(2) APPLICABILITY- A party described in this paragraph is an entity-affiliated party or any officer, director, or management of the Office of Finance, if the Director determines that--CommentsClose CommentsPermalink





‘(A) that party, officer, or director has, directly or indirectly--CommentsClose CommentsPermalink





`(A) violated--`(i) any law or regulation;`(ii) any cease-and- ‘(i) violated-- CommentsClose CommentsPermalink





‘(I) any law or regulation;CommentsClose CommentsPermalink





‘(II) any cease and desist order which has become final;CommentsClose CommentsPermalink





`(iii) any condition ‘(III) any condition imposed in writing by the Director in connection with the grant of any application or other request by such regulated entity; orCommentsClose CommentsPermalink





`(iv‘(IV) any written agreement between such regulated entity and the Director;CommentsClose CommentsPermalink





`(B‘(ii) engaged or participated in any unsafe or unsound practice in connection with any regulated entity; or`(C or business institution; orCommentsClose CommentsPermalink





‘(iii) committed or engaged in any act, omission, or practice which constitutes a breach of such party'’s fiduciary duty;CommentsClose CommentsPermalink





`(2‘(B) by reason of the violation, practice, or breach described in any subparagraph of paragraph (1)--`(A) such regulated entity hassubparagraph (A)--CommentsClose CommentsPermalink





‘(i) such regulated entity or business institution has suffered or will probably suffer financial loss or other damage; orCommentsClose CommentsPermalink





`(B) such party has received financial gain or other benefit by reason of such violation, practice, or breach; and`(3) such ‘(ii) such party has received financial gain or other benefit; and CommentsClose CommentsPermalink





‘(C) the violation, practice, or breach--` described in subparagraph (A)--CommentsClose CommentsPermalink





‘(i) involves personal dishonesty on the part of such party; orCommentsClose CommentsPermalink





`(B‘(ii) demonstrates willful or continuing disregard by such party for the safety or soundness of such regulated entity, the Director may serve upon such party a written notice of the Director's intention to remove such party from office or to prohibit any further participation by such party, in any manner, in the conduct of the affairs of any regulated entity.` or business institution.CommentsClose CommentsPermalink





‘(b) Suspension Order-CommentsClose CommentsPermalink





`‘(1) SUSPENSION OR PROHIBITION AUTHORITY- If the Director serves written notice under subsection (a) to any regulated entity-affiliated party of the Director's intention to issue an order under such subsection, the Director may--`(A) suspend such party from officeupon a party subject to that subsection (a), the Director may, by order, suspend or remove such party from office, or prohibit such party from further participation in any manner in the conduct of the affairs of the regulated entity, if the Director--CommentsClose CommentsPermalink





`(i) determines that such action is necessary for the‘(A) determines that such action is necessary for the protection of the regulated entity; andCommentsClose CommentsPermalink





`(ii) ‘(B) serves such party with written notice of the suspension order; and`(B) prohibit the regulated entity from releasing to or on behalf of the regulated entity-affiliated party any compensation or other payment of money or other thing of current or potential value in connection with any resignation, removal, retirement, or other termination of employment or office of the party.`order.CommentsClose CommentsPermalink





‘(2) EFFECTIVE PERIOD- Any suspension order issued under this subsection--`order issued under this subsection--CommentsClose CommentsPermalink





‘(A) shall become effective upon service; andCommentsClose CommentsPermalink





`‘(B) unless a court issues a stay of such order under subsection (g) of this section, shall remain in effect and enforceable until--CommentsClose CommentsPermalink





`(i) the date the Director‘(i) the date on which the Director dismisses the charges contained in the notice served under subsection (a) with respect to such party; orCommentsClose CommentsPermalink





`(ii) the effective date of an order issued by the Director to such party under subsection (a).` ‘(ii) the effective date of an order issued under subsection (b). CommentsClose CommentsPermalink





‘(3) COPY OF ORDER- If the Director issues a suspension order under this subsection to any regulated entity-affiliatedn order under subsection (b) to any party, the Director shall serve a copy of such order on any regulated entity with which such party is affiliated at the time such order is issued.CommentsClose CommentsPermalink





`‘(c) Notice, Hearing, and Order-CommentsClose CommentsPermalink





A notice of intention to remove a regulated entity-affiliated party from office or to prohibit such party from participating in the conduct of the affairs of a regulated entity‘(1) NOTICE- A notice under subsection (a) of the intention of the Director to issue an order under this section shall contain a statement of the facts constituting grounds for such action, and shall fix a time and place at which a hearing will be held on such action.CommentsClose CommentsPermalink





Such‘(2) TIMING OF HEARING- A hearing shall be fixed for a date not earlier than 30 days, nor later than 60 days after the date of service of such notice, after the date of service of notice under subsection (a), unless an earlier or a later date is set by the Director at the request of (1) such party, and for--CommentsClose CommentsPermalink





‘(A) the party receiving such notice, and good cause shown, or (2is shown; orCommentsClose CommentsPermalink





‘(B) the Attorney General of the United States.CommentsClose CommentsPermalink





Unless such party shall appear‘(3) CONSENT- Unless the party that is the subject of a notice delivered under subsection (a) appears at the hearing in person or by a duly authorized representative, such party shall be deemed to have consented to the issuance of an order of such removal or prohibition. In the event of such consent, or if upon the record made at any such hearing the Director shall find that any of the grounds specified in such notice have been established, the Director may issue such orders of suspension or removal from office, or prohibition from participation in the conduct of the affairs of the regulated entity, as itunder this section.CommentsClose CommentsPermalink





‘(4) ISSUANCE OF ORDER OF SUSPENSION- The Director may issue an order under this section, as the Director may deem appropriate, together with an order prohibiting compensation described in subsection (b)(1)(B). Any such orderif--CommentsClose CommentsPermalink





‘(A) a party is deemed to have consented to the issuance of an order under paragraph (3); orCommentsClose CommentsPermalink





‘(B) upon the record made at the hearing, the Director finds that any of the grounds specified in the notice have been established.CommentsClose CommentsPermalink





‘(5) EFFECTIVENESS OF ORDER- Any order issued under paragraph (4) shall become effective at the expiration of 30 days after service upon such regulated entity and suchthe date of service upon the relevant regulated entity and party (except in the case of an order issued upon consent under paragraph (3), which shall become effective at the time specified therein). Such order shall remain effective and enforceable except to such extent as it is stayed, modified, terminated, or set aside by action of the Director or a reviewing court.CommentsClose CommentsPermalink





`‘(d) Prohibition of Certain Specific Activities- Any person subject to an order issued under this section shall not--CommentsClose CommentsPermalink





`‘(1) participate in any manner in the conduct of the affairs of any regulated entity;` or the Office of Finance;CommentsClose CommentsPermalink





‘(2) solicit, procure, transfer, attempt to transfer, vote, or attempt to vote any proxy, consent, or authorization with respect to any voting rights in any regulated entity;CommentsClose CommentsPermalink





`(3) ‘(3) violate any voting agreement previously approved by the Director; orCommentsClose CommentsPermalink





`‘(4) vote for a director, or serve or act as a regulated entity-affiliated party.`n entity-affiliated party of a regulated entity or as an officer or director of the Office of Finance.CommentsClose CommentsPermalink





‘(e) Industry-Wide Prohibition-CommentsClose CommentsPermalink





`‘(1) IN GENERAL- Except as provided in paragraph (2), any person who, pursuant to an order issued under this section, has been removed or suspended from office in a regulated entity or the Office of Finance, or prohibited from participating in the conduct of the affairs of a regulated entity or the Office of Finance, may not, while such order is in effect, continue or commence to hold any office in, or participate in any manner in the conduct of the affairs of, any regulated entity.` or the Office of Finance.CommentsClose CommentsPermalink





‘(2) EXCEPTION IF DIRECTOR PROVIDES WRITTEN CONSENT- If, on or after the date an order is issued under this section which on which an order is issued under this section which removes or suspends from office any regulated entity-affiliated partyparty, or prohibits such party from participating in the conduct of the affairs of a regulated entity or the Office of Finance, such party receives the written consent of the Director, the order shall, to the extent of such consent, cease to apply to such party with respect to the regulated entity described in the or such Office of Finance described in the written consent. If the Director grants such a written consent, it shallAny such consent shall be publicly disclose such consent.`d.CommentsClose CommentsPermalink





‘(3) VIOLATION OF PARAGRAPH (1) TREATED AS VIOLATION OF ORDER- Any violation of paragraph (1) by any person who is subject to an order described in such subsection shall be treated as a violation of the order.`issued under subsection (h) shall be treated as a violation of the order.CommentsClose CommentsPermalink





‘(f) Applicability- This section shall only apply to a person who is an individual, unless the Director specifically finds that it should apply to a corporation, firm, or other business enterprise.`(g) ity.CommentsClose CommentsPermalink





‘(g) Stay of Suspension and Prohibition of Regulated Entity-Affiliated Party- Within 10 days after any regulatedNot later than 10 days after the date on which any entity-affiliated party has been suspended from office and/or prohibited from participation in the conduct of the affairs of a regulated entity under this section, such party may apply to the United States District Court for the District of Columbia, or the United States district court for the judicial district in which the headquarters of the regulated entity is located, for a stay of such suspension and/or prohibition and any prohibition under subsection (b)(1)(B)or prohibition pending the completion of the administrative proceedings pursuant to the notice served upon such party under this section, and suchsubsection (c). The court shall have jurisdiction to stay such suspension and/or prohibition.`or prohibition.CommentsClose CommentsPermalink





‘(h) Suspension or Removal of Regulated Entity-Affiliated Party Charged With Felony-CommentsClose CommentsPermalink





`‘(1) SUSPENSION OR PROHIBITION-CommentsClose CommentsPermalink





`(A) IN GENERAL- Whenever any regulated‘(A) IN GENERAL- Whenever any entity-affiliated party is charged in any information, indictment, or complaint, with the commission of or participation in a crime involving dishonesty or breach of trust which is punishable by imprisonment for a term exceeding one year under State or Federal law, the Director may, if1 year under Federal or State law, the Director may, if continued service or participation by such party may pose a threat to the regulated entity or impair public confidence in the regulated entity, by written notice served upon such party--`(i), suspend such party from office or prohibit such party from further participation in any manner in the conduct of the affairs of any regulated entity; and`(ii) prohibit the regulated entity from releasing to or on behalf of the regulated entity-affiliated party any compensation or other payment of money or other thing of current or potential value in connection with the period of any such suspension or with any resignation, removal, retirement, or other termination of employment or office of the party.`.CommentsClose CommentsPermalink





‘(B) PROVISIONS APPLICABLE TO NOTICE-CommentsClose CommentsPermalink





`‘(i) COPY- A copy of any notice under paragraph (1)(A) shall also be served upon the regulated entity.`(ii) subparagraph (A) shall be served upon the relevant regulated entity.CommentsClose CommentsPermalink





‘(ii) EFFECTIVE PERIOD- A suspension or prohibition under subparagraph (A) shall remain in effect until the information, indictment, or complaint referred to in such subparagraphbparagraph (A) is finally disposed of, or until terminated by the Director.CommentsClose CommentsPermalink





`‘(2) REMOVAL OR PROHIBITION-CommentsClose CommentsPermalink





`‘(A) IN GENERAL- If a judgment of conviction or an agreement to enter a pretrial diversion or other similar program is entered against a regulatedn entity-affiliated party in connection with a crime described in paragraph (1)(A), at such time as such judgment is not subject to further appellate review, the Director may, if continued service or participation by such party may pose a threat to the regulated entity or impair public confidence in the regulated entity, issue and serve upon such party an order that--`(i) removesremoving such party from office or prohibitsing such party from further participation in any manner in the conduct of the affairs of the regulated entity without the prior written consent of the Director; and`(ii) prohibits the regulated entity from releasing to or on behalf of the regulated entity-affiliated party any compensation or other payment of money or other thing of current or potential value in connection with the termination of employment or office of the party.`.CommentsClose CommentsPermalink





‘(B) PROVISIONS APPLICABLE TO ORDER-CommentsClose CommentsPermalink





`‘(i) COPY- A copy of any order under paragraph (2)(A) shall also be served upon the regulated entity, whereupon the regulatedsubparagraph (A) shall be served upon the relevant regulated entity, at which time the entity-affiliated party who is subject to the order (if a director or an officer) shall cease to be a director or officer of such regulated entity.CommentsClose CommentsPermalink





`‘(ii) EFFECT OF ACQUITTAL- A finding of not guilty or other disposition of the charge shall not preclude the Director from instituting proceedings after such finding or disposition to remove sucha party from office or to prohibit further participation in regulated entity affairs, and to prohibit compensation or other payment of money or other thing of current or potential value in connection with any resignation, removal, retirement, or other termination of employment or office of the party, pursuant to subsections (a), (d), or (e) of this section.`(iii) further participation in the affairs of a regulated entity pursuant to subsection (a) or (b).CommentsClose CommentsPermalink





‘(iii) EFFECTIVE PERIOD- AUnless terminated by the Director, any notice of suspension or order of removal issued under this subsection shall remain effective and outstanding until the completion of any hearing or appeal authorized under paragraph (4) unless terminated by the Director.`.CommentsClose CommentsPermalink





‘(3) AUTHORITY OF REMAINING BOARD MEMBERS-CommentsClose CommentsPermalink





If at any ‘(A) IN GENERAL- If at any time, because of the suspension of one1 or more directors pursuant to this section, there shall be on the board of directors of a regulated entity less than a quorum of directors not so suspended, all powers and functions vested in or exercisable by such board shall vest in and be exercisable by the director or directors on the board not so suspended, until such time as there shall be a quorum of the board of directors.CommentsClose CommentsPermalink





In the event all of the directors of a regulated entity are‘(B) APPOINTMENT OF TEMPORARY DIRECTORS- If all of the directors of a regulated entity are suspended pursuant to this section, the Director shall appoint persons to serve temporarily as directors in their place and stead pending the termination of such suspensions, or until such time as those who have been suspended cease to be directors of the regulated entity and their respective successors take office.CommentsClose CommentsPermalink





`‘(4) HEARING REGARDING CONTINUED PARTICIPATION-CommentsClose CommentsPermalink





Within 30 days from‘(A) IN GENERAL- Not later than 30 days after the date of service of any notice of suspension or order of removal issued pursuant to paragraph (1) or (2) of this subsection, the regulated entity-affiliated party concerned, the entity-affiliated party may request in writing an opportunity to appear before the Director to show that the continued service to or participation in the conduct of the affairs of the regulated entity by such party does not, or is not likely to, pose a threat to the interests of the regulated entity, or threaten to impair public confidence in the regulated entity.CommentsClose CommentsPermalink





‘(B) TIMING AND FORM OF HEARING- Upon receipt of any such request, the Director shall request for a hearing under subparagraph (A), the Director shall fix a time (not more than 30 days afterlater than 30 days after the date of receipt of such request, unless extended at the request of such party) and place at which suchthe entity-affiliated party may appear, personally or through counsel, before one or more members of the Director orthe Director or 1 or more designated employees of the Director to submit written materials (or, at the discretion of the Director, oral testimony) and oral argument.CommentsClose CommentsPermalink





Within 60 days of such hearing, the Director shall notify such party whether‘(C) DETERMINATION- Not later than 60 days after the date of a hearing under subparagraph (B), the Director shall notify the entity-affiliated party whether the suspension or prohibition from participation in any manner in the conduct of the affairs of the regulated entity will be continued, terminated, or otherwise modified, or whether the order removing such party from office or prohibiting such party from further participation in any manner in the conduct of the affairs of the regulated entity, and prohibiting compensation in connection with termination will be rescinded or otherwise modified. Such notification shall contain a statement of the basis for the Director's decision, if adverse to such party.any adverse decision of the Director.CommentsClose CommentsPermalink





‘(5) RULES- The Director is authorized to prescribe such rules as may be necessary to effectuate the purposes of this subsection.`(i) Hearings and Judicial Review-`(1) VENUE AND PROCEDURE- Any hearing provided for in this section shall be held in the District of Columbia or in the Federal judicial district in which the headquarters of the regulated entity is located, unless the party afforded the hearing consents to another place, and shall be conducted in accordance with the provisions of chapter 5 of title 5, United States Code. After such hearing, and within 90 days after the Director has notified the parties that the case has been submitted to it for final decision, it shall render its decision (which shall include findings of fact upon which its decision is predicated) and shall issue and serve upon each party to the proceeding an order or orders consistent with the provisions of this section. Judicial review of any such order shall be exclusively as provided in this subsection. Unless a petition for review is timely filed in a court of appeals of the United States, as provided in paragraph (2), and thereafter until the record in the proceeding has been filed as so provided, the Director may at any time, upon such notice and in such manner as it shall deem proper, modify, terminate, or set aside any such order. Upon such filing of the record, the Director may modify, terminate, or set aside any such order with permission of the court.`(2) REVIEW OF ORDER- Any party to any proceeding under paragraph (1) may obtain a review of any order served pursuant to paragraph (1) (other than an order issued with the consent of the regulated entity or the regulated entity-affiliated party concerned, or an order issued under subsection (h) of this section) by the filing in the United States Court of Appeals for the District of Columbia Circuit or court of appeals of the United States for the circuit in which the headquarters of the regulated entity is located, within 30 days after the date of service of such order, a written petition praying that the order of the Director be modified, terminated, or set aside. A copy of such petition shall be forthwith transmitted by the clerk of the court to the Director, and thereupon the Director shall file in the court the record in the proceeding, as provided insection 2112 of title 28, United States Code. Upon the filing of such petition, such court shall have jurisdiction, which upon the filing of the record shall (except as provided in the last sentence of paragraph (1)) be exclusive, to affirm, modify, terminate, or set aside, in whole or in part, the order of the Director. Review of such proceedings shall be had as provided in chapter 7 of title 5, United States Code. The judgment and decree of the court shall be final, except that the same shall be subject to review by the Supreme Court upon certiorari, as provided in section 1254 of title 28, United States Code.`(3) PROCEEDINGS NOT TREATED AS STAY- The commencement of proceedings for judicial review under paragraph (2) shall not, unless specifically ordered by the court, operate as a stay of any order issued by the Director.'carry out this subsection.’.CommentsClose CommentsPermalink





(b) Conforming Amendments-CommentsClose CommentsPermalink





(1) 1992 ACT- Section 1317(f) of the Housing and Community DevelopmentSAFETY AND SOUNDNESS ACT- Subtitle C of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4517(f)) is amended by striking `section 1379B' and inserting `section 1379D'01 et seq.) is amended--CommentsClose CommentsPermalink





(A) in section 1317(f), by striking ‘section 1379B’ and inserting ‘section 1379D’;CommentsClose CommentsPermalink





(B) in section 1373(a)--CommentsClose CommentsPermalink





(i) in paragraph (1), by striking ‘or 1376(c)’ and inserting ‘, 1376(c), or 1377’;CommentsClose CommentsPermalink





(ii) in paragraph (2), by inserting ‘or 1377’ after’ 1371’; andCommentsClose CommentsPermalink





(iii) in paragraph (4), by inserting ‘or removal or prohibition’ after ‘cease and desist’; andCommentsClose CommentsPermalink





(C) in section 1374(a)--CommentsClose CommentsPermalink





(i) by striking ‘or 1376’ and inserting ‘1313B, 1376, or 1377’; andCommentsClose CommentsPermalink





(ii) by striking ‘such section’ and inserting ‘this title’.CommentsClose CommentsPermalink





(2) FANNIE MAE CHARTER ACT- The second sentence of subsection (b) of section 308Section 308(b) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723(b)) is amended by striking `The' and inserting `in the second sentence, by striking ‘The’ and inserting ‘Except to the extent that action under section 1377 of the Housing and Community Development Act of 1992 Federal Housing Enterprises Financial Safety and Soundness Act of 1992 temporarily results in a lesser number, the'’.CommentsClose CommentsPermalink





(3) FREDDIE MAC ACT- The second sentence of subparagraph (A) of section 303(a)(2) of the Federal CHARTER ACT- Section 303(a)(2)(A) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1452(a)(2)(A)) is amended by striking `The' and inserting `Except to the extent that action under section 1377 of the Housing and Community Development Act of 1992 , in the second sentence, by striking ‘The’ and inserting ‘Except to the extent action under section 1377 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 temporarily results in a lesser number, the'’.CommentsClose CommentsPermalink

SEC. 3571154. ENFORCEMENT AND JURISDICTION.

SEC. 1156. CRIMINAL PENALTY.

Subtitle C of title XIII of the Housing and Community Development(a) In General- Subtitle C of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4631 et seq.) is amended by inserting after section 1377 (as added by the preceding provisions of this title) the following new section:`, as added by this Act, the following:CommentsClose CommentsPermalink

‘SEC. 1378. CRIMINAL PENALTY.

`‘Whoever, being subject to an order in effect under section 1377, without the prior written approval of the Director, knowingly participates, directly or indirectly, in any manner (including by engaging in an activity specifically prohibited in such an order) in the conduct of the affairs of any regulated entity shall, notwithstanding section 3571 of title 18, be fined not more than $1,000,000, imprisoned for not more than 5 years, or both.'’.CommentsClose CommentsPermalink





(b) Technical and Conforming Amendments- The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 et seq.) is amended--CommentsClose CommentsPermalink





(1) in section 1379 (as so designated by this Act)--CommentsClose CommentsPermalink





(A) by striking ‘an enterprise’ and inserting ‘a regulated entity’; andCommentsClose CommentsPermalink





(B) by striking ‘the enterprise’ and inserting ‘the regulated entity’;CommentsClose CommentsPermalink





(2) in section 1379A (as so designated by this Act), by striking ‘an enterprise’ and inserting ‘a regulated entity’;CommentsClose CommentsPermalink





(3) in section 1379B(c) (as so designated by this Act), by striking ‘enterprise’ and inserting ‘regulated entity’; andCommentsClose CommentsPermalink





(4) in section 1379D (as so designated by this Act), by striking ‘enterprise’ and inserting ‘regulated entity’.CommentsClose CommentsPermalink

SEC. 358. SUBPOENA AUTHORITY1157. NOTICE AFTER SEPARATION FROM SERVICE.

Section 1379D(c) of the Housing and Community Development of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4641(c)), as so redesignated by section 356(a)(1) of this title, is further amended--(1) by striking `request the Attorney General of the United States to' and inserting `, in the discretion of the Director,';(2) by inserting `or request that the Attorney General of the United States bring such an action,' after `District of Columbia,'; and(3) by striking `or may, under the direction and control of the Attorney General, bring such an action'37), as so designated by this Act, is amended--CommentsClose CommentsPermalink





(1) by striking ‘2-year’ and inserting ‘6-year’;CommentsClose CommentsPermalink





(2) by striking ‘a director or executive officer of an enterprise’ and inserting ‘an entity-affiliated party’;CommentsClose CommentsPermalink





(3) by striking ‘director or officer’ each place that term appears and inserting ‘entity-affiliated party’; andCommentsClose CommentsPermalink





(4) by striking ‘enterprise.’ and inserting ‘regulated entity.’.CommentsClose CommentsPermalink

SEC. 359. CONFORMING AMENDMENTS.Subtitle C of title XIII of the Housing and Community Development Act of 1992 1158. SUBPOENA AUTHORITY.

(a) In General- Section 1379B of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4631 et seq.), as amended by the preceding provisions of this title41) is amended--CommentsClose CommentsPermalink





(1) in subsection (a)--CommentsClose CommentsPermalink





(A) in the matter preceding paragraph (1)--CommentsClose CommentsPermalink





(i) by striking ‘administrative’;CommentsClose CommentsPermalink





(ii) by inserting ‘, examination, or investigation’ after ‘proceeding’;CommentsClose CommentsPermalink





(iii) by striking ‘subtitle’ and inserting ‘title’; andCommentsClose CommentsPermalink





(iv) by inserting ‘or any designated representative thereof, including any person designated to conduct any hearing under this subtitle’ after ‘Director’; andCommentsClose CommentsPermalink





(B) in paragraph (4), by striking ‘issued by the Director’;CommentsClose CommentsPermalink





(2) in subsection (b), by inserting ‘or in any territory or other place subject to the jurisdiction of the United States’ after ‘State’;CommentsClose CommentsPermalink





(3) by striking subsection (c) and inserting the following:CommentsClose CommentsPermalink





‘(c) Enforcement-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Director, or any party to proceedings under this subtitle, may apply to the United States District Court for the District of Columbia, or the United States district court for the judicial district of the United States in any territory in which such proceeding is being conducted, or where the witness resides or carries on business, for enforcement of any subpoena or subpoena duces tecum issued pursuant to this section.CommentsClose CommentsPermalink





‘(2) POWER OF COURT- The courts described under paragraph (1) shall have the jurisdiction and power to order and require compliance with any subpoena issued under paragraph (1).’;CommentsClose CommentsPermalink





(4) in subsection (d), by inserting ‘enterprise-affiliated party’ before ‘may allow’; andCommentsClose CommentsPermalink





(5) by adding at the end the following:CommentsClose CommentsPermalink





‘(e) Penalties- A person shall be guilty of a misdemeanor, and upon conviction, shall be subject to a fine of not more than $1,000 or to imprisonment for a term of not more than 1 year, or both, if that person willfully fails or refuses, in disobedience of a subpoena issued under subsection (c), to--CommentsClose CommentsPermalink





‘(1) attend court;CommentsClose CommentsPermalink





‘(2) testify in court;CommentsClose CommentsPermalink





‘(3) answer any lawful inquiry; orCommentsClose CommentsPermalink





‘(4) produce books, papers, correspondence, contracts, agreements, or such other records as requested in the subpoena.’.CommentsClose CommentsPermalink

(a) Amendments to 1992 Act- The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 et seq.), as amended by this Act, is amended--CommentsClose CommentsPermalink





(1) in section 1372(c)(1)15 (12 U.S.C. 4632(c)), by striking `that enterprise' and inserting `that regulated entity';(2) in section 1379515)--CommentsClose CommentsPermalink





(A) in subsection (a)--CommentsClose CommentsPermalink





(i) by striking ‘(a) Office Personnel- The’ and inserting ‘(a) In General- Subject to title III of the Federal Housing Finance Regulatory Reform Act of 2008, the’; andCommentsClose CommentsPermalink





(ii) by striking ‘the Office’ each place that term appears and inserting ‘the Agency’;CommentsClose CommentsPermalink





(B) in subsection (c), by striking ‘the Office’ and inserting ‘the Agency’;CommentsClose CommentsPermalink





(C) in subsection (e), by striking ‘the Office’ and inserting ‘the Agency’;CommentsClose CommentsPermalink





(D) by striking subsection (d) and redesignating subsection (e) as subsection (d); andCommentsClose CommentsPermalink





(E) by striking subsection (f);CommentsClose CommentsPermalink





(2) in section 1319A (12 U.S.C. 4637), as so redesignated by section 356(a)(1) of this title--(A) by inserting `, or of a regulated entity-affiliated party,' before `shall not affect'; and(B) by striking `such director or executive officer' each place such term appears and inserting `such director, executive officer, or regulated entity-affiliated party';(3) in section 1379A520)--CommentsClose CommentsPermalink





(A) by striking ‘(a) In General- ’; andCommentsClose CommentsPermalink





(B) by striking subsection (b);CommentsClose CommentsPermalink





(3) in section 1364(c) (12 U.S.C. 4638), as so redesignated by section 356(a)(1) of this title, by inserting `or against a regulated entity-affiliated party,' before `or impair';(4) by striking `An enterprise' each place such term appears in such subtitle and inserting `A regulated entity';(5) by striking `an enterprise' each place such term appears in such subtitle and inserting `a regulated entity';(6) by striking `the enterprise' each place such term appears in such subtitle and inserting `the regulated entity'; and(7) by striking `any enterprise' each place such term appears in such subtitle and inserting `any regulated entity'.CHAPTER 5--GENERAL PROVISIONSSEC. 361. BOARD14(c)), by striking the last sentence;CommentsClose CommentsPermalink





(4) by striking section 1383 (12 U.S.C. 1451 note);CommentsClose CommentsPermalink





(5) in each of sections 1319D, 1319E, and 1319F (12 U.S.C. 4523, 4524, 4525) by striking ‘the Office’ each place that term appears and inserting ‘the Agency’; andCommentsClose CommentsPermalink





(6) in each of sections 1319B and 1369(a)(3) (12 U.S.C. 4521, 4619(a)(3)), by striking ‘Committee on Banking, Finance and Urban Affairs’ each place such term appears and inserting ‘Committee on Financial Services’.CommentsClose CommentsPermalink





(b) Amendments to Fannie Mae Charter Act- The Federal National Mortgage Association Charter Act (12 U.S.C. 1716 et seq.) is amended--CommentsClose CommentsPermalink





(1) in each of sections 303(c)(2) (12 U.S.C. 1718(c)(2)), 309(d)(3)(B) (12 U.S.C. 1723a(d)(3)(B)), and 309(k)(1) (12 U.S.C. 1723a(k)(1)), by striking ‘Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development’ each place that term appears, and inserting ‘Director of the Federal Housing Finance Agency’; andCommentsClose CommentsPermalink





(2) in section 309--CommentsClose CommentsPermalink





(A) in subsection (m) (12 U.S.C. 1723a(m))--CommentsClose CommentsPermalink





(i) in paragraph (1), by striking ‘to the Secretary, in a form determined by the Secretary’ and inserting ‘to the Director of the Federal Housing Finance Agency, in a form determined by the Director’; andCommentsClose CommentsPermalink





(ii) in paragraph (2), by striking ‘to the Secretary, in a form determined by the Secretary’ and inserting ‘to the Director of the Federal Housing Finance Agency, in a form determined by the Director’;CommentsClose CommentsPermalink





(B) in subsection (n) (12 U.S.C. 1723a(n))--CommentsClose CommentsPermalink





(i) in paragraph (1), by striking ‘and the Secretary’ and inserting ‘and the Director of the Federal Housing Finance Agency’; andCommentsClose CommentsPermalink





(ii) in paragraph (2), by striking ‘Secretary’ each place that term appears and inserting ‘Director of the Federal Housing Finance Agency’; andCommentsClose CommentsPermalink





(C) in paragraph (3)(B), by striking ‘Secretary’ and inserting ‘Director of the Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(c) Amendments to Freddie Mac Charter Act- The Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1451 et seq.) is amended--CommentsClose CommentsPermalink





(1) in each of sections 303(b)(2) (12 U.S.C. 1452(b)(2)), 303(h)(2) (12 U.S.C. 1452(h)(2)), and section 307(c)(1) (12 U.S.C. 1456(c)(1)), by striking ‘Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development’ each place that term appears, and inserting ‘Director of the Federal Housing Finance Agency’;CommentsClose CommentsPermalink





(2) in section 306 (12 U.S.C. 1455)--CommentsClose CommentsPermalink





(A) in subsection (c)(2), by inserting ‘the’ after ‘Secretary of’;CommentsClose CommentsPermalink





(B) in subsection (i)--CommentsClose CommentsPermalink





(i) by striking ‘section 1316(c)’ and inserting ‘section 306(c)’; andCommentsClose CommentsPermalink





(ii) by striking ‘section 106’ and inserting ‘section 1316’; andCommentsClose CommentsPermalink





(C) in subsection (j)(2), by striking ‘of substantially’ and inserting ‘or substantially’; andCommentsClose CommentsPermalink





(3) in section 307 (12 U.S.C. 1456)--CommentsClose CommentsPermalink





(A) in subsection (e)--CommentsClose CommentsPermalink





(i) in paragraph (1), by striking ‘to the Secretary, in a form determined by the Secretary’ and inserting ‘to the Director of the Federal Housing Finance Agency, in a form determined by the Director’; andCommentsClose CommentsPermalink





(ii) in paragraph (2), by striking ‘to the Secretary, in a form determined by the Secretary’ and inserting ‘to the Director of the Federal Housing Finance Agency, in a form determined by the Director’; andCommentsClose CommentsPermalink





(B) in subsection (f)--CommentsClose CommentsPermalink





(i) in paragraph (1), by striking ‘and the Secretary’ and inserting ‘and the Director of the Federal Housing Finance Agency’;CommentsClose CommentsPermalink





(ii) in paragraph (2), by striking ‘the Secretary’ each place that term appears and inserting ‘the Director of the Federal Housing Finance Agency’; andCommentsClose CommentsPermalink





(iii) in paragraph (3)(B), by striking ‘Secretary’ and inserting ‘Director of the Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(d) Amendment to Title 18, United States Code- Section 1905 of title 18, United States Code, is amended by striking ‘Office of Federal Housing Enterprise Oversight’ and inserting ‘Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(e) Amendments to Flood Disaster Protection Act of 1973- Section 102(f)(3)(A) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(f)(3)(A)) is amended by striking ‘Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development’ and inserting ‘Director of the Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(f) Amendment to Department of Housing and Urban Development Act- Section 5 of the Department of Housing and Urban Development Act (42 U.S.C. 3534) is amended by striking subsection (d).CommentsClose CommentsPermalink





(g) Amendments to Title 5, United States Code- Title 5, United States Code, is amended--CommentsClose CommentsPermalink





(1) in section 5313, by striking the item relating to the Director of the Office of Federal Housing Enterprise Oversight, Department of Housing and Urban Development and inserting the following new item:CommentsClose CommentsPermalink





‘Director of the Federal Housing Finance Agency.’; andCommentsClose CommentsPermalink





(2) in section 3132(a)(1)--CommentsClose CommentsPermalink





(A) in subparagraph (B), by striking ‘,, and’ and inserting ‘, and’;CommentsClose CommentsPermalink





(B) in subparagraph (D)--CommentsClose CommentsPermalink





(i) by striking ‘the Federal Housing Finance Board’;CommentsClose CommentsPermalink





(ii) by striking ‘the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development’ and inserting ‘the Federal Housing Finance Agency’; andCommentsClose CommentsPermalink





(iii) by striking ‘or or’ at the end;CommentsClose CommentsPermalink





(C) in subparagraph (E), as added by section 8(d)(1)(B)(iii) of Public Law 107-123, by adding ‘or’ at the end; andCommentsClose CommentsPermalink





(D) by redesignating subparagraph (E), as added by section 10702(c)(1)(C) of Public Law 107-171, as subparagraph (F).CommentsClose CommentsPermalink





(h) Amendment to Sarbanes-Oxley Act- Section 105(b)(5)(B)(ii)(II) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7215(b)(5)(B)(ii)(II)) is amended by inserting ‘and the Director of the Federal Housing Finance Agency,’ after ‘Commission,’.CommentsClose CommentsPermalink





(i) Amendment to Federal Deposit Insurance Act- Section 11(t)(2)(A) of the Federal Deposit Insurance Act (12 U.S.C. 1821(t)(2)(A)) is amended by adding at the end the following:CommentsClose CommentsPermalink





‘(vii) Federal Housing Finance Agency.’.CommentsClose CommentsPermalink

SEC. 1162. PRESIDENTIALLY-APPOINTED DIRECTORS OF ENTERPRISES.

(a) Fannie Mae-CommentsClose CommentsPermalink





(1) IN GENERAL- Section 308(b) of the Federal National Mortgage Association Charter Act (12 U.S.C. 1723(b)) is amended--CommentsClose CommentsPermalink





(A) in the first sentence, by striking `‘eighteen persons, five of whom shall be appointed annually by the President of the United States, and the remainder of whom' and inserting `13 persons, or such other number that the Director determines appropriate, who';(B) in the second sentence, by striking `appointed by the President'’ and inserting ‘13 persons, or such other number that the Director determines appropriate, who’;CommentsClose CommentsPermalink





(B) in the second sentence, by striking ‘appointed by the President’;CommentsClose CommentsPermalink





(C) in the third sentence--CommentsClose CommentsPermalink





(i) by striking `appointed or'; and(ii) by striking `‘appointed or’; andCommentsClose CommentsPermalink





(ii) by striking ‘, except that any such appointed member may be removed from office by the President for good cause'’;CommentsClose CommentsPermalink





(D) in the fourth sentence, by striking `elective'‘elective’; andCommentsClose CommentsPermalink





(E) by striking the fifth sentence.CommentsClose CommentsPermalink





(2) TRANSITIONAL PROVISION- The amendments made by paragraph (1) shall not apply to any appointed position of the board of directors of the Federal National Mortgage Association until the expiration of the annual term for such position during which the effective date under section 3651163 occurs.CommentsClose CommentsPermalink





(b) Freddie Mac-CommentsClose CommentsPermalink





(1) IN GENERAL- Section 303(a)(2) of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1452(a)(2)) is amended--CommentsClose CommentsPermalink





(A) in subparagraph (A)--CommentsClose CommentsPermalink





(i) in the first sentence, by striking `‘18 persons, 5 of whom shall be appointed annually by the President of the United States and the remainder of whom' and inserting `13 persons, or such other number as the Director determines appropriate, who'; and(ii) in the second sentence, by striking `appointed by the President of the United States'’ and inserting ‘13 persons, or such other number as the Director determines appropriate, who’; andCommentsClose CommentsPermalink





(ii) in the second sentence, by striking ‘appointed by the President of the United States’;CommentsClose CommentsPermalink





(B) in subparagraph (B)--CommentsClose CommentsPermalink





(i) by striking `such or'; and(ii) by striking `‘such or’; andCommentsClose CommentsPermalink





(ii) by striking ‘, except that any appointed member may be removed from office by the President for good cause'’; andCommentsClose CommentsPermalink





(C) in subparagraph (C)--CommentsClose CommentsPermalink





(i) by striking the first sentence; andCommentsClose CommentsPermalink





(ii) by striking `elective'‘elective’.CommentsClose CommentsPermalink





(2) TRANSITIONAL PROVISION- The amendments made by paragraph (1) shall not apply to any appointed position of the board of directors of the Federal Home Loan Mortgage Corporation until the expiration of the annual term for such position during which the effective date under section 3651163 occurs.CommentsClose CommentsPermalink

SEC. 362. REPORT ON PORTFOLIO OPERATIONS, SAFETY AND SOUNDNESS, AND MISSION OF ENTERPRISES.Not later than the expiration of the 12-month period beginning on the effective date under section 365, the Director of the Federal Housing Finance Agency shall submit a report to the Congress which shall include--(1) a description of the portfolio holdings of the enterprises (as such term is defined in section 1303 of the Housing and Community Development Act of 1992 (12 U.S.C. 4502) in mortgages (including whole loans and mortgage-backed securities), non-mortgages, and other assets;(2) a description of the risk implications for the enterprises of such holdings and the consequent risk management undertaken by the enterprises (including the use of derivatives for hedging purposes), compared with off-balance sheet liabilities of the enterprises (including mortgage-backed securities guaranteed by the enterprises);(3) an analysis of portfolio holdings for safety and soundness purposes;(4) an assessment of whether portfolio holdings fulfill the mission purposes of the enterprises under the Federal National Mortgage Association Charter Act and the Federal Home Loan Mortgage Corporation Act; and(5) an analysis of the potential systemic risk implications for the enterprises, the housing and capital markets, and the financial system of portfolio holdings, and whether such holdings should be limited or reduced over time.SEC. 363. CONFORMING AND TECHNICAL AMENDMENTS.(a) 1992 Act- Title XIII of the Housing and Community Development Act of 1992 is amended by striking section 1383 (12 U.S.C. 1451 note).(b) Title 18, United States Code-Section 1905 of title 18, United States Code, is amended by striking `Office of Federal Housing Enterprise Oversight' and inserting `Federal Housing Finance Agency'.(c) Flood Disaster Protection Act of 1973- Section 102(f)(3)(A) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(f)(3)(A)) is amended by striking `Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' and inserting `Director of the Federal Housing Finance Agency'.(d) Department of Housing and Urban Development Act- Section 5 of the Department of Housing and Urban Development Act (42 U.S.C. 3534) is amended by striking subsection (d).(e) Title 5, United States Code-(1) Director'S PAY RATE-Section 5313 of title 5, United States Code, is amended by striking the item relating to the Director of the Office of Federal Housing Enterprise Oversight, Department of Housing and Urban Development and inserting the following new item:

`Director of the Federal Housing Finance Agency.'.

(2) EXCLUSION FROM SENIOR EXECUTIVE SERVICE-Section 3132(a)(1)(D) of title 5, United States Code, is amended--(A) by striking `the Federal Housing Finance Board,'; and(B) by striking `the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' and inserting `the Federal Housing Finance Agency'.(f) Inspector General Act of 1978- Section 8G(a)(2) of the Inspector General Act of 1978 (5 U.S.C. App.) is amended by striking `Federal Housing Finance Board' and inserting `Federal Housing Finance Agency'.(g) Federal Deposit Insurance Act- Section 11(t)(2)(A) of the Federal Deposit Insurance Act (12 U.S.C.1821(t)(2)(A)) is amended by adding at the end the following new clause:

`(vii) The Federal Housing Finance Agency.'.

(h) 1997 Emergency Supplemental Appropriations Act- Section 10001 of the 1997 Emergency Supplemental Appropriations Act for Recovery From Natural Disasters, and for Overseas Peacekeeping Efforts, Including Those In Bosnia (42 U.S.C. 3548) is amended--(1) by striking `the Government National Mortgage Association, and the Office of Federal Housing Enterprise Oversight' and inserting `and the Government National Mortgage Association'; and(2) by striking `, the Government National Mortgage Association, or the Office of Federal Housing Enterprise Oversight' and inserting `or the Government National Mortgage Association'.(i) National Homeownership Trust Act- Section 302(b)(4) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12851(b)(4)) is amended by striking `the chairperson of the Federal Housing Finance Board' and inserting `the Director of the Federal Housing Finance Agency'.SEC. 364. STUDY OF ALTERNATIVE SECONDARY MARKET SYSTEMS.(a) In General- The Director of the Federal Housing Finance Agency, in consultation with the Board of Governors of the Federal Reserve System, the Secretary of the Treasury, and the Secretary of Housing and Urban Development, shall conduct a comprehensive study of the effects on financial and housing finance markets of alternatives to the current secondary market system for housing finance, taking into consideration changes in the structure of financial and housing finance markets and institutions since the creation of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.(b) Contents- The study under this section shall--(1) include, among the alternatives to the current secondary market system analyzed--(A) repeal of the chartering Acts for the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation;(B) establishing bank-like mechanisms for granting new charters for limited purposed mortgage securitization entities;(C) permitting the Director of the Federal Housing Finance Agency to grant new charters for limited purpose mortgage securitization entities, which shall include analyzing the terms on which such charters should be granted, including whether such charters should be sold, or whether such charters and the charters for the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation should be taxed or otherwise assessed a monetary price; and(D) such other alternatives as the Director considers appropriate;(2) examine all of the issues involved in making the transition to a completely private secondary mortgage market system;(3) examine the technological advancements the private sector has made in providing liquidity in the secondary mortgage market and how such advancements have affected liquidity in the secondary mortgage market; and(4) examine how taxpayers would be impacted by each alternative system, including the complete privatization of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.(c) Report- The Director of the Federal Housing Finance Agency shall submit a report to the Congress on the study not later than the expiration of the 24-month period beginning on the effective date under section 365.SEC. 3651163. EFFECTIVE DATE.

Except as specifically provided otherwise in this subtitle, this subtitle shall take effect on and the amendments made by this subotherwise specifically provided in this title, this title and the amendments made by this title shall take effect on, and shall apply beginning on, the expiration of the 6-month period beginning on the date of thedate of enactment of this Act.CommentsClose CommentsPermalink

Subtitle B--Federal Home Loan BanksSEC. 371. DEFINITIONS.Section 2 of the Federal Home Loan Bank Act TITLE II--FEDERAL HOME LOAN BANKS CommentsClose CommentsPermalink

Section 1313 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 1422) is amended--(1) by striking paragraphs (1), (10), and (11);(2) by redesignating paragraphs (2) through (9) as paragraphs (1) through (8), respectively;(3) by redesignating paragraphs (12) and (13) as paragraphs (9) and (10), respectively; and(4) by adding at the end the following:`(11) DIRECTOR- The term `Director' means the Director of the Federal Housing Finance Agency.`(12) AGENCY- The term `Agency' means the Federal Housing Finance Agency.'4513) is amended by adding at the end the following:CommentsClose CommentsPermalink





‘(f) Recognition of Distinctions Between the Enterprises and the Federal Home Loan Banks- Prior to promulgating any regulation or taking any other formal or informal agency action of general applicability and future effect relating to the Federal Home Loan Banks (other than any regulation, advisory document, or examination guidance of the Federal Housing Finance Board that the Director reissues after the authority of the Director over the Federal Home Loan Banks takes effect), including the issuance of an advisory document or examination guidance, the Director shall consider the differences between the Federal Home Loan Banks and the enterprises with respect to--CommentsClose CommentsPermalink





‘(1) the Banks’--CommentsClose CommentsPermalink





‘(A) cooperative ownership structure;CommentsClose CommentsPermalink





‘(B) the mission of providing liquidity to members;CommentsClose CommentsPermalink





‘(C) affordable housing and community development mission;CommentsClose CommentsPermalink





‘(D) capital structure; andCommentsClose CommentsPermalink





‘(E) joint and several liability; andCommentsClose CommentsPermalink





‘(2) any other differences that the Director considers appropriate.’.CommentsClose CommentsPermalink

SEC. 371202. DIRECTORS.

(a) Election- Section 7 of the Federal Home Loan Bank Act (12 U.S.C. 1427) is amended--CommentsClose CommentsPermalink





(1) by striking subsection (a) and inserting the following:CommentsClose CommentsPermalink





`(a)‘(a) Number; Election; Qualifications; Conflicts of Interest-CommentsClose CommentsPermalink





`(1) IN GENERAL- T‘(1) IN GENERAL- Subject to paragraphs (2) through (4), the management of each Federal Home Loan Bank shall be vested in a board of 13 directors, or such other number as the Director determines appropriate, each of whom shall be a citizen of the United States. All directors of a Bank who are not independent directors pursuant to paragraph (3) shall be elected by the members.`(2) MEMBER DIRECTORS- A majority of the directors of each Bank shall be officers or directors of a member of such Bank that is located in the district in which such Bank is located.`(3) INDEPENDENT DIRECTORS- At least two-fifths of the directors of each Bank shall be .CommentsClose CommentsPermalink





‘(2) BOARD MAKEUP- The board of directors of each Bank shall be comprised of--CommentsClose CommentsPermalink





‘(A) member directors, who shall comprise at least the majority of the members of the board of directors; andCommentsClose CommentsPermalink





‘(B) independent directors, who shall be appointed by the Director of the Federal Housing Finance Agency fromcomprise not fewer than 2/5 of the members of the board of directors.CommentsClose CommentsPermalink





‘(3) SELECTION CRITERIA-CommentsClose CommentsPermalink





‘(A) IN GENERAL- Each member of the board of directors shall be--CommentsClose CommentsPermalink





‘(i) elected by plurality vote of the members, in accordance with procedures established under this section; andCommentsClose CommentsPermalink





‘(ii) a list of individuals recommended by the Federal Housing Enterprise Board. The Federal Housing Enterprise Board may recommend individuals who are identified by the Board's own independent process or included on a list of individuals recommended by the board of directors of the Bank involved, which shall be submitted to the Federal Housing Enterprise Board by such board of directors. The number of individuals on any such list submitted by a Bank's board of directors shall be equal to at least two times the number of independent directorships to be filled. All independent directors appointed shall meet the following criteria:`(A) IN GENERAL- Each independent director shall be a bona fide resident of the district in which such Bank is located.`(B) PUBLIC INTEREST DIRECTORS- At least 2 of the independent directors under this paragraph of each Bank shall be representatives chosen from organizations with more than a 2-year history of representing consumer or community interests on banking services, credit needs, housing, community development, economic development, or financial consumer protections.`(C) OTHER DIRECTORS-`(i) QUALIFICATIONScitizen of the United States.CommentsClose CommentsPermalink





‘(B) INDEPENDENT DIRECTOR CRITERIA-CommentsClose CommentsPermalink





‘(i) IN GENERAL- Each independent director that is not a public interest director under subparagraph (Bclause (ii) shall have demonstrated knowledge of, or experience in, financial management, auditing and accounting, risk management practices, derivatives, project development, or organizational management, or such other knowledge or expertise as the Director may provide by regulation.CommentsClose CommentsPermalink





`(ii) CONSULTATION WITH BANKS- In appointing other directors to serve on the board of a Federal home loan bank, the Director of the Federal Housing Finance Agency may consult with each Federal home loan bank about the knowledge, skills, and expertise needed to assist the board in better fulfilling its responsibilities.`(D ‘(ii) PUBLIC INTEREST- Not fewer than 2 of the independent directors shall have more than 4 years of experience in representing consumer or community interests on banking services, credit needs, housing, or financial consumer protections. CommentsClose CommentsPermalink





‘(iii) CONFLICTS OF INTEREST- Notwithstanding subsection (f)(2), an independent director under this paragraph of a Bank may not, during such director's term of office, serve as an officer of any Federal Home Loan Bank or as a director or officer of any member of a Bank.`(E) COMMUNITY DEMOGRAPHICS- In appointing independent directors of a Bank pursuant to this paragraph, the Director shall take into consideration the demographic makeup of the community most served by the Affordable Housing Program of the Bank pursuant to section 10(j).';(2) in the first sentence of subsection (b), by striking `may, during the term of service on the board of directors, serve as an officer of any Federal Home Loan Bank or as a director, officer, or employee of any member of a Bank, or of any person that receives advances from a Bank.CommentsClose CommentsPermalink





‘(4) DEFINITIONS- For purposes of this section, the following definitions shall apply:CommentsClose CommentsPermalink





‘(A) INDEPENDENT DIRECTOR- The terms ‘independent director’ and ‘independent directorship’ mean a member of the board of directors of a Federal Home Loan Bank who is a bona fide resident of the district in which the Federal Home Loan Bank is located, or the directorship held by such a person, respectively.CommentsClose CommentsPermalink





‘(B) MEMBER DIRECTOR- The terms ‘member director’ and ‘member directorship’ mean a member of the board of directors of a Federal Home Loan Bank who is an officer or director of a member institution that is located in the district in which the Federal Home Loan Bank is located, or the directorship held by such a person, respectively.’;CommentsClose CommentsPermalink





(2) by striking ‘elective’ each place that term appears, other than in subsections (d), (e), and (f), and inserting ‘member’;CommentsClose CommentsPermalink





(3) in subsection (b)--CommentsClose CommentsPermalink





(A) by striking the subsection heading and all that follows through ‘Each elective directorship' and inserting `member directorship established pursuant to subsection (a)(2)';(3’ and inserting the following:CommentsClose CommentsPermalink





‘(b) Directorships-CommentsClose CommentsPermalink





‘(1) MEMBER DIRECTORSHIPS- Each member directorship’; andCommentsClose CommentsPermalink





(B) by adding at the end the following:CommentsClose CommentsPermalink





‘(2) INDEPENDENT DIRECTORSHIPS-CommentsClose CommentsPermalink





‘(A) ELECTIONS- Each independent director--CommentsClose CommentsPermalink





‘(i) shall be elected by the members entitled to vote, from among eligible persons nominated, after consultation with the Advisory Council of the Bank, by the board of directors of the Bank; andCommentsClose CommentsPermalink





‘(ii) shall be elected by a plurality of the votes of the members of the Bank at large, with each member having the number of votes for each such directorship as it has under paragraph (1) in an election to fill member directorships.CommentsClose CommentsPermalink





‘(B) CRITERIA- Nominees shall meet all applicable requirements prescribed in this section.CommentsClose CommentsPermalink





‘(C) NOMINATION AND ELECTION PROCEDURES- Procedures for nomination and election of independent directors shall be prescribed by the bylaws of each Federal Home Loan Bank, in a manner consistent with the rules and regulations of the Agency.’;CommentsClose CommentsPermalink





(4) in subsection (c)--CommentsClose CommentsPermalink





(A) by striking `elective' each place such‘elective’ each place that term appears and inserting `member', except--(i) in the second sentence, the second place such term appears; and(ii) each place such‘member’, except--CommentsClose CommentsPermalink





(i) in the second sentence, the second place that term appears; andCommentsClose CommentsPermalink





(ii) each place that term appears in the fifth sentence;(B) in the first sentence, by inserting after `less than one' the following: `or two, as determined by the board of directors of the appropriate Federal home loan bank,'; and(C) in the second sentence--(i) by inserting ` andCommentsClose CommentsPermalink





(B) in the second sentence--CommentsClose CommentsPermalink





(i) by inserting ‘(A) except as provided in clause (B) of this sentence,' before `if at any time'; and(ii) by inserting before the period at the end the following: `’ before ‘if at any time’; andCommentsClose CommentsPermalink





(ii) by inserting before the period at the end the following: ‘, and (B) clause (A) of this sentence shall not apply to the directorships of any Federal home loan bHome Loan Bank resulting from the merger of any two or more such banks'; and(4) by striking `elective' each place such term appears (except in subsections (c), (e), and (f)).(b) Terms-(1) IN GENERAL- Section 7(d) of the Federal Home Loan Bank Act (12 U.S.C. 1427(d)) is amended--(A) in the first sentence, by striking `3 years' and inserting `4 years'; and(B) in the second sentence--(i) by striking `Federal Home Loan Bank System 2 or more such Banks’;CommentsClose CommentsPermalink





(5) in subsection (d)--CommentsClose CommentsPermalink





(A) in the first sentence--CommentsClose CommentsPermalink





(i) by striking ‘, whether elected or appointed,’; andCommentsClose CommentsPermalink





(ii) by striking ‘3 years’ and inserting ‘4 years’;CommentsClose CommentsPermalink





(B) in the second sentence--CommentsClose CommentsPermalink





(i) by striking ‘Federal Home Loan Bank System Modernization Act of 1999' and inserting `Federal Housing Finance Reform Act of 2008'; and(ii) by striking `1/3' and inserting `1/4'.(2) SAVINGS PROVISION- The amendments made by paragraph (1) shall not apply to the term of office of any director of a Federal home loan bank who is serving as of the effective date of this subtitle under section 381, including any director elected to fill a vacancy in any such office.(c) Continued Service of Independent Directors After Expiration of Term- Section 7(f)(2) of the Federal Home Loan Bank Act (12 U.S.C. 1427(f)(2)) is amended--(1) in the second sentence, by striking `or the term of such office expires, whichever occurs first';(2) by adding at the end the following new sentence: `An independent Bank director may continue to serve as a director after the expiration of the term of such director until a successor is appointed.';(3) in the paragraph heading, by striking `APPOINTED' and inserting `INDEPENDENT'; and(4) by striking `appointive' each place such’ and inserting ‘Federal Housing Finance Regulatory Reform Act of 2008’;CommentsClose CommentsPermalink





(ii) by striking ‘ 1/3 ’ and inserting ‘ 1/4 ’; andCommentsClose CommentsPermalink





(iii) by striking ‘or appointed’; andCommentsClose CommentsPermalink





(C) in the third sentence--CommentsClose CommentsPermalink





(i) by striking ‘an elective’ each place that term appears and inserting `independent'.(d) Conforming Amendments- Section 7(f)(3) of the Federal Home Loan Bank Act (12 U.S.C. 1427(f)(3)) is amended--(1) in the paragraph heading, by striking `ELECTED' and inserting `MEMBER'; and(2) by striking `elective' each place such term appears in the first and third sentences and inserting `member'.(e) Compensation- Subsection (i) of section 7 of the Federal Home Loan Bank Act (12 U.S.C. 1427(i)) is amended to read as follows:`‘a’; andCommentsClose CommentsPermalink





(ii) by striking ‘in any elective directorship or elective directorships’;CommentsClose CommentsPermalink





(6) in subsection (f)--CommentsClose CommentsPermalink





(A) by striking paragraph (2);CommentsClose CommentsPermalink





(B) by striking ‘appointed or’ each place that term appears; andCommentsClose CommentsPermalink





(C) in paragraph (3)--CommentsClose CommentsPermalink





(i) by striking ‘(3) ELECTED BANK DIRECTORS- ’ and inserting ‘(2) ELECTION PROCESS- ’; andCommentsClose CommentsPermalink





(ii) by striking ‘elective’ each place that term appears;CommentsClose CommentsPermalink





(7) in subsection (i)Directors' Compensation-`(1) IN GENERAL- Each Federal home loan bank may pay the directors on the board of directors for the bank reasonable and appropriate compensation for the time required of such directors, and reasonable and appropriate expenses incurred by such directors, in connection with service on the board of directors, in accordance with resolutions adopted by the board of directors and subject to the approval of the Director.`--CommentsClose CommentsPermalink





(A) in paragraph (1), by striking ‘Subject to paragraph (2), each’ and inserting ‘Each’; andCommentsClose CommentsPermalink





(B) by striking paragraph (2) and inserting the following:CommentsClose CommentsPermalink





‘(2) ANNUAL REPORT BY THE BOARD- The Director shall include, in the annual report submitted to the Congress pursuant to section 1319B of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, information regarding the compensation and expenses paid by the Federal home loan bHome Loan Banks to the directors on the boards of directors of the banks.'.(fBanks.’; andCommentsClose CommentsPermalink





(8) by adding at the end the following:CommentsClose CommentsPermalink





‘(l) Transition Rule- Any member of the board of directors of a Federal Home Loan Bank serving as of the effective date under section 381 may continue to serve as a member of such board of directors for the remainder of the term of such office as provided in section 7 of the Federal Home Loan Bank Act, as in effect before such effective dateBank elected or appointed in accordance with this section prior to the date of enactment of this subsection may continue to serve as a member of that board of directors for the remainder of the existing term of service.’.CommentsClose CommentsPermalink

SEC. 373. FEDERAL HOUSING FINANCE1203. DEFINITIONS.

SEC. 1204. AGENCY OVERSIGHT OF FEDERAL HOME LOAN BANKS.

The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.), other than in provisions of that Act added or amended otherwise by this titleAct, is amended--CommentsClose CommentsPermalink





(1) by striking sections 2A and 2B (12 U.S.C. 1422a, 1422b);CommentsClose CommentsPermalink





(2) in section 618 (12 U.S.C. 1426(b)(1))--(A) in subsection (b)(1), in the matter preceding subparagraph (A), by striking `Finance Board approval' and inserting `approval by the Director'; and(B) in each of subsections (c)(4)(B) and (d)(2), by striking `Finance Board regulations' each place that term appears and inserting `regulations of the Director'38), by striking subsection (b);CommentsClose CommentsPermalink





(3) in section 8 (12 U.S.C. 1428), in the section heading, by striking `BY THE BOARD';(4) in section 10(b) (12 U.S.C. 1430(b)), by striking `by formal resolution';(5) in section 10 (12 U.S.C. 1430), by adding at the end the following new subsection:

`(k) Monitoring and Enforcing Compliance With Affordable Housing and Community Investment Program Requirements- The requirements under subsection (i) and (j) that the Banks establish Community Investment and Affordable Housing Programs, respectively, and contribute to the Affordable Housing Program, shall be enforceable by the Director with respect to the Banks in the same manner and to the same extent as the housing goals under subpart B of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (12 U.S.C. 4561 et seq.) are enforceable under section 1336 of such Act with respect to the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.';

(6) in section 11 (12 U.S.C. 1431)--CommentsClose CommentsPermalink




(A) in subsection (b)--CommentsClose CommentsPermalink





(i) in the first sentence--CommentsClose CommentsPermalink





(I) by striking `The Board' and inserting `‘The Board’ and inserting ‘The Office of Finance, as agent for the Banks,'; and(II) by striking `the Board' and inserting `such Office'; and(ii) in the second and’; andCommentsClose CommentsPermalink





(II) by striking ‘the Board’ and inserting ‘such Office’; andCommentsClose CommentsPermalink





(ii) in the second and fourth sentences, by striking `the Board' each place such term appears and inserting `the Office of Finance'‘the Board’ each place such term appears and inserting ‘the Office of Finance’;CommentsClose CommentsPermalink





(B) in subsection (c)--CommentsClose CommentsPermalink





(i) by striking `the Board' the first place such term appears and inserting `‘the Board’ the first place such term appears and inserting ‘the Office of Finance, as agent for the Banks,'; and(ii) by striking `the Board' the second place such term appears and inserting `such Office'; and(C) in subsection (f)--(’; andCommentsClose CommentsPermalink





(ii) by striking ‘the Board’ the second place such term appears and inserting ‘such Office’; andCommentsClose CommentsPermalink





(C) in subsection (f)--CommentsClose CommentsPermalink





(i) by striking the 2 commas after ‘permit’ and inserting ‘or’; andCommentsClose CommentsPermalink





(ii) by striking the two commas after `permit' and inserting `or'; and(ii) by striking the comma after `require';(7) in section 15 (12 U.S.C. 1435), by inserting `or the Director' after `the Board';(8) in section 18 (12 U.S.C. 1438), by striking subsection (b);(9) in section 21 (12 U.S.C. 1441)--(A) in subsection (b)--(i) in paragraph (5), by striking `Chairperson of the Federal Housing Finance Board' and inserting `Director'; and(ii) in the heading for paragraph (8), by striking `FEDERAL HOUSING FINANCE BOARD' and inserting `DIRECTOR'; and(B) in subsection (i), in the heading for paragraph (2), by striking `FEDERAL HOUSING FINANCE BOARD' and inserting `DIRECTOR';(10) in section 23 (12 U.S.C. 1443), by striking `Board of Directors of the Federal Housing Finance Board' and inserting `Director';(11) by striking `the Board' each place such term appears in such Act (except in section 15 (12 U.S.C. 1435), section 21(f)(2) (12 U.S.C. 1441(f)(2)), subsections (a), (k)(2)(B)(i), and (n)(6)(C)(ii) of section 21Acomma after ‘require’;CommentsClose CommentsPermalink





(4) in section 6 (12 U.S.C. 1441a),26)--CommentsClose CommentsPermalink





(A) in subsection (b)(1), in the matter preceding subparagraph (A), by striking ‘Finance Board approval’ and inserting ‘approval by the Director’; andCommentsClose CommentsPermalink





(B) in each of subsections (f)(2)(C), and (k)(7)(B)(ii) of section 21B (12 U.S.C. 1441b), and the first two places such term appears in section 22 (12 U.S.C. 1442)) and inserting `the Director';(12) by striking `The Board' each place such term appears in such Act (except in sections 7(ec)(4)(B) and (d)(2), by striking ‘Finance Board regulations’ each place that term appears and inserting ‘regulations of the Director’;CommentsClose CommentsPermalink





(5) in section 10(b) (12 U.S.C. 1427(e)), and 11(b30(b))--CommentsClose CommentsPermalink





(A) in the subsection heading, by striking ‘Formal Board Resolution’ and inserting ‘Approval of Director’; andCommentsClose CommentsPermalink





(B) by striking ‘by formal resolution’;CommentsClose CommentsPermalink





(6) in section 21(b)(5) (12 U.S.C. 1431(b)) and inserting `The Director';(13) by striking `the Board's' each place such term appears in such Act and inserting `the Director's';(14) by striking `The Board's' each place such term appears in such Act and inserting `The Director's';(15) by striking `the Finance Board' each place such term appears in such Act and inserting `the Director';(16) by striking `Federal Housing Finance Board' each place such term appears and inserting `Director';(17) in section 11(i)41(b)(5)), by striking ‘Chairperson of the Federal Housing Finance Board’ and inserting ‘Director’;CommentsClose CommentsPermalink





(7) in section 15 (12 U.S.C. 1431(i), by striking `the Chairperson of'; and(18) in section 21(e)(9)5), by inserting ‘or the Director’ after ‘the Board’;CommentsClose CommentsPermalink





(8) by striking ‘the Board’ each place that term appears and inserting ‘the Director’;CommentsClose CommentsPermalink





(9) by striking ‘The Board’ each place that term appears and inserting ‘The Director’;CommentsClose CommentsPermalink





(10) by striking ‘the Finance Board’ each place that term appears and inserting ‘the Director’;CommentsClose CommentsPermalink





(11) by striking ‘The Finance Board’ each place that term appears and inserting ‘The Director’; andCommentsClose CommentsPermalink





(12) by striking ‘Federal Housing Finance Board’ each place that term appears and inserting ‘Director’.CommentsClose CommentsPermalink

The Federal Home Loan Bank Act (12 U.S.C. 1441(e)(9)), by striking `Chairperson of the'21 et seq.) is amended by inserting after section 10b the following new section:CommentsClose CommentsPermalink

‘SEC. 10C. HOUSING GOALS.

‘(a) In General- The Director shall establish housing goals with respect to the purchase of mortgages, if any, by the Federal Home Loan Banks. Such goals shall be consistent with the goals established under sections 1331 through 1334 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992.CommentsClose CommentsPermalink





‘(b) Considerations- In establishing the goals required by subsection (a), the Director shall consider the unique mission and ownership structure of the Federal Home Loan Banks.CommentsClose CommentsPermalink





‘(c) Transition Period- To facilitate an orderly transition, the Director shall establish interim target goals for purposes of this section for each of the 2 calendar years following the date of enactment of this section.CommentsClose CommentsPermalink





‘(d) Monitoring and Enforcement of Goals- The requirements of section 1336 of the Federal Housing Enterprises Safety and Soundness Act of 1992, shall apply to this section, in the same manner and to the same extent as that section applies to the Federal housing enterprises.CommentsClose CommentsPermalink





‘(e) Annual Report- The Director shall annually report to Congress on the performance of the Banks in meeting the goals established under this section.’.CommentsClose CommentsPermalink

SEC. 374. JOINT ACTIVITIES OF BANK1206. COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS.

Section 114(a)(1) of the Federal Home Loan Bank Act (12 U.S.C. 1431) is amended by adding at the end the following new subsection:`(l) Joint Activities- Subject to the regulation of the Director, any two or more Federal Home Loan Banks may establish a joint office for the purpose of performing functions for, or providing services to, the Banks on a common or collective basis, or may require that the Office of Finance perform such functions or services, but only if the Banks are otherwise authorized to perform such functions or services individually.'24(a)(1)) is amended--CommentsClose CommentsPermalink





(1) by inserting after ‘savings bank,’ the following: ‘community development financial institution,’; andCommentsClose CommentsPermalink





(2) in subparagraph (B), by inserting after ‘United States,’ the following: ‘or, in the case of a community development financial institution, is certified as a community development financial institution under the Community Development Banking and Financial Institutions Act of 1994.’.CommentsClose CommentsPermalink

SEC. 3751207. SHARING OF INFORMATION BETWEENAMONG FEDERAL HOME LOAN BANKS.

(a) In General- The Federal Home Loan Bank Act is amended by inserting after sectionThe Federal Home Loan Bank Act is amended by inserting after section 20 (12 U.S.C. 1440) the following new section:CommentsClose CommentsPermalink

`‘SEC. 20A. SHARING OF INFORMATION BETWEEN FEDERAL HOME LOAN BANKS.`(a) Regulatory Authority- The Director shall prescribe such regulations as may be necessary to ensure that each Federal Home Loan Bank has access to information that the Bank needs to determine the nature and extent of itsAMONG FEDERAL HOME LOAN BANKS.

‘(a) Information on Financial Condition- In order to enable each Federal Home Loan Bank to evaluate the financial condition of one or more of the other Federal Home Loan Banks individually and the Federal Home Loan Bank System (including any risks associated with the issuance or repayment of consolidated Federal Home Loan Bank bonds and debentures or other borrowings and the joint and several liability.`(bies of the Banks incurred due to such borrowings), as well as to comply with any of its obligations under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.), the Director shall make available to the Banks such reports, records, or other information as may be available, relating to the condition of any Federal Home Loan Bank.CommentsClose CommentsPermalink





‘(b) Sharing of Information-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Director shall promulgate regulations to facilitate the sharing of information made available under subsection (a) directly among the Federal Home Loan Banks.CommentsClose CommentsPermalink





‘(2) LIMITATION- Notwithstanding paragraph (1), a Federal Home Loan Bank responding to a request from another Bank or from the Director for information pursuant to this section may request that the Director determine that such information is proprietary and that the public interest requires that such information not be shared.CommentsClose CommentsPermalink





‘(c) Limitation- Nothing in this section shall affect the obligations of any Federal Home Loan Bank under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) or the regulations issued by the Securities and Exchange Commission thereunder.CommentsClose CommentsPermalink





‘(d) No Waiver of Privilege- The Director shall not be deemed to have waived any privilege applicable to any information concerning a Federal Home Loan Bank by transferring, or permitting the transfer of, that information to any other Federal Home Loan Bank for the purpose of enabling the recipient to evaluate the nature and extent of its joint and several liability.'.(b) Regulations- The regulations required under the amendment made by subsection (a) shall be issued in final form not later than 6 months after the effective date under section 381 of this title.SEC. 376. REORGANIZATION OF BANKS AND VOLUNTARY MERGER.Section 26 of the Federal Home Loan Bank Act (12 U.S.C. 1446) is amended--(1) by inserting `(a) Reorganization- ' before `Whenever'; and(2) by striking `liquidated or' each place such phrase appears;(3) by striking `liquidation or'; and(4) by adding at the end the following new subsection:`(b) Voluntary Mergers- Any two or more Banks may, with the approval of the Director, and the approval of the boards of directors of the Banks involved, merge. The Director shall promulgate regulations establishing the conditions and procedures for the consideration and approval of any such voluntary merger, including the procedures for Bank member approval.'s set out in subsection (a).’.CommentsClose CommentsPermalink

SEC. 377. SECURITIES AND EXCHANGE COMMISSION DISCLOSURE1208. EXCLUSION FROM CERTAIN REQUIREMENTS.

(a) In General- The Federal Home Loan Banks shall be exempt from compliance with--CommentsClose CommentsPermalink





(1) sections 13(e), 14(a), 14(c), and 17A of the Securities Exchange Act of 1934and 14(c) of the Securities Exchange Act of 1934, and related Commission regulations;CommentsClose CommentsPermalink





and(2) section 15 of that Act and related Securities and Exchange Commission regulations with respect to transactions in capital stock of the Banks (2) section 15 of the Securities Exchange Act of 1934, and related Commission regulations, with respect to transactions in the capital stock of a Federal Home Loan Bank; CommentsClose CommentsPermalink





(3) section 17A of the Securities Exchange Act of 1934, and related Commission regulations, with respect to the transfer of the securities of a Federal Home Loan Bank; andCommentsClose CommentsPermalink





(4) the Trust Indenture Act of 1939.CommentsClose CommentsPermalink





(b) Member Exemption- The members of the Federal Home Loan Banks shall be exempt from compliance with sections System shall be exempt from compliance with sections 13(d), 13(f), 13(g), 14(d), and 16 of the Securities Exchange Act of 1934 and related Securities and Exchange Commission regulations with respect to their ownership of, or transactions in, capital stock of the Federal Home Loan Banks.(c) , and related Commission regulations, with respect to ownership of or transactions in the capital stock of the Federal Home Loan Banks by such members.CommentsClose CommentsPermalink





(c) Exempted and Government Securities-CommentsClose CommentsPermalink





(1) CAPITAL STOCK- The capital stock issued by each of the Federal Home Loan Banks under section 6 of the Federal Home Loan Bank Act are--CommentsClose CommentsPermalink





(A) exempted securities, within the meaning of section 3(a)(2) of the Securities Act of 1933; andCommentsClose CommentsPermalink





(B) `exempted securities'exempted securities, within the meaning of section 3(a)(12)(A) of the Securities Exchange Act of 1934, except to the extent provided in section 38 of that Act.CommentsClose CommentsPermalink





(2) OTHER OBLIGATIONS- The debentures, bonds, and other obligations issued under section 11 of the Federal Home Loan Bank Act (12 U.S.C. 1431) are--CommentsClose CommentsPermalink





(A) exempted securities, within the meaning of section 3(a)(2) of the Securities Act of 1933;CommentsClose CommentsPermalink





(B) `government securities'government securities, within the meaning of section 3(a)(42) of the Securities Exchange Act of 1934;(C) excluded from the definition of `government securities broker' within section 3(a)(43) of the Securities Exchange Act of 1934;(D) excluded from the definition of `government securities dealer' within section 3(a)(44) of the SecuritiesExchange Act of 1934; andCommentsClose CommentsPermalink





(E) `government securities'C) government securities, within the meaning of section 2(a)(16) of the Investment Company Act of 1940.CommentsClose CommentsPermalink





(3) BROKERS AND DEALERS- A person (other than a Federal Home Loan Bank effecting transactions for members of the Federal Home Loan Bank System) that effects transactions in the capital stock or other obligations of a Federal Home Loan Bank, for the account of others or for that person’s own account, as applicable, is a broker or dealer, as those terms are defined in paragraphs (4) and (5), respectively, of section 3(a) of the Securities Exchange Act of 1934, but is excluded from the definition of--CommentsClose CommentsPermalink





(A) the term ‘government securities broker’ under section 3(a)(43) of the Securities Exchange Act of 1934; andCommentsClose CommentsPermalink





(B) the term ‘government securities dealer’ under section 3(a)(44) of the Securities Exchange Act of 1934.CommentsClose CommentsPermalink





(d) Exemption From Reporting Requirements- The Federal Home Loan Banks shall be exempt from periodic reporting requirements pertaining to--(1) the disclosure ofunder the securities laws pertaining to the disclosure of--CommentsClose CommentsPermalink





(1) related party transactions that occur in the ordinary course of business of the Banks with theirthe business of the Banks with members; andCommentsClose CommentsPermalink





(2) the disclosure of unregistered sales of equity securities.CommentsClose CommentsPermalink





(e) Tender Offers- The Securities and Exchange Commission'sCommission rules relating to tender offers shall not apply in connection with transactions in the capital stock of the Federal Home Loan Banks.CommentsClose CommentsPermalink





(f) Regulations-CommentsClose CommentsPermalink





In issuing any final regulations to implement provisions of this section, the Securities and Exchang (1) IN GENERAL- The Commission shall promulgate such rules and regulations as may be necessary or appropriate in the public interest or in furtherance of this section and the exemptions provided in this section. CommentsClose CommentsPermalink





(2) CONSIDERATIONS- In issuing regulations under this section, the Commission shall consider the distinctive characteristics of the Federal Home Loan Banks when evaluating--CommentsClose CommentsPermalink





(A) the accounting treatment with respect to the payment to the Resolution Funding Corporation,;CommentsClose CommentsPermalink





(B) the role of the combined financial statements of the twelve Banks,Federal Home Loan Banks;CommentsClose CommentsPermalink





(C) the accounting classification of redeemable capital stock, and; andCommentsClose CommentsPermalink





(D) the accounting treatment related to the joint and several nature of the obligations of the Banks.CommentsClose CommentsPermalink





(g) Definitions- As used in this section--CommentsClose CommentsPermalink





(1) the terms ‘Bank’, ‘Federal Home Loan Bank’, ‘member’, and ‘Federal Home Loan Bank System’ have the same meanings as in section 2 of the Federal Home Loan Bank Act (12 U.S.C. 1422);CommentsClose CommentsPermalink





(2) the term ‘Commission’ means the Securities and Exchange Commission; andCommentsClose CommentsPermalink





(3) the term ‘securities laws’ has the same meaning as in section 3(a)(47) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(47)).CommentsClose CommentsPermalink

SEC. 3781209. VOLUNTARY MERGERS.

SEC. 1211. COMMUNITY FINANCIAL INSTITUTION MEMBERS.

(a) Total Asset Requirement- Paragraph (10) of section 2 of the Federal Home Loan Bank Act (12 U.S.C. 1422(10)), as so redesignated by section 371(3) of this title, is amended by striking `$500,000,000' each place 201(3) of this Act, is amended by striking ‘$500,000,000’ each place such term appears and inserting `$1,000,000,000'‘$1,000,000,000’.CommentsClose CommentsPermalink





(b) Use of Advances for Community Development Activities- Section 10(a) of the Federal Home Loan Bank Act (12 U.S.C. 1430(a)) is amended--CommentsClose CommentsPermalink





(1) in paragraph (2)(B)--CommentsClose CommentsPermalink





(A) by striking `and'; and(B) by inserting `‘and’; andCommentsClose CommentsPermalink





(B) by inserting ‘, and community development activities'’ before the period at the end;CommentsClose CommentsPermalink





(2) in paragraph (3)(E), by inserting `or community development activities' after `agriculture,'; and(3) in paragraph (6)--(A) by striking `and'; and(B) by inserting `, and `‘or community development activities' before `shall'’ after ‘agriculture,’; andCommentsClose CommentsPermalink





(3) in paragraph (6)--CommentsClose CommentsPermalink





(A) by striking ‘and’; andCommentsClose CommentsPermalink





(B) by inserting ‘, and ‘community development activities’ before ‘shall’.CommentsClose CommentsPermalink

SEC. 3791212. PUBLIC USE DATABASE; REPORTS TO CONGRESS.

SEC. 1216. TECHNICAL AND CONFORMING AMENDMENTS.

(a) Right to Financial Privacy Act of 1978- Section 1113(o) of the Right to Financial Privacy Act of 1978 (12 U.S.C. 3413(o)) is amended--CommentsClose CommentsPermalink





(1) by striking `Federal Housing Finance Board' and inserting `Federal Housing Finance Agency'; and(2) by striking `Federal Housing Finance Board's' and inserting `Federal Housing Finance Agency's'‘Federal Housing Finance Board’ and inserting ‘Federal Housing Finance Agency’; andCommentsClose CommentsPermalink





(2) by striking ‘Federal Housing Finance Board’s’ and inserting ‘Federal Housing Finance Agency’s’.CommentsClose CommentsPermalink





(b) Riegle Community Development and Regulatory Improvement Act of 1994- Section 117(e) of the Riegle Community Development and Regulatory Improvement Act of 1994 (12 U.S.C. 4716(e)) is amended by striking `Federal Housing Finance Board' and inserting `Federal Housing Finance Agency'.(c)‘Federal Housing Finance Board’ and inserting ‘Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(c) Title 18, United States Code- Title 18, United States Code, is amended by striking `Federal Housing Finance Board'‘Federal Housing Finance Board’ each place such term appears in each of sections 212, 657, 1006, 1014, and inserting `Federal Housing Finance Agency'.(d)and 1014, and inserting ‘Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(d) MAHRA Act of 1997- Section 517(b)(4) of the Multifamily Assisted Housing Reform and Affordability Act of 1997 (42 U.S.C. 1437f note) is amended by striking `Federal Housing Finance Board' and inserting `Federal Housing Finance Agency'.(e)‘Federal Housing Finance Board’ and inserting ‘Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(e) Title 44, United States Code-Section 3502(5) of title 44, United States Code, is amended by striking `Federal Housing Finance Board' and inserting `Federal Housing Finance Agency'.(f) Section 3502(5) of title 44, United States Code, is amended by striking ‘Federal Housing Finance Board’ and inserting ‘Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(f) Access to Local TV Act of 2000- Section 1004(d)(2)(D)(iii) of the Launching Our Communities'’ Access to Local Television Act of 2000 (47 U.S.C. 1103(d)(2)(D)(iii)) is amended by striking `‘Office of Federal Housing Enterprise Oversight, the Federal Housing Finance Board' and inserting `Federal Housing Finance Agency'’ and inserting ‘Federal Housing Finance Agency’.CommentsClose CommentsPermalink





(g) Sarbanes-Oxley Act of 2002- Section 105(b)(5)(B)(ii)(II) of the Sarbanes-Oxley Act of 2002 (15FIRREA- Section 1216 of the Financial Institutions Reform, Recovery, and Enhancement Act of 1989 (12 U.S.C. 7215(B)(5)(b)(ii)(II)) is amended by inserting `and the Director of the Federal Housing Finance Agency' after `Commission,'1833e) is amended--CommentsClose CommentsPermalink





(1) in subsection (a), by striking paragraph (3) and inserting the following:CommentsClose CommentsPermalink





‘(3) the Federal Housing Finance Agency;’;CommentsClose CommentsPermalink





(2) in subsection (b), by striking ‘Federal National Mortgage Association’ and inserting ‘Federal Home Loan Banks, the Federal National Mortgage Association,’; andCommentsClose CommentsPermalink





(3) in subsection (c), by striking ‘Finance Board’ and inserting ‘Finance Agency’.CommentsClose CommentsPermalink

SEC. 380. STUDY OF AFFORDABLE HOUSING PROGRAM USE FOR LONG-TERM CARE FACILITIES.The Comptroller General shall conduct a study of the use of affordable housing programs of the Federal home loan banks under section 10(j) of the Federal Home Loan Bank Act to determine how and the extent to which such programs are used to assist long-term care facilities for low- and moderate-income individuals, and the effectiveness and adequacy of such assistance in meeting the needs of affected communities. The study shall examine the applicability of such use to the affordable housing fund required to be established by the Director of the Federal Housing Finance Agency pursuant to the amendment made by section 340 of this title. The Comptroller General shall submit a report to the Director of the Federal Housing Finance Agency and the Congress regarding the results of the study not later than the expiration of the 11217. STUDY ON FEDERAL HOME LOAN BANK ADVANCES.

Section 10(j)(2) of the Federal Home Loan Bank Act (12 U.S.C. 1430(j)(2)) is amended--CommentsClose CommentsPermalink





(1) in subparagraph (A), by striking ‘or’ at the end;CommentsClose CommentsPermalink





(2) in subparagraph (B), by striking the period at the end and inserting ‘; or’; andCommentsClose CommentsPermalink





(3) by adding at the end the following:CommentsClose CommentsPermalink





‘(C) during the 2-year period beginning on the date of the enactment of this Act. This section shall take effect on the date of the enactment of this Act.SEC. 381. EFFECTIVE DATE.Except as specifically provided otherwise in this subtitle, this subtitle shall take effect on and the amendments made by this subtitle shall take effect on, and shall apply beginning on, the expiration of the 6-month period beginning on the date of the enactment of this Act.

Subtitle C--Transfer of Functions, Personnel, and Property of Office of Federal Housing Enterprise Oversight, Federal Housing Finance Board, and Department of Housing and Urban DevelopmentCHAPTER 1--OFFICE OF FEDERAL HOUSING ENTERPRISE OVERSIGHTSEC. 385enactment of this subparagraph, use such percentage as the Director may by regulation establish of any subsidized advances set aside to finance homeownership under subparagraph (A) to refinance loans that are secured by a first mortgage on a primary residence of any family having an income at or below 80 percent of the median income for the area.’.CommentsClose CommentsPermalink

SEC. 1301. ABOLISHMENT OF OFHEO.

(a) In General- Effective at the end of the 6-month period beginning on the date of the enactment of this Act, the Office of Federal Housing Enterprise1-year period beginning on the date of enactment of this Act, the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development and the positions of the Director and Deputy Director of such Office are abolished.CommentsClose CommentsPermalink





(b) Disposition of Affairs- During the 6-month period beginning on the date of the enactment of this Act, the Director of the Office of Federal Housing Enterprise Oversight shall,1-year period beginning on the date of enactment of this Act, the Director of the Office of Federal Housing Enterprise Oversight, solely for the purpose of winding up the affairs of the Office of Federal Housing Enterprise Oversight and in addition to carrying out its other responsibilities under law--(1)--CommentsClose CommentsPermalink





(1) shall manage the employees of such Office and provide for the payment of the compensation and benefits of any such employee which accrue before the effective date of the transfer of such employee pursuant to section 387under section 1303; andCommentsClose CommentsPermalink





(2) may take any other action necessary for the purpose of winding up the affairs of the Office.CommentsClose CommentsPermalink





(c) Status of Employees Before Transfer- The amendments made by subtitle A and thetitle I and the abolishment of the Office of Federal Housing Enterprise Oversight under subsection (a) of this section may not be construed to affect the status of any employee of such Office as employees of an agency of the United States for purposes of any other provision of law before the effective date of the transfer of any such employee pursuant to section 387an employee of an agency of the United States for purposes of any other provision of law before the effective date of the transfer of any such employee under section 1303.CommentsClose CommentsPermalink





(d) Use of Property and Services-CommentsClose CommentsPermalink





(1) PROPERTY- The Director of the Federal Housing Finance Agency may use the property of the Office of Federal Housing Enterprise Oversight to perform functions which have been may use the property of the Office of Federal Housing Enterprise Oversight to perform functions which have been transferred to the Director of the Federal Housing Finance Agency for such time as is reasonable to facilitate the orderly transfer of functions transferred pursuant to any other provision of this title or any amendment made by this titleunder any other provision of this Act or any amendment made by this Act to any other provision of law.CommentsClose CommentsPermalink





(2) AGENCY SERVICES- Any agency, department, or other instrumentality of the United States, and any successor to any such agency, department, or instrumentality, which was providing supporting services to the Office of Federal Housing Enterprise Oversight before the expiration of the period under subsection (a) in connection with functions that are transferred to the Director of the Federal Housing Finance Agency shall--CommentsClose CommentsPermalink





(A) continue to provide such services, on a reimbursable basis, until the transfer of such functions is complete; andCommentsClose CommentsPermalink





(B) consult with any such agency to coordinate and facilitate a prompt and reasonable transition.CommentsClose CommentsPermalink





(e) Continuation of Services- The Director may use the services of employees and other personnel of the Office of Federal Housing Enterprise Oversight, on a reimbursable basis, to perform functions which have been transferred to the Director for such time as is reasonable to facilitate the orderly transfer of functions pursuant to any other provision of this Act or any amendment made by this Act to any other provision of law.CommentsClose CommentsPermalink





(f) Savings Provisions-CommentsClose CommentsPermalink





(1) EXISTING RIGHTS, DUTIES, AND OBLIGATIONS NOT AFFECTED- Subsection (a) shall not affect the validity of any right, duty, or obligation of the United States, the Director of the Office of Federal Housing Enterprise Oversight, or any other person, which--CommentsClose CommentsPermalink





(A) arises under or pursuant to the title XIII of the Housing and Community Development Act of 1992,--CommentsClose CommentsPermalink





(i) the Federal Housing Enterprises Financial Safety and Soundness Act of 1992;CommentsClose CommentsPermalink





(ii) the Federal National Mortgage Association Charter Act, the Federal Home Loan Mortgage Corporation Act, or;CommentsClose CommentsPermalink





(iii) the Federal Home Loan Mortgage Corporation Act; orCommentsClose CommentsPermalink





(iv) any other provision of law applicable with respect to such Office; andCommentsClose CommentsPermalink





(B) existed on the day before the date of abolishment under subsection (a) of this section.(2) .CommentsClose CommentsPermalink





(2) CONTINUATION OF SUITS- No action or other proceeding commenced by or against the Director of the Office of Federal Housing Enterprise Oversight in connection with functions that are transferred to the Director of the Federal Housing Finance Agency shall abate by reason of the enactment of this title, except that the Director of the FederalAct, except that the Director of the Federal Housing Finance Agency shall be substituted for the Director of the Office of Federal Housing Enterprise Oversight as a party to any such action or proceeding.CommentsClose CommentsPermalink

SEC. 3861302. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.ACTIONS.

(a) In General- All regulations, orders, determinations, and resolutions that--(1) were issued, made, prescribed, or allowed to become effective by--(A) the Office of Federal Housing Enterprise Oversight; or(B) a court of competent jurisdiction and that relate to functions transferred by this chapter; and(2) are in effect on the date of the abolishment under section 385(a) of this title,and determinations described in subsection (b) shall remain in effect according to the terms of such regulations, orders, determinations, and resolutions, and shall beand determinations, and shall be enforceable by or against the Director of the Federal Housing Finance Agencyr the Secretary of Housing and Urban Development, as the case may be, until modified, terminated, set aside, or superseded in accordance with applicable law by such Directorthe Director or the Secretary, as the case may be, any court of competent jurisdiction, or operation of law.CommentsClose CommentsPermalink





SEC. 387 (b) Applicability- A regulation, order, or determination is described in this subsection if it-- CommentsClose CommentsPermalink





(1) was issued, made, prescribed, or allowed to become effective by--CommentsClose CommentsPermalink





(A) the Office of Federal Housing Enterprise Oversight;CommentsClose CommentsPermalink





(B) the Secretary of Housing and Urban Development, and relates to the authority of the Secretary under--CommentsClose CommentsPermalink





(i) the Federal Housing Enterprises Financial Safety and Soundness Act of 1992;CommentsClose CommentsPermalink





(ii) the Federal National Mortgage Association Charter Act, with respect to the Federal National Mortgage Association; orCommentsClose CommentsPermalink





(iii) the Federal Home Loan Mortgage Corporation Act, with respect to the Federal Home Loan Mortgage Corporation; orCommentsClose CommentsPermalink





(C) a court of competent jurisdiction, and relates to functions transferred by this Act; andCommentsClose CommentsPermalink





(2) is in effect on the effective date of the abolishment under section 1301(a).CommentsClose CommentsPermalink

SEC. 1303. TRANSFER AND RIGHTS OF EMPLOYEES OF OFHEO.

(a) Transfer- Each employee of the Office of Federal Housing Enterprise Oversight shall be transferred to the Federal Housing Finance Agency for employment no later than the date of the Agency for employment, not later than the effective date of the abolishment under section 385(a) of this title1301(a), and such transfer shall be deemed a transfer of function for purposes of section 3503 of title 5, United States Code.CommentsClose CommentsPermalink





(b) Guaranteed Positions-CommentsClose CommentsPermalink





Each employee (1) IN GENERAL- Each employee transferred under subsection (a) shall be guaranteed a position with the same status, tenure, grade, and pay as that held on the day immediately preceding the transfer.CommentsClose CommentsPermalink





Each such employee(2) NO INVOLUNTARY SEPARATION OR REDUCTION- An employee transferred under subsection (a) holding a permanent position shallon the day immediately preceding the transfer may not be involuntarily separated or reduced in grade or compensation for 12 months afterduring the 12-month period beginning on the date of transfer, except for cause or, if the employee is, or, in the case of a temporary employee, separated in accordance with the terms of the appointment.(c) Appointment Authority for Excepted of the employee.CommentsClose CommentsPermalink





(c) Appointment Authority for Excepted and Senior Executive Service Employees-CommentsClose CommentsPermalink





(1) IN GENERAL- In the case of employees occupying positions in the excepted service, any appointment authority established pursuant to law oran employee occupying a position in the excepted service or the Senior Executive Service, any appointment authority established under law or by regulations of the Office of Personnel Management for filling such positions shall be transferred, subject to paragraph (2).CommentsClose CommentsPermalink





(2) DECLINE OF TRANSFER- The Director of the Federal Housing Finance Agency may may decline a transfer of authority under paragraph (1) (and the employees appointed pursuant thereto) to the extent that such authority relates to positions--CommentsClose CommentsPermalink





(A) a position excepted from the competitive service because of theirits confidential, policy-making, policy-determining, or policy-advocating character; orCommentsClose CommentsPermalink





(B) a noncareer position in the Senior Executive Service (within the meaning of section 3132(a)(7) of title 5, United States Code).CommentsClose CommentsPermalink





(d) Reorganization- If the Director of the Federal Housing Finance Agency determines, after the end of the 1-year period beginning on the date of the effective date of the abolishment under section 3851301(a), that a reorganization of the combined workforce is required, that reorganization shall be deemed a major reorganization for purposes of affording affected employees retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.CommentsClose CommentsPermalink





(e) Employee Benefit Programs-CommentsClose CommentsPermalink





(1) IN GENERAL- Any employee of the Office of Federal Housing Enterprise Oversight accepting employment with the Director of the Federal Housing Finance Agency as a result of a transfer under subsection (a) may retain, for 12 months after the date such transfer occurson which such transfer occurs, membership in any employee benefit program of the Federal Housing Finance Agency or the Office of Federal Housing Enterprise OversighAgency or the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development, as applicable, including insurance, to which such employee belongs on the date of the abolishment under section 385(a) if--(11301(a), if--CommentsClose CommentsPermalink





(A) the employee does not elect to give up the benefit or membership in the program; andCommentsClose CommentsPermalink





(2B) the benefit or program is continued by the Director of the Federal Housing Finance Agency,.CommentsClose CommentsPermalink





(2) COST DIFFERENTIAL-CommentsClose CommentsPermalink





(A) IN GENERAL- The difference in the costs between the benefits which would have been provided by such agencythe Office of Federal Housing Enterprise Oversight and those provided by this section shall be paid by the Director of the Federal Housing Finance Agency. If any employee .CommentsClose CommentsPermalink





(B) HEALTH INSURANCE- If any employee elects to give up membership in a health insurance program or the health insurance program is not continued by suchthe Director, the employee shall be permitted to select an alternate Federal health insurance program within 30 daysnot later than 30 days after the date of such election or notice, without regard to any other regularly scheduled open season.CommentsClose CommentsPermalink

SEC. 3881304. TRANSFER OF PROPERTY AND FACILITIES.

Upon the effective date of its abolishment under section 385(a), all property of 1301(a), all property of the Office of Federal Housing Enterprise Oversight shall transfer to the Director of the Federal Housing Finance Agency.CHAPTER 2--FEDERAL HOUSING FINANCE BOARDSEC. 39Agency.CommentsClose CommentsPermalink

SEC. 1311. ABOLISHMENT OF THE FEDERAL HOUSING FINANCE BOARD.

(a) In General- Effective at the end of the 6-month period beginning on1-year period beginning on the date of enactment of this Act, the Federal Housing Finance Board (in this subtitle referred to as the `Board'‘Board’) is abolished.CommentsClose CommentsPermalink





(b) Disposition of Affairs- During the 6-month period beginning on1-year period beginning on the date of enactment of this Act, the Board, solely for the purpose of winding up the affairs of the Board and in addition to carrying out its other responsibilities under law--CommentsClose CommentsPermalink





(1) shall manage the employees of suchthe Board and provide for the payment of the compensation and benefits of any such employee which accrue before the effective date of the transfer of such employee under section 391313; andCommentsClose CommentsPermalink





(2) may take any other action necessary for the purpose of winding up the affairs of the Board.CommentsClose CommentsPermalink





(c) Status of Employees Before Transfer- The amendments made by subtitles A and Btitles I and II and the abolishment of the Board under subsection (a) may not be construed to affect the status of any employee of such Board as employees of an agency of the United States for purposes of any other provision of law before the effective date of the transfer of any such employee under section 39the Board as an employee of an agency of the United States for purposes of any other provision of law before the effective date of the transfer of any such employee under section 1313.CommentsClose CommentsPermalink





(d) Use of Property and Services-CommentsClose CommentsPermalink





(1) PROPERTY- The Director of the Federal Housing Finance Agency may use the property of the Board to perform functions which have been transferred to the Director of the Federal Housing Finance Agencymay use the property of the Board to perform functions which have been transferred to the Director, for such time as is reasonable to facilitate the orderly transfer of functions transferred under any other provision of this title or any amendment made by this titleAct or any amendment made by this Act to any other provision of law.CommentsClose CommentsPermalink





(2) AGENCY SERVICES- Any agency, department, or other instrumentality of the United States, and any successor to any such agency, department, or instrumentality, which was providing supporting services to the Board before the expiration of the 1-year period under subsection (a) in connection with functions that are transferred to the Director of the Federal Housing Finance Agency shall--CommentsClose CommentsPermalink





(A) continue to provide such services, on a reimbursable basis, until the transfer of such functions is complete; andCommentsClose CommentsPermalink





(B) consult with any such agency to coordinate and facilitate a prompt and reasonable transition.CommentsClose CommentsPermalink





(e) Continuation of Services- The Director may use the services of employees and other personnel of the Board, on a reimbursable basis, to perform functions which have been transferred to the Director for such time as is reasonable to facilitate the orderly transfer of functions pursuant to any other provision of this Act or any amendment made by this Act to any other provision of law.CommentsClose CommentsPermalink





(f) Savings Provisions-CommentsClose CommentsPermalink





(1) EXISTING RIGHTS, DUTIES, AND OBLIGATIONS NOT AFFECTED- Subsection (a) shall not affect the validity of any right, duty, or obligation of the United States, a member of the Board, or any other person, which--CommentsClose CommentsPermalink





(A) arises under the Federal Home Loan Bank Act, or any other provision of law applicable with respect to suchthe Board; andCommentsClose CommentsPermalink





(B) existed on the day before the effective date of the abolishment under subsection (a).CommentsClose CommentsPermalink





(2) CONTINUATION OF SUITS- No action or other proceeding commenced by or against the Board in connection with functions that are transferred to the Director of the Federal Housing Finance Agencyunder this Act to the Director shall abate by reason of the enactment of this title, except that the Director of the Federal Housing Finance AgencyAct, except that the Director shall be substituted for the Board or any member thereof as a party to any such action or proceeding.CommentsClose CommentsPermalink

SEC. 391312. CONTINUATION AND COORDINATION OF CERTAIN REGULAACTIONS.

(a) In General- All regulations, orders, determinations, and resolutions described under subsection (b) shall remain in effect according to the terms of such regulations, orders, determinations, and resolutions, and shall be enforceable by or against the Director of the Federal Housing Finance Agency until modified, terminated, set aside, or superseded in accordance with applicable law by suchthe Director, any court of competent jurisdiction, or operation of law.CommentsClose CommentsPermalink





(b) Applicability- A regulation, order, determination, or resolution is described under this subsection if it--CommentsClose CommentsPermalink





(1) was issued, made, prescribed, or allowed to become effective by--CommentsClose CommentsPermalink





(A) the Board; orCommentsClose CommentsPermalink





(B) a court of competent jurisdiction, and relates to functions transferred by this chapterAct; andCommentsClose CommentsPermalink





(2) is in effect on the effective date of the abolishment under section 391311(a).CommentsClose CommentsPermalink

SEC. 391313. TRANSFER AND RIGHTS OF EMPLOYEES OF THE FEDERAL HOUSING FINANCE BOARD.

(a) Transfer- Each employee of the Board shall be transferred to the Federal Housing Finance Agency for employmentAgency for employment, not later than the effective date of the abolishment under section 391311(a), and such transfer shall be deemed a transfer of function for purposes of section 3503 of title 5, United States Code.CommentsClose CommentsPermalink





(b) Guaranteed Positions-CommentsClose CommentsPermalink





Each employee (1) IN GENERAL- Each employee transferred under subsection (a) shall be guaranteed a position with the same status, tenure, grade, and pay as that held on the day immediately preceding the transfer.CommentsClose CommentsPermalink





Each such employee(2) NO INVOLUNTARY SEPARATION OR REDUCTION- An employee holding a permanent position shallon the day immediately preceding the transfer may not be involuntarily separated or reduced in grade or compensation for 12 months afterduring the 12-month period beginning on the date of transfer, except for cause, or, if the employee is a temporary employee, separated in accordance with the terms of the appointment.(c) Appointment Authority for Excepted and Senior Executive Service of the employee.CommentsClose CommentsPermalink





(c) Appointment Authority for Excepted Employees-CommentsClose CommentsPermalink





(1) IN GENERAL- In the case of employees occupying positions in the excepted service or the Senior Executive San employee occupying a position in the excepted service, any appointment authority established under law or by regulations of the Office of Personnel Management for filling such positions shall be transferred, subject to paragraph (2).CommentsClose CommentsPermalink





(2) DECLINE OF TRANSFER- The Director of the Federal Housing Finance Agency may may decline a transfer of authority under paragraph (1) to the extent that such authority relates to positions, to the extent that such authority relates to a position excepted from the competitive service because of theirits confidential, policymaking, policy-determining, or policy-advocating character, and noncareer positions in the Senior Executive Service (within the meaning ofsection 3132(a)(7) of title 5, United States Code).CommentsClose CommentsPermalink





(d) Reorganization- If the Director of the Federal Housing Finance Agency determines, after the end of the 1-year period beginning on the effective date of the abolishment under section 391311(a), that a reorganization of the combined workforce is required, that reorganization shall be deemed a major reorganization for purposes of affording affected employees retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.CommentsClose CommentsPermalink





(e) Employee Benefit Programs-CommentsClose CommentsPermalink





(1) IN GENERAL- Any employee of the Board accepting employment with the Federal Housing Finance Agency as a result of a transfer under subsection (a) may retain, for 12 months after the date on which such transfer occurs, membership in any employee benefit program of the Federal Housing Finance Agency or the Board, as applicable, including insurance, to which such employee belongs on the effective date of the abolishment under section 391311(a) if--CommentsClose CommentsPermalink





(A) the employee does not elect to give up the benefit or membership in the program; andCommentsClose CommentsPermalink





(B) the benefit or program is continued by the Director of the Federal Housing Finance Agency.(2) .CommentsClose CommentsPermalink





(2) COST DIFFERENTIAL-CommentsClose CommentsPermalink





(A) IN GENERAL- The difference in the costs between the benefits which would have been provided by the Board and those provided by this section shall be paid by the Director of the Federal Housing Finance Agency. If any employee .CommentsClose CommentsPermalink





(B) HEALTH INSURANCE- If any employee elects to give up membership in a health insurance program or the health insurance program is not continued by suchthe Director, the employee shall be permitted to select an alternate Federal health insurance program within 30 days after suchnot later than 30 days after the date of such election or notice, without regard to any other regularly scheduled open season.CommentsClose CommentsPermalink

SEC. 391314. TRANSFER OF PROPERTY AND FACILITIES.

Upon the effective date of the abolishment under section 391(a), all property of 1311(a), all property of the Board shall transferto the Director of the Federal Housing Finance Agency.CHAPTER 3--DEPARTMENT OF HOUSING AND URBAN DEVELOPMENTSEC. 395. TERMINATION OF ENTERPRISE-RELATED FUNCTIONS to the Agency.CommentsClose CommentsPermalink

SEC. 1402. ESTABLISHMENT OF HOPE FOR HOMEOWNERS PROGRAM.

(a) Termination Date- For purposes of this chapter, the term `termination date' means the date that occurs 6 months after the date of the enactment of this Act.(b) Determination of Transferred Functions and Employees-(1) IN GENERAL- Not later than the expiration of the 3-month period beginning on the date of the enactment of this Act, the Secretary, in consultation with the Director of the Office of Federal Housing Enterprise Oversight, shall determine--(A) the functions, duties, and activities of the Secretary of Housing and Urban Development regarding oversight or regulation of the enterprises under or pursuant to the authorizing statutes, title XIII of the Housing and Community Development Act of 1992, and any other provisions of law, as in effect before the date of the enactment of this Act, but not including any such functions, duties, and activities of the Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development and such Office; and(B)Establishment- Title II of the National Housing Act (12 U.S.C. 1707 et seq.) is amended by adding at the end the following:CommentsClose CommentsPermalink

‘SEC. 257. HOPE FOR HOMEOWNERS PROGRAM.

‘(a) Establishment- There is established in the Federal Housing Administration a HOPE for Homeowners Program.CommentsClose CommentsPermalink





‘(b) Purpose- The purpose of the HOPE for Homeowners Program is--CommentsClose CommentsPermalink





‘(1) to create an FHA program, participation in which is voluntary on the part of homeowners and existing loan holders to insure refinanced loans for distressed borrowers to support long-term, sustainable homeownership;CommentsClose CommentsPermalink





‘(2) to allow homeowners to avoid foreclosure by reducing the principle balance outstanding, and interest rate charged, on their mortgages;CommentsClose CommentsPermalink





‘(3) to help stabilize and provide confidence in mortgage markets by bringing transparency to the value of assets based on mortgage assets;CommentsClose CommentsPermalink





‘(4) to target mortgage assistance under this section to homeowners for their principal residence;CommentsClose CommentsPermalink





‘(5) to enhance the administrative capacity of the FHA to carry out its expanded role under the HOPE for Homeowners Program;CommentsClose CommentsPermalink





‘(6) to ensure the HOPE for Homeowners Program remains in effect only for as long as is necessary to provide stability to the housing market; andCommentsClose CommentsPermalink





‘(7) to provide servicers of delinquent mortgages with additional methods and approaches to avoid foreclosure.CommentsClose CommentsPermalink





‘(c) Establishment and Implementation of Program Requirements-CommentsClose CommentsPermalink





‘(1) DUTIES OF THE BOARD- In order to carry out the purposes of the HOPE for Homeowners Program, the Board shall--CommentsClose CommentsPermalink





‘(A) establish requirements and standards for the program; andCommentsClose CommentsPermalink





‘(B) prescribe such regulations and provide such guidance as may be necessary or appropriate to implement such requirements and standards.CommentsClose CommentsPermalink





‘(2) DUTIES OF THE SECRETARY- In carrying out any of the program requirements or standards established under paragraph (1), the Secretary may issue such interim guidance and mortgagee letters as the Secretary determines necessary or appropriate.CommentsClose CommentsPermalink





‘(d) Insurance of Mortgages- The Secretary is authorized upon application of a mortgagee to make commitments to insure or to insure any eligible mortgage that has been refinanced in a manner meeting the requirements under subsection (e).CommentsClose CommentsPermalink





‘(e) Requirements of Insured Mortgages- To be eligible for insurance under this section, a refinanced eligible mortgage shall comply with all of the following requirements:CommentsClose CommentsPermalink





‘(1) LACK OF CAPACITY TO PAY EXISTING MORTGAGE-CommentsClose CommentsPermalink





‘(A) BORROWER CERTIFICATION-CommentsClose CommentsPermalink





‘(i) IN GENERAL- The mortgagor shall provide certification to the Secretary that the mortgagor has not intentionally defaulted on the mortgage or any other debt, and has not knowingly, or willfully and with actual knowledge, furnished material information known to be false for the purpose of obtaining any eligible mortgage.CommentsClose CommentsPermalink





‘(ii) PENALTIES-CommentsClose CommentsPermalink





‘(I) FALSE STATEMENT- Any certification filed pursuant to clause (i) shall contain an acknowledgment that any willful false statement made in such certification is punishable under section 1001, of title 18, United States Code, by fine or imprisonment of not more than 5 years, or both.CommentsClose CommentsPermalink





‘(II) LIABILITY FOR REPAYMENT- The mortgagor shall agree in writing that the mortgagor shall be liable to repay to the Federal Housing Administration any direct financial benefit achieved from the reduction of indebtedness on the existing mortgage or mortgages on the residence refinanced under this section derived from misrepresentations made in the employees of the Department of Housing and Urban Development necessary to perform such functions, duties, and activities.(2) ENTERPRISE-RELATED FUNCTIONS- For purposes ofcertifications and documentation required under this chapter, the term `enterprise-related functions of the Department' means the functions, duties, and activities of the Department of Housing and Urban Development determined under paragraph (1)(A).(3) ENTERPRISE-RELATED EMPLOYEES- For purposes ofsubparagraph, subject to the discretion of the Secretary.CommentsClose CommentsPermalink





‘(B) CURRENT BORROWER DEBT-TO-INCOME RATIO- As of March 1, 2008, the mortgagor shall have had a ratio of mortgage debt to income, taking into consideration all existing mortgages of that mortgagor at such time, greater than 31 percent (or such higher amount as the Board determines appropriate).CommentsClose CommentsPermalink





‘(2) DETERMINATION OF PRINCIPAL OBLIGATION AMOUNT- The principal obligation amount of the refinanced eligible mortgage to be insured shall--CommentsClose CommentsPermalink





‘(A) be determined by the reasonable ability of the mortgagor to make his or her mortgage payments, as such ability is determined by the Secretary pursuant to section 203(b)(4) or by any other underwriting standards established by the Board; andCommentsClose CommentsPermalink





‘(B) not exceed 90 percent of the appraised value of the property to which such mortgage relates.CommentsClose CommentsPermalink





‘(3) REQUIRED WAIVER OF PREPAYMENT PENALTIES AND FEES- All penalties for prepayment or refinancing of the eligible mortgage, and all fees and penalties related to default or delinquency on the eligible mortgage, shall be waived or forgiven.CommentsClose CommentsPermalink





‘(4) EXTINGUISHMENT OF SUBORDINATE LIENS-CommentsClose CommentsPermalink





‘(A) REQUIRED AGREEMENT- All holders of outstanding mortgage liens on the property to which the eligible mortgage relates shall agree to accept the proceeds of the insured loan as payment in full of all indebtedness under the eligible mortgage, and all encumbrances related to such eligible mortgage shall be removed. The Secretary may take such actions, subject to standards established by the Board under subparagraph (B), as may be necessary and appropriate to facilitate coordination and agreement between the holders of the existing senior mortgage and any existing subordinate mortgages, taking into consideration the subordinate lien status of such subordinate mortgages.CommentsClose CommentsPermalink





‘(B) SHARED APPRECIATION-CommentsClose CommentsPermalink





‘(i) IN GENERAL- The Board shall establish standards and policies that will allow for the payment to the holder of any existing subordinate mortgage of a portion of any future appreciation in the property secured by such eligible mortgage that is owed to the Secretary pursuant to subsection (k).CommentsClose CommentsPermalink





‘(ii) FACTORS- In establishing the standards and policies required under clause (i), the Board shall take into consideration--CommentsClose CommentsPermalink





‘(I) the status of any subordinate mortgage;CommentsClose CommentsPermalink





‘(II) the outstanding principal balance of and accrued interest on the existing senior mortgage and any outstanding subordinate mortgages;CommentsClose CommentsPermalink





‘(III) the extent to which the current appraised value of the property securing a subordinate mortgage is less than the outstanding principal balance and accrued interest on any other liens that are senior to such subordinate mortgage; andCommentsClose CommentsPermalink





‘(IV) such other factors as the Board determines to be appropriate.CommentsClose CommentsPermalink





‘(C) VOLUNTARY PROGRAM- This paragraph may not be construed to require any holder of any existing mortgage to participate in the program under this section generally, or with respect to any particular loan.CommentsClose CommentsPermalink





‘(5) TERM OF MORTGAGE- The refinanced eligible mortgage to be insured shall--CommentsClose CommentsPermalink





‘(A) bear interest at a single rate that is fixed for the entire term of the mortgage; andCommentsClose CommentsPermalink





‘(B) have a maturity of not less than 30 years from the date of the beginning of amortization of such refinanced eligible mortgage.CommentsClose CommentsPermalink





‘(6) MAXIMUM LOAN AMOUNT- The principal obligation amount of the eligible mortgage to be insured shall not exceed 132 percent of 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 property of the applicable size.CommentsClose CommentsPermalink





‘(7) PROHIBITION ON SECOND LIENS- A mortgagor may not grant a new second lien on the mortgaged property during the first 5 years of the term of the mortgage insured under this section, except as the Board determines to be necessary to ensure the maintenance of property standards; and provided that such new outstanding liens (A) do not reduce the value of the Government’s equity in the borrower’s home; and (B) when combined with the mortgagor’s existing mortgage indebtedness, do not exceed 95 percent of the home’s appraised value at the time of the new second lien.CommentsClose CommentsPermalink





‘(8) APPRAISALS- Any appraisal conducted in connection with a mortgage insured under this section shall--CommentsClose CommentsPermalink





‘(A) be based on the current value of the property;CommentsClose CommentsPermalink





‘(B) be conducted in accordance with title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3331 et seq.);CommentsClose CommentsPermalink





‘(C) be completed by an appraiser who meets the competency requirements of the Uniform Standards of Professional Appraisal Practice;CommentsClose CommentsPermalink





‘(D) be wholly consistent with the appraisal standards, practices, and procedures under section 202(e) of this Act that apply to all loans insured under this chapter, the term `enterprise-related employees of the Department' means the employees of the Department of Housing and Urban Development determined under paragraph (1)(B).(c) Disposition of Affairs- During the 6-month period beginning on the date of enactment of this Act, the Secretary of Housing and Urban Development (in this subtitle referred to as the `Secretary'), for the purpose of winding up the affairs of the Secretary regarding the enterprise-related functions of the Department of Housing and Urban Development (in this subtitle referred to as the `Department') and in addition to carrying out the Secretary's other responsibilities under law regarding such functions--(1) shall manage the enterprise-related employees of the Department and provide for the payment of the compensation and benefits of any such employee which accrue before the effective date of the transfer of any such employee under section 397; and(2) may take any other action necessary for the purpose of winding up the enterprise-related functions of the Department.(d) Status of Employees Before Transfer- The amendments made by subtitles A and B and the termination of the enterprise-related functions of the Department under subsection (b) may not be construed to affect the status of any employee of the Department as employees of an agency of the United States for purposes of any other provision of law before the effective date of the transfer of any such employee under section 397.(e) Use of Property and Services-(1) PROPERTY- The Director of the Federal Housing Finance Agency may use the propertyAct; andCommentsClose CommentsPermalink





‘(E) comply with the requirements of subsection (g) of this section (relating to appraisal independence).CommentsClose CommentsPermalink





‘(9) DOCUMENTATION AND VERIFICATION OF INCOME- In complying with the FHA underwriting requirements under the HOPE for Homeowners Program under this section, the mortgagee shall document and verify the income of the mortgagor or non-filing status by procuring (A) an income tax return transcript of the income tax returns of the mortgagor, or(B) a copy of the income tax returns from the Internal Revenue Service, for the two most recent years for which the filing deadline for such years has passed and by any other method, in accordance with procedures and standards that the Board shall establish.CommentsClose CommentsPermalink





‘(10) MORTGAGE FRAUD- The mortgagor shall not have been convicted under Federal or State law for fraud during the 10-year period ending upon the insurance of the mortgage under this section.CommentsClose CommentsPermalink





‘(11) PRIMARY RESIDENCE- The mortgagor shall provide documentation satisfactory in the determination of the Secretary to perform functions which have been transferred to the Director of the Federal Housing Finance Agency for such time as is reasonable to facilitate the orderly transfer of functions transferred under any other provision of this title or any amendment made by this title to any other provision of law.(2) AGENCY SERVICES- Any agency, department, or other instrumentality of the United States, and any successor to any such agency, department, or instrumentality, which was providing supporting services to the Secretary regarding enterprise-related functions of the Department before the termination date under subsection (a) in connection with such functions that are transferred to the Director of the Federal Housing Finance Agency shall--rove that the residence covered by the mortgage to be insured under this section is occupied by the mortgagor as the primary residence of the mortgagor, and that such residence is the only residence in which the mortgagor has any present ownership interest.CommentsClose CommentsPermalink





‘(f) Study of Auction or Bulk Refinance Program-CommentsClose CommentsPermalink





‘(1) STUDY- The Board shall conduct a study of the need for and efficacy of an auction or bulk refinancing mechanism to facilitate refinancing of existing residential mortgages that are at risk for foreclosure into mortgages insured under this section. The study shall identify and examine various options for mechanisms under which lenders and servicers of such mortgages may make bids for forward commitments for such insurance in an expedited manner.CommentsClose CommentsPermalink





‘(2) CONTENT-CommentsClose CommentsPermalink





‘(A) ANALYSIS- The study required under paragraph (1) shall analyze--CommentsClose CommentsPermalink





‘(i) the feasibility of establishing a mechanism that would facilitate the more rapid refinancing of borrowers at risk of foreclosure into performing mortgages insured under this section;CommentsClose CommentsPermalink





‘(ii) whether such a mechanism would provide an effective and efficient mechanism to reduce foreclosures on qualified existing mortgages;CommentsClose CommentsPermalink





‘(iii) whether the use of an auction or bulk refinance program is necessary to stabilize the housing market and reduce the impact of turmoil in that market on the economy of the United States;CommentsClose CommentsPermalink





‘(iv) whether there are other mechanisms or authority that would be useful to reduce foreclosure; andCommentsClose CommentsPermalink





‘(v) and any other factors that the Board considers relevant.CommentsClose CommentsPermalink





‘(B) DETERMINATIONS- To the extent that the Board finds that a facility of the type described in subparagraph (A)continue to provide such services, on a reimbursable basis, until the transfer of such functions is complete; and(B) consult with any such agency is feasible and useful, the study shall--CommentsClose CommentsPermalink





‘(i) determine and identify any additional authority or resources needed to establish and operate such a mechanism;CommentsClose CommentsPermalink





‘(ii) determine whether there is a need for additional authority with respect to the loan underwriting criteria established in this section or with respect to coordinate and facilitate a prompt and reasonable transition.(f) Savings Provisions-eligibility of participating borrowers, lenders, or holders of liens;CommentsClose CommentsPermalink





‘(iii) determine whether such underwriting criteria should be established on the basis of individual loans, in the aggregate, or otherwise to facilitate the goal of refinancing borrowers at risk of foreclosure into viable loans insured under this section.CommentsClose CommentsPermalink





‘(3) REPORT- Not later than the expiration of the 60-day period beginning on the date of the enactment of this section, the Board shall submit a report regarding the results of the study conducted under this subsection to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate. The report shall include a detailed description of the analysis required under paragraph (2)(A) and of the determinations made pursuant to paragraph (2)(B), and shall include any other findings and recommendations of the Board pursuant to the study, including identifying various options for mechanisms described in paragraph (1)EXISTING RIGHTS, DUTIES, AND OBLIGATIONS NOT AFFECTED- Subsection (a) shall not affect the validity of any right, duty, or obligation of the United States, the Secretary, or any other person, which--(A) arises under the authorizing statutes, title XIII of the Housing and Community Development Act of 1992, or any other provision of law applicable with respect to the Secretary, in connection with the enterprise-related functions of the Department; and(B) existed on the day before.CommentsClose CommentsPermalink





‘(g) Appraisal Independence-CommentsClose CommentsPermalink





‘(1) PROHIBITIONS ON INTERESTED PARTIES IN A REAL ESTATE TRANSACTION- No mortgage lender, mortgage broker, mortgage banker, real estate broker, appraisal management company, employee of an appraisal management company, nor any other person with an interest in a real estate transaction involving an appraisal in connection with a mortgage insured under this section shall improperly influence, or attempt to improperly influence, through coercion, extortion, collusion, compensation, instruction, inducement, intimidation, nonpayment for services rendered, or bribery, the development, reporting, result, or review of a real estate appraisal sought in connection with the mortgage.CommentsClose CommentsPermalink





‘(2) CIVIL MONETARY PENALTIES- The Secretary may impose a civil money penalty for any knowing and material violation of paragraph (1) under the same terms and conditions as are authorized in section 536(a) of this Act.CommentsClose CommentsPermalink





‘(h) Standards To Protect Against Adverse Selection-CommentsClose CommentsPermalink





‘(1) IN GENERAL- The Board shall, by rule or order, establish standards and policies to require the underwriter of the insured loan to provide such representations and warranties as the Board considers necessary or appropriate to enforce compliance with all underwriting and appraisal standards of the HOPE for Homeowners Program.CommentsClose CommentsPermalink





‘(2) EXCLUSION FOR VIOLATIONS- The Board shall prohibit the Secretary from paying insurance benefits to a mortgagee who violates the representations and warranties, as established under paragraph (1), or in any case in which a mortgagor fails to make the first payment on a refinanced eligible mortgage.CommentsClose CommentsPermalink





‘(3) OTHER AUTHORITY- The Board may establish such other standards or policies as necessary to protect against adverse selection, including requiring loans identified by the Secretary as higher risk loans to demonstrate payment performance for a reasonable period of time prior to being insured under the program.CommentsClose CommentsPermalink





‘(i) Premiums- For each refinanced eligible mortgage insured under this section, the Secretary shall establish and collect--CommentsClose CommentsPermalink





‘(1) at the time of insurance, a single premium payment in an amount equal to 3 percent of the amount of the original insured principal obligation of the refinanced eligible mortgage, which shall be paid from the proceeds of the mortgage being insured under this section, through the reduction of the amount of indebtedness that existed on the eligible mortgage prior to refinancing; andCommentsClose CommentsPermalink





‘(2) in addition to the premium required under paragraph (1), an annual premium in an amount equal to 1.5 percent of the amount of the termination date under subsection (a).(2) CONTINUATION OF SUITS- No action or other proceeding commenced by or against the Secretary in connection with the enterprise-related functions of the Department shall abate by reason of the enactment of this title, except that the Director of the Federal Housing Finance Agencyremaining insured principal balance of the mortgage.CommentsClose CommentsPermalink





‘(j) Origination Fees and Interest Rate- The Board shall establish--CommentsClose CommentsPermalink





‘(1) a reasonable limitation on origination fees for refinanced eligible mortgages insured under this section; andCommentsClose CommentsPermalink





‘(2) procedures to ensure that interest rates on such mortgages shall be substituted for the Secretary or any member thereof as a party to any such action or proceeding.SEC. 396. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.(a) In General- All regulations, orders, and determinations described in subsection (b) shall remain in effect according to the terms of such regulations, orders, determinations, and resolutions, and shall be enforceable by or against the Director of the Federal Housing Finance Agency until modified, terminated, set aside, or superseded in accordance with applicable law by such Director, any court of competent jurisdiction, or operation of law.(b) Applicability- A regulation, order, or determination is described under this subsection if it--(1) was issued, made, prescribed, or allowed to become effective by--(A) the Secretary; or(B) a court of competent jurisdiction and that relate to the enterprise-related functions of the Department; and(2) is in effect on the termination date under section 395(a).SEC. 397. TRANSFER AND RIGHTS OF EMPLOYEES OF DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT.(a) Transfer-(1) IN GENERAL- Except as provided in paragraph (2), each enterprise-related employee of the Departmentcommensurate with market rate interest rates on such types of loans.CommentsClose CommentsPermalink





‘(k) Equity and Appreciation-CommentsClose CommentsPermalink





‘(1) FIVE-YEAR PHASE-IN FOR EQUITY AS A RESULT OF SALE OR REFINANCING- For each eligible mortgage insured under this section, the Secretary and the mortgagor of such mortgage shall, upon any sale or disposition of the property to which such mortgage relates, or upon the subsequent refinancing of such mortgage, be entitled to the following with respect to any equity created as a direct result of such sale or refinancing:CommentsClose CommentsPermalink





‘(A) If such sale or refinancing occurs during the period that begins on the date that such mortgage is insured and ends 1 year after such date of insurance, the Secretary shall be transferred to the Federal Housing Finance Agency for employment not later than the termination date under section 395(a) and such transfeentitled to 100 percent of such equity.CommentsClose CommentsPermalink





‘(B) If such sale or refinancing occurs during the period that begins 1 year after such date of insurance and ends 2 years after such date of insurance, the Secretary shall be entitled to 90 percent of such equity and the mortgagor shall be deemed a transfer of function for purposes ofsection 3503 of title 5, United States Code.(2) AUTHORITY TO DECLINE- An enterprise-related employee of the Department may, in the discretion of the employee, decline transfer under paragraph (1) to a position in the Federal Housing Finance Agency and shallentitled to 10 percent of such equity.CommentsClose CommentsPermalink





‘(C) If such sale or refinancing occurs during the period that begins 2 years after such date of insurance and ends 3 years after such date of insurance, the Secretary shall be entitled to 80 percent of such equity and the mortgagor shall be guaranteed a position in the Department with the same status, tenure, grade, and pay as that held on the day immediately preceding the date that such declination was made. Each such employee holding a permanent position shall not be involuntarily separated or reduced in grade or compensation for 12 months after the date that the transfer would otherwise have occurred, except for cause or, if the employee is a temporary employee, separated in accordance with the terms of the appointment.(b) Guaranteed Positions- Each enterprise-related employee of the Department transferred under subsection (a)entitled to 20 percent of such equity.CommentsClose CommentsPermalink





‘(D) If such sale or refinancing occurs during the period that begins 3 years after such date of insurance and ends 4 years after such date of insurance, the Secretary shall be guaranteed a position with the same status, tenure, grade, and pay as that held on the day immediately preceding the transfer. Each such employee holding a permanent position shall not be involuntarily separated or reduced in grade or compensation for 12 months after the date of transfer, except for cause or, if the employee is a temporary employee, separated in accordance with the terms of the appointment.(c) Appointment Authority for Excepted and Senior Executive Service Employees-(1) IN GENERAL- In the casentitled to 70 percent of such equity and the mortgagor shall be entitled to 30 percent of such equity.CommentsClose CommentsPermalink





‘(E) If such sale or refinancing occurs during the period that begins 4 years after such date of insurance and ends 5 years after such date of employees occupying positions in the excepted service or the Senior Executive Service, any appointment authority established under law or by regulations of the Office of Personnel Management for filling such positions shall be transferred, subject to paragraph (2).(2) DECLINE OF TRANSFER- The Director of the Federal Housing Finance Agency may decline a transfer of authority under paragraph (1) (and the employees appointed pursuant thereto) to the extent that such authority relates to positions excepted from the competitive service because of their confidential, policymaking, policy-determining, or policy-advocating character, and noncareer positions in the Senior Executive Service (within the meaning ofsection 3132(a)(7) of title 5, United States Code).(d) Reorganization- If the Director of the Federal Housing Finance Agency determines, after the end of the 1-year period beginning oninsurance, the Secretary shall be entitled to 60 percent of such equity and the mortgagor shall be entitled to 40 percent of such equity.CommentsClose CommentsPermalink





‘(F) If such sale or refinancing occurs during any period that begins 5 years after such date of insurance, the Secretary shall be entitled to 50 percent of such equity and the mortgagor shall be entitled to 50 percent of such equity.CommentsClose CommentsPermalink





‘(2) APPRECIATION IN VALUE- For each eligible mortgage insured under this section, the Secretary and the mortgagor of such mortgage shall, upon any sale or disposition of the property to which such mortgage relates, each be entitled to 50 percent of any appreciation in value of the termination date under section 395(a), that a reorganization of the combined workforce is required, that reorganization shall be deemed a major reorganization for purposesappraised value of such property that has occurred since the date that such mortgage was insured under this section.CommentsClose CommentsPermalink





‘(l) Establishment of HOPE Fund-CommentsClose CommentsPermalink





‘(1) IN GENERAL- There is established in the Federal Housing Administration a revolving fund to be known as the Home Ownership Preservation Entity Fund, which shall be used by the Board for carrying out the mortgage insurance obligations under this section.CommentsClose CommentsPermalink





‘(2) MANAGEMENT OF FUND- The HOPE Fund shall be administered and managed by the Secretary, who shall establish reasonable and prudent criteria for the management and operation of any amounts in the HOPE Fund.CommentsClose CommentsPermalink





‘(m) Limitation on Aggregate Insurance Authority- The aggregate original principal obligation of all mortgages insured under this section may not exceed $300,000,000,000.CommentsClose CommentsPermalink





‘(n) Reports by the Board- The Board shall submit monthly reports to the Congress identifying the progress of the HOPE for Homeowners Program, which shall contain the following information for each month:CommentsClose CommentsPermalink





‘(1) The number of new mortgages insured under this section, including the location of the properties subject to such mortgages by census tract.CommentsClose CommentsPermalink





‘(2) The aggregate principal obligation of new mortgages insured under this section.CommentsClose CommentsPermalink





‘(3) The average amount by which the principle balance outstanding on mortgages insured this section was reduced.CommentsClose CommentsPermalink





‘(4) The amount of premiums collected for insurance of mortgages under this section.CommentsClose CommentsPermalink





‘(5) The claim and loss rates for mortgages insured under this section.CommentsClose CommentsPermalink





‘(6) Any other information that the Board considers appropriate.CommentsClose CommentsPermalink





‘(o) Required Outreach Efforts- The Secretary shall carry out outreach efforts to ensure that homeowners, lenders, and the general public are aware of the opportunities for assistance available under this section.CommentsClose CommentsPermalink





‘(p) Enhancement of FHA Capacity- Under the direction of the Board, the Secretary shall take such actions as may be necessary to--CommentsClose CommentsPermalink





‘(1) contract for the establishment of underwriting criteria, automated underwriting systems, pricing standards, and other factors relating to eligibility for mortgages insured under this section;CommentsClose CommentsPermalink





‘(2) contract for independent quality reviews of underwriting, including appraisal reviews and fraud detection, of mortgages insured under this section or pools of such mortgages; andCommentsClose CommentsPermalink





‘(3) increase personnel of the Department as necessary to process or monitor the processing of mortgages insured under this section.CommentsClose CommentsPermalink





‘(q) GNMA Commitment Authority-CommentsClose CommentsPermalink





‘(1) GUARANTEES- The Secretary shall take such actions as may be necessary to ensure that securities based on and backed by a trust or pool composed of mortgages insured under this section are available to be guaranteed by the Government National Mortgage Association as to the timely payment of principal and interest.CommentsClose CommentsPermalink





‘(2) GUARANTEE AUTHORITY- To carry out the purposes of section 306 of the National Housing Act (12 U.S.C. 1721), the Government National Mortgage Association may enter into new commitments to issue guarantees of securities based on or backed by mortgages insured under this section, not exceeding $300,000,000,000. The amount of authority provided under the preceding sentence to enter into new commitments to issue guarantees is in addition to any amount of authority to make new commitments to issue guarantees that is provided to the Association under any other provision of law.CommentsClose CommentsPermalink





‘(r) Sunset- The Secretary may not enter into any new commitment to insure any refinanced eligible mortgage, or newly insure any refinanced eligible mortgage pursuant to this section before October 1, 2008 or after September 30, 2011.CommentsClose CommentsPermalink





‘(s) Definitions- For purposes of this section, the following definitions shall apply:CommentsClose CommentsPermalink





‘(1) APPROVED FINANCIAL INSTITUTION OR MORTGAGEE- The term ‘approved financial institution or mortgagee’ means a financial institution or mortgagee approved by the Secretary under section 203 as responsible and able to service mortgages responsibly.CommentsClose CommentsPermalink





‘(2) BOARD- The term ‘Board’ means the Board of Directors of the HOPE for Homeowners Program. The Board shall be composed of the Secretary, the Secretary of the Treasury, the Chairperson of the Board of affording affected employees retirement under section 8336(d)(2) or 8414(b)(1)(B)Governors of the Federal Reserve System, and the Chairperson of the Board of Directors of the Federal Deposit Insurance Corporation, or their designees.CommentsClose CommentsPermalink





‘(3) ELIGIBLE MORTGAGE- The term ‘eligible mortgage’ means a mortgage--CommentsClose CommentsPermalink





‘(A) the mortgagor of which--CommentsClose CommentsPermalink





‘(i) occupies such property as his or her principal residence; andCommentsClose CommentsPermalink





‘(ii) cannot, subject to subsection (e)(1)(B) and such other standards established by the Board, afford his or her mortgage payments; andCommentsClose CommentsPermalink





‘(B) originated on or before January 1, 2008.CommentsClose CommentsPermalink





‘(4) EXISTING SENIOR MORTGAGE- The term ‘existing senior mortgage’ means, with respect to a mortgage insured under this section, the existing mortgage that has superior priority.CommentsClose CommentsPermalink





‘(5) EXISTING SUBORDINATE MORTGAGE- The term ‘existing subordinate mortgage’ means, with respect to a mortgage insured under this section, an existing mortgage that has subordinate priority to the existing senior mortgage.CommentsClose CommentsPermalink





‘(6) HOPE FOR HOMEOWNERS PROGRAM- The term ‘HOPE for Homeowners Program’ means the program established under this section.CommentsClose CommentsPermalink





‘(7) SECRETARY- The term ‘Secretary’ means the Secretary of Housing and Urban Development, except where specifically provided otherwise.CommentsClose CommentsPermalink





‘(t) Requirements Related to the Board-CommentsClose CommentsPermalink





‘(1) COMPENSATION, ACTUAL, NECESSARY, AND TRANSPORTATION EXPENSES-CommentsClose CommentsPermalink





‘(A) FEDERAL EMPLOYEES- A member of the Board who is an officer or employee of the Federal Government shall serve without additional pay (or benefits in the nature of compensation) for service as a member of the Board.CommentsClose CommentsPermalink





‘(B) TRAVEL EXPENSES- Members of the Board shall be entitled to receive travel expenses, including per diem in lieu of subsistence, equivalent to those set forth in subchapter I of chapter 57 of title 5, United States Code.CommentsClose CommentsPermalink





(e) Employee Benefit Programs-(1) IN GENERAL- Any enterprise-related employee of the Department accepting employment with the Federal Housing Finance Agency as a result of a transfer under subsection (a) may retain for 12 months after the date on which such transfer occurs membership in any employee benefit program of the Federal Housing Finance Agency or the Department, as applicable, including insurance, to which such employee belongs on the termination date under section 395(a) if--(A) the employee does not elect to give up the benefit or membership in the program; and(B) the benefit or program is continued by the Director of the Federal Housing Finance Agency.(2) COST DIFFERENTIAL- The difference in the costs between the benefits which would have been provided by the Department ‘(2) BYLAWS- The Board may prescribe, amend, and repeal such bylaws as may be necessary for carrying out the functions of the Board. CommentsClose CommentsPermalink





‘(3) QUORUM- A majority of the Board shall constitute a quorum.CommentsClose CommentsPermalink





‘(4) STAFF; EXPERTS AND CONSULTANTS-CommentsClose CommentsPermalink





‘(A) DETAIL OF GOVERNMENT EMPLOYEES- Upon request of the Board, any Federal Government employee may be detailed to the Board without reimbursement, and such detail shall be without interruption or loss of civil service status or privilege.CommentsClose CommentsPermalink





‘(B) EXPERTS AND CONSULTANTS- The Board shall procure the services of experts and consultants as the Board considers appropriate.CommentsClose CommentsPermalink





‘(u) Rule of Construction Related to Voluntary Nature of the Program- This section shall not be construed to require that any approved financial institution or mortgagee participate in any activity authorized under this section, including any activity related to the refinancing of an eligible mortgage.CommentsClose CommentsPermalink





‘(v) Rule of Construction Related to Insurance of Mortgages- Except as otherwise provided for in this section or by action of the Board, the provisions and requirements of section 203(b) shall apply with respect to the insurance of any eligible mortgage under this section.CommentsClose CommentsPermalink





‘(w) HOPE Bonds-CommentsClose CommentsPermalink





‘(1) ISSUANCE AND REPAYMENT OF BONDS- Notwithstanding section 504(b) of the Federal Credit Reform Act of 1990 (2 U.S.C. 661d(b)), the Secretary of the Treasury shall--CommentsClose CommentsPermalink





‘(A) subject to such terms and conditions as the Secretary of the Treasury deems necessary, issue Federal credit instruments, to be known as ‘HOPE Bonds’, that are callable at the discretion of the Secretary of the Treasury and do not, in the aggregate, exceed the amount specified in subsection (m);CommentsClose CommentsPermalink





‘(B) provide the subsidy amounts necessary for loan guarantees under the HOPE for Homeowners Program, not to exceed the amount specified in subsection (m), in accordance with the provisions of the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et seq.), except as provided in this paragraph; andCommentsClose CommentsPermalink





‘(C) use the proceeds from HOPE Bonds only to pay for the net costs to the Federal Government of the HOPE for Homeowners Program, including administrative costs.CommentsClose CommentsPermalink





‘(2) REIMBURSEMENTS TO TREASURY- Funds received pursuant to section 1338(b) of the Federal Housing Enterprises Regulatory Reform Act of 1992 shall be used to reimburse the Secretary of the Treasury for amounts borrowed under paragraph (1).CommentsClose CommentsPermalink





‘(3) USE OF RESERVE FUND- If the net cost to the Federal Government for the HOPE for Homeowners Program exceeds the amount of funds received under paragraph (2), remaining debts of the HOPE for Homeowners Program shall be paid from amounts deposited into the fund established by the Secretary under section 1337(e) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, remaining amounts in such fund to be used to reduce the National debt.CommentsClose CommentsPermalink





‘(4) REDUCTION OF NATIONAL DEBT- Amounts collected under the HOPE for Homeowners Program in accordance with subsections (i) and those provided by this section shall be paid by the Director of the Federal Housing Finance Agency. If any employee elects to give up membership in a health insurance program or the health insurance program is not continued by such Director, the employee shall be permitted to select an alternate Federal health insurance program within 30 days after such election or notice, without regard to any other regularly scheduled open season.SEC. 398. TRANSFER OF APPROPRIATIONS, PROPERTY, AND FACILITIES.Upon the termination date under section 395(a), all assets, liabilities, contracts, property, records, and unexpended balances of appropriations, authorizations, allocations, and other funds employed, held, used, arising from, available to, or to be made available to the Department in connection with enterprise-related functions of the Department shall transfer to the Director of the Federal Housing Finance Agency. Unexpended funds transferred by this section shall be used only for the purposes for which the funds were originally authorized and appropriated.

TITLE IV--EMERGENCY MORTGAGE LOAN MODIFICATIONSEC. 401. SHORT TITLE.This title may be cited as the `Emergency Mortgage Loan Modification Act of 2008'(k) in excess of the net cost to the Federal Government for such Program shall be used to reduce the National debt.’.CommentsClose CommentsPermalink

SEC. 402. SAFE HARBOR FOR QUALIFIED LOAN MODIFICATIONS OR WORKOUT PLANS FOR CERTAIN1403. FIDUCIARY DUTY OF SERVICERS OF POOLED RESIDENTIAL MORTGAGE LOANS.

(a) Standard for Loan Modifications or Workout Plans- Absent contractual provisions to the contrary--(1) the The Truth in Lending Act (15 U.S.C. 1601 et seq.) is amended by inserting after section 129 the following new section: CommentsClose CommentsPermalink

‘SEC. 129A. FIDUCIARY DUTY OF SERVICERS OF POOLED RESIDENTIAL MORTGAGES.

‘(a) In General- Except as may be established in any investment contract between a servicer of pooled residential mortgages and an investor, a servicer of pooled residential mortgages--CommentsClose CommentsPermalink





‘(1) owes any duty to maximize, or to not adversely affect, the recovery of total proceeds from pooled residential mortgage loans is owed by a servicer of such pooled loans to the securitization vehicle for the benefit of the net present value of the pooled mortgages in an investment to all investors and holders of beneficial interests in the pooled loans, in the aggregate, andparties having a direct or indirect interest in such investment, not to any individual party or group of parties; andCommentsClose CommentsPermalink





(2) a servicer of pooled residential mortgage loans shall be deemed to be acting on behalf of the securitization vehicle in the best interest of all‘(2) shall be deemed to act in the best interests of all such investors and holders of beneficial interests in the pooled loans, in the aggregate, if for a loan that is in payment default under the loan agreement or for which payment default is imminent or reasonably foreseeable, the loanparties if the servicer makes or causes to be made reasonable and documented efforts to implementagrees to or implements a modification or workout plan or, if such efforts are unsuccessful or such plan would be infeasible, engages or causes to engage in other loss mitigation, including accepting a short payment or partial discharge of principal, or agreeing to a short sale of the property, to the extent that the servicer, including any modification or refinancing undertaken pursuant to the HOPE for Homeowners Act of 2008, for a residential mortgage or a class of residential mortgages that constitute a part or all of the pooled mortgages in such investment, provided that any mortgage so modified meets the following criteria:CommentsClose CommentsPermalink





‘(A) Default on the payment of such mortgage has occurred or is reasonably believesforeseeable.CommentsClose CommentsPermalink





‘(B) The property securing such mortgage is occupied by the mortgagor of such mortgage.CommentsClose CommentsPermalink





‘(C) The anticipated recovery on the principal outstanding obligation of the mortgage under the modification or workout plan or other mitigation actions will maximize theexceeds, on a net present value to be realized on the loan over that which would be realizedbasis, the anticipated recovery on the principal outstanding obligation of the mortgage through foreclosure.CommentsClose CommentsPermalink





(b) Safe Harbor- Absent contractual provisions to the contrary, a servicer of a residential mortgage loan that acts or causes to act in a manner consistent with the duty set forth in subsection (a), shall not be liable for entering into a qualified ‘(b) Definition- As used in this section, the term ‘servicer’ means the person responsible for servicing of a loan (including the person who makes or holds a loan if such person also services the loan).’. CommentsClose CommentsPermalink

For purposes of this title, the following definitions shall apply:CommentsClose CommentsPermalink





(1) FEDERAL BANKING AGENCIES- The term ‘Federal banking agencies’ means the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the National Credit Union Administration, and the Federal Deposit Insurance Corporation.CommentsClose CommentsPermalink





(2) 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.CommentsClose CommentsPermalink





(3) LOAN ORIGINATOR-CommentsClose CommentsPermalink





(A) IN GENERAL- The term ‘loan originator’--CommentsClose CommentsPermalink





(i) means an individual who--CommentsClose CommentsPermalink





(I) takes a residential mortgage loan modification or workout plan, to--(1) any person, based on that person's ownership of a residential mortgage loan or any interest in a pool of residential mortgage loans or in securities that distribute payments out of the principal, interest and other payments in loans on the pool;(2) any person who is obligated to make payments pursuant to a derivatives instrument determined in reference to any interest referred to in paragraph (1); or(3) any person that insures any loan or any interest referred to in paragraph (1) under any law or regulation of the United States or any law or regulation of any State or political subdivision of any State.(c) Rule of Construction- No provision of this section shall be construed as limiting the ability of a servicer to enter into loan modifications or workout plans other than qualifiedapplication; andCommentsClose CommentsPermalink





(II) offers or negotiates terms of a residential mortgage loan for compensation or gain;CommentsClose CommentsPermalink





(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;CommentsClose CommentsPermalink





(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; andCommentsClose CommentsPermalink





(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.CommentsClose CommentsPermalink





(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.CommentsClose CommentsPermalink





(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.CommentsClose CommentsPermalink





(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--CommentsClose CommentsPermalink





(i) acting as a real estate agent or real estate broker for a buyer, seller, lessor, or lessee of real property;CommentsClose CommentsPermalink





(ii) bringing together parties interested in the sale, purchase, lease, rental, or exchange of real property;CommentsClose CommentsPermalink





(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);CommentsClose CommentsPermalink





(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; andCommentsClose CommentsPermalink





(v) offering to engage in any activity, or act in any capacity, described in clause (i), (ii), (iii), or (iv).CommentsClose CommentsPermalink





(4) LOAN PROCESSOR OR UNDERWRITER-CommentsClose CommentsPermalink





(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--CommentsClose CommentsPermalink





(i) a State-licensed loan originator; orCommentsClose CommentsPermalink





(ii) a registered loan originator.CommentsClose CommentsPermalink





(B) CLERICAL OR SUPPORT DUTIES- For purposes of subparagraph (A), the term ‘clerical or support duties’ may include--CommentsClose CommentsPermalink





(i) the receipt, collection, distribution, and analysis of information common for the processing or underwriting of a residential mortgage loan; andCommentsClose CommentsPermalink





(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 modification or workout plans.(d) Definitions- For purposes of this section, the following definitions shall apply:(1) QUALIFIED LOAN MODIFICATION OR WORKOUT PLAN- The term `qualified loan modification or workout plan' means a modification or plan that--(Arates or terms.CommentsClose CommentsPermalink





(5) 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 Secretary under section 1509.CommentsClose CommentsPermalink





(6) NONTRADITIONAL MORTGAGE PRODUCT- The term ‘nontraditional mortgage product’ means any mortgage product other than a 30-year fixed rate mortgage.CommentsClose CommentsPermalink





(7) REGISTERED LOAN ORIGINATOR- The term ‘registered loan originator’ means any individual who--CommentsClose CommentsPermalink





(A) meets the definition of loan originator and is an employee of--CommentsClose CommentsPermalink





(i) a depository institution;CommentsClose CommentsPermalink





(ii) a subsidiary that is--CommentsClose CommentsPermalink





(I) owned and controlled by a depository institution; andCommentsClose CommentsPermalink





(II) regulated by a Federal banking agency; orCommentsClose CommentsPermalink





(iii) an institution regulated by the Farm Credit Administration; andCommentsClose CommentsPermalink





(B) is scheduled to remain in place until the borrower sells or refinances the property, or for at least 5 years from the date of adoption of the plan, whichever is sooner;(B) does not provide for a repayment schedule that results in an increase inregistered with, and maintains a unique identifier through, the Nationwide Mortgage Licensing System and Registry.CommentsClose CommentsPermalink





(8) 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).CommentsClose CommentsPermalink





(9) SECRETARY- The term ‘Secretary’ means the Secretary of Housing and Urban Development.CommentsClose CommentsPermalink





(10) 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.CommentsClose CommentsPermalink





(11) STATE-LICENSED LOAN ORIGINATOR- The term ‘State-licensed loan originator’ means any individual who--CommentsClose CommentsPermalink





(A) is a loan originator;CommentsClose CommentsPermalink





(B) is not an employee of--CommentsClose CommentsPermalink





(i) a depository institution;CommentsClose CommentsPermalink





(ii) a subsidiary that is--CommentsClose CommentsPermalink





(I) owned and controlled by a depository institution; andCommentsClose CommentsPermalink





(II) regulated by a Federal banking agency; orCommentsClose CommentsPermalink





(iii) an institution regulated by the outstanding principal balance of the loan, including by deferred or unpaid interest, fees, or other charges; and(C) does not require the borrower to pay additional points and feesFarm Credit Administration; andCommentsClose CommentsPermalink





(C) is licensed by a State or by the Secretary under section 1508 and registered as a loan originator with, and maintains a unique identifier through, the Nationwide Mortgage Licensing System and Registry.CommentsClose CommentsPermalink





(12) UNIQUE IDENTIFIER-CommentsClose CommentsPermalink





(A) IN GENERAL- The term ‘unique identifier’ means a number or other identifier that--CommentsClose CommentsPermalink





(i) permanently identifies a loan originator;CommentsClose CommentsPermalink





(ii) is assigned by protocols established by the Nationwide Mortgage Licensing System and Registry and the Federal banking agencies 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; andCommentsClose CommentsPermalink





(iii) shall not be used for purposes other than those set forth under this title.CommentsClose CommentsPermalink





(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.CommentsClose CommentsPermalink

(a) In General- Subject to the existence of a licensing or registration regime, as the case may be, an individual may not engage in the business of a loan originator without first--CommentsClose CommentsPermalink





(1) obtaining, and maintaining annually--CommentsClose CommentsPermalink





(A) a registration as a registered loan originator; orCommentsClose CommentsPermalink





(B) a license and registration as a State-licensed loan originator; andCommentsClose CommentsPermalink





(2) obtaining a unique identifier.CommentsClose CommentsPermalink





(b) Loan Processors and Underwriters-CommentsClose CommentsPermalink





(1) SUPERVISED LOAN PROCESSORS AND UNDERWRITERS- A loan processor or underwriter who does not represent 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 individual can or will perform any of the activities of a loan originator shall not be required to be a State-licensed loan originator.CommentsClose CommentsPermalink





(2) RESIDENTIAL MORTGAGE LOAN DEFINED- The term `residential mortgage loan' means a loan that is secured by a lien on an owner-occupied residential dwelling.(3) SECURITIZATION VEHICLE- The term `securitization vehicle' means a trust, corporation, partnership, limited liability entity, special purpose entity, or other structure that--(A) is the issuer, or is created by the issuer, of mortgage pass-through certificates, participation certificates, mortgage-backed securities, or other similar securities backed by a pool of assets that includes residential mortgage loans; and(B) holds such loans.(e) Effective Period- This section shall apply only with respect to qualifiedINDEPENDENT CONTRACTORS- An independent contractor may not engage in residential mortgage loan modification or workout plans initiated prior to January 1, 2011.

TITLE V--OTHER HOUSING PROVISIONSSEC. 501. DEPOSITORY INSTITUTION COMMUNITY DEVELOPMENT INVESTMENTS ENHANCEMENTorigination activities as a loan processor or underwriter unless such independent contractor is a State-licensed loan originator.CommentsClose CommentsPermalink

SEC. 1505. STATE LICENSE AND REGISTRATION APPLICATION AND ISSUANCE.

(a) Technical CorrectionsBackground Checks- In connection with an application to any State for licensing and registration as a State-licensed loan originator, the applicant shall, at a minimum, furnish to the Nationwide Mortgage Licensing System and Registry information concerning the applicant’s identity, including--CommentsClose CommentsPermalink





(1) NATIONAL BANKS- The first sentence of the paragraph designated as the `Eleventh' of section 5136 of the Revised Statutes of the United States (12 U.S.C. 24) (as amended by section 305(a) of the Financial Services Regulatory Relief Act of 2006) is amended by striking `promotes the public welfare by benefitting primarily' and inserting `is designed primarily to promote the public welfare, including the welfare of'fingerprints for submission to the Federal Bureau of Investigation, and any governmental agency or entity authorized to receive such information for a State and national criminal history background check; andCommentsClose CommentsPermalink





(2) personal history and experience, including authorization for the System to obtain--CommentsClose CommentsPermalink





(A) an independent credit report obtained from a consumer reporting agency described in section 603(p) of the Fair Credit Reporting Act; andCommentsClose CommentsPermalink





(B) information related to any administrative, civil or criminal findings by any governmental jurisdiction.CommentsClose CommentsPermalink





(b) Issuance of License- The minimum standards for licensing and registration as a State-licensed loan originator shall include the following:CommentsClose CommentsPermalink





(1) The applicant has never had a loan originator license revoked in any governmental jurisdiction.CommentsClose CommentsPermalink





(2) The applicant has not been convicted of, or pled guilty or nolo contendere to, a felony in a domestic, foreign, or military court--CommentsClose CommentsPermalink





(A) during the 7-year period preceding the date of the application for licensing and registration; orCommentsClose CommentsPermalink





(B) at any time preceding such date of application, if such felony involved an act of fraud, dishonesty, or a breach of trust, or money laundering.CommentsClose CommentsPermalink





(3) The applicant has demonstrated financial responsibility, character, and general fitness such as to command the confidence of the community and to warrant a determination that the loan originator will operate honestly, fairly, and efficiently within the purposes of this title.CommentsClose CommentsPermalink





(4) The applicant has completed the pre-licensing education requirement described in subsection (c).CommentsClose CommentsPermalink





(5) The applicant has passed a written test that meets the test requirement described in subsection (d).CommentsClose CommentsPermalink





(6) The applicant has met either a net worth or surety bond requirement, or paid into a State fund, as required by the State pursuant to section 1508(d)(6).CommentsClose CommentsPermalink





(c) Pre-Licensing Education of Loan Originators-CommentsClose CommentsPermalink





(1) MINIMUM EDUCATIONAL REQUIREMENTS- In order to meet the pre-licensing education requirement referred to in subsection (b)(4), a person shall complete at least 20 hours of education approved in accordance with paragraph (2), which shall include at least--CommentsClose CommentsPermalink





(A) 3 hours of Federal law and regulations;CommentsClose CommentsPermalink





(B) 3 hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues; andCommentsClose CommentsPermalink





(C) 2 hours of training related to lending standards for the nontraditional mortgage product marketplace.CommentsClose CommentsPermalink





(2) APPROVED EDUCATIONAL COURSES- For purposes of paragraph (1), pre-licensing education courses shall be reviewed, and approved by the Nationwide Mortgage Licensing System and Registry.CommentsClose CommentsPermalink





(3) LIMITATION AND STANDARDS-CommentsClose CommentsPermalink





(A) LIMITATION- To maintain the independence of the approval process, the Nationwide Mortgage Licensing System and Registry shall not directly or indirectly offer pre-licensure educational courses for loan originators.CommentsClose CommentsPermalink





(B) STANDARDS- In approving courses under this section, the Nationwide Mortgage Licensing System and Registry shall apply reasonable standards in the review and approval of courses.CommentsClose CommentsPermalink





(d) Testing of Loan Originators-CommentsClose CommentsPermalink





(1) IN GENERAL- In order to meet the written test requirement referred to in subsection (b)(5), an individual shall pass, in accordance with the standards established under this subsection, a qualified written test developed by the Nationwide Mortgage Licensing System and Registry and administered by an approved test provider.CommentsClose CommentsPermalink





(2) QUALIFIED TEST- A written test shall not be treated as a qualified written test for purposes of paragraph (1) unless the test adequately measures the applicant’s knowledge and comprehension in appropriate subject areas, including--CommentsClose CommentsPermalink





(A) ethics;CommentsClose CommentsPermalink





(B) Federal law and regulation pertaining to mortgage origination;CommentsClose CommentsPermalink





(C) State law and regulation pertaining to mortgage origination;CommentsClose CommentsPermalink





(D) Federal and State law and regulation, including instruction on fraud, consumer protection, the nontraditional mortgage marketplace, and fair lending issues.CommentsClose CommentsPermalink





(3) MINIMUM COMPETENCE-CommentsClose CommentsPermalink





(A) PASSING SCORE- An individual shall not be considered to have passed a qualified written test unless the individual achieves a test score of not less than 75 percent correct answers to questions.CommentsClose CommentsPermalink





(B) INITIAL RETESTS- An individual may retake a test 3 consecutive times with each consecutive taking occurring at least 30 days after the preceding test.CommentsClose CommentsPermalink





(C) SUBSEQUENT RETESTS- After failing 3 consecutive tests, an individual shall wait at least 6 months before taking the test again.CommentsClose CommentsPermalink





(D) RETEST AFTER LAPSE OF LICENSE- A State-licensed loan originator who fails to maintain a valid license for a period of 5 years or longer shall retake the test, not taking into account any time during which such individual is a registered loan originator.CommentsClose CommentsPermalink





(e) Mortgage Call Reports- Each mortgage licensee shall submit to the Nationwide Mortgage Licensing System and Registry reports of condition, which shall be in such form and shall contain such information as the Nationwide Mortgage Licensing System and Registry may require.CommentsClose CommentsPermalink

SEC. 1506. STANDARDS FOR STATE MEMBER BANKS- The first sentence of the 23rd undesignated paragraph of section 9 of the Federal Reserve Act (12 U.S.C. 338a) (as amended by section 305(b) of the LICENSE RENEWAL.

(a) Development-CommentsClose CommentsPermalink





(1) IN GENERAL- The Federal banking agencies shall jointly, through the Federal Financial Services Regulatory Relief Act of 2006) is amended by striking `promotes the public welfare by benefitting primarily' and inserting `is designed primarily to promote the public welfare, including the welfare of'Institutions Examination Council, and together with the Farm Credit Administration, develop and maintain a system for registering employees of a depository institution, employees of a subsidiary that is owned and controlled by a depository institution and regulated by a Federal banking agency, or employees of an institution regulated by the Farm Credit Administration, as registered loan originators with the Nationwide Mortgage Licensing System and Registry. The system shall be implemented before the end of the 1-year period beginning on the date of enactment of this title.CommentsClose CommentsPermalink





(2) REGISTRATION REQUIREMENTS- In connection with the registration of any loan originator under this subsection, the appropriate Federal banking agency and the Farm Credit Administration shall, at a minimum, furnish or cause to be furnished to the Nationwide Mortgage Licensing System and Registry information concerning the employees’s identity, including--CommentsClose CommentsPermalink





(A) fingerprints for submission to the Federal Bureau of Investigation, and any governmental agency or entity authorized to receive such information for a State and national criminal history background check; andCommentsClose CommentsPermalink





(B) personal history and experience, including authorization for the Nationwide Mortgage Licensing System and Registry to obtain information related to any administrative, civil or criminal findings by any governmental jurisdiction.CommentsClose CommentsPermalink





(b) Investments by Federal Savings Associations Authorized to Promote theCoordination-CommentsClose CommentsPermalink





(1) UNIQUE IDENTIFIER- The Federal banking agencies, through the Financial Institutions Examination Council, and the Farm Credit Administration shall coordinate with the Nationwide Mortgage Licensing System and Registry to establish protocols for assigning a unique identifier to each registered loan originator that will facilitate electronic tracking and uniform identification of, and public access to, the employment history of and publicly adjudicated disciplinary and enforcement actions against loan originators.CommentsClose CommentsPermalink





(2) NATIONWIDE MORTGAGE LICENSING SYSTEM AND REGISTRY DEVELOPMENT- To facilitate the transfer of information required by subsection (a)(2), the Nationwide Mortgage Licensing System and Registry shall coordinate with the Federal banking agencies, through the Financial Institutions Examination Council, and the Farm Credit Administration concerning the development and operation, by such System and Registry, of the registration functionality and data requirements for loan originators.CommentsClose CommentsPermalink





(c) Consideration of Factors and Procedures- In establishing the registration procedures under subsection (a) and the protocols for assigning a unique identifier to a registered loan originator, the Federal banking agencies shall make such de minimis exceptions as may be appropriate to paragraphs (1)(A) and (2) of section 1504(a), shall make reasonable efforts to utilize existing information to minimize the burden of registering loan originators, and shall consider methods for automating the process to the greatest extent practicable consistent with the purposes of this title.CommentsClose CommentsPermalink

(a) System Confidentiality- Except as otherwise provided in this section, any requirement under Federal or State law regarding the privacy or confidentiality of any information or material provided to the Nationwide Mortgage Licensing System and Registry or a system established by the Secretary under section 1509, and any privilege arising under Federal or State law (including the rules of any Federal or State court) with respect to such information or material, shall continue to apply to such information or material after the information or material has been disclosed to the system. Such information and material may be shared with all State and Federal regulatory officials with mortgage industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by Federal and State laws.CommentsClose CommentsPermalink





(b) Nonapplicability of Certain Requirements- Information or material that is subject to a privilege or confidentiality under subsection (a) shall not be subject to--CommentsClose CommentsPermalink





(1) disclosure under any Federal or State law governing the disclosure to the public of information held by an officer or an agency of the Federal Government or the respective State; orCommentsClose CommentsPermalink





(2) subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Mortgage Licensing System and Registry or the Secretary with respect to such information or material, the person to whom such information or material pertains waives, in whole or in part, in the discretion of such person, that privilege.CommentsClose CommentsPermalink





(c) Coordination With Other Law- Any State law, including any State open record law, relating to the disclosure of confidential supervisory information or any information or material described in subsection (a) that is inconsistent with subsection (a) shall be superseded by the requirements of such provision to the extent State law provides less confidentiality or a weaker privilege.CommentsClose CommentsPermalink





(d) Public Welfare-(1) IN GENERAL- Section 5(c)(3) of the Home Owners' Loan Act (12 U.S.C. 1464(c)) is amended by adding at the end the following new subparagraph:`(D) DIRECT INVESTMENTS TO PROMOTE THE PUBLIC WELFARE-`(i) IN GENERAL- A Federal savings association may make investments, directly or indirectly, each of which is designed primarily to promote the public welfare, including the welfare of low- and moderate-income communities or families through the provisionAccess to Information- This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions against, loan originators that is included in Nationwide Mortgage Licensing System and Registry for access by the public.CommentsClose CommentsPermalink

(a) Summons Authority- The Secretary may--CommentsClose CommentsPermalink





(1) examine any books, papers, records, or other data of any loan originator operating in any State which is subject to a licensing system established by the Secretary under section 1508; andCommentsClose CommentsPermalink





(2) summon any loan originator referred to in paragraph (1) or any person having possession, custody, or care of the reports and records relating to such loan originator, to appear before the Secretary or any delegate of the Secretary at a time and place named in the summons and to produce such books, papers, records, or other data, and to give testimony, under oath, as may be relevant or material to an investigation of such loan originator for compliance with the requirements of this title.CommentsClose CommentsPermalink





(b) Examination Authority-CommentsClose CommentsPermalink





(1) IN GENERAL- If the Secretary establishes a licensing system under section 1508 for any State, the Secretary shall appoint examiners for the purposes of housing, services, and jobs.`(ii) DIRECT INVESTMENTS OR ACQUISITION OF INTEREST IN OTHER COMPANIES- Investments under clause (i) may be made directly or by purchasing interests in an entity primarily engaged in making such investments.`(iii) PROHIBITION ON UNLIMITED LIABILITY- No investment may be made under this subparagraph which would subject a Federal savings association to unlimited liability to any person.`(iv) SINGLE INVESTMENT LIMITATION TO BE ESTABLISHED BY DIRECTOR- Subject to clauses (v) and (vi), the Director shall establish, by order or regulation, limits on--`(I) the amount any savings association may invest in any 1 project; and`(II) the aggregate amount of investment of any savings association under this subparagraph.`(v) FLEXIBLE AGGREGATE INVESTMENT LIMITATION- The aggregate amount of investments of any savings association under this subparagraph may not exceed an amount equal to the sum of 5 percent of the savings association's capital stock actually paid in and unimpaired and 5 percent of the savings association's unimpaired surplus, unless--`(I) the Director determines that the savings association is adequately capitalized; and`(II) the Director determines, by order, that the aggregate amount of investments in a higher amount than the limit under this clause will pose no significant risk to the affected deposit insurance fund.`(vi) MAXIMUM AGGREGATE INVESTMENT LIMITATION- Notwithstanding clause (v), the aggregate amount of investments of any savings association under this subparagraph may not exceed an amount equal to the sum of 15 percent of the savings association's capital stock actually paid in and unimpaired and 15 percent of the savings association's unimpaired surplus.`(vii) INVESTMENTS NOT SUBJECT TO OTHER LIMITATION ON QUALITY OF INVESTMENTS- No obligation a Federal savings association acquires or retains under this subparagraph shall be taken into account for purposes of the limitation contained in section 28(d) of the Federal Deposit Insurance Act on the acquisition and retention of any corporate debt security not of investment grade.`(viii) APPLICABILITY OF STANDARDS TO EACH INVESTMENT- The standardsadministering such section.CommentsClose CommentsPermalink





(2) POWER TO EXAMINE- Any examiner appointed under paragraph (1) shall have power, on behalf of the Secretary, to make any examination of any loan originator operating in any State which is subject to a licensing system established by the Secretary under section 1508 whenever the Secretary determines an examination of any loan originator is necessary to determine the compliance by the originator with this title.CommentsClose CommentsPermalink





(3) REPORT OF EXAMINATION- Each examiner appointed under paragraph (1) shall make a full and detailed report of examination of any loan originator examined to the Secretary.CommentsClose CommentsPermalink





(4) ADMINISTRATION OF OATHS AND AFFIRMATIONS; EVIDENCE- In connection with examinations of loan originators operating in any State which is subject to a licensing system established by the Secretary under section 1508, or with other types of investigations to determine compliance with applicable law and regulations, the Secretary and limitations of this subparagraph shall apply to each investment under this subparagraph made by a savings association directly and by its subsidiaries.'examiners appointed by the Secretary may administer oaths and affirmations and examine and take and preserve testimony under oath as to any matter in respect to the affairs of any such loan originator.CommentsClose CommentsPermalink





(5) ASSESSMENTS- The cost of conducting any examination of any loan originator operating in any State which is subject to a licensing system established by the Secretary under section 1508 shall be assessed by the Secretary against the loan originator to meet the Secretary’s expenses in carrying out such examination.CommentsClose CommentsPermalink





(c) Cease and Desist Proceeding-CommentsClose CommentsPermalink





(1) AUTHORITY OF SECRETARY- If the Secretary finds, after notice and opportunity for hearing, that any person is violating, has violated, or is about to violate any provision of this title, or any regulation thereunder, with respect to a State which is subject to a licensing system established by the Secretary under section 1508, the Secretary may publish such findings and enter an order requiring such person, and any other person that is, was, or would be a cause of the violation, due to an act or omission the person knew or should have known would contribute to such violation, to cease and desist from committing or causing such violation and any future violation of the same provision, rule, or regulation. Such order may, in addition to requiring a person to cease and desist from committing or causing a violation, require such person to comply, or to take steps to effect compliance, with such provision or regulation, upon such terms and conditions and within such time as the Secretary may specify in such order. Any such order may, as the Secretary deems appropriate, require future compliance or steps to effect future compliance, either permanently or for such period of time as the Secretary may specify, with such provision or regulation with respect to any loan originator.CommentsClose CommentsPermalink





(2) TECHNICAL AND CONFORMING AMENDMENTS- Section 5(c)(3)(A) of the Home Owners' Loan Act (12 U.S.C. 1464(c)(3)(A)) is amendedHEARING- The notice instituting proceedings pursuant to paragraph (1) shall fix a hearing date not earlier than 30 days nor later than 60 days after service of the notice unless an earlier or a later date is set by the Secretary with the consent of any respondent so served.CommentsClose CommentsPermalink





(3) TEMPORARY ORDER- Whenever the Secretary determines that the alleged violation or threatened violation specified in the notice instituting proceedings pursuant to paragraph (1), or the continuation thereof, is likely to result in significant dissipation or conversion of assets, significant harm to consumers, or substantial harm to the public interest prior to the completion of the proceedings, the Secretary may enter a temporary order requiring the respondent to cease and desist from the violation or threatened violation and to take such action to prevent the violation or threatened violation and to read as follows:`prevent dissipation or conversion of assets, significant harm to consumers, or substantial harm to the public interest as the Secretary deems appropriate pending completion of such proceedings. Such an order shall be entered only after notice and opportunity for a hearing, unless the Secretary determines that notice and hearing prior to entry would be impracticable or contrary to the public interest. A temporary order shall become effective upon service upon the respondent and, unless set aside, limited, or suspended by the Secretary or a court of competent jurisdiction, shall remain effective and enforceable pending the completion of the proceedings.CommentsClose CommentsPermalink





(4) REVIEW OF TEMPORARY ORDERS-CommentsClose CommentsPermalink





(A) [Struck out->][ Repealed ][<-Struck out] '.SEC. 502. PRESERVATION OF CERTAIN AFFORDABLE HOUSING DWELLING UNITREVIEW BY SECRETARY- At any time after the respondent has been served with a temporary cease and desist order pursuant to paragraph (3), the respondent may apply to the Secretary to have the order set aside, limited, or suspended. If the respondent has been served with a temporary cease and desist order entered without a prior hearing before the Secretary, the respondent may, within 10 days after the date on which the order was served, request a hearing on such application and the Secretary shall hold a hearing and render a decision on such application at the earliest possible time.CommentsClose CommentsPermalink





(B) JUDICIAL REVIEW- Within--CommentsClose CommentsPermalink





(i) 10 days after the date the respondent was served with a temporary cease and desist order entered with a prior hearing before the Secretary; orCommentsClose CommentsPermalink





(ii) 10 days after the Secretary renders a decision on an application and hearing under paragraph (1), with respect to any temporary cease and desist order entered without a prior hearing before the Secretary,CommentsClose CommentsPermalink





the respondent may apply to the United States district court for the district in which the respondent resides or has its principal place of business, or for the District of Columbia, for an order setting aside, limiting, or suspending the effectiveness or enforcement of the order, and the court shall have jurisdiction to enter such an order. A respondent served with a temporary cease and desist order entered without a prior hearing before the Secretary may not apply to the court except after hearing and decision by the Secretary on the respondent’s application under subparagraph (A).CommentsClose CommentsPermalink





(C) NO AUTOMATIC STAY OF TEMPORARY ORDER- The commencement of proceedings under subparagraph (B) shall not, unless specifically ordered by the court, operate as a stay of the Secretary’s order.CommentsClose CommentsPermalink





(5) AUTHORITY OF THE SECRETARY TO PROHIBIT PERSONS FROM SERVING AS LOAN ORIGINATORS- In any cease and desist proceeding under paragraph (1), the Secretary may issue an order to prohibit, conditionally or unconditionally, and permanently or for such period of time as the Secretary shall determine, any person who has violated this title or regulations thereunder, from acting as a loan originator if the conduct of that person demonstrates unfitness to serve as a loan originator.CommentsClose CommentsPermalink





(d) Authority of the Secretary To Assess Money Penalties-CommentsClose CommentsPermalink





(1) IN GENERAL- The Secretary may impose a civil penalty on a loan originator operating in any State which is subject to a licensing system established by the Secretary under section 1508, if the Secretary finds, on the record after notice and opportunity for hearing, that such loan originator has violated or failed to comply with any requirement of this title or any regulation prescribed by the Secretary under this title or order issued under subsection (c).CommentsClose CommentsPermalink





(2) MAXIMUM AMOUNT OF PENALTY- The maximum amount of penalty for each act or omission described in paragraph (1) shall be $25,000.CommentsClose CommentsPermalink

SEC. 1516. REPORTS AND RECOMMENDATIONS TO CONGRESS.

(a) Conversion ofAnnual Reports- Not later than 1 year after the date of enactment of this title, and annually thereafter, the Secretary shall submit a report to Congress on the effectiveness of the provisions of this title, including legislative recommendations, if any, for strengthening consumer protections, enhancing examination standards, streamlining communication between all stakeholders involved in residential mortgage loan origination and processing, and establishing performance based bonding requirements for mortgage originators or institutions that employ such brokers.CommentsClose CommentsPermalink





(b) Legislative Recommendations- Not later than 6 months after the date of enactment of this title, the Secretary shall make recommendations to Congress on legislative reforms to the Real Estate Settlement Procedures Act of 1974, that the Secretary deems appropriate to promote more transparent disclosures, allowing consumers to better shop and compare mortgage loan terms and settlement costs.CommentsClose CommentsPermalink

SEC. 1603. CONVERSION OF HUD Contracts- Notwithstanding any other provision of law, the Secretary of Housing and Urban Development may, at the request of the owner of the multifamily housing project to which Section 8 Project Number NY 913 VO 0018 and RAP Contract Number 012035NIRAP are subject, convert such contracts toONTRACTS.

(a) In General- Notwithstanding any other provision of law, the Secretary may, at the request of an owner of a multifamily housing project that exceeds 5,000 units to which a contract for project-based rental assistance under section 8 of the United States Housing Act of 1937 (‘Act’) (42 U.S.C. 1437f) and a Rental Assistance Payment contract is subject, convert such contracts to a contract for project-based rental assistance under section 8 of the Act.CommentsClose CommentsPermalink





(b) Initial Renewal-CommentsClose CommentsPermalink





(1) ELIGIBILITY- At the request of the ownerAt the request of an owner under subsection (a) made no later than 90 days prior to a conversion, the Secretary may, to the extent sufficient amounts are made available in appropriation Acts and notwithstanding any other law, treat the contemplated resulting contract as if such contract were eligible for initial renewal under section 524(a) of the MultifFamily Assisted Housing Reform and Affordability Act of 1997 (42 U.S.C. 1437f note) (‘MAHRA’) (42 U.S.C. 1437f note).CommentsClose CommentsPermalink





(2) REQUEST- A request by theA request by an owner pursuant to paragraph (1) shall be upon such terms and conditions as the Secretary may require.CommentsClose CommentsPermalink





(c) Resulting Contract- The resulting contract shall--CommentsClose CommentsPermalink





(1) be subject to section 524(a) of MAHRA (42 U.S.C. 1437f note);CommentsClose CommentsPermalink





(2) be considered for all purposes a contract that has been renewed under section 524(a) of MAHRA (42 U.S.C. 1437f note) for a term not to exceed 20 years;CommentsClose CommentsPermalink





(3) be subsequently renewable at the request of thean owner, under any renewal option for which the project is eligible under MAHRA (42 U.S.C. 1437f note);CommentsClose CommentsPermalink





(4) contain provisions limiting distributions, as the Secretary determines appropriate, not to exceed 10 percent of the initial investment of the owner;CommentsClose CommentsPermalink





(5) be subject to the availability of sufficient amounts in appropriation Acts; andCommentsClose CommentsPermalink





(6) be subject to such other terms and conditions as the Secretary considers appropriate.CommentsClose CommentsPermalink





(d) Income Targeting- The owner shall be deemed to be in compliance with all income-o the extent that assisted dwelling units, subject to the resulting contract under subsection (a), serve low-income families, as defined in section 3(b)(2) of the Act (42 U.S.C. 1437a(b)(2)) the units shall be considered to be in compliance with all income targeting requirements under the United States Housing Act of 1937 by serving low-income families, as such term is defined in the section 3(b)(2) of such Act (42 U.S.C. 1437a(b)(2) et seq).CommentsClose CommentsPermalink





(e) Tenant Eligibility- Notwithstanding any other provision of law, each family residing in an assisted dwelling unit on the date of the conversionconversion of a contract under this section, subject to the resulting contract under subsection (a), shall be considered to meet the applicable requirements for income eligibility and occupancy.CommentsClose CommentsPermalink





(f) Definitions- As used in this section--CommentsClose CommentsPermalink





(1) the term `assisted dwelling unit' means the dwelling units that, on the date of the conversion under this section, were subject to Section 8 Project Number NY 913 VO 0018 or RAP Contract Number 012035NIRAP;(2) the term `conversion' means the action under which Section 8 Project Number NY 913 VO 0018 and RAP Contract Number 012035NIRAP‘Secretary’ means the Secretary of Housing and Urban Development;CommentsClose CommentsPermalink





(2) the term ‘conversion’ means the action under which a contract for project-based rental assistance under section 8 of the Act and a Rental Assistance Payment contract become a contract for project-based rental assistance under section 8 of the United States Housing Act of 1937Act (42 U.S.C. 1437f) pursuant to subsection (a);CommentsClose CommentsPermalink





(3) the term `MAHRA' means the Multifamily Assisted Housing Reform and Affordability Act of 1997‘resulting contract’ means the new contract after a conversion pursuant to subsection (a); andCommentsClose CommentsPermalink





(4) the term ‘assisted dwelling unit’ means a dwelling unit in a multifamily housing project that exceeds 5,000 units that, on the date of conversion of a contract under this section, is subject to a contract for project-based rental assistance under section 8 of the Act (42 U.S.C. 1437f note);(4) the term `owner' means Starrett City Associates) or a Rental Assistance Payment contract.CommentsClose CommentsPermalink

(a) In General- During the 12-month period beginning on October 1, 2008, the Secretary of Housing and Urban Development shall not take any action to implement or carry out risk-based premiums, which are designed for mortgage lenders to offer borrowers an FHA-insured product that provides a range of mortgage insurance premium pricing, based on the risk that the insurance contract represents, as such planned implementation was set forth in the Notice published in the Federal Register on May 13, 2008 (Vol. 73, No. 93, Pages 27703 through 27711) (effective July 14, 2008).CommentsClose CommentsPermalink





(b) Insurance of Mortgages Under the National Housing Act- During the 12-month period beginning on October 1, 2008, the Secretary of Housing and Urban Development shall not take any action to implement or carry out any other risk-based premium product related to the insurance of any mortgage on a single family residence under title II of the National Housing Act, where the premium price for such new product is based in whole or in part on a borrower’s Decision Credit Score, as that term is defined in the Notice described under subsection (a), or any successor owner of the multifamily housing project to which thereto.CommentsClose CommentsPermalink

Section 8 Project Number NY 913 VO 0018 and RAP Contract Number 012035NIRAP are subject;(5) the term `resulting contract' means the new contract after a conversion of Section 8 Project Number NY 913 VO 0018 and RAP Contract Number 012035NIRAP to a contract for project-based rental assistance und1717 of title 38, United States Code , is amended by adding at the end the following new subsection: CommentsClose CommentsPermalink





‘(d)(1) In the case of a member of the Armed Forces who, as determined by the Secretary, has a disability permanent in nature incurred or aggravated in the line of duty in the active military, naval, or air service, the Secretary may furnish improvements and structural alterations for such member for such disability or as otherwise described in subsection (a)(2) while such member is hospitalized or receiving outpatient medical care, services, or treatment for such disability if the Secretary determines that such member is likely to be discharged or released from the Armed Forces for such disability.CommentsClose CommentsPermalink





‘(2) The furnishing of improvements and alterations under paragraph (1) in connection with the furnishing of medical services described in subparagraph (A) or (B) of subsection (a)(2) shall be subject to the limitation specified in the applicable subparagraph.’.CommentsClose CommentsPermalink

(a) Eligibility- Chapter 21 of title 38, United States Code, is amended by inserting after section 82101 the following new section:CommentsClose CommentsPermalink

(a) In General- Section 5A(b) of the United States Housing Act of 1937 (42 U.S.C. 1437c-1(b)) is amended by adding at the end the following:CommentsClose CommentsPermalink





‘(3) EXEMPTION OF CERTAIN PHAS FROM FILING REQUIREMENT-CommentsClose CommentsPermalink





‘(A) IN GENERAL- Notwithstanding paragraph (1) or any other provision of this Act--CommentsClose CommentsPermalink





‘(i) the requirement under paragraph (1) shall not apply to any qualified public housing agency; andCommentsClose CommentsPermalink





‘(ii) except as provided in subsection (e)(4)(B), any reference in this section or any other provision of law to a ‘public housing agency’ shall not be considered to refer to any qualified public housing agency, to the extent such reference applies to the requirement to submit an annual public housing agency plan under this subsection.CommentsClose CommentsPermalink





‘(B) CIVIL RIGHTS CERTIFICATION- Notwithstanding that qualified public housing agencies are exempt under subparagraph (A) from the requirement under this section to prepare and submit an annual public housing plan, each qualified public housing agency shall, on an annual basis, make the certification described in paragraph (16) of subsection (d), except that for purposes of such qualified public housing agencies, such paragraph shall be applied by substituting ‘the public housing program of the agency’ for ‘the public housing agency plan’.CommentsClose CommentsPermalink





‘(C) DEFINITION- For purposes of this section, the term ‘qualified public housing agency’ means a public housing agency that meets the following requirements:CommentsClose CommentsPermalink





‘(i) The sum of (I) the number of public housing dwelling units administered by the agency, and (II) the number of vouchers under section 8(o) of the United States Housing Act of 1937 (42 U.S.C. 1437f(o)) administered by the agency, is 550 or fewer.CommentsClose CommentsPermalink





‘(ii) The agency is not designated under section 6(j)(2) as a troubled public housing agency, and does not have a failing score under the section 8 Management Assessment Program during the prior 12 months.’.CommentsClose CommentsPermalink





(b) Resident Participation- Section 5A of the United States Housing Act of 1937 (42 U.S.C. 1437f) pursuant to subsection (a); and(6) the term `Secretary' means the Secretary of Housing and Urban Developmentc-1) is amended--CommentsClose CommentsPermalink





(1) in subsection (e), by inserting after paragraph (3) the following:CommentsClose CommentsPermalink





‘(4) QUALIFIED PUBLIC HOUSING AGENCIES-CommentsClose CommentsPermalink





‘(A) IN GENERAL- Except as provided in subparagraph (B), nothing in this section may be construed to exempt a qualified public housing agency from the requirement under paragraph (1) to establish 1 or more resident advisory boards. Notwithstanding that qualified public housing agencies are exempt under subsection (b)(3)(A) from the requirement under this section to prepare and submit an annual public housing plan, each qualified public housing agency shall consult with, and consider the recommendations of the resident advisory boards for the agency, at the annual public hearing required under subsection (f)(5), regarding any changes to the goals, objectives, and policies of that agency.CommentsClose CommentsPermalink





‘(B) APPLICABILITY OF WAIVER AUTHORITY- Paragraph (3) shall apply to qualified public housing agencies, except that for purposes of such qualified public housing agencies, subparagraph (B) of such paragraph shall be applied by substituting ‘the functions described in the second sentence of paragraph (4)(A)’ for ‘the functions described in paragraph (2)’.CommentsClose CommentsPermalink





‘(f) Public Hearings- ’; andCommentsClose CommentsPermalink





(2) in subsection (f) (as so designated by the amendment made by paragraph (1)), by adding at the end the following:CommentsClose CommentsPermalink





‘(5) QUALIFIED PUBLIC HOUSING AGENCIES-CommentsClose CommentsPermalink





‘(A) REQUIREMENT- Notwithstanding that qualified public housing agencies are exempt under subsection (b)(3)(A) from the requirement under this section to conduct a public hearing regarding the annual public housing plan of the agency, each qualified public housing agency shall annually conduct a public hearing