Bill Text
111th Congress (2009-2010)
H.R.787.RH

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HR 787 RH

To make improvements in the Hope for Homeowners Program, and for other purposes.

February 2, 2009

Mr. FRANK of Massachusetts introduced the following bill; which was referred to the Committee on Financial Services

February 10, 2009

Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed

[Strike out all after the enacting clause and insert the part printed in italic]

To make improvements in the Hope for Homeowners Program, and for other purposes.

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

[Struck out->] SECTION 1. CHANGES TO HOPE FOR HOMEOWNERS PROGRAM. [<-Struck out]

[Struck out->] Section 257 of the National Housing Act (12 U.S.C. 1715z-23) is amended-- [<-Struck out]

[Struck out->] (1) in subsection (e)-- [<-Struck out]

[Struck out->] (A) in paragraph (1), by striking subparagraph (B); [<-Struck out]

[Struck out->] (B) in paragraph (2)(B), by striking `90 percent' and inserting `93 percent'; [<-Struck out]

[Struck out->] (C) by striking paragraph (7); and [<-Struck out]

[Struck out->] (D) by redesignating paragraphs (8), (9), (10), and (11) as paragraphs (7), (8), (9), and (10), respectively; [<-Struck out]

[Struck out->] (2) in subsection (h)(2), by striking `, or in any case in which a mortgagor fails to make the first payment on a refinanced eligible mortgage'; [<-Struck out]

[Struck out->] (3) by striking subsection (i) and inserting the following new subsection: [<-Struck out]

[Struck out->] `(i) Annual Premiums- [<-Struck out]

[Struck out->] `(1) IN GENERAL- For each refinanced eligible mortgage insured under this section, the Secretary shall establish and collect an annual premium in an amount equal to not less than 0.55 percent of the amount of the remaining insured principal balance of the mortgage and not more than 0.75 percent of such remaining insured principal balance, as determined according to a schedule established by the Board that assigns such annual premiums based upon the credit risk of the mortgage. [<-Struck out]

[Struck out->] `(2) REDUCTION OR TERMINATION DURING MORTGAGE TERM- Notwithstanding paragraph (1), the Secretary may provide that the annual premiums charged for refinanced eligible mortgages insured under this section are reduced over the term of the mortgage or that the collection of such premiums is discontinued at some time during the term of the mortgage, in a manner that is consistent with policies for such reduction or discontinuation of annual premiums charged for mortgages in accordance with section 203(c).'; [<-Struck out]

[Struck out->] (4) in subsection (k)-- [<-Struck out]

[Struck out->] (A) by striking the subsection heading and inserting `Exit Fee'; [<-Struck out]

[Struck out->] (B) in paragraph (1), in the matter preceding subparagraph (A), by striking `such sale or refinancing' and inserting `the mortgage being insured under this section'; and [<-Struck out]

[Struck out->] (C) by striking paragraph (2); [<-Struck out]

[Struck out->] (5) in subsection (s)(3)(A)(ii), by striking `subsection (e)(1)(B) and such other' and inserting `such'; [<-Struck out]

[Struck out->] (6) in subsection (v), by inserting after the period at the end the following: `The Board shall conform documents, forms, and procedures for mortgages insured under this section to those in place for mortgages insured under section 203(b) to the maximum extent possible consistent with the requirements of this section.'; [<-Struck out]

[Struck out->] (7) in subsection (w)(1)(C), by striking `(e)(4)(A)' and inserting `(e)(3)(A)'; and [<-Struck out]

[Struck out->] (8) by adding at the end the following new subsection: [<-Struck out]

[Struck out->] `(x) Payment to Existing Loan Servicer- The Board may establish a payment to the servicer of the existing senior mortgage for every loan insured under the HOPE for Homeowners Program.'. [<-Struck out]

SECTION 1. CHANGES TO HOPE FOR HOMEOWNERS PROGRAM.

Section 257 of the National Housing Act, as added by section 1402(a) of Public Law 110-289, (12 U.S.C. 1715z-23) is amended--

(1) in subsection (e)--

(A) by striking paragraph (1) and inserting the following:

`(1) BORROWER CERTIFICATION-

`(A) NO INTENTIONAL DEFAULT OR FALSE INFORMATION- The mortgagor shall provide a certification to the Secretary that the mortgagor has not intentionally defaulted on the existing mortgage or mortgages 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.

`(B) LIABILITY FOR REPAYMENT- The mortgagor shall agree in writing that the mortgagor shall be liable to repay to the Secretary 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 by the mortgagor in the certifications and documentation required under this paragraph, subject to the discretion of the Oversight Board.'.

(B) in paragraph (2)(B), by striking `90 percent' and inserting `93 percent';

(C) by striking paragraph (7);

(D) in paragraph (9)--

(i) by striking `by procuring (A) an income tax return transcript of the income tax returns of the mortgagor, or(B)' and inserting `in accordance with procedures and standards that the Board shall establish, which may include requiring the mortgagee to procure'; and

(ii) by striking `and by any other method, in accordance with procedures and standards that the Board shall establish';

(E) by redesignating paragraphs (8), (9), (10), and (11) as paragraphs (7), (8), (9), and (10), respectively; and

(F) by adding after paragraph (10) (as so redesignated by subparagraph (E) of this paragraph) the following new paragraph:

`(11) BAN ON MILLIONAIRES- The mortgagor shall not have a net worth, as of the date the mortgagor first applies for a mortgage to be insured under the Program under this section, that exceeds $1,000,000.';

(2) in subsection (h)(2), by striking `, or in any case in which a mortgagor fails to make the first payment on a refinanced eligible mortgage';

(3) by striking subsection (i) and inserting the following new subsection:

`(i) Annual Premiums-

`(1) IN GENERAL- For each refinanced eligible mortgage insured under this section, the Secretary shall establish and collect an annual premium in an amount equal to not less than 0.55 percent of the amount of the remaining insured principal balance of the mortgage and not more than 0.75 percent of such remaining insured principal balance, as determined according to a schedule established by the Board that assigns such annual premiums based upon the credit risk of the mortgage.

`(2) REDUCTION OR TERMINATION DURING MORTGAGE TERM- Notwithstanding paragraph (1), the Secretary may provide that the annual premiums charged for refinanced eligible mortgages insured under this section are reduced over the term of the mortgage or that the collection of such premiums is discontinued at some time during the term of the mortgage, in a manner that is consistent with policies for such reduction or discontinuation of annual premiums charged for mortgages in accordance with section 203(c).';

(4) in subsection (k)--

(A) by striking the subsection heading and inserting `Exit Fee' ;

(B) in paragraph (1), in the matter preceding subparagraph (A), by striking `such sale or refinancing' and inserting `the mortgage being insured under this section'; and

(C) by striking paragraph (2);

(5) in subsection (s)(3)(A)(ii), by striking `subsection (e)(1)(B) and such other' and inserting `such';

(6) in subsection (v), by inserting after the period at the end the following: `The Board shall conform documents, forms, and procedures for mortgages insured under this section to those in place for mortgages insured under section 203(b) to the maximum extent possible consistent with the requirements of this section.';

(7) in subsection (w)(1)(C), by striking `(e)(4)(A)' and inserting `(e)(3)(A)'; and

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

`(x) Payment to Existing Loan Servicer- The Board may establish a payment to the servicer of the existing senior mortgage for every loan insured under the HOPE for Homeowners Program in an amount, for each such loan, that does not exceed $1,000.'.

Union Calendar No. 4

To make improvements in the Hope for Homeowners Program, and for other purposes.

February 10, 2009

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