To promote bank liquidity and lending through deposit insurance, the HOPE for Homeowners Program, and other enhancements.

Summary: Amends the Federal Deposit Insurance Act and the Emergency Economic Stabilization Act of 2008 (EESA) to make permanent the increase in the standard maximum deposit insurance amount from $100,000 to $250,000.

Extends from five years to eight years after implementation of a Deposit Insurance Fund (DIF) restoration plan the deadline by which the DIF reserve ratio must meet or exceed the required minimum of 1.15% of estimated insured deposits.

Increases the borrowing authority of the Federal Deposit Insurance Corporation (FDIC) from a maximum $30 billion to $100 billion.

Extends to depository institution holding companies liability for special assessments to recover loss to the DIF arising from certain actions taken or assistance provided to avoid serious adverse effects on economic conditions or financial stability.

Amends the National Housing Act to revise certain requirements for the HOPE for Homeowners Program.

Repeals the requirement that the current borrower have, or is likely to have, a mortgage debt-to-income ratio greater than 31% (or any higher amount the Federal Home Loan Bank Board determines appropriate).

Increases from 90% to 93% of a property's appraised value the cap on the principal obligation amount of a refinanced eligible insured mortgage.

Repeals the prohibitions on: (1) second liens; and (2) payment of insurance benefits to a mortgagee in any case in which a mortgagor fails to make the first payment on a refinanced eligible mortgage.

Reduces the annual premium for a refinanced eligible insured mortgage, and allows its further reduction or termination during the mortgage term.

Repeals the entitlement of the Secretary of Housing and Urban Development and the mortgagor of an eligible insured mortgage, upon any sale or disposition of the subject property, to 50% of any appreciation in the property's appraised value since the date that the mortgage was insured.

Authorizes the Federal Home Loan Bank Board to establish a payment to the servicer of the existing senior mortgage for every loan insured under the HOPE for Homeowners Program.

Prescribes requirements (safe harbor) that will render a mortgage servicer not liable for entering into a loan modification or workout plan with respect to any mortgage on which: (1) default has occurred or is reasonably foreseeable; (2) the property securing it is occupied by the mortgagor; and (3) the servicer reasonably and in good faith believes that the anticipated recovery on the mortgage's principal outstanding obligation under a particular mortgage modification, workout plan, or other loss mitigation action will exceed, on a net present value basis, the anticipated recovery on the principal outstanding obligation to be realized through foreclosure.

Requires the Secretary of the Treasury to take prompt action to provide EESA Troubled Asset Relief Program (TARP) assistance to smaller community financial institutions, including privately held institutions.

SECTION 1. PERMANENT INCREASE IN DEPOSIT INSURANCE.

    (a) Amendments to Federal Deposit Insurance Act.--Section 11(a)(1) 
of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)) is amended--
            (1) in paragraph (1)(E), by striking ``$100,000'' and 
        inserting ``$250,000'';
            (2) in paragraph (1)(F)(i), by striking ``2010'' and 
        inserting ``2015'';
            (3) in subclause (I) of paragraph (1)(F)(i), by striking 
        ``$100,000'' and inserting ``$250,000'';
            (4) in subclause (II) of paragraph (1)(F)(i), by striking 
        ``the calendar year preceding the date this subparagraph takes 
        effect under the Federal Deposit Insurance Reform Act of 2005'' 
        and inserting ``calendar year 2008''; and
            (5) in paragraph (3)(A)(iii), by striking ``, except that 
        $250,000 shall be substituted for $100,000 wherever such term 
        appears in such paragraph''.
    (b) Repeal of EESA Provision.--Section 136 of the Emergency 
Economic Stabilization Act (Public Law 110-343; 122 Stat. 3765) is 
hereby repealed.
    (c) Amendment to Federal Credit Union Act.--Section 207(k) of the 
Federal Credit Union Act (12 U.S.C. 1787(k)) is amended--
            (1) in paragraph (3)--
                    (A) by striking the opening quotation mark before 
                ``$250,000'';
                    (B) by striking ``, except that $250,000 shall be 
                substituted for $100,000 wherever such term appears in 
                such section''; and
                    (C) by striking the closing quotation mark after 
                the closing parenthesis; and
            (2) in paragraph (5), by striking ``$100,000'' and 
        inserting ``$250,000''.

SEC. 2. EXTENSION OF RESTORATION PLAN PERIOD.

    Section 7(b)(3)(E)(ii) of the Federal Deposit Insurance Act (12 
U.S.C. 1817(b)(3)(E)(ii)) is amended by striking ``5-year period'' and 
inserting ``8-year period''.

SEC. 3. FDIC BORROWING AUTHORITY.

    Section 14(a) of the Federal Deposit Insurance Act (12 U.S.C. 
1824(a)) is amended--
            (1) by striking ``$30,000,000,000'' and inserting 
        ``$100,000,000,000''; and
            (2) by inserting prior to the last sentence, the following 
        new sentence: ``The Corporation may request in writing to 
        borrow, and the Secretary may authorize and approve the 
        borrowing of, additional amounts above $100,000,000,000 to the 
        extent that the Board of Directors and the Secretary determine 
        such borrowing to be necessary.''.

SEC. 4. FDIC SYSTEMIC RISK SPECIAL ASSESSMENTS.

    Section 13(c)(4)(G)(ii) of the Federal Deposit Insurance Act (12 
U.S.C. 1823(c)(4)(G)(ii)) is amended to read as follows:
                            ``(ii) Repayment of loss.--
                                    ``(I) In general.--The Corporation 
                                shall recover the loss to the Deposit 
                                Insurance Fund arising from any action 
                                taken or assistance provided with 
                                respect to an insured depository 
                                institution under clause (i) from 1 or 
                                more special assessments on insured 
                                depository institutions, depository 
                                institution holding companies (with the 
                                concurrence of the Secretary of the 
                                Treasury with respect to holding 
                                companies), or both, as the Corporation 
                                determines to be appropriate.
                                    ``(II) Treatment of depository 
                                institution holding companies.--For 
                                purposes of this clause, sections 
                                7(c)(2) and 18(h) shall apply to 
                                depository institution holding 
                                companies as if they were insured 
                                depository institutions.
                                    ``(III) Regulations.--The 
                                Corporation shall prescribe such 
                                regulations as it deems necessary to 
                                implement this clause. In prescribing 
                                such regulations, defining terms, and 
                                setting the appropriate assessment rate 
                                or rates, the Corporation shall 
                                consider: the types of entities that 
                                benefit from any action taken or 
                                assistance provided under this 
                                subparagraph; economic conditions; the 
                                effects on the industry; and such other 
                                factors as the Corporation deems 
                                appropriate.''.

SEC. 5. CHANGES TO HOPE FOR HOMEOWNERS PROGRAM.

    Section 257 of the National Housing Act (12 U.S.C. 1715z-23) is 
amended--
            (1) in subsection (e)--
                    (A) in paragraph (1), by striking subparagraph (B);
                    (B) in paragraph (2)(B), by striking ``90 percent'' 
                and inserting ``93 percent'';
                    (C) by striking paragraph (7); and
                    (D) by redesignating paragraphs (8), (9), (10), and 
                (11) as paragraphs (7), (8), (9), and (10), 
                respectively;
            (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.''.

SEC. 6. SERVICER SAFE HARBOR.

    (a) Safe Harbor.--
            (1) Loan modifications and workout plans.--Notwithstanding 
        any other provision of law, and notwithstanding any investment 
        contract between a servicer and a securitization vehicle or 
        investor, a servicer that acts consistent with the duty set 
        forth in section 129A(a) of Truth in Lending Act (15 U.S.C. 
        1639a) shall not be liable for entering into a loan 
        modification or workout plan with respect to any such mortgage 
        that meets all of the criteria set forth in paragraph (2)(B) 
        to--
                    (A) 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;
                    (B) any person who is obligated to make payments 
                determined in reference to any loan or any interest 
                referred to in subparagraph (A); or
                    (C) any person that insures any loan or any 
                interest referred to in subparagraph (A) under any law 
                or regulation of the United States or any law or 
                regulation of any State or political subdivision of any 
                State.
            (2) Ability to modify mortgages.--
                    (A) Ability.--Notwithstanding any other provision 
                of law, and notwithstanding any investment contract 
                between a servicer and a securitization vehicle or 
                investor, a servicer--
                            (i) shall not be limited in the ability to 
                        modify mortgages, the number of mortgages that 
                        can be modified, the frequency of loan 
                        modifications, or the range of permissible 
                        modifications; and
                            (ii) shall not be obligated to repurchase 
                        loans from or otherwise make payments to the 
                        securitization vehicle on account of a 
                        modification, workout, or other loss mitigation 
                        plan for a residential mortgage or a class of 
                        residential mortgages that constitute a part or 
                        all of the mortgages in the securitization 
                        vehicle,
                if any mortgage so modified meets all of the criteria 
                set forth in subparagraph (B).
                    (B) Criteria.--The criteria under this subparagraph 
                with respect to a mortgage are as follows:
                            (i) Default on the payment of such mortgage 
                        has occurred or is reasonably foreseeable.
                            (ii) The property securing such mortgage is 
                        occupied by the mortgagor of such mortgage.
                            (iii) The servicer reasonably and in good 
                        faith believes that the anticipated recovery on 
                        the principal outstanding obligation of the 
                        mortgage under the particular modification or 
                        workout plan or other loss mitigation action 
                        will exceed, on a net present value basis, the 
                        anticipated recovery on the principal 
                        outstanding obligation of the mortgage to be 
                        realized through foreclosure.
            (3) Applicability.--This subsection shall apply only with 
        respect to modifications, workouts, and other loss mitigation 
        plans initiated before January 1, 2012.
    (b) Reporting.--Each servicer that engages in loan modifications or 
workout plans subject to the safe harbor in subsection (a) shall report 
to the Secretary on a regular basis regarding the extent, scope and 
results of the servicer's modification activities. The Secretary shall 
prescribe regulations specifying the form, content, and timing of such 
reports.
    (c) Definition of Securitization Vehicles.--For purposes of this 
section, the term ``securitization vehicle'' means a trust, 
corporation, partnership, limited liability entity, special purpose 
entity, or other structure that--
            (1) 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
            (2) holds such mortgages.

SEC. 7. AVAILABILITY OF TARP FUNDS TO SMALLER COMMUNITY INSTITUTIONS.

    (a) Prompt Action.--The Secretary shall promptly take all necessary 
actions to provide assistance under title I of the Emergency Economic 
Stabilization Act of 2008 to smaller community financial institutions, 
including such institutions that are privately held.
    (b) Comparable Terms.--An institution that receives assistance 
after the date of the enactment of the this Act, shall do so on terms 
comparable to the terms applicable to institutions that received 
assistance prior to the date of the enactment of this Act if the 
institution--
            (1) has submitted an application on which no action has 
        been taken, such as institutions that are C corporations 
        (including privately held institutions) and community 
        development financial institutions; or
            (2) is of a type for which the Secretary has not yet 
        established an application deadline or for which any such 
        deadline has not yet occurred as of the date of the enactment 
        of this Act, such as institutions that are non-stock 
        corporations, S-corporations, mutually owned insured depository 
        institutions (as defined in section 3 of the Federal Deposit 
        Insurance Act).
    (c) Definitions.--For purposes of this section, the terms ``S 
Corporation'' and ``C Corporation'' shall have the same meaning given 
to those terms in section 1361(a) of the Internal Revenue Code of 1986.