To establish the Home Owners' Loan Corporation to provide emergency home mortgage relief.

Summary: Home Owners' Loan Corporation for the 21st Century Act - Establishes the Home Owners' Loan Corporation as an instrumentality of the United States.



Authorizes the Corporation to: (1) acquire, in exchange for bonds and subject to specified limitations, home mortgages, obligations, and liens secured by real estate (mortgage relief); and (2) make cash advances to pay the taxes and assessments on the real estate, provide for maintenance, meet incidental transaction expenses, and pay the mortgage, obligation, or lien holder the difference (not to exceed $200) between the face value of the bonds exchanged, plus accrued interest, and the purchase price of the mortgage, obligation, or lien.

Requires the homeowner to make mortgage payments to the Corporation. Sets forth 40-year amortization requirements. Authorizes the Corporation to exchange bonds and make cash advances to redeem or recover homes lost by the owners by foreclosure or forced sale.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Home Owners' Loan Corporation for 
the 21st Century Act''.

SEC. 2. ESTABLISHMENT.

    (a) In General.--There is established a corporation to be known as 
the Home Owners' Loan Corporation, which shall be an instrumentality of 
the United States, and which shall have authority to sue and to be sued 
in any court of competent jurisdiction, Federal or State.
    (b) Treatment of Corporation.--The Corporation, including its 
franchise, its capital, reserves, and surplus, and its loans and 
income, shall be exempt from taxation referred to in section 6(c), 
except that any real property of the Corporation shall be subject to 
taxation to the same extent, according to its value, as other real 
property is taxed.

SEC. 3. BOARD.

    (a) In General.--The Corporation shall be under the direction of a 
Board of Directors and shall be operated by the Board under such 
bylaws, rules, and regulations as the Board may prescribe for the 
accomplishment of the purposes and intent of this Act and the prudent 
use of the capital and authority of the Corporation.
    (b) Members.--The Board shall consist of five members, as follows:
            (1) The Secretary of the Treasury, or the designee of the 
        Secretary.
            (2) The Comptroller General of the United States, or the 
        designee of the Comptroller.
            (3) A designee of the Board of Directors of the Federal 
        Deposit Insurance Corporation.
            (4) The Secretary of Housing and Urban Development, or the 
        designee of the Secretary.
            (5) The Director of the Office of Federal Housing 
        Enterprise Oversight of the Department of Housing and Urban 
        Development (or any successor agency of such Office responsible 
        for supervision and regulation of the Federal National Mortgage 
        Association and the Federal Home Loan Mortgage Corporation), or 
        the designee of the Director.
    (c) No Compensation.--Members of the Board shall serve as such 
directors without additional compensation.

SEC. 4. CAPITAL STOCK.

    (a) In General.--The Corporation shall have capital stock, 
$25,000,000,000, which shall be subscribed to by the Secretary of the 
Treasury on behalf of the United States Government. The Corporation 
shall issue to the Secretary of the Treasury receipts for payments by 
the Secretary for or on account of such stock, and such receipts shall 
be evidence of the stock ownership of the United States. Payments for 
such subscriptions shall be subject to call in whole or in part by the 
Board and shall be made at such time or times as the Secretary of the 
Treasury deems advisable.
    (b) Public Debt Transaction.--For the purpose of purchasing shares 
of capital stock of the Corporation, the Secretary may use as a public-
debt transaction the proceeds of any securities issued under chapter 31 
of title 31, United States Code.

SEC. 5. MINIMUM CAPITAL RATIO REQUIREMENTS.

    The Board shall on an annual basis establish a minimum capital 
ratio requirement for the Corporation and the Corporation shall at all 
times hold such capital as may be required to comply with the 
applicable annual ratio. Such ratio shall be risk-adjusted to reflect 
the Corporation's direct and indirect credit exposure, and may not be 
lower than the minimum capital ratio required for similar financial 
institutions under the international guidelines and standards for 
capital adequacy issued by the Basel Committee on Banking Supervision 
established by the Bank for International Settlements.

SEC. 6. BORROWING AUTHORITY.

    (a) Issuance.--
            (1) Authority.--The Corporation may issue bonds in an 
        aggregate amount not to exceed $300,000,000,000, which may be 
        sold by the Corporation to obtain funds for carrying out the 
        purposes of this Act, or exchanged as hereinafter provided.
            (2) Terms.--Such bonds shall be issued in such 
        denominations as the Board shall prescribe, shall mature within 
        a period of not more than 10 years from the date of their 
        issue, and shall be fully and unconditionally guaranteed as to 
        interest only by the United States, and such guaranty shall be 
        expressed on the face thereof. The bonds shall bear interest at 
        a rate determined by the Board and approved by the Secretary of 
        the Treasury prior to issue.
            (3) Issuance through ginnie mae.--The Corporation may issue 
        bonds under this subsection through the Government National 
        Mortgage Association and the Association is hereby authorized 
        to provide for such issuance, subject to the aggregate amount 
        limitation under paragraph (1).
    (b) Treasury Borrowing.--In the event that the Corporation is 
unable to pay upon demand, when due, the interest or principal on any 
such bonds, the Secretary of the Treasury shall pay to the Corporation 
the amount of such interest or principal, which is hereby authorized to 
be appropriated to the Corporation, and the Corporation shall pay the 
amount of such interest or principal to the holders of the bonds. Upon 
the payment of such interest or principal by the Secretary, the amount 
so paid shall become an obligation of the Corporation to the United 
States and shall bear interest at the same rate as that borne by the 
bonds upon which the interest or principal has been so paid.
    (c) Treatment.--The bonds issued by the Corporation under this 
section shall be exempt, both as to principal and interest, from all 
taxation (except surtaxes, estate, inheritance, and gift taxes) now or 
hereafter imposed by the United States or any District, Territory, 
dependency, or possession thereof, or by any State, county, 
municipality, or local taxing authority.

SEC. 7. MORTGAGE RELIEF.

    (a) Acquisition of Mortgages.--
            (1) Authority.--The Corporation may, during the three-year 
        period beginning upon the date of the enactment of this Act--
                    (A) to acquire in exchange for bonds issued by the 
                Corporation, home mortgages and other obligations and 
                liens secured by real estate (including the interest of 
                a vendor under a purchase-money mortgage or contract) 
                recorded or filed in the proper office or executed 
                before the date of the enactment of this Act; and
                    (B) in connection with any such exchange, to make 
                advances in cash to pay the taxes and assessments on 
                the real estate, to provide for necessary maintenance 
                and make necessary repairs, to meet the incidental 
                expenses of the transaction, and to pay such amounts, 
                not exceeding $200 or such greater amount as may be 
                approved by the Board, to the holder of the mortgage, 
                obligation, or lien acquired as may be the difference 
                between the face value of the bonds exchanged plus 
                accrued interest thereon and the purchase price of the 
                mortgage, obligation, or lien.
            (2) Limitations.--
                    (A) In general.--The face value of bonds exchanged 
                pursuant to paragraph (1) for any home mortgage or 
                other obligation or lien secured by real estate, plus 
                accrued interest thereon and any cash advanced pursuant 
                to paragraph (1)(B), shall not exceed such limits as 
                the Board may establish, but shall not in any case 
                exceed the lesser of--
                            (i) $900,000; or
                            (ii) 90 percent of the fair market value of 
                        the real estate involved, as determined by an 
                        appraisal made by the Corporation.
                    (B) Upside-down mortgages.--In any case in which 
                the amount of the face value of the bonds exchanged 
                plus accrued interest thereon and the cash advanced is 
                less than the amount the home owner owes with respect 
                to the home mortgage or other obligation or lien so 
                acquired by the Corporation, the Corporation shall 
                credit the difference between such amounts to the home 
                owner and shall reduce the amount owed by the home 
                owner to the Corporation to that extent.
            (3) Amortization.--Each home mortgage or other obligation 
        or lien acquired by the Corporation pursuant to this section 
        shall be carried as a first lien or refinanced as a home 
        mortgage by the Corporation on the basis of the price paid by 
        the Corporation for the mortgage, obligation, or lien, and 
        shall be amortized by means of monthly payments sufficient to 
        retire the interest and principal within a period of not to 
        exceed 40 years.
            (4) Payments by home owner.--
                    (A) Timing.--Notwithstanding paragraph (3), the 
                amortization payments of any home owner may be made 
                quarterly, semiannually, or annually, if in the 
                judgment of the Corporation the situation of the home 
                owner so requires.
                    (B) FHA conforming interest rates and terms.--The 
                Corporation shall set terms for repayment of the unpaid 
                balance of the obligation of the home owner to the 
                Corporation that are consistent with the rates and 
                terms being offered at the time for mortgages on real 
                estate of a similar type that are insured under title 
                II of the National Housing Act (12 U.S.C. 1707 et 
                seq.), as adjusted for risk premiums to be established 
                by the Board.
                    (C) Extension.--The Corporation may at any time 
                grant an extension of time to any home owner for the 
                payment of any installment of principal or interest 
                owed by the home owner to the Corporation if, in the 
                judgment of the Corporation, the circumstances of the 
                home owner and the condition of the security justify 
                such extension, and no payment of any installment of 
                principal shall be required during the three-year 
                period beginning upon the date of the enactment of this 
                Act if the home owner is not in default with respect to 
                any other condition or covenant of the mortgage of the 
                home owner.
    (b) Nondiscrimination.--No discrimination shall be made under this 
Act against any home mortgage by reason of the fact that the real 
estate securing such mortgage is located in a municipality, county, or 
taxing district which is in default upon any of its obligations.
    (c) Cash Loans on Unencumbered Property.--
            (1) Authority.--The Corporation may, during the three-year 
        period beginning upon the date of the enactment of this Act, 
        make loans in cash subject to the same limitations and for the 
        same purposes for which cash advances may be made under 
        subsection (a), in cases in which the property is not otherwise 
        encumbered.
            (2) Limitation on amount.--A loan pursuant to this 
        subsection may not exceed 50 percent of the value of the 
        property securing the loan, as determined upon an appraisal 
        made by the Corporation.
            (3) Terms.--Each such loan shall--
                    (A) be secured by a duly recorded home mortgage;
                    (B) bear interest at the same rate; and
                    (C) be subject to the same provisions with respect 
                to amortization and extensions as are applicable in the 
                case of obligations refinanced under subsection (a).
    (d) Cash Advances for Redemption of Foreclosed Homes.--The 
Corporation may, during the three-year period beginning upon the date 
of the enactment of this Act, exchange bonds and advance cash, subject 
to the limitations provided in subsection (a), to redeem or recover 
homes lost by the owners by foreclosure or forced sale by a trustee 
under a deed of trust or under power of attorney, or by voluntary 
surrender to the mortgagee within two years prior to such exchange or 
advance.
    (e) Appraisals.--The Board shall establish rules for the appraisal 
of the property on which loans are made under this section to 
accomplish the purposes of this Act.
    (f) Bonds Accepted in Payment.--Any person indebted to the 
Corporation may make payment to the Corporation in part or in full by 
delivery to the Corporation of its bonds, which shall be accepted by 
the Corporation for such purpose at face value.

SEC. 8. OTHER PROVISIONS.

    (a) Officers and Employees.--The Corporation shall have power to 
select, employ, and fix the compensation of such officers, employees, 
attorneys, or agents as shall be necessary for the performance of its 
duties under this Act, without regard to the provisions of other laws 
applicable to the employment or compensation of officers, employees, 
attorneys, or agents of the United States. No such officer, employee, 
attorney, or agent shall be paid compensation at a rate in excess of 
market rates as documented by the Corporation. In carrying out its 
duties under this section, the Corporation shall utilize the services 
of private persons, including real estate and loan portfolio asset 
management, property management, auction marketing, and brokerage 
services, if such services are available in the private sector and the 
Corporation determines utilization of such services is practicable and 
efficient. Compensation paid to members of the Board shall not exceed 
the rate provided by law.
    (b) Use of Mails.--The Corporation may use the United States mails 
in the same manner and under the same conditions as other departments 
and agencies of the United States.
    (c) Salaries and Expenses.--The Corporation shall pay such 
proportion of the expenses of the members of the Board, and such 
proportion of the salaries and expenses of its officers and employees, 
as the Board determines to be equitable, and may use the facilities of 
Federal Home Loan Banks, upon making reasonable compensation for such 
use, as determined by the Board.
    (d) Bylaws, Rules, and Regulations.--The Board may make such 
bylaws, rules, and regulations, not inconsistent with the provisions of 
this Act, as may be necessary for the proper conduct of the affairs of 
the Corporation.
    (e) Retirement of Stock.--The Corporation shall retire and cancel 
the bonds and stock of the Corporation as rapidly as the resources of 
the Corporation will permit. Upon the retirement of such stock, the 
reasonable value of the stock as determined by the Board shall be paid 
into the Treasury of the United States and the receipts issued therefor 
shall be canceled.
    (f) Operating Expenses.--The Board shall provide for the operating 
expenses of the Corporation to be met through use of any returns on 
investments and loans of the Corporation.

SEC. 9. LIQUIDATION.

    The Board shall proceed to liquidate the Corporation when its 
purposes have been accomplished, and shall pay any surplus or 
accumulated funds into the Treasury of the United States. The 
Corporation may declare and pay such dividends to the United States as 
may be earned and the Board, in its judgment, determines it is proper 
for the Corporation to pay.

SEC. 10. DEFINITIONS.

    For purposes of this Act, the following definitions shall apply:
            (1) Corporation.--The term ``Corporation'' means the Home 
        Owners' Loan Corporation established under section 2.
            (2) Board.--The term ``Board'' means the Board of Directors 
        of the Corporation.
            (3) Real estate.--The term ``real estate'' means real 
        estate--
                    (A)(i) upon which there is located a dwelling--
                            (I) for not more than four families; and
                            (II) that is used by the owner of the 
                        dwelling as a principal residence; and
                    (ii) that is held in fee simple or on a leasehold 
                under a renewable lease for not less than 99 years; and
                    (iii) that has a value not exceeding $1,000,000; or
                    (B)(i) 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, that is used by the 
                owner as a principal residence;
                    (ii) that is held in fee simple or on a long-term 
                leasehold, together with an undivided interest in the 
                common areas and facilities that serve the project; and
                    (iii) that has a value not exceeding $500,000.