To amend the Real Estate Settlement Procedures Act of 1974 and the Truth in Lending Act to make the residential mortgage process more understandable, fair, and competitive.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Mortgage Loan Consumer Protection 
Act''.

SEC. 2. DISCLOSURE SIMPLIFICATION AND IMPROVEMENT.

    (a) More Accurate Finance Charge.--Subsection (e) of section 106 of 
the Truth in Lending Act (15 U.S.C. 1605(e)) is amended to read as 
follows:
    ``(e) Exclusion of Certain Escrows.--Escrows for future payments of 
taxes and insurance shall not be included in the computation of the 
finance charge with respect to any extension of credit secured by an 
interest in real property.''.
    (b) More Understandable Disclosure Statements.--Section 4(a) of the 
Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2603(a)) is 
amended--
            (1) by inserting ``(1)'' after ``(a)''; and
            (2) by adding at the end the following new paragraph:
    ``(2) In developing and prescribing such form, the Secretary shall 
clearly delineate, and provide a box for totals for, the following 3 
types of charges:
            ``(A) `Closing Costs', which shall include all noninterest 
        costs that the consumer is required to pay as a condition for 
        receiving the extension of credit. Fees paid to or collected by 
        the lender may be itemized by purpose, but must also be totaled 
        up and shown separately under the heading `Total Lender Fees'.
            ``(B) `Prepaid Items', which shall include prepaid 
        interest, funds deposited into any escrow account, and any 
        other items required by the lender to be paid in advance.
            ``(C) `All Other Costs Paid At Closing', which shall 
        include all costs paid at the time of closing that are neither 
        Closing Costs nor Prepaid Items.''.
    (c) Harmonization of Good Faith Estimate and Settlement 
Statement.--Section 5(c) of the Real Estate Settlement Procedures Act 
of 1974 (12 U.S.C. 2604(c)) is amended--
            (1) by inserting ``(1)'' after ``(c)''; and
            (2) by adding at the end the following new paragraph:
    ``(2) The Secretary shall, to the maximum extent, harmonize the 
terms and forms for the good faith estimate required under this 
subsection and the final settlement statement required under section 4, 
which shall include delineating, on the good faith estimate, the 3 
types of charges specified under section 4(a)(2).''.

SEC. 3. ADVANCE AVAILABILITY OF FINAL SETTLEMENT STATEMENT.

    Section 4(b) of the Real Estate Settlement Procedures Act of 1974 
(12 U.S.C. 2603(b)) is amended--
            (1) by inserting ``(1)'' after ``(b)'';
            (2) in the first sentence, by striking ``at or before 
        settlement'' and inserting ``at least 2 days before 
        settlement''; and
            (3) by striking the last sentence.

SEC. 4. PROHIBITION AGAINST MARKUPS AND UNDISCLOSED LENDER FEES.

    (a) Requirement to Disclose All Lender Fees.--Section 4 of the Real 
Estate Settlement Procedures Act of 1974 (12 U.S.C. 2603) is amended by 
adding at the end the following new subsection:
    ``(c)(1) All fees paid to or collected by a lender in connection 
with a federally related mortgage loan shall be clearly disclosed as 
being paid to such lender on the settlement statement for such mortgage 
loan.''.
    (b) Prohibition of Markups and Unearned Fees.--Section 8(b) of the 
Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2607(b)) is 
amended by insert after the period at the end the following: ``This 
subsection prohibits markups of the cost of services performed or goods 
provided by another settlement service provider, and fees charged or 
collected by one settlement service provider where no, nominal, or 
duplicative work is done.''.

SEC. 5. ENHANCED CONSUMER ASSISTANCE.

    Section 5(b) of the Real Estate Settlement Procedures Act of 1974 
(12 U.S.C. 2604(b)) is amended--
            (1) in paragraph (4) by striking ``and'' at the end;
            (2) in paragraph (5), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following new paragraphs:
            ``(6) an explanation of the issues regarding the cost-
        efficiency of refinancing a mortgage loan, including the 
        tradeoffs between mortgage interest rates and closing costs 
        (including tax considerations), and other factors that may 
        affect a mortgagor's decision to refinance; and
            ``(7) an explanation that some lenders may offer the 
        mortgagor the option to pay some fees up-front or in the form 
        of a higher mortgage interest rate, and assistance in 
        evaluating this type of option.''.

SEC. 6. ADDITIONAL ESCROW ACCOUNT PROTECTIONS.

    Section 10 of the Real Estate Settlement Procedures Act of 1974 (12 
U.S.C. 2609) is amended by adding at the end the following new 
subsections:
    ``(e) Liability of Servicers.--A servicer (as such term is defined 
in section 6(i)) for a federally related mortgage loan, in connection 
with which an escrow account is established, shall be liable to the 
borrower for any fees, penalties, and other charges that arise out of 
the servicer's failure to make timely payment of taxes, insurance 
premiums, or other charges that are required to be paid out of such 
escrow account.
    ``(f) Force-Placed Hazard Insurance.--A servicer for a federally 
related mortgage loan may not receive any portion of any charge, 
rebate, or other fee associated with any force-placed hazard insurance 
in connection with such loan that arises from the servicer's failure to 
make timely payment of insurance premiums.
    ``(g) Timely Crediting of Escrow Funds.--
            ``(1) Requirement.--The servicer for a federally related 
        mortgage loan shall return to the borrower under such loan any 
        amounts remaining in any escrow account established for such 
        loan, as follows:
                    ``(A) Notice of payment.--If the borrower provides 
                written notice to the servicer of intent to pay a loan 
                in full not less than 7 days before such payment, such 
                amounts shall be returned not later than the date that 
                such loan is paid in full. Such return of funds may be 
                in the form of an offset against the amount required to 
                pay the loan in full.
                    ``(B) General deadline.--In no case shall such 
                amounts be returned later than 21 days after the date 
                that the loan is paid in full.
            ``(2) Liability for failure to return escrow amounts.--A 
        servicer who fails to comply with the requirements under 
        paragraph (1) shall be liable to the borrower under the loan 
        for the unreturned amount, plus a penalty equal to the sum of 
        20 percent of the unreturned amount plus 1 percent for each 
        month that such amounts remain unreturned to the borrower.''.

SEC. 7. ENFORCEMENT OF RESPA CONSUMER PROTECTIONS.

    (a) Uniform Enforcement Provisions.--The Real Estate Settlement 
Procedures Act of 1974 is amended by inserting after section 12 (12 
U.S.C. 2610) the following new section:

``SEC. 13. DAMAGES AND COSTS.

    ``Whoever fails to comply with any provision of section 4, 5, 6, or 
10(c) shall be liable to the borrower for each such failure in an 
amount equal to the sum of the following:
            ``(1) Actual damages.--Any actual damages to the borrower 
        as a result of such failure.
            ``(2) Additional damages.--Any additional damages, as the 
        court may allow, in an amount not to exceed $2,000 for each 
        loan.
            ``(3) Costs.--In the case of any successful action for 
        damages pursuant to this section, the costs of the action, 
        together with any attorneys' fees incurred in connection with 
        such action as the court may determine to be reasonable under 
        the circumstances.''.
    (b) Superseded Enforcement Provisions.--The Real Estate Settlement 
Procedures Act of 1974 is amended--
            (1) in section 6 (12 U.S.C. 2605), by striking subsection 
        (f); and
            (2) in section 10 (12 U.S.C. 2609), by striking subsection 
        (d).
    (c) Jurisdiction of Courts and Statute of Limitations.--Section 16 
of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2614) 
is amended--
            (1) by striking ``, or 9'' and inserting ``, 9, 10, or 
        13''; and
            (2) by striking ``in the case of a violation of section 6'' 
        and all that follows through ``may be brought within 3 years''.

SEC. 8. EFFECTIVE DATE.

    The amendments made by this Act shall be made and shall apply upon 
the expiration of the 180-day period beginning on the date of the 
enactment of this Act.

Summary: Mortgage Loan Consumer Protection Act - Amends the Truth in Lending Act, with respect to credit extensions secured by a real property interest, to revise the category of excluded finance charge items. Amends the Real Estate Settlement Procedures Act, with respect to the uniform settlement statement, to require: (1) separate lines for closing costs, prepaid items, and all other costs paid at closing. (2) at least two days' advance availability of the final settlement statement. And (3) disclosure of all lender fees. Provides, with respect to special information booklets, for: (1) harmonization of good faith estimates and settlement statements. And (2) inclusion of refinancing and upfront payment option information. Prohibits markups and unearned fees. Sets forth servicer escrow-related liabilities. Revises damage and cost, and jurisdiction and statute of limitations provisions.