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[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 3535 Introduced in Senate (IS)]

109th CONGRESS
  2d Session
                                S. 3535

  To modernize and update the National Housing Act and to enable the 
   Federal Housing Administration to use risk based pricing to more 
    effectively reach underserved borrowers, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             June 19, 2006

Mr. Talent (for himself, Mr. Martinez, Mr. Isakson, and Mr. Chambliss) 
introduced the following bill; which was read twice and referred to the 
            Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL

 
  To modernize and update the National Housing Act and to enable the 
   Federal Housing Administration to use risk based pricing to more 
    effectively reach underserved borrowers, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Expanding American 
Homeownership Act of 2006''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
            TITLE I--SINGLE FAMILY MORTGAGE INSURANCE REFORM

Sec. 101. Short title.
Sec. 102. Findings and purposes.
Sec. 103. Conforming loan limits and maximum principal loan obligation.
Sec. 104. Extension of mortgage term.
Sec. 105. Cash investment requirement.
Sec. 106. Mortgage insurance premiums.
Sec. 107. Rehabilitation loans.
Sec. 108. Discretionary action.
Sec. 109. Insurance of condominiums.
Sec. 110. Mutual Mortgage Insurance Fund.
Sec. 111. Hawaiian home lands and Indian reservations.
Sec. 112. Conforming and technical amendments.
Sec. 113. Home equity conversion mortgages.
Sec. 114. Conforming loan limit in disaster areas.
Sec. 115. Savings provision.
Sec. 116. Implementation.
           TITLE II--MANUFACTURED HOUSING MORTGAGE INSURANCE

Sec. 201. Short title.
Sec. 202. Findings and purposes.
Sec. 203. Exception to limitation on financial institution portfolio.
Sec. 204. Insurance benefits.
Sec. 205. Maximum loan limits.
Sec. 206. Insurance premiums.
Sec. 207. Technical corrections.

            TITLE I--SINGLE FAMILY MORTGAGE INSURANCE REFORM

SEC. 101. SHORT TITLE.

    This title may be cited as the ``FHA Modernization Act of 2006''.

SEC. 102. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) one of the primary missions of the Federal Housing 
        Administration is to reach borrowers underserved or not served 
        by the existing conventional marketplace;
            (2) the Federal Housing Administration has a long history 
        of innovation and has pioneered the 30-year self-amortizing 
        mortgage and a safe-to-seniors reverse mortgage product, both 
        of which were once thought too risky by private lenders;
            (3) the Federal Housing Administration single family 
        mortgage insurance program has traditionally been a major 
        provider of mortgage insurance for home purchases;
            (4) the Federal Housing Administration mortgage insurance 
        premium structure, as well as the Federal Housing 
        Administration's product offerings, should be revised to 
        reflect the enhanced ability of the Federal Housing 
        Administration to determine risk at the loan level and to allow 
        Federal Housing Administration to better respond to changes in 
        the mortgage market;
            (5) during past recessions, including the oil-patch 
        downturns in the mid-1980s, the Federal Housing Administration 
        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 the Federal 
        Housing Administration mortgage insurance provides.
    (b) Purposes.--The purposes of this title are--
            (1) to provide flexibility to the Federal Housing 
        Administration 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 Federal Housing Administration single 
        family mortgage insurance program by making such program 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. 103. CONFORMING LOAN LIMITS AND MAXIMUM PRINCIPAL LOAN OBLIGATION.

    Section 203(b)(2) of the National Housing Act (12 U.S.C. 
1709(b)(2)) is amended--
            (1) by inserting ``not to exceed the lesser of'' after ``in 
        an amount'';
            (2) by striking subparagraphs (A) and (B) and inserting the 
        following--
                    ``(A)(i) in the case of a 1-family residence, the 
                median 1-family house price in the area, as determined 
                by the Secretary; and
                    ``(ii) 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 in effect 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 in 
                effect under such section for a 1-family residence; or
                    ``(B) the dollar amount limitation determined under 
                such section 305(a)(2) for a residence of the 
                applicable size, except that the dollar amount 
                limitation in effect for any area under this 
                subparagraph 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 limitation 
                        determined under such section 305(a)(2) for a 
                        residence of the applicable size.'';
            (3) in the first undesignated paragraph, by striking the 
        second sentence (relating to average cost); and
            (4) by striking the last undesignated paragraph.

SEC. 104. EXTENSION OF MORTGAGE TERM.

    Section 203(b)(3) of the National Housing Act (12 U.S.C. 
1709(b)(3)) is amended by striking ``thirty-five years (or thirty years 
if such mortgage is not approved for insurance prior to construction'' 
and inserting ``40 years''.

SEC. 105. CASH INVESTMENT REQUIREMENT.

    Section 203(b)(9) of the National Housing Act (12 U.S.C. 
1709(b)(9)) is amended--
            (1) by striking ``(except with respect to'' and all that 
        follows through ``larger amount'' and inserting ``an amount, if 
        any,'';
            (2) by striking the comma after ``determine'' and inserting 
        ``based on factors determined by the Secretary and commensurate 
        with the likelihood of default'';
            (3) by striking ``of the Secretary's'' and all that follows 
        through ``insured)'';
            (4) by striking the first colon and inserting a period;
            (5) by striking the first proviso; and
            (6) by striking ``Provided further, That for'' and 
        inserting ``For''.

SEC. 106. MORTGAGE INSURANCE PREMIUMS.

    Section 203(c) of the National Housing Act (12 U.S.C. 1709(c)(2)) 
is amended by adding at the end the following:
            ``(3)(A) For mortgages insured by the Secretary under this 
        title that are secured by 1 to 4 family dwellings and for which 
        the loan application is received by the mortgagee on or after 
        October 1, 2006, the Secretary may establish a mortgage 
        insurance premium structure involving a single premium 
        collected prior to the insurance of the mortgage or periodic 
        payments, or both, without regard to any maximum or minimum 
        premium amounts set forth in this subsection. The rate of 
        premium for a mortgage may vary during the mortgage term as 
        long as the basis for determining the variable rate is 
        determined prior to the execution of the mortgage. The 
        Secretary may change a premium structure established under this 
        subparagraph if the change is not applied to any mortgage 
        already executed.
            ``(B) A premium structure shall be established or changed 
        under subparagraph (A) by providing notice to mortgagees and by 
        providing notice to Congress at least 30 days prior to the date 
        that the premium structure is to be established or changed.
            ``(C) In establishing a premium structure under 
        subparagraph (A) or when changing such a premium structure the 
        Secretary shall consider the following:
                    ``(i) The effect on the ability of the Secretary to 
                meet the operational goals of the Mutual Mortgage 
                Insurance Fund as provided in section 202(a).
                    ``(ii) Underwriting variables.
                    ``(iii) The extent to which new pricing has 
                potential for acceptance on the private market.
                    ``(iv) The administrative capability of the 
                Secretary to administer the proposed premium structure.
                    ``(v) The effect on the ability of the Secretary to 
                maintain the availability of mortgage credit and 
                provide stability to mortgage markets.''.

SEC. 107. REHABILITATION LOANS.

    Section 203(k) 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 the period at the end, and 
                inserting a period.

SEC. 108. DISCRETIONARY ACTION.

    (a) Transfer of Notice Requirements.--Section 203 of the National 
Housing Act (12 U.S.C. 1709) is amended by striking subsection (s);
    (b) Notice Provisions.--Section 202 of the National Housing Act (12 
U.S.C. 1708) is amended--
            (1) by redesignating subsection (e) as subsection (f); and
            (2) by inserting after subsection (d) the following new 
        subsection (e):
    ``(e) Notice of Discretionary Action.--Whenever the Secretary has 
taken any discretionary action to suspend or revoke the approval of any 
mortgagee to participate in any mortgage insurance program under this 
subchapter, the Secretary shall provide prompt notice of the action and 
a statement of the reasons for the action to--
            ``(1) the Secretary of Veterans Affairs;
            ``(2) the chief executive officer of the Federal National 
        Mortgage Association;
            ``(3) the chief executive officer of the Federal Home Loan 
        Mortgage Corporation;
            ``(4) the Administrator of the Rural Housing Service;
            ``(5) if the mortgagee is a national bank, or a subsidiary 
        or affiliate of such a bank, the Comptroller of the Currency;
            ``(6) if the mortgagee is a State bank that is a member of 
        the Federal Reserve System or a subsidiary or affiliate of such 
        a bank, or a bank holding company or a subsidiary or affiliate 
        of such a company, the Board of Governors of the Federal 
        Reserve System;
            ``(7) if the mortgagee is a State bank that is not a member 
        of the Federal Reserve System or is a subsidiary or affiliate 
        of such a bank, the Board of Directors of the Federal Deposit 
        Insurance Corporation; and
            ``(8) if the mortgagee is a Federal or State savings 
        association or a subsidiary or affiliate of a savings 
        association, the Director of the Office of Thrift 
        Supervision.''.

SEC. 109. INSURANCE OF CONDOMINIUMS.

    (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, by striking the period 
                and inserting the following ``, and (3) the project has 
                a blanket mortgage insured by the Secretary under 
                subsection (d).''; and
                    (B) by striking ``thirty-five'' and inserting 
                ``40''; and
            (2) in subsection (g), by striking ``, except'' and all 
        that follows through the period at the end and inserting a 
        period.
    (b) First Mortgages.--Section 201(a) of the National Housing Act 
(12 U.S.C. 1707(a)) is amended by striking the semicolon and inserting 
``or (3) a first mortgage given to secure the unpaid purchase price of 
a fee interest in, or long-term leasehold interest in, a 1 family unit 
in a multifamily project, including a project in which the dwelling 
units are attached, semi-detached, or detached, and an undivided 
interest in the common areas and facilities which serve the project;''.

SEC. 110. MUTUAL MORTGAGE INSURANCE FUND.

    (a) Establishment of Fund.--Section 202(a) of the National Housing 
Act (12 U.S.C. 1708) 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 (referred to in this section 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 is authorized to use amounts 
        in the Fund to guarantee any mortgage insured under section 
        203.
            ``(2) Authorization of appropriations.--There are 
        authorized to be appropriated such sums as are necessary for 
        the cost of--
                    ``(A) loan guarantees authorized under this 
                subsection; and
                    ``(B) administering such loan guarantees.
            ``(3) Limit on loan guarantees.--Commitments to guarantee 
        loans under the subsection may be made by the Secretary only to 
        the extent that total loan principal, any part of which is 
        guaranteed, does not exceed the amount specified in annual 
        appropriations acts each year.
            ``(4) Annual independent actuarial study.--
                    ``(A) Study and report.--The Secretary shall--
                            ``(i) provide for an independent actuarial 
                        study of the Fund to be conducted annually; and
                            ``(ii) report annually to the Congress 
                        regarding the financial status of the Fund.
                    ``(B) Content of study.--Each study required under 
                subparagraph (A) shall analyze the financial position 
                of the Fund and recommend adjustments to underwriting 
                standards, program participation, or premiums, if 
                necessary, to ensure that the Fund remains financially 
                sound.
                    ``(C) Timing of report.--The Secretary shall submit 
                a report required under subparagraph (A) to Congress 
                each quarter, with the first report submitted on the 
                later of--
                            ``(i) the last day of the first quarter of 
                        fiscal year 2007; or
                            ``(ii) 90 days after the date of enactment 
                        of this subsection.
                    ``(D) Additional requirements of the report.--Each 
                report required under subparagraph (A) shall detail--
                            ``(i) the cumulative volume of loan 
                        guarantee commitments made for the fiscal year;
                            ``(ii) the types of loans insured, 
                        categorized by risk;
                            ``(iii) significant changes between actual 
                        and projected claim and prepayment activity;
                            ``(iv) projected versus actual loss rates; 
                        and
                            ``(v) updated projections of the annual 
                        subsidy rates to ensure that increases in risk 
                        to the Fund are identified and mitigated by 
                        adjustments to underwriting standards, program 
                        participation, or premiums, and the Fund's 
                        financial soundness is maintained.
            ``(5) Additional responsibility.--The Secretary shall 
        ensure that the Fund remains financially sound.
            ``(6) Adjustment of premiums.--
                    ``(A) Authority of the secretary.--If, pursuant to 
                the independent actuarial study of the Fund required 
                under paragraph (4), the Secretary determines that the 
                Fund is not meeting the operational goals established 
                under subparagraph (B) or there is a substantial 
                probability that the Fund will not maintain its 
                established target subsidy rate, the Secretary may 
                either make--
                            ``(i) programmatic adjustments under 
                        section 203 as necessary to reduce the risk to 
                        the Fund; or
                            ``(ii) appropriate premium adjustments.
                    ``(B) Operational goals.--The operational goals of 
                the Fund are--
                            ``(i) charging borrowers an appropriate 
                        premium for the risk that such borrower poses 
                        to the Fund;
                            ``(ii) minimizing the default risk to the 
                        Fund and to homeowners;
                            ``(iii) curtailing the impact of adverse 
                        selection on the Fund; and
                            ``(iv) meeting the housing needs of the 
                        target mortgagors of the Fund.''.
    (b) Amendment to Section 205.--Section 205 of the National Housing 
Act (12 U.S.C. 1711) is amended by striking subsections (g) and (h).
    (c) Amendment to Section 203.--Section 203(v) of the National 
Housing Act (12 U.S.C. 1709(v)) is amended by--
            (1) striking ``Notwithstanding section 202 of this title, 
        the'' and inserting ``The''; and
            (2) striking ``General Insurance Fund'' and all that 
        follows through the period at the end and inserting ``Mutual 
        Mortgage Insurance Fund.''.
    (d) Amendments to General Insurance Fund.--Section 519(e) of the 
National Housing Act (12 U.S.C. 1735c(e)) is amended by--
            (1) striking ``203(b)'' and inserting ``203''; and
            (2) striking ``(except'' and all that follows through 
        ``203(i)'' and inserting ``except as determined by the 
        Secretary''.
    (e) 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''.

SEC. 111. HAWAIIAN HOME LANDS AND INDIAN RESERVATIONS.

    (a) Single Family Mortgage Insurance.--Section 247(c) of the 
National Housing Act (12 U.S.C. 1715z-12) is amended--
            (1) in the heading, by striking ``General Insurance Fund'' 
        and inserting ``Mutual Mortgage Insurance Fund'';
            (2) in the first sentence, by striking ``General Insurance 
        Fund established in section 519'' and inserting ``Mutual 
        Mortgage Insurance Fund''; and
            (3) in the second sentence, by striking the comma and all 
        that follows through the period at the end and inserting ``, 
        except that all references in section 204 to section 203 shall 
        be construed to refer to the section under which the mortgage 
        is insured.''.
    (b) Mortgage Insurance on Indian Reservations.--Section 248(f) of 
the National Housing Act (12 U.S.C. 1715z-13) is amended--
            (1) in the heading, by striking ``General Insurance Fund'' 
        and inserting ``Mutual Mortgage Insurance Fund'';
            (2) in the first sentence, by striking ``General Insurance 
        Fund established in section 519'' and inserting ``Mutual 
        Mortgage Insurance Fund''; and
            (3) in the second sentence, by striking the comma and all 
        that follows through the period at the end and inserting ``, 
        except that all references in section 204 to section 203 shall 
        be construed to refer to the section under which the mortgage 
        is insured.''.

SEC. 112. CONFORMING AND TECHNICAL AMENDMENTS.

    (a) Repeal of Sections.--The following sections of the National 
Housing Act are repealed:
            (1) Section 203(i) (12 U.S.C. 1709(i)).
            (2) Section 203(o) (12 U.S.C. 1709(o)).
            (3) Section 203(p) (12 U.S.C. 1709(p)).
            (4) Section 203(q) (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 through the semicolon at the end 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 Northern Marianas Islands''.

SEC. 113. HOME EQUITY CONVERSION MORTGAGES.

    Section 255 of the National Housing Act (12 U.S.C. 1715z-20) is 
amended--
            (1) in subsection (g)--
                    (A) by striking the first sentence; and
                    (B) by striking ``section 203(b)(2)'' and inserting 
                ``section 305(a)(2) of the Federal Home Loan Mortgage 
                Corporation Act'';
            (2) in subsection (i)(1)(C), by striking ``limitations'' 
        and inserting ``limitation''; and
            (3) by adding a new subsection as follows:
    ``(n) Authority for Home Purchase.--
            ``(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 under paragraph (1) shall involve a 
        principal obligation that does not exceed the dollar amount 
        limitation determined under section 305(a)(2) of the Federal 
        Home Loan Mortgage Corporation Act for a residence of the 
        applicable size.''.

SEC. 114. CONFORMING LOAN LIMIT IN DISASTER AREAS.

    Section 203(h) of the National Housing Act (12 U.S.C. 1709) is 
amended--
            (1) by striking ``Notwithstanding'' and inserting the 
        following:
            ``(1) In general.--Notwithstanding'';
            (2) by inserting after ``value of property'' the following: 
        ``plus any initial service charges, appraisal, inspection, and 
        other fees in connection with the mortgage, as approved by the 
        Secretary''; and
            (3) by adding at the end the following:
            ``(2) Temporary agreements to insure mortgages.--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 as described in paragraph (1), 
        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. 115. SAVINGS PROVISION.

    Any mortgage insured under title II of the National Housing Act 
before the date of enactment of this title shall continue to be 
governed by the laws, regulations, orders, terms, and conditions to 
which it was subject to on the day prior to the date of enactment of 
this title.

SEC. 116. IMPLEMENTATION.

    (a) In General.--The Secretary shall by notice establish any 
additional requirements that may be necessary to immediately carry out 
the provisions of this title.
    (b) Effect of Notice.--Any notice required under subsection (a) 
shall take effect upon the date of issuance of such notice.

           TITLE II--MANUFACTURED HOUSING MORTGAGE INSURANCE

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Federal Housing Administration 
Manufactured Housing Loan Act of 2006''.

SEC. 202. FINDINGS AND PURPOSES.

    (a) Findings.--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 Federal Housing Administration 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 Federal Housing 
        Administration 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 2004, fewer than 2,000 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) such 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 title are--
            (1) to provide adequate funding for the Federal Housing 
        Administration-insured manufactured housing loans for low- and 
        moderate-income homebuyers during all economic cycles in the 
        manufactured housing industry;
            (2) to modernize the Federal Housing Administration 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 such limits to 
        inflation.

SEC. 203. EXCEPTION TO LIMITATION ON FINANCIAL INSTITUTION PORTFOLIO.

    (a) Insurance of Financial Institutions.--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 the colon and inserting a period.
    (b) Clarification.--The proviso in section 2(a) of the National 
Housing Act (12 U.S.C. 1703(a)) is amended by striking ``Provided, that 
with'' and inserting ``With''.

SEC. 204. INSURANCE BENEFITS.

    (a) Manufactured Housing Loans.--Section 2(b) of the National 
Housing Act (12 U.S.C. 1703(b)), is amended by adding at the end the 
following:
            ``(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 this provision 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 provisions of this section shall only apply 
to loans that are registered or endorsed for insurance after the date 
of enactment of this section.

SEC. 205. MAXIMUM LOAN LIMITS.

    (a) Dollar Amounts.--Section 2(b)(1) 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 ``$24,500'';
            (2) in subparagraph (C), by striking ``$48,600'' and 
        inserting ``$68,040'';
            (3) in subparagraph (D), by striking ``$64,800'' and 
        inserting ``$90,720'';
            (4) in subparagraph (E), by striking ``$16,200'' and 
        inserting ``$22,680''; 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.--Section 2(b) of the National Housing Act (12 
U.S.C. 1703(b)), as amended by section 204, is amended by adding at the 
end the following:
            ``(9) Indexing.--
                    ``(A) In general.--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.
                    ``(B) Basis of index.--The index method developed 
                under subparagraph (A) shall be based on the 
                manufactured housing price data collected by the United 
                States Census Bureau.
                    ``(C) Timing.--The Secretary shall develop the 
                index method required under subparagraph (A) not later 
                than 1 year after the date of enactment of this 
                paragraph.''.
    (c) Technical and Conforming Changes.--Section 2(b)(1) 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 the following flush text after subparagraph 
        (G):
``The Secretary shall, by regulation, increase the dollar amount 
limitations in subparagraphs (A)(ii), (C), (D), and (E) according to 
the index method developed in paragraph (9).''.

SEC. 206. INSURANCE PREMIUMS.

    Section 2(f) of the National Housing Act (12 U.S.C. 1703(f)) is 
amended--
            (1) by striking ``(f) The Secretary'' and by inserting the 
        following:
    ``(f) Insurance Premiums.--
            ``(1) In general.--The Secretary''; and
            (2) by adding at the end the following:
            ``(2) Manufactured home loans.--
                    ``(A) Premium structure.--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 
                Secretary may establish a mortgage insurance premium 
                structure involving a single premium collected prior to 
                the insurance of the mortgage or periodic payments, or 
                both.
                    ``(B) Rate.--The rate of premium for a mortgage 
                under subparagraph (A) may vary during the mortgage 
                term as long as the basis for determining the variable 
                rate is determined prior to the execution of the 
                mortgage.
                    ``(C) Change in premiums.--The Secretary may change 
                a premium structure established under this paragraph if 
                the change is not applied to any mortgage already 
                executed.
                    ``(D) Notice.--A premium structure shall be 
                established or changed under this paragraph by 
                providing notice to lenders and by providing notice to 
                Congress at least 30 days prior to the date that the 
                premium structure is to be established or changed.''.

SEC. 207. TECHNICAL CORRECTIONS.

    (a) Dates.--Section 2(a) of the National Housing Act (12 U.S.C. 
1703(a)) is amended--
            (1) by striking ``on and after July 1, 1939,''; and
            (2) by striking ``made after August 2, 1954''.
    (b) Authority of the Secretary.--Section 2(c) of the National 
Housing Act (12 U.S.C. 1703(c)) is amended to read as follows:
    ``(c) Authority of the Secretary.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, the Secretary is authorized--
                    ``(A) to 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 discretion of the Secretary, 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 the Secretary in connection with 
                the payment of insurance heretofore or hereafter 
                granted under this section; and
                    ``(B) to 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) Rule of construction.--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 power.--
                    ``(A) In general.--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.
                    ``(B) Rule of construction.--Nothing in this 
                paragraph shall be construed to prevent the Secretary 
                from delegating such power by order or by power of 
                attorney, in the discretion of the Secretary, to any 
                officer or agent the Secretary may appoint.''.
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