I 

108TH CONGRESS 

1ST SESSION H. R. 314

To amend the Fair Debt Collection Practices Act to exempt mortgage 

servicers from certain requirements of the Act with respect to federally 

related mortgage loans secured by a first lien, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 8, 2003

Mr. ROYCE (for himself, Mr. KANJORSKI, Mr. JONES of North Carolina, Mr. 

PAUL, Mr. SHERMAN, Mr. MEEKS of New York, and Mrs. MALONEY) introduced the following bill; which was referred to the Committee on Financial Services 

A BILL

To amend the Fair Debt Collection Practices Act to exempt 

mortgage servicers from certain requirements of the Act 

with respect to federally related mortgage loans secured 

by a first lien, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Mortgage Servicing 

5 Clarification Act’’. 
2

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1 SEC. 2. MORTGAGE SERVICING CLARIFICATION. 

2 (a) IN GENERAL.—The Fair Debt Collection Prac3 tices Act (15 U.S.C. 1692 et seq.) is amended—

4 (1) by redesignating section 818 as section 819; 

5 and 

6 (2) by inserting after section 817 the following 

7 new section: 

8 ‘‘§ 818. Mortgage servicer exemption 

9 ‘‘(a) EXEMPTION.—A covered mortgage servicer who, 

10 whether by assignment, sale or transfer, becomes the per11 son responsible for servicing federally related mortgage 

12 loans secured by first liens that include loans that were 

13 in default at the time such person became responsible for 

14 the servicing of such federally related mortgage loans shall 

15 be exempt from the requirements of section 807(11) in 

16 connection with the collection of any debt arising from 

17 such defaulted federally related mortgage loans. 

18 ‘‘(b) DEFINITIONS.—For purposes of this section, the 

19 following definitions shall apply: 

20 ‘‘(1) COVERED MORTGAGE SERVICER.—The 

21 term ‘covered mortgage servicer’ means any servicer 

22 of federally related mortgage loans –secured by first 

23 liens—

24 ‘‘(A) who is also debt collector; and 

25 ‘‘(B) for whom the collection of delinquent 

26 debts is incidental to –the servicer’s primary 
3

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1 function of servicing current federally related 

2 –mortgage loans. 

3 ‘‘(2) FEDERALLY RELATED MORTGAGE LOAN.—

4 The term ‘federally related mortgage loan’ has the 

5 meaning given to such term in section 3(1) of the 

6 Real Estate Settlement Procedures Act of 1974, ex7 cept that, for purposes of this section, such term in8 cludes only loans secured by first liens. 

9 ‘‘(3) PERSON.—The term ‘person’ has the 

10 meaning given to such term in section 3(5) of the 

11 Real Estate Settlement Procedures Act of 1974. 

12 ‘‘(4) SERVICER; SERVICING.—The terms 

13 ‘servicer’ and ‘servicing’ have the meanings given to 

14 such terms in section 6(i) of the Real Estate Settle15 ment Procedures Act of 1974.’’. 

16 (b) CLERICAL AMENDMENT.—The table of sections 

17 for the Fair Debt Collection Practices Act (15 U.S.C. 

18 1692 et seq.) is amended—

19 (1) by redesignating the item relating to section 

20 818 as section 819; and 

21 (2) by inserting after the item relating to sec22 tion 817 the following new item:

‘‘818. Mortgage servicer exemption.’’.

Æ