I 

111TH CONGRESS 

1ST SESSION H. R. 200 

To amend title 11 of the United States Code with respect to modification 

of certain mortgages on principal residences, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 6, 2009 

Mr. CONYERS (for himself, Ms. LINDA T. SA ́NCHEZ of California, Mr. NADLER of New York, Mr. DELAHUNT, Mr. SCOTT of Virginia, and Ms. WATERS) introduced the following bill; which was referred to the Committee 

on the Judiciary 

A BILL 

To amend title 11 of the United States Code with respect 

to modification of certain mortgages on principal residences, 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 ‘‘Helping Families Save 

5 Their Homes in Bankruptcy Act of 2009’’. 

6 SEC. 2. ELIGIBILITY FOR RELIEF. 

7 Section 109 of title 11, United States Code, is 

8 amended— 


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1 (1) by adding at the end of subsection (e) the 

2 following: ‘‘For purposes of this subsection, the com3 putation of debts shall not include the secured or 

4 unsecured portions of— 

5 ‘‘(1) debts secured by the debtor’s principal res6 idence if the current value of that residence is less 

7 than the secured debt limit; or 

8 ‘‘(2) debts secured or formerly secured by real 

9 property that was the debtor’s principal residence 

10 that was sold in foreclosure or that the debtor sur11 rendered to the creditor if the current value of such 

12 real property is less than the secured debt limit.’’; 

13 and 

14 (2) by adding at the end of subsection (h) the 

15 following: 

16 ‘‘(5) The requirements of paragraph (1) shall not 

17 apply in a case under chapter 13 with respect to a debtor 

18 who submits to the court a certification that the debtor 

19 has received notice that the holder of a claim secured by 

20 the debtor’s principal residence may commence a fore21 closure on the debtor’s principal residence.’’. 

22 SEC. 3. PROHIBITING CLAIMS ARISING FROM VIOLATIONS 

23 OF CONSUMER PROTECTION LAWS. 

24 Section 502(b) of title 11, United States Code, is 

25 amended— 


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1 (1) in paragraph (8) by striking ‘‘or’’ at the 

2 end, 

3 (2) in paragraph (9) by striking the period at 

4 the end and inserting ‘‘; or’’, and 

5 (3) by adding at the end the following: 

6 ‘‘(10) the claim is subject to any remedy for 

7 damages or rescission due to failure to comply with 

8 any applicable requirement under the Truth in 

9 Lending Act, or any other provision of applicable 

10 State or Federal consumer protection law that was 

11 in force when the noncompliance took place, notwith12 standing the prior entry of a foreclosure judgment.’’. 

13 SEC. 4. AUTHORITY TO MODIFY CERTAIN MORTGAGES. 

14 Section 1322(b) of title 11, United States Code, is 

15 amended— 

16 (1) by redesignating paragraph (11) as para17 graph (12), 

18 (2) in paragraph (10) by striking ‘‘and’’ at the 

19 end, and 

20 (3) by inserting after paragraph (10) the fol21 lowing: 

22 ‘‘(11) notwithstanding paragraph (2) and other23 wise applicable nonbankruptcy law, with respect to a 

24 claim for a loan secured by a security interest in the 

25 debtor’s principal residence that is the subject of a 


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1 notice that a foreclosure may be commenced, modify 

2 the rights of the holder of such claim— 

3 ‘‘(A) by providing for payment of the 

4 amount of the allowed secured claim as deter5 mined under section 506(a)(1); 

6 ‘‘(B) if any applicable rate of interest is 

7 adjustable under the terms of such security in8 terest by prohibiting, reducing, or delaying ad9 justments to such rate of interest applicable on 

10 and after the date of filing of the plan; 

11 ‘‘(C) by modifying the terms and condi12 tions of such loan— 

13 ‘‘(i) to extend the repayment period 

14 for a period that is no longer than the 

15 longer of 40 years (reduced by the period 

16 for which such loan has been outstanding) 

17 or the remaining term of such loan, begin18 ning on the date of the order for relief 

19 under this chapter; and 

20 ‘‘(ii) to provide for the payment of in21 terest accruing after the date of the order 

22 for relief under this chapter at an annual 

23 percentage rate calculated at a fixed an24 nual percentage rate, in an amount equal 

25 to the then most recently published annual 


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1 yield on conventional mortgages published 

2 by the Board of Governors of the Federal 

3 Reserve System, as of the applicable time 

4 set forth in the rules of the Board, plus a 

5 reasonable premium for risk; and 

6 ‘‘(D) by providing for payments of such 

7 modified loan directly to the holder of the 

8 claim; and’’. 

9 SEC. 5. COMBATING EXCESSIVE FEES. 

10 Section 1322(c) of title 11, the United States Code, 

11 is amended— 

12 (1) in paragraph (1) by striking ‘‘and’’ at the 

13 end, 

14 (2) in paragraph (2) by striking the period at 

15 the end and inserting a semicolon, and 

16 (3) by adding at the end the following: 

17 ‘‘(3) the debtor, the debtor’s property, and 

18 property of the estate are not liable for a fee, cost, 

19 or charge that is incurred while the case is pending 

20 and arises from a debt that is secured by the debt21 or’s principal residence except to the extent that— 

22 ‘‘(A) the holder of the claim for such debt 

23 files with the court (annually or, in order to 

24 permit filing consistent with clause (ii), at such 

25 more frequent periodicity as the court deterVerDate Nov 24 2008 23:50 Jan 10, 2009 Jkt 079200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H200.IH H200

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1 mines necessary) notice of such fee, cost, or 

2 charge before the earlier of— 

3 ‘‘(i) 1 year after such fee, cost, or 

4 charge is incurred; or 

5 ‘‘(ii) 60 days before the closing of the 

6 case; and 

7 ‘‘(B) such fee, cost, or charge— 

8 ‘‘(i) is lawful under applicable non9 bankruptcy law, reasonable, and provided 

10 for in the applicable security agreement; 

11 and 

12 ‘‘(ii) is secured by property the value 

13 of which is greater than the amount of 

14 such claim, including such fee, cost, or 

15 charge; 

16 ‘‘(4) the failure of a party to give notice de17 scribed in paragraph (3) shall be deemed a waiver 

18 of any claim for fees, costs, or charges described in 

19 paragraph (3) for all purposes, and any attempt to 

20 collect such fees, costs, or charges shall constitute a 

21 violation of section 524(a)(2) or, if the violation oc22 curs before the date of discharge, of section 362(a); 

23 and 


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1 ‘‘(5) a plan may provide for the waiver of any 

2 prepayment penalty on a claim secured by the debt3 or’s principal residence.’’. 

4 SEC. 6. CONFIRMATION OF PLAN. 

5 Section 1325(a) of title 11, the United States Code, 

6 is amended— 

7 (1) in paragraph (8) by striking ‘‘and’’ at the 

8 end, 

9 (2) in paragraph (9) by striking the period at 

10 the end and inserting a semicolon, and 

11 (3) by inserting after paragraph (9) the fol12 lowing: 

13 ‘‘(10) notwithstanding subclause (I) of para14 graph (5)(B)(i), the plan provides that the holder of 

15 a claim whose rights are modified pursuant to sec16 tion 1322(b)(11) retain the lien until the later of— 

17 ‘‘(A) the payment of such holder’s allowed 

18 secured claim; or 

19 ‘‘(B) discharge under section 1328; and 

20 ‘‘(11) the plan modifies a claim in accordance 

21 with section 1322(b)(11), and the court finds that 

22 such modification is in good faith.’’. 

23 SEC. 7. DISCHARGE. 

24 Section 1328 of title 11, the United States Code, is 

25 amended— 


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1 (1) in subsection (a)— 

2 (A) by inserting ‘‘(other than payments to 

3 holders of claims whose rights are modified 

4 under section 1322(b)(11)’’ after ‘‘paid’’ the 

5 first place it appears, and 

6 (B) in paragraph (1) by inserting ‘‘or, to 

7 the extent of the unpaid portion of an allowed 

8 secured claim, provided for in section 

9 1322(b)(11)’’ after ‘‘1322(b)(5)’’, and 

10 (2) in subsection (c)(1) by inserting ‘‘or, to the 

11 extent of the unpaid portion of an allowed secured 

12 claim, provided for in section 1322(b)(11)’’ after 

13 ‘‘1322(b)(5)’’. 

14 SEC. 8. EFFECTIVE DATE; APPLICATION OF AMENDMENTS. 

15 (a) EFFECTIVE DATE.—Except as provided in sub16 section (b), this Act and the amendments made by this 

17 Act shall take effect on the date of the enactment of this 

18 Act. 

19 (b) APPLICATION OF AMENDMENTS.—The amend20 ments made by this Act shall apply with respect to cases 

21 commenced under title 11 of the United States Code be22 fore, on, or after the date of the enactment of this Act. 

Æ 


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