I 

111TH CONGRESS 

1ST SESSION H. R. 225 

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 7, 2009 

Mr. MILLER of North Carolina (for himself, Ms. LINDA T. SA ́NCHEZ of California, Mr. FRANK of Massachusetts, Mr. WATT, Mr. ELLISON, Ms. LEE

of California, Mr. COURTNEY, Mr. BLUMENAUER, Mrs. CHRISTENSEN, 

Ms. EDDIE BERNICE JOHNSON of Texas, Mr. BUTTERFIELD, Mr. 

GRIJALVA, Ms. JACKSON-LEE of Texas, Mr. SIRES, Mr. CAPUANO, Mr. 

HINCHEY, Mr. GEORGE MILLER of California, Mr. STARK, Mr. JOHNSON

of Georgia, Mr. DAVIS of Alabama, Mr. VAN HOLLEN, Ms. WASSERMAN

SCHULTZ, Mr. COHEN, Ms. EDWARDS of Maryland, and Mr. LEWIS of 

Georgia) 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 ‘‘Emergency Homeown5 ership and Equity Protection Act’’. 


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1 SEC. 2. ELIGIBILITY FOR RELIEF. 

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

3 amended— 

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

5 following: ‘‘For purposes of this subsection, the com6 putation of debts shall not include the secured or 

7 unsecured portions of— 

8 ‘‘(1) debts secured by the debtor’s principal res9 idence if the current value of that residence is less 

10 than the secured debt limit; or 

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

12 property that was the debtor’s principal residence 

13 that was sold in foreclosure or that the debtor sur14 rendered to the creditor if the current value of such 

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

16 and 

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

18 following: 

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

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

21 who submits to the court a certification that the debtor 

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

23 the debtor’s principal residence may commence a fore24 closure on the debtor’s principal residence.’’. 


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1 SEC. 3. AUTHORITY TO MODIFY CERTAIN MORTGAGES. 

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

3 amended— 

4 (1) by redesignating paragraph (11) as para5 graph (12), 

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

7 end, and 

8 (3) by inserting after paragraph (10) the fol9 lowing: 

10 ‘‘(11) notwithstanding paragraph (2) and other11 wise applicable nonbankruptcy law, with respect to a 

12 claim for a loan made before the date of the enact13 ment of the Emergency Homeownership and Equity 

14 Protection Act secured by a security interest in the 

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

16 notice that a foreclosure may be commenced, modify 

17 the rights of the holder of such claim— 

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

19 amount of the allowed secured claim as deter20 mined under section 506(a)(1); 

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

22 adjustable under the terms of such security in23 terest by prohibiting, reducing, or delaying ad24 justments to such rate of interest applicable on 

25 and after the date of filing of the plan; 


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1 ‘‘(C) by modifying the terms and condi2 tions of such loan— 

3 ‘‘(i) to extend the repayment period 

4 for a period that is no longer than the 

5 longer of 40 years (reduced by the period 

6 for which such loan has been outstanding) 

7 or the remaining term of such loan, begin8 ning on the date of the order for relief 

9 under this chapter; and 

10 ‘‘(ii) to provide for the payment of in11 terest accruing after the date of the order 

12 for relief under this chapter at an annual 

13 percentage rate calculated at a fixed an14 nual percentage rate, in an amount equal 

15 to the then most recently published annual 

16 yield on conventional mortgages published 

17 by the Board of Governors of the Federal 

18 Reserve System, as of the applicable time 

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

20 reasonable premium for risk; and 

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

22 modified loan directly to the holder of the 

23 claim; and’’. 


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1 SEC. 4. COMBATING EXCESSIVE FEES. 

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

3 is amended— 

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

5 end, 

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

7 the end and inserting a semicolon, and 

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

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

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

11 or charge that is incurred while the case is pending 

12 and arises from a debt that is secured by the debt13 or’s principal residence except to the extent that— 

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

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

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

17 more frequent periodicity as the court deter18 mines necessary) notice of such fee, cost, or 

19 charge before the earlier of— 

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

21 charge is incurred; or 

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

23 case; and 

24 ‘‘(B) such fee, cost, or charge— 

25 ‘‘(i) is lawful under applicable non26 bankruptcy law, reasonable, and provided 


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1 for in the applicable security agreement; 

2 and 

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

4 of which is greater than the amount of 

5 such claim, including such fee, cost, or 

6 charge; 

7 ‘‘(4) the failure of a party to give notice de8 scribed in paragraph (3) shall be deemed a waiver 

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

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

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

12 violation of section 524(a)(2) or, if the violation oc13 curs before the date of discharge, of section 362(a); 

14 and 

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

16 prepayment penalty on a claim secured by the debt17 or’s principal residence.’’. 

18 SEC. 5. CONFIRMATION OF PLAN. 

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

20 is amended— 

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

22 end, 

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

24 the end and inserting a semicolon, and 


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1 (3) by inserting after paragraph (9) the fol2 lowing: 

3 ‘‘(10) notwithstanding subclause (I) of para4 graph (5)(B)(i), the plan provides that the holder of 

5 a claim whose rights are modified pursuant to sec6 tion 1322(b)(11) retain the lien until the later of— 

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

8 secured claim; or 

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

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

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

12 such modification is in good faith.’’. 

13 SEC. 6. DISCHARGE. 

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

15 amended— 

16 (1) in subsection (a)— 

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

18 holders of claims whose rights are modified 

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

20 1st place it appears, and 

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

22 the extent of the unpaid portion of an allowed 

23 secured claim, provided for in section 

24 1322(b)(11)’’ after ‘‘1322(b)(5)’’, and 


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

2 extent of the unpaid portion of an allowed secured 

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

4 ‘‘1322(b)(5)’’. 

5 SEC. 7. EFFECTIVE DATE; APPLICATION OF AMENDMENTS. 

6 (a) EFFECTIVE DATE.—Except as provided in sub7 section (b), this Act and the amendments made by this 

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

9 Act. 

10 (b) APPLICATION OF AMENDMENTS.—The amend11 ments made by this Act shall apply with respect to cases 

12 commenced under title 11 of the United States Code be13 fore, on, or after the date of the enactment of this Act. 

Æ 


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