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[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 1834 Introduced in Senate (IS)]

112th CONGRESS
  1st Session
                                S. 1834

To restore and repair the United States mortgage markets by making them 
 transparent, bringing in private capital, winding down the Government-
             sponsored enterprises, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            November 9, 2011

  Mr. Corker introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL

 
To restore and repair the United States mortgage markets by making them 
 transparent, bringing in private capital, winding down the Government-
             sponsored enterprises, 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.

    This Act may be cited as the ``Residential Mortgage Market 
Privatization and Standardization Act of 2011''.

SEC. 2. DEFINITIONS.

    For purposes of this Act, the following definitions shall apply:
            (1) Covered mortgage loan.--
                    (A) In general.--The term ``covered mortgage loan'' 
                means any residential mortgage loan, including any 
                single-family and multifamily loan, that is originated, 
                serviced, or subserviced, in whole or in part, owned 
                directly or indirectly, including through any interest 
                in a security that is backed in whole or in part by a 
                mortgage loan, or securitized or resecuritized, by an 
                entity or affiliate or subsidiary thereof that is 
                regulated by any of the agencies listed in subparagraph 
                (B).
                    (B) Agencies.--The agencies listed in this 
                subparagraph are--
                            (i) the Board of Governors of the Federal 
                        Reserve System;
                            (ii) the Department of Agriculture;
                            (iii) the Department of Housing and Urban 
                        Development;
                            (iv) the Federal Deposit Insurance 
                        Corporation;
                            (v) the Federal Housing Finance Agency;
                            (vi) the Farm Credit Administration;
                            (vii) the Federal Trade Commission;
                            (viii) the Office of the Comptroller of the 
                        Currency;
                            (ix) the National Credit Union 
                        Administration; and
                            (x) the Securities and Exchange Commission.
            (2) Enterprises.--The term ``enterprises'' means, 
        individually and collectively, the Federal National Mortgage 
        Association and the Federal Home Loan Mortgage Corporation.
            (3) FHFA; director.--The terms ``FHFA'' and ``Director'' 
        mean the Federal Housing Finance Agency and the Director 
        thereof, respectively.
            (4) Mortgage data.--
                    (A) In general.--The Director shall define mortgage 
                data, by regulation, consistent with this paragraph.
                    (B) Single-family loans.--For single-family covered 
                mortgage loans, the term ``mortgage data'' means, as of 
                the date of origination--
                            (i) the loan origination date and the loan 
                        maturity date;
                            (ii) whether the loan is a purchase loan or 
                        a refinance, and for refinance loans--
                                    (I) the date on which the 
                                refinanced loan was originated;
                                    (II) the identity of the lender on 
                                the refinanced loan; and
                                    (III) the unpaid principal balance 
                                of the refinanced loan that was repaid 
                                by the new loan;
                            (iii) the value of the collateral property 
                        on which the lender relied, and how the lender 
                        determined the value;
                            (iv) the credit score or scores that the 
                        lender used or on which it relied, and the 
                        entity that supplied each;
                            (v) debt-to-income ratios, including--
                                    (I) the ratio of the total debt of 
                                the borrower and coborrowers, expressed 
                                as a monthly payment amount, to the 
                                total current and expected future 
                                income of the borrower and any 
                                coborrowers on which the lender relied, 
                                expressed as a monthly income amount; 
                                and
                                    (II) the ratio of the first 
                                scheduled payment on the loan, 
                                expressed as a monthly payment amount, 
                                to the total current and expected 
                                future income of the borrower and any 
                                coborrowers on which the lender relied, 
                                expressed as a monthly income amount;
                            (vi) the total value of borrower assets, 
                        but not including the value of the collateral 
                        and not including income, on which the lender 
                        relied;
                            (vii) the principal amount of the loan;
                            (viii) the interest rate on the loan;
                            (ix) if the interest rate may adjust under 
                        the loan terms, the terms and limits of any 
                        permissible adjustment, including the index and 
                        margin, if applicable, when the rate may 
                        adjust, and any caps or floors on any such 
                        adjustment;
                            (x) if the principal may increase under the 
                        loan terms at origination, the terms and limits 
                        of any permissible increase, including when the 
                        increase or increases may occur, how the amount 
                        and timing of any increase is determined, and 
                        any caps on any such increases;
                            (xi) if the payment amount may adjust, 
                        independently of a rate adjustment or of an 
                        increase in the principal amount, the terms and 
                        limits of any permissible adjustment, including 
                        when the adjustment may occur, how the amount 
                        and timing of any adjustment is determined, and 
                        any caps or floors on any such adjustments;
                            (xii) whether, under the loan terms, the 
                        borrower may be required to pay any prepayment 
                        penalty, and if so, the potential amount and 
                        timing of any such penalty;
                            (xiii) any permissible grace periods and 
                        late fees under the loan terms, including fee 
                        amounts permitted on the loan;
                            (xiv) whether the borrower or any 
                        coborrower has stated an intent to reside in 
                        the property as a principal residence;
                            (xv) whether the loan is assumable under 
                        the loan terms at origination and if so, the 
                        conditions on which any assumption may be 
                        denied;
                            (xvi) whether the originating lender was or 
                        is aware of any subordinate or senior lien on 
                        the property at the time at which the loan was 
                        originated, and if so, the identity of all 
                        lenders or other lienholders of such other 
                        loans, the relative lien position of each, and 
                        the date of origination of each lien if it 
                        secures a mortgage loan;
                            (xvii) the type of mortgage insurance 
                        relating to the loan, including who pays it, 
                        and the amount and scheduled payment dates of 
                        any premiums;
                            (xviii) whether flood insurance is required 
                        in connection with the loan, and if so, the 
                        amount and timing of premiums;
                            (xix) whether the loan has an escrow 
                        account and if so, the amount of the initial 
                        deposit into the escrow account and the amount 
                        of the monthly payments scheduled to be 
                        deposited into the escrow account;
                            (xx) the amount of points, fees, and 
                        settlement charges paid to originate the loan, 
                        including the amount of any compensation paid 
                        to a mortgage broker, and who paid it;
                            (xxi) whether the borrower or borrowers 
                        have any payment assistance at origination, 
                        such as government or private subsidies or 
                        buydowns, and if so, the amounts, terms, and 
                        timing of such assistance; and
                            (xxii) the address of the real property 
                        securing the mortgage loan.
                    (C) Multifamily loans.--For multifamily covered 
                mortgage loans, the term ``mortgage data'' means, as of 
                the date of origination--
                            (i) the number of dwelling units in each 
                        property securing each loan;
                            (ii) the rent on each dwelling unit, or, if 
                        more than 1 has the same rent, the number of 
                        units at each rent level;
                            (iii) the occupancy status of each dwelling 
                        unit;
                            (iv) whether the rent is subsidized by any 
                        government agency and, if so, in what amounts, 
                        under what terms and conditions, and for what 
                        period of time;
                            (v) whether the rent on the units is 
                        current, and if not, how many days or months 
                        the rent for each unit is delinquent; and
                            (vi) all of the information described in 
                        subparagraph (B), except as modified by the 
                        Director, by regulation, consistent with this 
                        Act.
                    (D) After origination.--For both single-family and 
                multifamily covered mortgage loans, beginning the day 
                after the date of origination of the loan, and reported 
                not less frequently than monthly thereafter until the 
                loan ceases to exist, the term ``mortgage data'' 
                includes--
                            (i) the amount and date of payments 
                        received each month, including--
                                    (I) whether each payment is 
                                received by the due date or within a 
                                grace period, and if a payment is 
                                received after the scheduled due date, 
                                how many days past due;
                                    (II) the amount of any payment 
                                deposited into an escrow account;
                                    (III) amounts paid for other loan 
                                charges, with an identification of the 
                                amount and type of such other charge; 
                                and
                                    (IV) the amount of any prepayments;
                            (ii) for loans on which any payment or 
                        partial payment is overdue, the number of days 
                        since the loan was current;
                            (iii) whether property taxes, hazard 
                        insurance premiums, and any flood insurance 
                        premiums required in connection with the loan 
                        are paid by the borrower or borrowers as 
                        required, and if any such item is not paid as 
                        required--
                                    (I) the number of days since the 
                                payment was required, and the amount of 
                                the missed payment;
                                    (II) whether the servicer or other 
                                party on behalf of the servicer paid 
                                property taxes on the property, and in 
                                what amount; and
                                    (III) whether the servicer or other 
                                party on behalf of the servicer force-
                                placed hazard or flood insurance, and 
                                if so, the amount of the premium and 
                                the identity of the insurer;
                            (iv) the amount of any interest paid to the 
                        borrower on any escrow;
                            (v) the type and date of any actions taken 
                        by or on behalf of the servicer due to default, 
                        including nonpayment default, and the amount 
                        charged to the borrower or borrowers as a 
                        result of the action or actions; and
                            (vi) if the servicer is aware of any damage 
                        to the property securing the loan, the type and 
                        extent of the damage and of any repairs, the 
                        amount of insurance proceeds paid, the amount 
                        of such proceeds disbursed or paid to the 
                        borrower, and the amount held by the servicer, 
                        and the date and results of any inspection done 
                        by or on behalf of the servicer.
                    (E) Adjustments consistent with the purposes of 
                this act.--The Director may adjust the items that are 
                included in or excluded from the definition of mortgage 
                data consistent with this Act, as appropriate to 
                protect the privacy of individual consumers.
                    (F) Privacy.--The regulations required by 
                subparagraph (A) may require rounding off of the debt 
                to income ratios required to be included as mortgage 
                data to protect the privacy of the borrower, taking 
                into consideration the information that is already 
                available on the Internet or in other ways.

SEC. 3. GSE WINDDOWN.

    (a) Fannie Mae.--Section 304 of the National Housing Act (12 U.S.C. 
1719) is amended by adding at the end the following:
    ``(h) Winddown of Enterprises.--
            ``(1) Annual guarantee reductions.--Not later than 180 days 
        after the date of enactment of the Mortgage Market 
        Privatization and Standardization Act of 2011, and annually 
        thereafter, the Director shall begin reducing the percentage of 
        the value of a trust certificate or other security that may be 
        guaranteed by the corporation by not less than 10 percent per 
        year.
            ``(2) Structure.--The percentage of the bond guaranteed by 
        the corporation can be structured on either a pro-rata or 
        senior-subordinated basis, as determined by the Director. The 
        Director shall pursue a strategy that allows for market signals 
        to assist Congress and the Director to monitor and assess the 
        price that private market participants are assigning to 
        mortgage credit risk.''.
    (b) Freddie Mac.--Section 305 of the Federal Home Loan Mortgage 
Corporation Act (12 U.S.C. 1454) is amended by adding at the end the 
following:
    ``(d) Winddown of Enterprises.--
            ``(1) Annual guarantee reductions.--Not later than 180 days 
        after the date of enactment of the Mortgage Market 
        Privatization and Standardization Act of 2011, and annually 
        thereafter, the Director shall begin reducing the percentage of 
        the value of a trust certificate or other security that may be 
        guaranteed by the corporation by not less than 10 percent per 
        year.
            ``(2) Structure.--The percentage of the bond guaranteed by 
        the corporation can be structured on either a pro-rata or 
        senior-subordinated basis, as determined by the Director. The 
        Director shall pursue a strategy that allows for market signals 
        to assist Congress and the Director to monitor and assess the 
        price that private market participants are assigning to 
        mortgage credit risk.''.

SEC. 4. RESIDENTIAL MORTGAGE MARKET TRANSPARENCY.

    (a) In General.--Mortgage data relating to all covered mortgage 
loans shall be put into the public domain in accordance with this 
section.
    (b) Agency Action.--Each agency named in section 2(1)(B) shall, not 
later than 1 year after the date of enactment of this Act, require, by 
regulation, that all entities regulated by such agency shall put 
mortgage data relating to covered mortgage loans into the public 
domain, in accordance with this Act and the regulations issued under 
this Act. Such regulations shall require that the data be reasonably 
accurate and complete.
    (c) Manner and Form of Data.--Not later than 1 year after the date 
of enactment of this Act, the Director shall, by regulation--
            (1) establish the manner and form by which all mortgage 
        data required to be put into the public domain by this section 
        shall be put into the public domain; and
            (2) require that such mortgage data be made available in a 
        uniform manner, in a form designed for uniformity of data 
        definitions and forms, ease and speed of access, ease and speed 
        of downloading, and ease and speed of use.
    (d) Update.--All entities required to put mortgage data into the 
public domain under this Act shall continuously update the mortgage 
data, not less frequently than monthly, as long as the entities exist, 
whether in conservatorship, receivership, or otherwise. All updates 
shall be reasonably accurate and complete.
    (e) Responsibility of Regulated Entities.--The mortgage data 
required to be put into the public domain in accordance with this Act 
shall include all mortgage data related to all covered mortgage loans, 
to the extent practicable.
    (f) Duplication of Effort.--If 2 or more entities are required by 
this Act to report the same mortgage data relating to the same mortgage 
loan, they may, by agreement, determine that only 1 of such entities 
will report the data. If 1 of such entities reports the required 
mortgage data, it shall not be a violation of this section for the 
other entities not to report the data.
    (g) Date of Access to Data.--The Director shall establish, and 
cause to be published in the Federal Register, the initial date on 
which--
            (1) the public shall begin to have access to any data put 
        into the public domain in accordance with this Act; and
            (2) all mortgage data is required to be put into the public 
        domain, in accordance with this Act.
    (h) Costs to FHFA.--The FHFA shall pay the cost of establishing the 
database of mortgage data that is put into the public domain under this 
section, and of providing public access to that database. If the FHFA 
ever ceases to exist without being replaced, and unless otherwise 
provided by Act of Congress, the cost of maintaining the database shall 
be borne by the remaining agencies named in section 2(1)(B), by 
agreement.

SEC. 5. ENCOURAGING A MARKET FOR HIGH QUALITY RESIDENTIAL MORTGAGE 
              FUTURES.

    (a) In General.--Subpart A of part 2 of subtitle A of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 (12 
U.S.C. 4541 et seq.) is amended by adding at the end the following:

``SEC. 1327. ENCOURAGING A MARKET FOR HIGH QUALITY RESIDENTIAL MORTGAGE 
              FUTURES.

    ``(a) Definitions.--In this section, the following definitions 
shall apply:
            ``(1) Deliverable residential mortgage.--
                    ``(A) In general.--The terms `deliverable 
                residential mortgage' and `DRM' have the meaning given 
                those terms by rule of the Director, in consultation 
                with participants in the TBA market, taking into 
                consideration underwriting and product features that 
                historical loan performance data indicate result in a 
                lower risk of default, such as--
                            ``(i) documentation and verification of the 
                        financial resources relied upon to qualify the 
                        mortgagor;
                            ``(ii) standards with respect to--
                                    ``(I) the residual income of the 
                                mortgagor after all monthly 
                                obligations;
                                    ``(II) the ratio of the housing 
                                payments of the mortgagor to the 
                                monthly income of the mortgagor; and
                                    ``(III) the ratio of total monthly 
                                installment payments of the mortgagor 
                                to the income of the mortgagor;
                            ``(iii) mitigating the potential for 
                        payment shock on adjustable rate mortgages 
                        through product features and underwriting 
                        standards;
                            ``(iv) mortgage guarantee insurance or 
                        other types of insurance or credit enhancement 
                        obtained at the time of origination, to the 
                        extent such insurance or credit enhancement 
                        reduces the risk of default; and
                            ``(v) prohibiting or restricting the use of 
                        balloon payments, negative amortization, 
                        prepayment penalties, interest-only payments, 
                        and other features that have been demonstrated 
                        to exhibit a higher risk of borrower default.
                    ``(B) Limitation on definition.--The Director, in 
                defining the term `deliverable residential mortgage', 
                as required by subparagraph (B), shall define that term 
                to be no broader than the definition of the term 
                `qualified mortgage', as provided under section 
                129C(c)(2) of the Truth in Lending Act and regulations 
                adopted thereunder.
            ``(2) Participant in the tba market.--The term `participant 
        in the TBA market' means a private investor in or dealer of 
        mortgage-backed securities, particularly mortgage-backed 
        securities issued by the enterprises, that routinely enters 
        into forward contracts for the sale of mortgage-backed 
        securities that do not specify the particular mortgage-backed 
        securities that will be delivered to the buyer.
            ``(3) Program.--The term `program' means the program 
        established under subsection (b).
            ``(4) DRM futures market.--The term `DRM futures market' 
        means a market for forward contracts for the sale of mortgage-
        backed securities collateralized exclusively by deliverable 
        residential mortgages.
            ``(5) TBA market.--The term `TBA market' means the market 
        for forward contracts for the sale of mortgage-backed 
        securities that do not specify the particular mortgage-backed 
        securities that will be delivered to the buyer.
    ``(b) Program Established.--The Director, in consultation with 
participants in the TBA market, shall establish a program to encourage 
the development of a DRM futures market that--
            ``(1) compliments the TBA market;
            ``(2) creates incentives for trading by participants in the 
        TBA market; and
            ``(3) has the potential to replace the TBA market.
    ``(c) Technology and Infrastructure.--The Director shall consult 
with participants in the TBA market to develop the technology and 
infrastructure necessary to carry out the program established under 
this section.
    ``(d) Annual Report.--The Director shall submit to Congress an 
annual report on the program established under this section.''.
    (b) Securities Laws Exemptions.--
            (1) Securities act of 1933.--Section 3(a) of the Securities 
        Act of 1933 (15 U.S.C. 77c(a)) is amended by adding at the end 
        the following:
            ``(14) Any mortgage-backed security collateralized 
        exclusively by deliverable residential mortgages, as such term 
        is defined under section 1327 of the Federal Housing 
        Enterprises Financial Safety and Soundness Act of 1992.''.
            (2) Securities exchange act of 1934.--Section 3(a)(12)(A) 
        of the Securities Exchange Act of 1934 (15 U.S.C. 
        78c(a)(12)(A)) is amended--
                    (A) by redesignating clauses (vi) and (vii) as 
                clauses (vii) and (viii), respectively; and
                    (B) by inserting after clause (v) the following:
                            ``(vi) any mortgage-backed security 
                        collateralized exclusively by deliverable 
                        residential mortgages, as such term is defined 
                        under section 1327 of the Federal Housing 
                        Enterprises Financial Safety and Soundness Act 
                        of 1992;''.

SEC. 6. MONETIZATION OF BUSINESS VALUE.

    Pursuant to the authority of the Director as conservator of the 
enterprises under section 1367 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4617), the 
Director shall--
            (1) identify any property of the enterprises that would be 
        of value to nongovernmental entities, including--
                    (A) historical databases containing information on 
                prepayment, delinquency, and default rates;
                    (B) proprietary home price indices;
                    (C) technology used in the securitization of 
                mortgages; and
                    (D) patents relating to the securitization of 
                mortgages, automated underwriting systems, and other 
                processes; and
            (2) sell any property identified under paragraph (1) to 
        nongovernmental entities.

SEC. 7. UNIFORM UNDERWRITING STANDARDS.

    (a) Standards Established.--Notwithstanding any other provision of 
this Act or any other provision of Federal, State, or local law, the 
Federal banking agencies (as that term is defined in section 3 of the 
Federal Deposit Insurance Act (12 U.S.C. 1813)), in consultation with 
the FHFA and the Secretary of Housing and Urban Development, shall 
jointly establish specific minimum standards for mortgage underwriting, 
including--
            (1) a requirement that the mortgagee verify and document 
        the income and assets relied upon to qualify the mortgagor on 
        the residential mortgage, including the previous employment and 
        credit history of the mortgagor; and
            (2) a down payment requirement that--
                    (A) is equal to not less than 5 percent of the 
                purchase price of the property securing the residential 
                mortgage;
                    (B) in the case of a first lien residential 
                mortgage loan with an initial loan to value ratio that 
                is more than 80 percent and not more than 95 percent, 
                includes a requirement for credit enhancements, as 
                defined by the Federal banking agencies, until the loan 
                to value ratio of the residential mortgage loan 
                amortizes to a value that is less than 80 percent of 
                the purchase price;
                    (C) uses a method for determining the ability of 
                the mortgagor to repay the residential mortgage that is 
                based on factors including--
                            (i) all terms of the residential mortgage, 
                        including principal payments that fully 
                        amortize the balance of the residential 
                        mortgage over the term of the residential 
                        mortgage; and
                            (ii) the debt to income ratio of the 
                        mortgagor; and
                    (D) any other specific standards that the Federal 
                banking agencies jointly determine are appropriate to 
                ensure prudent underwriting of residential mortgages.
    (b) Updates to Standards.--The Federal banking agencies, in 
consultation with the FHFA and the Secretary of Housing and Urban 
Development--
            (1) shall review the standards established under this 
        section not less frequently than every 5 years; and
            (2) based on the review under paragraph (1), may revise the 
        standards established under this section, as the Federal 
        banking agencies, in consultation with the FHFA and the 
        Secretary of Housing and Urban Development, determine to be 
        necessary.
    (c) Compliance.--It shall be a violation of Federal law--
            (1) for any mortgage loan originator to fail to comply with 
        the minimum standards for mortgage underwriting established 
        under subsection (a) in originating a residential mortgage 
        loan;
            (2) for any company to maintain an extension of credit on a 
        revolving basis to any person to fund a residential mortgage 
        loan, unless the company reasonably determines that the 
        residential mortgage loan funded by such credit was subject to 
        underwriting standards no less stringent than the minimum 
        standards for mortgage underwriting established under 
        subsection (a); or
            (3) for any company to purchase, fund by assignment, or 
        guarantee a residential mortgage loan, unless the company 
        reasonably determines that the residential mortgage loan was 
        subject to underwriting standards no less stringent than the 
        minimum standards for mortgage underwriting established under 
        subsection (a).
    (d) Implementation.--
            (1) Regulations required.--The Federal banking agencies, in 
        consultation with the FHFA, shall issue regulations to 
        implement subsections (a) and (c), which shall take effect not 
        later than 270 days after the date of enactment of this Act.
            (2) Report required.--If the Federal banking agencies have 
        not issued final regulations under subsections (a) and (c) 
        before the date that is 270 days after the date of enactment of 
        this Act, the Federal banking agencies shall jointly submit to 
        the Committee on Banking, Housing, and Urban Affairs of the 
        Senate and the Committee on Financial Services of the House of 
        Representatives a report that--
                    (A) explains why final regulations have not been 
                issued under subsections (a) and (c); and
                    (B) provides a timeline for the issuance of final 
                regulations under subsections (a) and (c).
    (e) Enforcement.--Compliance with the rules issued under this 
section shall be enforced by--
            (1) the primary financial regulatory agency as that term is 
        defined under section 2 of the Dodd-Frank Wall Street Reform 
        and Consumer Protection Act (12 U.S.C. 5301) of an entity, with 
        respect to an entity subject to the jurisdiction of a primary 
        financial regulatory agency, in accordance with the statutes 
        governing the jurisdiction of the primary financial regulatory 
        agency over the entity, and as if the action of the primary 
        financial regulatory agency were taken under such statutes; and
            (2) the Bureau of Consumer Financial Protection, with 
        respect to a company that is not subject to the jurisdiction of 
        a primary financial regulatory agency.
    (f) Exemptions for Certain Nonprofit Mortgage Loan Originators.--
            (1) In general.--Not later than 180 days after the date of 
        enactment of this Act, the Federal banking agencies, in 
        consultation with the Secretary of Housing and Urban 
        Development and the Secretary of the Treasury, may jointly 
        issue rules to exempt from the requirements under subsection 
        (a)(2), mortgage loan originators that are exempt from taxation 
        under section 501(c)(3) of the Internal Revenue Code of 1986.
            (2) Determining factors.--The Federal banking agencies 
        shall ensure that--
                    (A) the lending activities of a mortgage loan 
                originator that receives an exemption under this 
                subsection do not threaten the safety and soundness of 
                the banking system of the United States; and
                    (B) a mortgage loan originator that receives an 
                exemption under this subsection--
                            (i) is not compensated based on the number 
                        or value of residential mortgage loan 
                        applications accepted, offered, or negotiated 
                        by the mortgage loan originator;
                            (ii) does not offer residential mortgage 
                        loans that have an interest rate greater than 
                        zero percent;
                            (iii) does not gain a monetary profit from 
                        any residential mortgage product or service 
                        provided;
                            (iv) has the primary purpose of serving low 
                        income housing needs;
                            (v) has not been specifically prohibited, 
                        by statute, from receiving Federal funding; and
                            (vi) meets any other requirements that the 
                        Federal banking agencies jointly determine are 
                        appropriate for ensuring that a mortgage loan 
                        originator that receives an exemption under 
                        this subsection does not threaten the safety 
                        and soundness of the banking system of the 
                        United States.
            (3) Reports required.--Before the issuance of final rules 
        under subsection (a), and annually thereafter, the Federal 
        banking agencies shall jointly submit to the Committee on 
        Banking, Housing, and Urban Affairs of the Senate and the 
        Committee on Financial Services of the House of Representatives 
        a report that--
                    (A) identifies the mortgage loan originators that 
                receive an exemption under this subsection; and
                    (B) for each mortgage loan originator identified 
                under subparagraph (A), explains the rationale for 
                providing an exemption.
            (4) Updates to exemptions.--The Federal banking agencies, 
        in consultation with the Secretary of Housing and Urban 
        Development and the Secretary of the Treasury--
                    (A) shall review the exemptions established under 
                this subsection, not less frequently than every 2 
                years; and
                    (B) based on the review under subparagraph (A), may 
                revise the standards established under this subsection, 
                as the Federal banking agencies, in consultation with 
                the Secretary of Housing and Urban Development and the 
                Secretary of the Treasury, determine to be necessary.
    (g) Rules of Construction.--Nothing in this section may be 
construed to permit--
            (1) the enterprises to make or guarantee a residential 
        mortgage loan that does not meet the minimum underwriting 
        standards established under this section; or
            (2) the Federal banking agencies to issue an exemption 
        under subsection (f) that is not on a case-by-case basis.
    (h) Definitions.--In this section, the following definitions shall 
apply:
            (1) Company.--The term ``company''--
                    (A) has the same meaning as in section 2(b) of the 
                Bank Holding Company Act of 1956 (12 U.S.C. 1841(b)); 
                and
                    (B) includes a sole proprietorship.
            (2) Mortgage loan originator.--The term ``mortgage loan 
        originator'' means any company that takes residential mortgage 
        loan applications and offers or negotiates terms of residential 
        mortgage loans.
            (3) Residential mortgage loan.--The term ``residential 
        mortgage loan''--
                    (A) means any extension of credit primarily for 
                personal, family, or household use that is secured by a 
                mortgage, deed of trust, or other equivalent security 
                interest in a dwelling or residential real estate upon 
                which is constructed or intended to be constructed a 
                dwelling; and
                    (B) does not include a mortgage loan for which 
                mortgage insurance is provided by the Department of 
                Veterans Affairs or the Rural Housing Administration.
            (4) Extension of credit; dwelling.--The terms ``extension 
        of credit'' and ``dwelling'' have the same meanings as in 
        section 103 of the Truth in Lending Act (15 U.S.C. 1602).
    (i) Repeal of Credit Risk Retention and QRM Rules.--Section 15G of 
the Securities Exchange Act of 1934 (15 U.S.C. 78o-11) is repealed, and 
any rule or regulation promulgated under that section shall have no 
force or effect, effective on the date of enactment of this Act.

SEC. 8. RESIDENTIAL MORTGAGE SERVICING STANDARDS.

    (a) Uniform PSA.--
            (1) Development.--
                    (A) In general.--The Director, in consultation with 
                the Secretary of the Treasury and the Board of 
                Governors of the Federal Reserve System, shall, not 
                later than 1 year after the date of enactment of this 
                Act, develop a uniform pooling and servicing agreement 
                (in this section referred to as a ``uniform PSA''). The 
                Director shall work with industry groups, including 
                servicers, originators, and mortgage investors to 
                develop the uniform PSA.
                    (B) Criteria.--The uniform PSA shall--
                            (i) address all issues relating to the pool 
                        trustee, and shall be based on pooling and 
                        servicing agreements in use by the enterprises 
                        on the date of enactment of this Act; and
                            (ii) create uniform loss mitigation 
                        standards, including standards for a single 
                        point of contact for troubled borrowers, an 
                        industry wide net-present-value model for 
                        determining when to conduct a loan modification 
                        rather than foreclosure, and national standards 
                        for the foreclosure process.
            (2) Effect of uniform psa.--Beginning 1 year after the date 
        of enactment of this Act, all mortgage backed securities issued 
        by national or State chartered banks in the United States will 
        be affected in accordance with the uniform PSA.
    (b) MERS2.--The Director shall establish, by rule, a Mortgage 
Electronic Registration System (in this section referred to as 
``MERS2'') based on the Mortgage Electronic Registration System in use 
on the date of enactment of this Act. MERS2 shall incorporate a single 
national database for all mortgage title transfers, to be maintained 
and operated by FHFA. The rules of the Director shall ensure that 
property title is transferred in accordance with all applicable 
provisions of law. All mortgage transfers shall take place according to 
national standards and shall be recorded in the MERS2 system.
    (c) Uniform Regulatory Practices.--The Comptroller of the Currency, 
Chairperson of the Federal Deposit Insurance Corporation, Director, 
Chairman of the Board of Governors of the Federal Reserve System, and 
Director of the Bureau of Consumer Financial Protection shall, jointly, 
under the direction of the Director, develop uniform regulatory 
practices for the mortgage market.
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