I 

115TH CONGRESS 

1ST SESSION H. R. 2133 

To provide regulatory relief to community financial institutions, and for 

other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 25, 2017 

Mr. LUETKEMEYER introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To provide regulatory relief to community financial 

institutions, 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 ‘‘Community Lending 

5 Enhancement and Regulatory Relief Act of 2017’’ or the 

6 ‘‘CLEARR Act of 2017’’. 

7 SEC. 2. COMMUNITY INSTITUTION MORTGAGE RELIEF. 

8 (a) EXEMPTION FROM ESCROW REQUIREMENTS FOR

9 LOANS HELD BY SMALL CREDITORS.—Section 129D(c) 

10 of the Truth in Lending Act (15 U.S.C. 1639d(c)), as 


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1 added by section 1461(a) of the Dodd-Frank Wall Street 

2 Reform and Consumer Protection Act, is amended— 

3 (1) by redesignating paragraphs (1), (2), (3), 

4 and (4) as subparagraphs (A), (B), (C), and (D) 

5 (and conforming the margins accordingly); 

6 (2) by striking ‘‘The Board’’ and inserting the 

7 following: 

8 ‘‘(1) IN GENERAL.—The Bureau’’; and 

9 (3) by adding at the end the following new 

10 paragraph: 

11 ‘‘(2) TREATMENT OF LOANS HELD BY SMALLER

12 CREDITORS.—The Bureau shall, by regulation, exempt 

13 from the requirements of subsection (a) any loan secured 

14 by a first lien on a consumer’s principal dwelling, if such 

15 loan is held by a creditor with assets of $50,000,000,000 

16 or less.’’. 

17 (b) MODIFICATION TO EXEMPTION FOR SMALL

18 SERVICERS OF MORTGAGE LOANS.—Section 6 of the Real 

19 Estate Settlement Procedures Act of 1974 (12 U.S.C. 

20 2605) is amended by adding at the end the following: 

21 ‘‘(n) SMALL SERVICER EXEMPTION.—The Bureau 

22 shall, by regulation, provide exemptions to, or adjustments 

23 for, the provisions of this section for servicers that annu24 ally service 30,000 or fewer mortgage loans, in order to 


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1 reduce regulatory burdens while appropriately balancing 

2 consumer protections.’’. 

3 SEC. 3. ACCESS TO AFFORDABLE MORTGAGES. 

4 (a) EXEMPTION FROM PROPERTY APPRAISAL RE5 QUIREMENTS FOR LOWER-COST DWELLINGS.—Section 

6 129H of the Truth in Lending Act (15 U.S.C. 1639h) is 

7 amended by adding at the end the following new sub8 section: 

9 ‘‘(g) EXEMPTION FOR CERTAIN MORTGAGES.—The 

10 Bureau, the Comptroller of the Currency, the Federal De11 posit Insurance Corporation, the National Credit Union 

12 Administration Board, and the Federal Housing Finance 

13 Agency shall exempt, by rule, a mortgage loan of $250,000 

14 or less from the requirements of this section if such loan 

15 appears on the balance sheet of the creditor of such loan 

16 for a period of not less than 3 years.’’. 

17 (b) EXEMPTION FROM PENALTIES FOR FAILURE TO

18 REPORT APPRAISERS.—Paragraph (1) of section 129E(k) 

19 of the Truth in Lending Act (15 U.S.C. 1639e(k)(1)) is 

20 amended by inserting after ‘‘this section’’ the following: 

21 ‘‘, other than subsection (e),’’. 

22 (c) EXEMPTION FROM APPRAISAL STANDARD RE23 QUIREMENTS FOR LOWER-COST DWELLINGS.—Section 

24 1110 of the Financial Institutions Reform, Recovery, and 

25 Enforcement Act of 1989 (12 U.S.C. 3339) is amended— 


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1 (1) by striking ‘‘Each Federal financial institu2 tions regulatory agency and the Resolution Trust 

3 Corporation’’ and inserting the following: 

4 ‘‘(a) REAL ESTATE APPRAISALS IN CONNECTION

5 WITH FEDERALLY RELATED TRANSACTIONS.—Each 

6 Federal financial institutions regulatory agency’’; 

7 (2) by striking ‘‘each such agency or instrumen8 tality’’ and inserting ‘‘each such agency’’; 

9 (3) in the flush left matter following paragraph 

10 (3), by striking ‘‘Each such agency or instrumen11 tality’’ and inserting the following: 

12 ‘‘(b) ADDITIONAL STANDARDS.—Each such agency 

13 described under subsection (a)’’; and 

14 (4) by adding at the end the following new sub15 section: 

16 ‘‘(c) EXEMPTION FOR CERTAIN MORTGAGE

17 LOANS.—Each such agency described under subsection 

18 (a) shall exempt, by rule, a real estate appraisal or evalua19 tion conducted in connection with a mortgage loan of 

20 $250,000 or less from the standards prescribed under this 

21 section, if such loan appears on the balance sheet of the 

22 creditor of such loan for a period of not less than 3 

23 years.’’. 


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1 SEC. 4. CHANGES REQUIRED TO SMALL BANK HOLDING 

2 COMPANY POLICY STATEMENT ON ASSESS3 MENT OF FINANCIAL AND MANAGERIAL FAC4 TORS. 

5 Before the end of the 6-month period beginning on 

6 the date of the enactment of this Act, the Board of Gov7 ernors of the Federal Reserve System shall revise the 

8 Small Bank Holding Company Policy Statement on As9 sessment of Financial and Managerial Factors (12 C.F.R. 

10 part 225—appendix C) to raise the consolidated asset 

11 threshold under such policy statement from 

12 $1,000,000,000 (as adjusted by Public Law 113–250) to 

13 $10,000,000,000. 

14 SEC. 5. CAPITAL REQUIREMENTS FOR MORTGAGE SERV15 ICING ASSETS. 

16 (a) REPEAL OF BASEL III REGULATIONS.—Not later 

17 than the end of the 60-day period beginning on the date 

18 of the enactment of this Act, each Federal banking agency 

19 shall— 

20 (1) repeal all regulations issued by the agency 

21 to implement the Basel III capital requirements or 

22 the NCUA capital requirements, as applicable, on 

23 mortgage servicing assets; and 

24 (2) revive or restore any regulation repealed or 

25 revised by a regulation described under paragraph 

26 (1). 


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1 (b) NEW REGULATIONS.—Before any final regulation 

2 is issued by a Federal banking agency with respect to cap3 ital requirements on mortgage servicing assets, the Fed4 eral banking agency shall— 

5 (1) issue a new proposed rule for public com6 ment; 

7 (2) submit to Congress a notification of the 

8 proposed rule and an explanation for the proposed 

9 rule; and 

10 (3) consider— 

11 (A) the history of the market for mortgage 

12 servicing assets, including particularly the mar13 ket for such assets in the period of the financial 

14 crisis; 

15 (B) the impact on consumer access to 

16 mortgage lending and mortgage servicing; and 

17 (C) competition in the mortgage servicing 

18 market, including analysis of the role commu19 nity and mid-sized financial institutions play in 

20 the mortgage servicing market. 

21 (c) DEFINITIONS.—For purposes of this section: 

22 (1) BASEL III CAPITAL REQUIREMENTS.—The 

23 term ‘‘Basel III capital requirements’’ means the 

24 Global Regulatory Framework for More Resilient 

25 Banks and Banking Systems issued by the Basel 


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1 Committee on Banking Supervision on December 16, 

2 2010, as revised on June 1, 2011. 

3 (2) FEDERAL BANKING AGENCY.—The term 

4 ‘‘Federal banking agency’’ means the Board of Gov5 ernors of the Federal Reserve System, the Office of 

6 the Comptroller of the Currency, the Federal De7 posit Insurance Corporation, or the National Credit 

8 Union Administration. 

9 (3) MORTGAGE SERVICING ASSET.—The term 

10 ‘‘mortgage servicing asset’’ means those assets that 

11 result from contracts to service loans secured by real 

12 estate, where such loans are owned by third parties. 

13 (4) NCUA CAPITAL REQUIREMENTS.—The 

14 term ‘‘NCUA capital requirements’’ means the final 

15 rule of the National Credit Union Administration 

16 entitled ‘‘Risk-Based Capital’’ (80 Fed. Reg. 66626 

17 (Oct. 29, 2015)). 

18 SEC. 6. BUREAU AUTHORITY OVER UNFAIR AND DECEP19 TIVE ACTS OR PRACTICES. 

20 (a) IN GENERAL.—Section 1031 of the Consumer Fi21 nancial Protection Act of 2010 (12 U.S.C. 5531) is 

22 amended— 

23 (1) in the heading of such section, by striking 

24 ‘‘, DECEPTIVE, OR ABUSIVE’’ and inserting ‘‘OR

25 DECEPTIVE’’; 


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1 (2) in subsection (a)— 

2 (A) by striking ‘‘, deceptive, or abusive’’ 

3 and inserting ‘‘or deceptive’’; and 

4 (B) by adding at the end the following: 

5 ‘‘The Bureau may not take any action described 

6 under this subsection against a covered person 

7 or service provider unless the Bureau first 

8 consults the covered person or service provider’s 

9 primary financial regulatory agency, if any.’’; 

10 (3) in subsection (b)— 

11 (A) by striking ‘‘, deceptive, or abusive’’ 

12 and inserting ‘‘or deceptive’’; and 

13 (B) by inserting at the end the following: 

14 ‘‘In prescribing any rule under this subsection, 

15 the Bureau shall comply with the requirements 

16 of section 18 of the Federal Trade Commission 

17 Act (15 U.S.C. 57a) applicable to the Federal 

18 Trade Commission when the Commission pre19 scribes rules and general statements of policy 

20 under that section with respect to unfair or de21 ceptive acts or practices in or affecting com22 merce.’’; 

23 (4) by striking subsection (d); and 

24 (5) by redesignating subsections (e) and (f) as 

25 subsections (d) and (e), respectively. 


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1 (b) CONFORMING AMENDMENTS.— 

2 (1) CONSUMER FINANCIAL PROTECTION ACT OF

3 2010.—The Consumer Financial Protection Act of 

4 2010 (12 U.S.C. 5481 et seq.) is amended— 

5 (A) by striking ‘‘, deceptive, and abusive’’ 

6 each place such term appears and inserting 

7 ‘‘and deceptive’’; and 

8 (B) by striking ‘‘, deceptive, or abusive’’ 

9 each place such term appears and inserting ‘‘or 

10 deceptive’’. 

11 (2) DODD-FRANK WALL STREET REFORM AND

12 CONSUMER PROTECTION ACT.—The table of contents 

13 in section 1(b) of the Dodd-Frank Wall Street Re14 form and Consumer Protection Act is amended, in 

15 the item relating to section 1031, by striking ‘‘, DE16 CEPTIVE, OR ABUSIVE’’ and inserting ‘‘OR DE17 CEPTIVE’’. 

18 (3) OMNIBUS APPROPRIATIONS ACT, 2009.—Sec19 tion 626(a)(1) of the Omnibus Appropriations Act, 

20 2009 (15 U.S.C. 1638 note) is amended by striking 

21 ‘‘, deceptive, or abusive’’ and inserting ‘‘or decep22 tive’’. 


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1 SEC. 7. AMENDMENTS TO THE EQUAL CREDIT OPPOR2 TUNITY ACT AND THE FAIR HOUSING ACT TO 

3 REQUIRE INTENT TO DISCRIMINATE. 

4 (a) AMENDMENT TO EQUAL CREDIT OPPORTUNITY

5 ACT.—Subsection (a) of section 701 of the Equal Credit 

6 Opportunity Act (15 U.S.C. 1691(a)) is amended by in7 serting ‘‘intentionally’’ before ‘‘discriminate’’. 

8 (b) AMENDMENT TO FAIR HOUSING ACT.—The Fair 

9 Housing Act (42 U.S.C. 3601 et seq.) is amended— 

10 (1) in section 804— 

11 (A) by inserting ‘‘intentionally’’ before 

12 ‘‘discriminate’’ each place such term appears; 

13 (B) in subsection (a), by inserting ‘‘inten14 tionally’’ before ‘‘refuse’’; 

15 (C) in subsection (c)— 

16 (i) by inserting ‘‘intentionally’’ before 

17 ‘‘make’’; and 

18 (ii) by inserting ‘‘intentionally’’ before 

19 ‘‘cause’’; 

20 (D) in subsection (d), by inserting ‘‘inten21 tionally’’ before ‘‘represent’’; and 

22 (E) in subsection (e), by striking ‘‘induce 

23 or attempt’’ and inserting ‘‘intentionally induce 

24 or intentionally attempt’’; 

25 (2) in section 805, by inserting ‘‘intentionally’’ 

26 before ‘‘discriminate’’; and 


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1 (3) in section 806, by inserting ‘‘intentionally’’ 

2 before ‘‘discriminate’’. 

3 SEC. 8. AMENDMENTS TO THE HOME MORTGAGE DISCLO4 SURE ACT OF 1975. 

5 (a) LOAN VOLUME THRESHOLD.—Section 304(i) of 

6 the Home Mortgage Disclosure Act of 1975 (12 U.S.C. 

7 2803(i)) is amended to read as follows: 

8 ‘‘(i) EXEMPTION FROM CERTAIN DISCLOSURE RE9 QUIREMENTS.— 

10 ‘‘(1) IN GENERAL.—The requirements of sub11 sections (b)(4), (b)(5), and (b)(6) shall not apply 

12 with respect to any depository institution described 

13 in section 303(2)(A). 

14 ‘‘(2) CLOSED-END MORTGAGE LOANS.—With 

15 respect to a depository institution, the requirements 

16 of subsections (a) and (b) shall not apply with re17 spect to closed-end mortgage loans if the depository 

18 institution originated less than 1,000 closed-end 

19 mortgage loans in each of the 2 preceding calendar 

20 years. 

21 ‘‘(3) OPEN-END LINES OF CREDIT.—With re22 spect to a depository institution, the requirements of 

23 subsections (a) and (b) shall not apply with respect 

24 to open-end lines of credit if the depository instituVerDate Sep 11 2014 23:00 Apr 26, 2017 Jkt 069200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H2133.IH H2133

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1 tion originated less than 2,000 open-end lines of 

2 credit in each of the 2 preceding calendar years.’’. 

3 (b) DATA POINTS.—Section 304(b) of the Home 

4 Mortgage Disclosure Act of 1975 (12 U.S.C. 2803(b)) is 

5 amended— 

6 (1) by striking paragraphs (5) and (6); 

7 (2) in paragraph (3), by inserting ‘‘and’’ at the 

8 end; and 

9 (3) in paragraph (4), by striking ‘‘age.’’. 

10 SEC. 9. REPEAL OF SMALL BUSINESS LOAN COLLECTION 

11 DATA. 

12 (a) REPEAL.—Section 704B of the Equal Credit Op13 portunity Act (15 U.S.C. 1691c–2) is repealed. 

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

15 for title VII of the Consumer Credit Protection Act is 

16 amended by striking the item relating to section 704B. 

17 SEC. 10. REQUIREMENTS FOR DEPOSIT ACCOUNT TERMI18 NATION REQUESTS AND ORDERS. 

19 (a) TERMINATION REQUESTS OR ORDERS MUST BE

20 MATERIAL.— 

21 (1) IN GENERAL.—An appropriate Federal 

22 banking agency may not formally or informally re23 quest or order a depository institution to terminate 

24 a specific customer account or group of customer ac25 counts or to otherwise restrict or discourage a deVerDate Sep 11 2014 23:00 Apr 26, 2017 Jkt 069200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H2133.IH H2133

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1 pository institution from entering into or maintain2 ing a banking relationship with a specific customer 

3 or group of customers unless— 

4 (A) the agency has a material reason for 

5 such request or order; and 

6 (B) such reason is not based solely on rep7 utation risk. 

8 (2) TREATMENT OF NATIONAL SECURITY

9 THREATS.—If an appropriate Federal banking agen10 cy believes a specific customer or group of customers 

11 is, or is acting as a conduit for, an entity which— 

12 (A) poses a threat to national security; 

13 (B) is involved in terrorist financing; 

14 (C) is an agency of the government of 

15 Iran, North Korea, Syria, or any country listed 

16 from time to time on the State Sponsors of 

17 Terrorism list; 

18 (D) is located in, or is subject to the juris19 diction of, any country specified in subpara20 graph (C); or 

21 (E) does business with any entity described 

22 in subparagraph (C) or (D), unless the appro23 priate Federal banking agency determines that 

24 the customer or group of customers has used 


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1 due diligence to avoid doing business with any 

2 entity described in subparagraph (C) or (D), 

3 such belief shall satisfy the requirement under para4 graph (1). 

5 (b) NOTICE REQUIREMENT.— 

6 (1) IN GENERAL.—If an appropriate Federal 

7 banking agency formally or informally requests or 

8 orders a depository institution to terminate a spe9 cific customer account or a group of customer ac10 counts, the agency shall— 

11 (A) provide such request or order to the 

12 institution in writing; and 

13 (B) accompany such request or order with 

14 a written justification for why such termination 

15 is needed, including any specific laws or regula16 tions the agency believes are being violated by 

17 the customer or group of customers, if any. 

18 (2) JUSTIFICATION REQUIREMENT.—A jus19 tification described under paragraph (1)(B) may not 

20 be based solely on the reputation risk to the deposi21 tory institution. 

22 (c) CUSTOMER NOTICE.— 

23 (1) NOTICE NOT REQUIRED.—Nothing in this 

24 section shall be construed as requiring a depository 

25 institution or an appropriate Federal banking agenVerDate Sep 11 2014 23:00 Apr 26, 2017 Jkt 069200 PO 00000 Frm 00014 Fmt 6652 Sfmt 6201 E:\BILLS\H2133.IH H2133

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1 cy to inform a customer or customers of the jus2 tification for the customer’s account termination de3 scribed under subsection (b). 

4 (2) NOTICE PROHIBITED IN CASES OF NA5 TIONAL SECURITY.—If an appropriate Federal bank6 ing agency requests or orders a depository institu7 tion to terminate a specific customer account or a 

8 group of customer accounts based on a belief that 

9 the customer or customers pose a threat to national 

10 security, neither the depository institution nor the 

11 appropriate Federal banking agency may inform the 

12 customer or customers of the justification for the 

13 customer’s account termination. 

14 (d) REPORTING REQUIREMENT.—Each appropriate 

15 Federal banking agency shall issue an annual report to 

16 the Congress stating— 

17 (1) the aggregate number of specific customer 

18 accounts that the agency requested or ordered a de19 pository institution to terminate during the previous 

20 year; and 

21 (2) the legal authority on which the agency re22 lied in making such requests and orders and the fre23 quency on which the agency relied on each such au24 thority. 

25 (e) DEFINITIONS.—For purposes of this section: 


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1 (1) APPROPRIATE FEDERAL BANKING AGEN2 CY.—The term ‘‘appropriate Federal banking agen3 cy’’ means— 

4 (A) the appropriate Federal banking agen5 cy, as defined under section 3 of the Federal 

6 Deposit Insurance Act (12 U.S.C. 1813); and 

7 (B) the National Credit Union Administra8 tion, in the case of an insured credit union. 

9 (2) DEPOSITORY INSTITUTION.—The term ‘‘de10 pository institution’’ means— 

11 (A) a depository institution, as defined 

12 under section 3 of the Federal Deposit Insur13 ance Act (12 U.S.C. 1813); and 

14 (B) an insured credit union. 

15 SEC. 11. AMENDMENTS TO CIVIL PENALTIES UNDER 

16 FIRREA. 

17 Section 951 of the Financial Institutions Reform, Re18 covery, and Enforcement Act of 1989 (12 U.S.C. 1833a) 

19 is amended— 

20 (1) in subsection (c)(2), by striking ‘‘affecting 

21 a federally insured financial institution’’ and insert22 ing ‘‘against a federally insured financial institution 

23 or by a federally insured financial institution against 

24 an unaffiliated third person’’; and 

25 (2) in subsection (g)— 


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1 (A) in the header, by striking ‘‘Subpoenas’’ 

2 and inserting ‘‘Investigations’’; and 

3 (B) by amending paragraph (1)(C) to read 

4 as follows: 

5 ‘‘(C) summon witnesses and require the 

6 production of any books, papers, correspond7 ence, memoranda, or other records which the 

8 Attorney General deems relevant or material to 

9 the inquiry, if the Attorney General— 

10 ‘‘(i) requests a court order from a 

11 court of competent jurisdiction for such ac12 tions and offers specific and articulable 

13 facts showing that there are reasonable 

14 grounds to believe that the information or 

15 testimony sought is relevant and material 

16 for conducting an investigation under this 

17 section; or 

18 ‘‘(ii) either personally or through dele19 gation no lower than the Deputy Attorney 

20 General, issues and signs a subpoena for 

21 such actions and such subpoena is sup22 ported by specific and articulable facts 

23 showing that there are reasonable grounds 

24 to believe that the information or testiVerDate Sep 11 2014 23:00 Apr 26, 2017 Jkt 069200 PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 E:\BILLS\H2133.IH H2133

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1 mony sought is relevant for conducting an 

2 investigation under this section.’’. 

3 SEC. 12. WAIVER OF WAITING PERIOD. 

4 Not later than 120 days after the date of the enact5 ment of this Act, the Bureau of Consumer Financial Pro6 tection shall issue regulations establishing a process to 

7 waive the requirement relating to the timing of providing 

8 closing disclosures for mortgage loans described under sec9 tion 1026.19(f)(1)(ii) of title 12, Code of Federal Regula10 tions. 

11 SEC. 13. LIMIT ON BUREAU SUPERVISION. 

12 The Consumer Financial Protection Act of 2010 (12 

13 U.S.C. 5481 et seq.) is amended— 

14 (1) in section 1025(a), by striking 

15 ‘‘$10,000,000,000’’ each place such term appears 

16 and inserting ‘‘$50,000,000,000’’; and 

17 (2) in section 1026(a), by striking 

18 ‘‘$10,000,000,000’’ each place such term appears 

19 and inserting ‘‘$50,000,000,000’’. 

20 SEC. 14. LIMITED EXCEPTION FOR RECIPROCAL DEPOSITS. 

21 (a) IN GENERAL.—Section 29 of the Federal Deposit 

22 Insurance Act (12 U.S.C. 1831f) is amended by adding 

23 at the end the following new subsection: 

24 ‘‘(a) LIMITED EXCEPTION FOR RECIPROCAL DEPOS25 ITS.— 


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1 ‘‘(1) IN GENERAL.—Reciprocal deposits of an 

2 insured depository institution shall not be considered 

3 to be funds obtained, directly or indirectly, by or 

4 through a deposit broker if— 

5 ‘‘(A) when the institution was most re6 cently examined, its composite condition was 

7 found to be outstanding or good; or 

8 ‘‘(B) the total amount of such reciprocal 

9 deposits does not exceed the lesser of— 

10 ‘‘(i) $10,000,000,000; or 

11 ‘‘(ii) an amount equal to 20 percent of 

12 the total liabilities of the insured deposi13 tory institution. 

14 ‘‘(2) RULE OF CONSTRUCTION.—Nothing in 

15 this subsection shall be construed to limit the au16 thority of the Corporation to require, on a case-by17 case basis, that an agent institution that is less than 

18 adequately capitalized (as defined in section 

19 38(b)(1)(B)) not accept particular types of deposits 

20 upon finding that the acceptance of such deposits 

21 constitutes an unsafe or unsound practice with re22 spect to such institution. 

23 ‘‘(3) DEFINITIONS.—In this subsection: 

24 ‘‘(A) AGENT INSTITUTION.—The term 

25 ‘agent institution’ means an insured depository 


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1 institution that places a covered deposit 

2 through a deposit placement network at other 

3 insured depository institutions in amounts that 

4 are less than or equal to the standard max5 imum deposit insurance amount, specifying the 

6 interest rate to be paid for such amounts, 

7 where the agent institution— 

8 ‘‘(i) is well capitalized (as defined in 

9 section 38(b)(1)(A)) or has obtained a 

10 waiver pursuant to subsection (c) of this 

11 section; or 

12 ‘‘(ii) does not receive an amount of re13 ciprocal deposits that causes the total 

14 amount of reciprocal deposits held by the 

15 agent institution to be greater than the av16 erage of the total amount of reciprocal de17 posits held by the agent institution on the 

18 last day of each of the 4 calendar quarters 

19 preceding the calendar quarter in which 

20 the agent institution was determined to be 

21 not well capitalized. 

22 ‘‘(B) COVERED DEPOSIT.—The term ‘cov23 ered deposit’ means a deposit that— 


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1 ‘‘(i) is submitted for placement 

2 through a deposit placement network by an 

3 agent institution; and 

4 ‘‘(ii) does not consist of funds that 

5 were obtained for the agent institution, di6 rectly or indirectly, by or through a deposit 

7 broker before submission for placement 

8 through a deposit placement network. 

9 ‘‘(C) DEPOSIT PLACEMENT NETWORK.— 

10 The term ‘deposit placement network’ means a 

11 network in which an insured depository institu12 tion participates, together with other insured 

13 depository institutions, for the processing and 

14 receipt of reciprocal deposits. 

15 ‘‘(D) NETWORK MEMBER BANK.—The 

16 term ‘network member bank’ means an insured 

17 depository institution that is a member of a de18 posit placement network. 

19 ‘‘(E) RECIPROCAL DEPOSITS.—The term 

20 ‘reciprocal deposits’ means deposits received by 

21 an agent institution through a deposit place22 ment network with the same maturity (if any) 

23 and in the same aggregate amount as covered 

24 deposits placed by the agent institution in other 

25 network member banks.’’. 


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1 (b) APPLICABILITY.—Nothing in this Act shall be 

2 construed to limit the application of any provision of the 

3 Federal Deposit Insurance Act, other than section 29 of 

4 such Act (12 U.S.C. 1831f), to an insured depository in5 stitution (as defined in section 3(c) of such Act (12 U.S.C. 

6 1813(c))). 

7 SEC. 15. SAFE HARBOR FOR CERTAIN LOANS HELD ON 

8 PORTFOLIO. 

9 (a) IN GENERAL.—Section 129C of the Truth in 

10 Lending Act (15 U.S.C. 1639c) is amended by adding at 

11 the end the following: 

12 ‘‘(j) SAFE HARBOR FOR CERTAIN LOANS HELD ON

13 PORTFOLIO.— 

14 ‘‘(1) SAFE HARBOR FOR CREDITORS THAT ARE

15 DEPOSITORY INSTITUTIONS.— 

16 ‘‘(A) IN GENERAL.—A creditor that is a 

17 depository institution shall not be subject to 

18 suit for failure to comply with subsection (a), 

19 (c)(1), or (f)(2) of this section or section 129H 

20 with respect to a residential mortgage loan, and 

21 the banking regulators shall treat such loan as 

22 a qualified mortgage, if— 

23 ‘‘(i) the creditor has, since the origi24 nation of the loan, held the loan on the 

25 balance sheet of the creditor; and 


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1 ‘‘(ii) all prepayment penalties with re2 spect to the loan comply with the limita3 tions described under subsection (c)(3). 

4 ‘‘(B) EXCEPTION FOR CERTAIN TRANS5 FERS.—In the case of a depository institution 

6 that transfers a loan originated by that institu7 tion to another depository institution by reason 

8 of the bankruptcy or failure of the originating 

9 depository institution or the purchase of the 

10 originating depository institution, the depository 

11 institution transferring such loan shall be 

12 deemed to have complied with the requirement 

13 under subparagraph (A)(i). 

14 ‘‘(2) SAFE HARBOR FOR MORTGAGE ORIGINA15 TORS.—A mortgage originator shall not be subject 

16 to suit for a violation of section 129B(c)(3)(B) for 

17 steering a consumer to a residential mortgage loan 

18 if— 

19 ‘‘(A) the creditor of such loan is a deposi20 tory institution and has informed the mortgage 

21 originator that the creditor intends to hold the 

22 loan on the balance sheet of the creditor for the 

23 life of the loan; and 

24 ‘‘(B) the mortgage originator informs the 

25 consumer that the creditor intends to hold the 


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1 loan on the balance sheet of the creditor for the 

2 life of the loan. 

3 ‘‘(3) DEFINITIONS.—For purposes of this sub4 section: 

5 ‘‘(A) BANKING REGULATORS.—The term 

6 ‘banking regulators’ means the Federal banking 

7 agencies, the Bureau, and the National Credit 

8 Union Administration. 

9 ‘‘(B) DEPOSITORY INSTITUTION.—The 

10 term ‘depository institution’ has the meaning 

11 given that term under section 19(b)(1) of the 

12 Federal Reserve Act (12 U.S.C. 505(b)(1)). 

13 ‘‘(C) FEDERAL BANKING AGENCIES.—The 

14 term ‘Federal banking agencies’ has the mean15 ing given that term under section 3 of the Fed16 eral Deposit Insurance Act.’’. 

17 (b) RULE OF CONSTRUCTION.—Nothing in the 

18 amendment made by this Act may be construed as pre19 venting a balloon loan from qualifying for the safe harbor 

20 provided under section 129C(j) of the Truth in Lending 

21 Act if the balloon loan otherwise meets all of the require22 ments under such subsection (j), regardless of whether the 

23 balloon loan meets the requirements described under 

24 clauses (i) through (iv) of section 129C(b)(2)(E) of such 

25 Act. 


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1 SEC. 16. AMENDMENTS TO ABILITY TO PAY REQUIREMENTS 

2 FOR MORTGAGE LOANS. 

3 Section 129C(b)(3) of the Truth in Lending Act (15 

4 U.S.C. 1639C(b)(3)) is amended— 

5 (1) by amending subparagraph (A) to read as 

6 follows: 

7 ‘‘(A) IN GENERAL.— 

8 ‘‘(i) BUREAU REGULATIONS.—The 

9 Bureau shall prescribe regulations to carry 

10 out the purposes of this subsection, except 

11 that the Bureau may not prescribe any 

12 regulation that addresses modifies any pro13 vision of paragraph (2)(A)(iii), or that ad14 dresses modifies any rule promulgated by 

15 the Federal Housing Finance Agency pur16 suant to subparagraph (B)(i). Any existing 

17 regulation of the Bureau that addresses 

18 modifies paragraph (2)(A)(iii) shall have 

19 no force or effect as of the date the Fed20 eral Housing Finance Agency prescribes a 

21 rule pursuant to subparagraph (B)(i)(II). 

22 ‘‘(ii) FEDERAL HOUSING FINANCE

23 AGENCY REGULATIONS.—The Federal 

24 Housing Finance Agency shall only pre25 scribe regulations to carry out the pur26 poses of paragraph (2)(A)(iii). The Federal 


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1 Housing Finance Agency may not pre2 scribe any regulation that addresses modi3 fies any requirement under clause (i), (ii), 

4 (iv), (v), (vi), (vii), (viii), or (ix) of para5 graph (2)(A), or that addresses modifies 

6 any rule promulgated by the Bureau pur7 suant to clause (i) or subparagraph 

8 (B)(i)(I).’’; 

9 (2) in subparagraph (B)— 

10 (A) by striking ‘‘The Board may’’ and in11 serting 

12 ‘‘(I) BUREAU REGULATIONS.— 

13 The Bureau may’’. 

14 (B) in subclause (I), as designated by sub15 paragraph (A), by striking ‘‘compliance with 

16 such actions’’ and inserting ‘‘, except that the 

17 Bureau may not prescribe any regulation that 

18 violates the provisions of subparagraph (A). 

19 The Bureau may not eliminate any requirement 

20 or add any new requirement under clause (i), 

21 (ii), (iv), (v), (vi), (vii), (viii), or (ix) of para22 graph (2)(A) unless it does so by prescribing a 

23 rule enacted pursuant to the procedures set 

24 forth in section 553 of title 5, United States 

25 Code’’; 


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1 (C) in clause (i), by adding at the end the 

2 following new subclause: 

3 ‘‘(II) FEDERAL HOUSING FI4 NANCE AGENCY REGULATIONS.—Not 

5 later than 180 days after the date of 

6 the enactment of this subclause, the 

7 Federal Housing Finance Agency 

8 shall prescribe regulations to carry 

9 out the requirements of paragraph 

10 (2)(A)(iii). Notwithstanding the proce11 dures set forth in section 553 of title 

12 5, United States Code, the Federal 

13 Housing Finance Agency shall review 

14 its promulgated standards under such 

15 paragraph at least annually, and shall 

16 publish any proposed adjustments to 

17 such standards in the Federal Reg18 ister. The Federal Housing Finance 

19 Agency may not eliminate any re20 quirement or add any new require21 ment under paragraph (2)(A)(iii) un22 less it does so by prescribing a rule 

23 enacted pursuant to the procedures 

24 set forth in section 553 of title 5, 

25 United States Code.’’; and 


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1 (D) in clause (ii), by striking ‘‘with the 

2 Board’’ and inserting ‘‘with the Bureau with re3 spect to the requirements under clauses (i), (ii), 

4 (iv), (v), (vi), (vii), (viii), and (ix) of paragraph 

5 (2)(A), and in consultation with the Federal 

6 Housing Finance Agency with respect to the re7 quirement under paragraph (2)(A)(iii)’’. 

Æ 


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