thereof (in this section referred 
to as the ‘warrant common’); and 
‘‘(II) preferred stock having an 
aggregate liquidation preference equal 
to 15 percent of such aggregate loan 
amount, less the value of common 
stock available for purchase under the 
warrant common (in this section re-
ferred to as the ‘warrant preferred’). 
‘‘(ii) 
COMMON
STOCK
WARRANT 
PRICE.—The exercise price on a warrant 
or instrument described in paragraph (1) 
shall be— 
‘‘(I) the 15-day trailing average, 
as of 1 day prior to the date on which 
any commitment to provide assistance 
under this title was entered into, of 
the market price of the common stock 
of the assisted institution; or 
‘‘(II) in the case of an assisted 
institution, which is a mutual associa-
tion or the securities of which are not 
traded on a national securities ex-
change, the economic equivalent of the 
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market price described in clause (I), 
as determined by the Secretary. 
‘‘(iii) TERMS OF PREFERRED STOCK 
WARRANT.— 
‘‘(I) IN
GENERAL.—The initial 
exercise price for the preferred stock 
warrant shall be $0.01 per share or 
such greater amount as the corporate 
charter may require as the par value 
per share of the warrant preferred. 
The Government shall have the right 
to immediately exercise the warrants. 
‘‘(II) REDEMPTION.—The war-
rant preferred may be redeemed at 
any time after exercise of the pre-
ferred stock warrant at 100 percent of 
its issue price, plus any accrued and 
unpaid dividends.’’. 
(b) REPEAL
OF
CERTAIN
EXCEPTION.—Section 
113(d)(3) of the Emergency Economic Stabilization Act 
of 2008 (12 U.S.C. 5223(d)(3)) is amended by striking 
subparagraph (A). 
(c) TECHNICAL AND CONFORMING AMENDMENTS.— 
Section 113(d)(2) of the Emergency Economic Stabiliza-
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tion Act of 2008 (12 U.S.C. 2553(d)) is amended by strik-
ing subparagraph (E). 
SEC. 105. AVAILABILITY OF TARP FUNDS TO SMALLER COM-
MUNITY INSTITUTIONS. 
(a) PROMPT ACTION.—The Secretary shall promptly 
take all necessary actions to make available funds under 
title I of the Emergency Economic Stabilization Act of 
2008 to smaller community financial institutions. 
(b) COMPARABLE TERMS.—If any institution be-
comes an assisted institution after the date of the enact-
ment of this Act, such funding for depository institutions 
that— 
(1) have submitted applications on which no ac-
tion has been taken, such as institutions that are C 
corporations (including privately held institutions) 
and community development financial institutions; 
or 
(2) are of a type for which the Secretary has 
not yet established an application deadline or for 
which any such deadline has not yet occurred as of 
the date of the enactment of this Act, such as insti-
tutions that are non-stock corporations, S-corpora-
tions, mutually-owned insured depository institutions 
(as defined in section 3 of the Federal Deposit In-
surance Act), 
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shall receive such funding on terms comparable to the 
terms applicable to institutions that received funding prior 
to the date of the enactment of this Act. 
(c) DEFINITIONS.—For purposes of this section, the 
terms ‘‘S Corporation’’ and ‘‘C Corporation’’ shall have 
the same meaning given to those terms in section 1361(a) 
of the Internal Revenue Code of 1986. 
SEC. 106. INCREASE IN SIZE AND AUTHORITY OF FINAN-
CIAL STABILITY OVERSIGHT BOARD. 
(a) AUTHORITY.—Section 104 of the Emergency 
Economic Stabilization Act of 2008 (12 U.S.C. 2514) is 
amended— 
(1) by redesignating subsections (g) and (h) as 
subsections (h) and (i), respectively; and 
(2) by inserting after subsection (f) the fol-
lowing new subsection: 
‘‘(g) REVIEW
AND DECISIONMAKING.—After con-
ducting any review under this section of a policy deter-
mination made by the Secretary, the Financial Stability 
Oversight Board may overturn any such policy determina-
tion by a 2⁄3 vote of all members of such board.’’. 
(b) APPOINTMENT OF 3 ADDITIONAL MEMBERS.— 
Section 104(b) of the Emergency Economic Stabilization 
Act of 2008 (12 U.S.C. 2514(b)) is amended— 
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(1) by striking ‘‘and’’ at the end of paragraph 
(4); 
(2) by striking the period at the end of para-
graph (5) and inserting a semicolon; and 
(3) by adding at the end the following new 
paragraphs: 
‘‘(6) the Chairperson of the Board of Directors 
of the Federal Deposit Insurance Corporation; and 
‘‘(7) 2 members appointed by the President, by 
and with the consent of the Senate, from among in-
dividuals who are not officers or employees of the 
United States Government.’’. 
SEC. 107. CLARIFICATION. 
Section 101 of the Emergency Economic Stabilization 
Act of 2008 (12 U.S.C. 2514(b)) is amended by adding 
at the end the following new subsection: 
‘‘(f) CLARIFICATION.—Any provision of capital to, 
purchase of equity in, or assistance provided to any insti-
tution under this title shall be considered to be a purchase 
of troubled assets for purposes of this title.’’. 
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TITLE II—FORECLOSURE 
RELIEF 
SEC. 201. TARP FORECLOSURE MITIGATION PLAN AND IM-
PLEMENTATION. 
(a) PLAN REQUIRED.—Notwithstanding any provi-
sion of title I of the Emergency Economic Stabilization 
Act of 2008, none of the funds otherwise available to the 
Secretary of the Treasury (in this title referred to as the 
‘‘Secretary’’) pursuant to section 115(a)(3) of such Act 
shall be available to the Secretary after March 15, 2009, 
unless a comprehensive plan to prevent and mitigate fore-
closures on residential properties, in accordance with the 
requirements of this title, has been developed by the Sec-
retary and approved by the Financial Stability Oversight 
Board by such date. 
(b) COMMITMENT OF RESOURCES.—The comprehen-
sive plan established pursuant to subsection (a) shall re-
quire the commitment of funds made available to the Sec-
retary under title I of the Emergency Economic Stabiliza-
tion Act of 2008 in an amount up to $100,000,000,000, 
but in no case less than $40,000,000,000. 
(c) IMPLEMENTATION REQUIRED.—The Secretary 
shall begin committing funds available to the Secretary 
under title I of the Emergency Economic Stabilization Act 
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of 2008 to implement the comprehensive plan established 
pursuant to subsection (a) by not later than April 1, 2009. 
(d) CERTIFICATION.—If by May 1, 2009, the Sec-
retary does not commit more than the minimum of 
$40,000,000,000 as required under subsection (b), the 
Secretary shall certify to the Congress, no later than May 
15, 2009, the specific reasons that such additional funds 
have not been committed. 
SEC. 202. ELEMENTS OF PLAN. 
(a) REQUIRED ELEMENTS.—The comprehensive plan 
established pursuant to section 201(a) shall comply with 
the following requirements: 
(1) OWNER-OCCUPIED
RESIDENCES
ONLY.— 
The programs implemented under the plan shall pre-
vent and mitigate foreclosures specifically on owner- 
occupied residential properties. 
(2) LEVERAGING
OF
PRIVATE
CAPITAL.—The 
plan shall leverage private capital to the maximum 
extent possible consistent with the purpose of pre-
venting and mitigating foreclosures on such prop-
erties. 
(3) USE OF PROGRAM ALTERNATIVES.—The ac-
tions to be taken under the plan shall consist of one, 
or a combination of more than one, of the program 
alternatives set forth in section 203. 
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(b) CONCENTRATIONS
OF
FORECLOSURES.—The 
comprehensive plan established pursuant to section 201(a) 
may include provisions designed to prevent and mitigate 
foreclosures on residential properties located in areas that 
are most seriously affected by such foreclosures. 
SEC. 203. PROGRAM ALTERNATIVES. 
The program alternatives set forth in this section are 
as follows: 
(1) SYSTEMATIC
LOAN
MODIFICATION
PRO-
GRAM.—The systematic foreclosure prevention and 
mortgage modification program under section 204. 
(2) REDUCTION OF HOPE FOR HOMEOWNERS 
PROGRAM COSTS.—A program under which the Sec-
retary— 
(A) provides coverage for fees under the 
HOPE for Homeowners Program under section 
257 of the National Housing Act (12 U.S.C. 
1715z–23), as amended by title V of this Act; 
or 
(B) ensures the affordability of interest 
rates of mortgages insured under such Pro-
gram. 
(3) BUY-DOWN
OF
SECOND
LIEN
MORT-
GAGES.—A program under which the Secretary 
makes available to owners of owner-occupied residen-
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tial properties a direct mortgage loan the proceeds 
of which shall be used only to reduce the out-
standing debt of such owner under an existing sec-
ond lien mortgage on such residential property, for 
the purpose of facilitating loan modification, subject 
to such reductions in the principal of such existing 
second lien mortgages as the Secretary may require. 
(4) SERVICER INCENTIVES AND ASSISTANCE.— 
A program under which the Secretary may make 
payments to servicers who implement modifications 
to mortgages that result in mortgages that meet 
such requirements as the Secretary shall establish. 
(5) LOAN
PURCHASES.—A program under 
which the Secretary, or one or more entities that the 
Secretary, in consultation with the Secretary of 
Housing and Urban Development, enters into a con-
tract with to carry out the program under this para-
graph, which may include the Federal Deposit Insur-
ance Corporation and entities selected as contractors 
under section 107 of the Emergency Economic Sta-
bilization Act of 2008, purchases whole loans for the 
purpose of modifying or refinancing the loans. 
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SEC. 204. SYSTEMATIC FORECLOSURE PREVENTION AND 
MORTGAGE 
MODIFICATION 
PLAN 
ESTAB-
LISHED. 
(a) IN GENERAL.—The systematic foreclosure pre-
vention and mortgage modification program under this 
section shall be a program established by the Secretary, 
in consultation with the Chairperson of the Board of Di-
rectors of the Federal Deposit Insurance Corporation and 
the Secretary of Housing and Urban Development, that— 
(1) provides lenders and loan servicers with cer-
tain compensation to cover administrative costs for 
each loan modified according to the required stand-
ards; and 
(2) provides loss sharing or guarantees for cer-
tain losses incurred if a modified loan should subse-
quently re-default. 
(b) PROGRAM ADMINISTRATION.—The Secretary, in 
consultation with the Secretary of Housing and Urban De-
velopment, may contract with one or more entities, includ-
ing the Federal Deposit Insurance Corporation and enti-
ties selected as contractors under section 107 of the Emer-
gency Economic Stabilization Act of 2008, to conduct the 
program activities required under the program under this 
section. 
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(c) PROGRAM COMPONENTS.—The program estab-
lished under subsection (a) may include the following com-
ponents: 
(1) ELIGIBLE BORROWERS.—The program shall 
be limited to loans secured by owner-occupied prop-
erties. 
(2) EXCLUSION
FOR
EARLY
PAYMENT
DE-
FAULT.—To promote sustainable mortgages, loss 
sharing or guarantees shall be available only after 
the borrower has made a specified minimum number 
of payments on the modified mortgage. 
(3) STANDARD NET PRESENT VALUE TEST.—In 
order to promote consistency and simplicity in imple-
mentation and audit, the Secretary shall prescribe a 
standardized net present value analysis for partici-
pating lenders and servicers comparing the expected 
net present value of modifying past due loans com-
pared to the net present value of foreclosing on them 
will be applied. Under this test, standard assump-
tions shall be used to ensure that a consistent stand-
ard for affordability is provided based on a ratio of 
the borrower’s mortgage-related expenses for the 
first priority mortgage-to-gross income specified by 
the Secretary. 
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