I 
112TH CONGRESS 
1ST SESSION H. R. 3530 
To require the exercise of clean-up call options under securities issued by 
the Federal National Mortgage Association or the Federal Home Loan 
Mortgage Corporation and to prohibit any new mortgage-backed securi-
ties issued by such enterprises to contain provisions for a clean-up 
call option. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 30, 2011 
Mr. PERLMUTTER (for himself and Mr. SCHWEIKERT) introduced the 
following bill; which was referred to the Committee on Financial Services 
A BILL 
To require the exercise of clean-up call options under securi-
ties issued by the Federal National Mortgage Association 
or the Federal Home Loan Mortgage Corporation and 
to prohibit any new mortgage-backed securities issued 
by such enterprises to contain provisions for a clean- 
up call option. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Freddie Mac Debt Re-
duction Act of 2011’’. 
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SEC. 2. EXERCISE OF CLEAN-UP CALL OPTIONS. 
Subtitle B of title XIII of the Housing and Commu-
nity Development Act of 1992 (12 U.S.C. 4611 et seq.) 
is amended by adding at the end the following new section: 
‘‘SEC. 1369F. EXERCISE OF CLEAN-UP CALL OPTIONS. 
‘‘(a) REQUIREMENT.—In complying with any restric-
tion under law, regulation, order, or agreement with the 
Director or the Secretary of the Treasury on the mortgage 
assets issued by the Federal Home Loan Mortgage Cor-
poration, such Corporation or, during the term of any con-
servatorship or receivership of such enterprise pursuant 
to section 1367, the Director, shall in the case of any 
mortgage-backed security with a clean-up call option (as 
such term is defined in subsection (c) of this section) that 
is issued by such Corporation, exercise any option under 
which the residual holder is willing to share not less than 
50 percent of any excess proceeds resulting from exercise 
of such option or right with the Agency as conservator 
or receiver of such Corporation, which thereby reduces the 
liability of the taxpayers of the United States. 
‘‘(b) PROHIBITION REGARDING ISSUANCE OF NEW 
SECURITIES.—The Director shall prohibit the Federal 
Home Loan Mortgage Corporation and the Federal Na-
tional Mortgage Association from issuing, after the date 
of the enactment of this section, any mortgage-backed se-
curity with a clean-up call option. 
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‘‘(c) USE OF PROCEEDS TO REDUCE DEFICIT.—The 
Director shall ensure that any excess proceeds received as 
result of the exercise of any clean-up call option shall be 
used only to reduce the budget deficit of the Federal Gov-
ernment. 
‘‘(d) DEFINITIONS.— 
‘‘(1) MORTGAGE ASSETS.—The term ‘mortgage 
assets’ means, with respect to the Federal Home 
Loan Mortgage Corporation, assets of such Corpora-
tion consisting of mortgages, mortgage loans, mort-
gage-related securities, participation certificates, 
mortgage-backed commercial paper, obligations of 
real estate mortgage investment conduits and similar 
assets, in each case to the extent such assets would 
appear on the balance sheet of such Corporation in 
accordance with generally accepted accounting prin-
ciples in effect in the United States as of September 
7, 2008 (as set forth in the opinions and pronounce-
ments of the Accounting Principles Board and the 
American Institute of Certified Public Accountants 
and statements and pronouncements of the Finan-
cial Accounting Standards Board from time to time; 
and without giving any effect to any change that 
may be made after September 7, 2008, in respect of 
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Statement of Financial Accounting Standards No. 
140 or any similar accounting standard). 
‘‘(2) MORTGAGE-BACKED
SECURITY
WITH
A 
CLEAN-UP
CALL
OPTION.—The term ‘mortgage- 
backed security with a clean-up call option’ means 
any mortgage-backed security under which there is 
an option or right to redeem all remaining classes of 
such security at such time when the amount of the 
aggregate remaining principal would be less than the 
amount of the optional redemption or clean-up call 
percentage, as defined in the applicable circular of-
fering or offering circular supplement. 
‘‘(3) EXCESS
PROCEEDS.—The term ‘excess 
proceeds’ means, with respect to exercise of any 
clean-up call option, the excess of the net proceeds 
from the sale of the collateral underlying the mort-
gage-backed security with such option, and the re-
demption price as defined in the applicable offering 
circular or offering circular supplement.’’. 
Æ 
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