IB 
Union Calendar No. 547 
116TH CONGRESS 
2D SESSION 
H. R. 123 
[Report No. 116–663] 
To authorize a pilot program under section 258 of the National Housing 
Act to establish an automated process for providing additional credit 
rating information for mortgagors and prospective mortgagors under 
certain mortgages. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 3, 2019 
Mr. GREEN of Texas introduced the following bill; which was referred to the 
Committee on Financial Services 
DECEMBER 17, 2020 
Additional sponsors: Mr. SHERMAN and Mr. CLEAVER 
DECEMBER 17, 2020 
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on January 3, 2019] 
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A BILL 
To authorize a pilot program under section 258 of the Na-
tional Housing Act to establish an automated process 
for providing additional credit rating information for 
mortgagors and prospective mortgagors under certain 
mortgages. 
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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 ‘‘Alternative Data for 
Additional Credit FHA Pilot Program Reauthorization 
Act’’. 
SEC. 2. PILOT PROGRAM FOR BORROWERS WITHOUT SUFFI-
CIENT CREDIT HISTORY. 
Section 258 of the National Housing Act (12 U.S.C. 
1715z–24) is amended— 
(1) in subsection (a)— 
(A) by striking ‘‘carry out’’ and inserting 
‘‘establish and carry out’’; 
(B) by striking ‘‘establish, and’’; 
(C) by inserting ‘‘who elect to participate in 
the pilot program’’ before the second comma; 
(D) by striking ‘‘mortgagors and’’; 
(E) by inserting after ‘‘their creditworthi-
ness’’ the following: ‘‘and have opted into the use 
of additional credit information’’; and 
(F) by striking ‘‘alternative’’ each place 
such term appears and inserting ‘‘additional’’; 
(2) in subsection (b), by adding after the period 
at the end the following: ‘‘The pilot program may not 
be carried out with respect to any mortgagor or pro-
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spective mortgagor under a mortgage the proceeds of 
which are used to prepay or pay off an existing loan 
secured by the same property.’’; 
(3) by striking subsection (c); 
(4) by redesignating subsections (b) (as amended 
by paragraph (2) of this subsection) and (d) as sub-
sections (c) and (k), respectively; 
(5) by inserting after subsection (a) the following 
new subsection: 
‘‘(b) GOAL.—The goal of the pilot program under this 
section shall be to examine and evaluate the benefits of 
using such a credit scoring model that uses additional 
data.’’; 
(6) by inserting after subsection (c) (as so redes-
ignated by paragraph (4) of this subsection) the fol-
lowing: 
‘‘(d) ADDITIONAL CREDIT INFORMATION.—The Sec-
retary shall, after consultation with the Government Na-
tional Mortgage Association and not later than one year 
after the date of the enactment of this subsection, select one 
or more commercially available credit scoring models that 
will be available under the pilot and that utilize additional 
data, as the Secretary considers appropriate based on the 
goals of the pilot program. In selecting the model or models 
to use, the Secretary shall consider the criteria under part 
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1254 of the regulations of the Director of the Federal Hous-
ing Finance Agency (12 C.F.R. Part 1254) to the extent 
appropriate. 
‘‘(e) NOTIFICATION.— 
‘‘(1) NOTICE OF OPTIONS.—The Secretary shall 
develop a notice for prospective mortgagors, and re-
quire mortgagees to provide such notice to prospective 
mortgagors, that informs prospective mortgagors of— 
‘‘(A) the ability to opt into the use of the 
credit scoring model selected for use under the 
pilot program; 
‘‘(B) information on how the pilot program 
credit scoring model differs from the FHA’s cur-
rent credit scoring models, including the types of 
additional data that are included in the pilot 
program model; and 
‘‘(C) housing counseling agencies in the 
area that are approved by the Department of 
Housing and Urban Development. 
‘‘(2) COMPARISON OF LENDING OPTIONS.—The 
Secretary shall require mortgagees participating in 
the pilot program to provide information to prospec-
tive mortgagors sufficient to allow comparison of the 
mortgagor’s lending options using the credit scoring 
model under the pilot program and using the credit 
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scoring model then in effect for mortgagors not opting 
into the use of the credit scoring model under the pilot 
program. 
‘‘(f) UNDERWRITING OPTIONS.—This section may not 
be construed to preclude a prospective mortgagor who opts 
to use an approved credit scoring model under the pilot pro-
gram under this subsection in connection with under-
writing for a mortgage insured under this title from there-
after obtaining a determination of creditworthiness in-
volved in underwriting for such mortgage using informa-
tion other than that provided under such approved credit 
scoring model. 
‘‘(g) PROTECTION OF PROPRIETARY INFORMATION.— 
This section may not be construed to require the disclosure 
or sharing of any proprietary information. 
‘‘(h) REPORTING.— 
‘‘(1) IN GENERAL.—The Secretary shall submit 
reports to the Congress in accordance with paragraph 
(2) that provide a detailed evaluation of the effective-
ness of the pilot, including data that shows— 
‘‘(A) the number of mortgagors who had the 
option to opt into using additional credit infor-
mation and the number of mortgagors who opted 
into using additional credit information; 
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‘‘(B) the total number and percent of mort-
gagors who opted into the pilot and were subse-
quently approved for a mortgage; 
‘‘(C) demographic information about mort-
gagors who opt into using additional credit in-
formation, compared to demographic informa-
tion about mortgagors generally, which shall in-
clude race, ethnicity, marital status, sex or gen-
der, geographic location regarding mortgaged 
properties, and any other information the Sec-
retary deems appropriate; 
‘‘(D) whether or not mortgagors with no or 
thin credit files benefitted from having this op-
tion and how; 
‘‘(E) whether or not other borrowers who 
did not have thin or no credit files benefitted 
from this option and how; 
‘‘(F) the effectiveness of the additional credit 
information in predicting mortgage loan default; 
‘‘(G) the rate of participation of mortgagees 
in the pilot program; 
‘‘(H) whether or not the pilot program had 
an impact on the Mutual Mortgage Insurance 
Fund, in general, and specifically whether it had 
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an impact on the economic net worth ratio of the 
Fund; 
‘‘(I) whether or not there was sufficient in-
come from the pilot program to offset the risk 
posed to such Fund by the pilot program; 
‘‘(J) whether the pilot program had an im-
pact on the ability of other borrowers not par-
ticipating in the program to obtain the products 
and services of the FHA; and 
‘‘(K) any other information the Secretary 
determines relevant. 
‘‘(2) SUBMISSION.—The Secretary shall submit a 
report described in paragraph (1)— 
‘‘(A) not later than 6 months after the con-
clusion of the 2-year period beginning on the 
date on which the Secretary begins accepting the 
additional credit scores through the pilot pro-
gram established by the Secretary pursuant to 
this section; and 
‘‘(B) not later than 1 year after the conclu-
sion of the 5-year period beginning on the date 
of the enactment of the Alternative Data for Ad-
ditional Credit FHA Pilot Program Reauthor-
ization Act. 
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‘‘(3) REPORT
ON
SELECTION
OF
ADDITIONAL 
CREDIT MODEL.—Not later than the conclusion of the 
6-month period that begins upon the conclusion of the 
one-year period under subsection (d), the Secretary 
shall submit to the Congress a report explaining why 
the additional credit scoring model or models selected 
pursuant to subsection (d) were selected in lieu of 
other commercially available credit scoring models. 
‘‘(4) PUBLIC AVAILABILITY OF INFORMATION.— 
The Secretary shall make publicly available in an 
easily accessible location on the website of the Depart-
ment— 
‘‘(A) each report submitted to the Congress 
pursuant to this subsection; and 
‘‘(B) information about the pilot program, 
which shall include an up-to-date listing of 
mortgagees participating in the pilot program. 
‘‘(i) AUTHORITY TO LIMIT PARTICIPATION.—The Sec-
retary may establish a limitation to cap participation in 
the pilot program under this section. 
‘‘(j) AUTHORIZATION OF APPROPRIATIONS.—There is 
authorized to be appropriated— 
‘‘(1) $3,000,000 for fiscal year 2020 for estab-
lishing and carrying out the pilot program under this 
section; and 
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‘‘(2) $1,500,000 for each of fiscal years 2021 
through 2024 for carrying out the pilot program 
under this section.’’; and 
(7) in subsection (k), as so redesignated by para-
graph (4), by striking ‘‘5-year period beginning on 
the date of the enactment of the Building American 
Homeownership Act of 2008’’ and inserting ‘‘5-year 
period beginning on the date of the enactment of the 
Alternative Data for Additional Credit FHA Pilot 
Program Reauthorization Act’’. 
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Union Calendar No. 547 
116TH CONGRESS 
2D SESSION 
H. R. 123 
[Report No. 116–663] 
A BILL 
To authorize a pilot program under section 258 of 
the National Housing Act to establish an auto-
mated process for providing additional credit rat-
ing information for mortgagors and prospective 
mortgagors under certain mortgages. 
DECEMBER 17, 2020 
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed 
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