IIB 
111TH CONGRESS 
1ST SESSION H. R. 2529 
IN THE SENATE OF THE UNITED STATES 
JULY 30, 2009 
Received; read twice and referred to the Committee on Banking, Housing, and 
Urban Affairs 
AN ACT 
To amend the Federal Deposit Insurance Act to authorize 
depository institutions and depository institution holding 
companies to lease foreclosed property held by such insti-
tutions and companies for up to 5 years, and for other 
purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Neighborhood Preser-
vation Act’’. 
SEC. 2. FINDINGS. 
The Congress finds as follows: 
(1) Depository institutions and affiliates of de-
pository institutions currently may control and lease 
foreclosed property for a limited period of time often 
subject to safety and soundness considerations, 
under various Federal laws and the law of some 
States. 
(2) Authorizing such institutions and affiliates 
to enter into a long-term lease with the occupant of 
the property or any other person would reduce the 
number of residential properties entering into the 
housing inventory, which in turn would help to sta-
bilize home values and restore confidence in the 
housing markets. 
(3) Allowing depository institutions and affili-
ates of such institutions to lease foreclosed property 
will allow the institution or affiliate to dispose of 
such property into a presumably more stable market 
at the end of the lease term which would reduce the 
loss the institution or affiliate may otherwise be re-
quired to recognize upon disposition of the property. 
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(4) Providing a means for foreclosed property 
to remain occupied during the housing downturn will 
preserve the property itself as well as the aesthetic 
and economic values of neighboring homes and even 
whole neighborhoods. 
(5) Allowing depository institutions to lease 
foreclosed property gives families the opportunity to 
remain in the home, causing less disruption to fami-
lies, until they have the means to become a home-
owner again. 
SEC. 3. BANK LEASING OF FORECLOSED PROPERTIES. 
(a) IN GENERAL.—Section 18 of the Federal Deposit 
Insurance Act (12 U.S.C. 1828) is amended by adding at 
the end the following new subsection: 
‘‘(y) LEASING OF FORECLOSED PROPERTY.— 
‘‘(1) LEASING AUTHORIZED.—Notwithstanding 
any provision of Federal or State law restricting the 
time during which a depository institution, or any 
affiliate of a depository institution, may hold or 
lease property, or any provision of Federal or State 
law prohibiting a depository institution, or any affil-
iate of a depository institution, from leasing prop-
erty and subject to this subsection and regulations 
prescribed under this subsection, any depository in-
stitution, and any affiliate of a depository institu-
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tion, may lease to any individual, including a lease 
with an option to purchase, for not to exceed 5 years 
an interest in residential property which— 
‘‘(A) was or is security for an extension of 
credit by such depository institution or affiliate; 
and 
‘‘(B) came under the ownership or control 
of the depository institution or affiliate through 
foreclosure, or a deed in lieu of foreclosure, on 
the extension of credit. 
‘‘(2) SAFETY AND SOUNDNESS REGULATIONS.— 
The Federal banking agencies shall jointly prescribe 
regulations which— 
‘‘(A) establish criteria and minimum re-
quirements for the leasing activity of any depos-
itory institution or affiliate of a depository in-
stitution, including minimum capital require-
ments, that the agency determines to be appro-
priate for the preservation of the safety and 
soundness of the institution or affiliate; 
‘‘(B) establish requirements or exceptions 
that the agency determines are appropriate 
under this subsection for any such institution 
or affiliate for any other purpose; and 
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‘‘(C) provide for appropriate actions under 
section 38 with respect to any such lease if nec-
essary to protect the capital or safety and 
soundness of the institution or affiliate or any 
other necessary enforcement action. 
‘‘(3) LENGTH OF LEASE.—If any provision of 
any Federal or State law, including the Bank Hold-
ing Company Act of 1956, governing the permissible 
activities of depository institutions or affiliates of de-
pository institutions permits a depository institution 
or any such affiliate to hold property as described in 
paragraph (1) for a period longer than 5 years, any 
lease under paragraph (1) may be extended to the 
extent permitted by such provision of law. 
‘‘(4) SUNSET.—This section shall apply only 
with respect to leases entered into during the 2-year 
period beginning on the date of the enactment of the 
Neighborhood Preservation Act.’’. 
(b) INTENT OF THE CONGRESS.—It is the intent of 
the Congress that— 
(1) no permanent change in policy on leasing 
foreclosed property is being established with respect 
to depository institutions and depository institution 
holding companies; and 
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(2) subsection (y) of section 18 of the Federal 
Deposit Insurance Act should not apply to leases en-
tered into after the sunset date contained in such 
subsection. 
Passed the House of Representatives July 29, 2009. 
Attest: 
LORRAINE C. MILLER, 
Clerk. 
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