H. R. 3221—172 
(d) CONTENTS OF REPORTS.—The reports required under sub-
section (c) shall identify and analyze— 
(1) the factors considered in determining the amount of 
the guarantee fees charged; 
(2) the total revenue earned by the enterprises from guar-
antee fees; 
(3) the total costs incurred by the enterprises for providing 
guarantees; 
(4) the average guarantee fee charged by the enterprises; 
(5) an analysis of any increase or decrease in guarantee 
fees from the preceding year; 
(6) a breakdown of the revenue and costs associated with 
providing guarantees, based on product type and risk classifica-
tions; and 
(7) a breakdown of guarantee fees charged based on asset 
size of the originator and the number of loans sold or trans-
ferred to an enterprise. 
(e) PROTECTION OF INFORMATION.—Nothing in this section may 
be construed to require or authorize the Director to publicly disclose 
information that is confidential or proprietary. 
SEC. 1602. STUDY AND REPORT ON DEFAULT RISK EVALUATION. 
(a) STUDY.—The Director shall conduct a study of ways to 
improve the overall default risk evaluation used with respect to 
residential mortgage loans. Particular attention shall be paid to 
the development and utilization of processes and technologies that 
provide a means to standardize the measurement of risk. 
(b) REPORT.—The Director shall submit a report on the study 
conducted under this section to the Committee on Banking, 
Housing, and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives, not later 
than 1 year after the date of enactment of this Act. 
SEC. 1603. CONVERSION OF HUD CONTRACTS. 
(a) IN GENERAL.—Notwithstanding any other provision of law, 
the Secretary may, at the request of an owner of a multifamily 
housing project that exceeds 5,000 units to which a contract for 
project-based rental assistance under section 8 of the United States 
Housing Act of 1937 (‘‘Act’’) (42 U.S.C. 1437f) and a Rental Assist-
ance Payment contract is subject, convert such contracts to a con-
tract for project-based rental assistance under section 8 of the 
Act. 
(b) INITIAL RENEWAL.— 
(1) At the request of an owner under subsection (a) made 
no later than 90 days prior to a conversion, the Secretary 
may, to the extent sufficient amounts are made available in 
appropriation Acts and notwithstanding any other law, treat 
the contemplated resulting contract as if such contract were 
eligible for initial renewal under section 524(a) of the Multi-
Family Assisted Housing Reform and Affordability Act of 1997 
(42 U.S.C. 1437f note) (‘‘MAHRA’’) (42 U.S.C. 1437f note). 
(2) A request by an owner pursuant to paragraph (1) shall 
be upon such terms and conditions as the Secretary may 
require. 
(c) RESULTING CONTRACT.—The resulting contract shall— 
(1) be subject to section 524(a) of MAHRA (42 U.S.C. 1437f 
note);
H. R. 3221—173 
(2) be considered for all purposes a contract that has been 
renewed under section 524(a) of MAHRA (42 U.S.C. 1437f 
note) for a term not to exceed 20 years; 
(3) be subsequently renewable at the request of an owner, 
under any renewal option for which the project is eligible under 
MAHRA (42 U.S.C. 1437f note); 
(4) contain provisions limiting distributions, as the Sec-
retary determines appropriate, not to exceed 10 percent of 
the initial investment of the owner; 
(5) be subject to the availability of sufficient amounts in 
appropriation Acts; and 
(6) be subject to such other terms and conditions as the 
Secretary considers appropriate. 
(d) INCOME TARGETING.—To the extent that assisted dwelling 
units, subject to the resulting contract under subsection (a), serve 
low-income families, as defined in section 3(b)(2) of the Act (42 
U.S.C. 1437a(b)(2)) the units shall be considered to be in compliance 
with all income targeting requirements under the Act (42 U.S.C. 
1437 et seq). 
(e) TENANT ELIGIBILITY.—Notwithstanding any other provision 
of law, each family residing in an assisted dwelling unit on the 
date of conversion of a contract under this section, subject to the 
resulting contract under subsection (a), shall be considered to meet 
the applicable requirements for income eligibility and occupancy. 
(f) DEFINITIONS.—As used in this section— 
(1) the term ‘‘Secretary’’ means the Secretary of Housing 
and Urban Development; 
(2) the term ‘‘conversion’’ means the action under which 
a contract for project-based rental assistance under section 
8 of the Act and a Rental Assistance Payment contract become 
a contract for project-based rental assistance under section 
8 of the Act (42 U.S.C. 1437f) pursuant to subsection (a); 
(3) the term ‘‘resulting contract’’ means the new contract 
after a conversion pursuant to subsection (a); and 
(4) the term ‘‘assisted dwelling unit’’ means a dwelling 
unit in a multifamily housing project that exceeds 5,000 units 
that, on the date of conversion of a contract under this section, 
is subject to a contract for project-based rental assistance under 
section 8 of the Act (42 U.S.C. 1437f) or a Rental Assistance 
Payment contract. 
SEC. 1604. BRIDGE DEPOSITORY INSTITUTIONS. 
(a) IN GENERAL.—Section 11 of the Federal Deposit Insurance 
Act (12 U.S.C. 1821) is amended— 
(1) in subsection (d)(2)— 
(A) in subparagraph (F), by striking ‘‘as receiver’’ and 
all that follows through clause (ii) and inserting the fol-
lowing: ‘‘as receiver, with respect to any insured depository 
institution, organize a new depository institution under 
subsection (m) or a bridge depository institution under 
subsection (n).’’; 
(B) in subparagraph (G), by striking ‘‘new bank or 
a bridge bank’’ and inserting ‘‘new depository institution 
or a bridge depository institution’’; 
(2) in the heading for subsection (e)(10)(C), by striking 
‘‘BRIDGE BANKS’’ and inserting ‘‘BRIDGE DEPOSITORY INSTITU-
TIONS’’;
H. R. 3221—174 
(3) in subsection (e)(10)(C)(i), by striking ‘‘bridge bank’’ 
and inserting ‘‘bridge depository institution’’; 
(4) in subsection (m)— 
(A) in the subsection heading, by striking ‘‘BANKS’’ 
and inserting ‘‘DEPOSITORY INSTITUTIONS’’; 
(B) by striking ‘‘insured bank’’ each place such term 
appears and inserting ‘‘insured depository institution’’; 
(C) by striking ‘‘new bank’’ each place such term 
appears and inserting ‘‘new depository institution’’; 
(D) by striking ‘‘such bank’’ each place such term 
appears and inserting ‘‘such depository institution’’; 
(E) by striking ‘‘the bank’’ each place such term appears 
and inserting ‘‘the insured depository institution’’; 
(F) in paragraph (1), by inserting ‘‘or Federal savings 
association’’ after ‘‘national bank’’; 
(G) in paragraph (6), by striking ‘‘only bank’’ and 
inserting ‘‘only depository institution’’; 
(H) in paragraph (9), by inserting ‘‘or the Director 
of the Office of Thrift Supervision, as appropriate’’ after 
‘‘Comptroller of the Currency’’; 
(I) in paragraph (15), by striking ‘‘, but in no event’’ 
and all that follows through ‘‘located’’; 
(J) in paragraph (16)— 
(i) by inserting ‘‘or the Director of the Office of 
Thrift Supervision, as appropriate,’’ after ‘‘Comptroller 
of the Currency’’ each place such term appears; 
(ii) by striking ‘‘the bank’’ each place such term 
appears and inserting ‘‘the depository institution’’; 
(iii) by inserting ‘‘or Federal savings association’’ 
after ‘‘national bank’’ each place such term appears; 
(iv) by inserting ‘‘or Federal savings associations’’ 
after ‘‘national banks’’; and 
(v) by striking ‘‘Such bank’’ and inserting ‘‘Such 
depository institution’’; and 
(K) in paragraph (18), by inserting ‘‘or the Director 
of the Office of Thrift Supervision, as appropriate,’’ after 
‘‘Comptroller of the Currency’’ each place such term 
appears; 
(5) in subsection (n)— 
(A) in the subsection heading, by striking ‘‘BANKS’’ 
and inserting ‘‘DEPOSITORY INSTITUTIONS’’; 
(B) by striking ‘‘bridge bank’’ each place such term 
appears and inserting ‘‘bridge depository institution’’; 
(C) by striking ‘‘bridge banks’’ each place such term 
appears (other than in paragraph (1)(A))and inserting 
‘‘bridge depository institutions’’; 
(D) by striking ‘‘bridge bank’s’’ each place such term 
appears and inserting ‘‘bridge depository institution’s’’; 
(E) by striking ‘‘insured bank’’ each place such term 
appears and inserting ‘‘insured depository institution’’; 
(F) by striking ‘‘insured banks’’ each place such term 
appears and inserting ‘‘insured depository institutions’’; 
(G) by striking ‘‘such bank’’ each place such term 
appears (other than in paragraph (4)(J)) and inserting 
‘‘such depository institution’’; 
(H) by striking ‘‘the bank’’ each place such term 
appears and inserting ‘‘the depository institution’’;
H. R. 3221—175 
(I) by striking ‘‘bank or banks’’ each place such term 
appears and inserting ‘‘depository institution or institu-
tions’’; 
(J) in paragraph (1)(A)— 
(i) by inserting ‘‘, with respect to 1 or more insured 
banks, or the Director of the Office of Thrift Super-
vision, with respect to 1 or more insured savings 
associations,’’ after ‘‘Comptroller of the Currency’’; 
(ii) by inserting ‘‘or Federal savings associations, 
as appropriate,’’ after ‘‘national banks’’; 
(iii) by inserting ‘‘or Federal savings associations, 
as applicable,’’ after ‘‘banking associations’’; and 
(iv) by striking ‘‘as bridge banks’’ and inserting 
‘‘as ‘bridge depository institutions’ ’’; 
(K) in paragraph (1)(B)— 
(i) by striking ‘‘of a bank’’; and 
(ii) by striking ‘‘of that bank’’; 
(L) in the heading for paragraph (1)(E), by inserting 
‘‘OR FEDERAL SAVINGS ASSOCIATION’’ before the period; 
(M) in paragraph (1)(E), by inserting before the period 
‘‘, in the case of 1 or more insured banks, and as a Federal 
savings association, in the case of 1 or more insured savings 
associations’’; 
(N) in paragraph (2)— 
(i) by inserting ‘‘or Federal savings association’’ 
after ‘‘national bank’’ each place such term appears; 
(ii) in subparagraph (A), by inserting ‘‘or the 
Director of the Office of Thrift Supervision’’ after 
‘‘Comptroller of the Currency’’; and 
(iii) in the heading for subparagraph (B), by 
inserting ‘‘OR
FEDERAL
SAVINGS
ASSOCIATION’’ before 
the period; 
(O) in paragraph (4)— 
(i) in the matter preceding subparagraph (A), by 
inserting ‘‘or Federal savings association, as appro-
priate’’ after ‘‘national bank’’; 
(ii) in subparagraph (C), by striking ‘‘under section 
5138 of the Revised Statutes or any other’’ and 
inserting ‘‘under any’’; 
(iii) by inserting ‘‘and the Director of the Office 
of Thrift Supervision, as appropriate,’’ after ‘‘Comp-
troller of the Currency’’ each place such term appears; 
(iv) in subparagraph (D), by striking ‘‘bank’s’’ and 
inserting ‘‘depository institution’s’’; and 
(v) in subparagraph (H), by striking ‘‘a bank in 
default’’ and inserting ‘‘a depository institution in 
default’’; 
(P) in paragraph (8)— 
(i) in subparagraph (A), by striking ‘‘the banks’’ 
and inserting ‘‘the depository institutions’’; 
(ii) in subparagraph (B), by striking ‘‘bank’s’’ and 
inserting ‘‘depository institution’s’’; 
(Q) by striking ‘‘BRIDGE BANK’’ or ‘‘BRIDGE BANKS’’ as 
the case may be in the headings for paragraphs (9), (10), 
(12), and (13) and inserting ‘‘BRIDGE DEPOSITORY INSTITU-
TION’’ or ‘‘BRIDGE DEPOSITORY INSTITUTIONS’’ as appropriate;
H. R. 3221—176 
(R) in paragraph (11), by inserting ‘‘or a Federal 
savings association, as the case may be,’’ after ‘‘national 
bank’’ each place such term appears; 
(S) in paragraph (12)— 
(i) by inserting ‘‘or the Director of the Office of 
Thrift Supervision, as appropriate,’’ after ‘‘Comptroller 
of the Currency’’ each place such term appears; and 
(ii) by inserting ‘‘or Federal savings associations, 
as appropriate’’ after ‘‘national banks’’; and 
(T) in paragraph (13), by striking ‘‘single bank’’ and 
inserting ‘‘single depository institution’’. 
(b) OTHER CONFORMING AMENDMENTS.— 
(1) FEDERAL DEPOSIT INSURANCE ACT.—The Federal Deposit 
Insurance Act (12 U.S.C. 1811 et seq.) is amended— 
(A) in section 3 (12 U.S.C. 1813), by striking subsection 
(i) and inserting the following: 
‘‘(i) NEW DEPOSITORY INSTITUTION
AND BRIDGE DEPOSITORY 
INSTITUTION DEFINED.— 
‘‘(1) NEW DEPOSITORY INSTITUTION.—The term ‘new deposi-
tory institution’ means a new national bank or Federal savings 
association, other than a bridge depository institution, orga-
nized by the Corporation in accordance with section 11(m). 
‘‘(2) BRIDGE
DEPOSITORY
INSTITUTION.—The term ‘bridge 
depository institution’ means a new national bank or Federal 
savings association organized by the Corporation in accordance 
with section 11(n).’’; 
(B) in section 10(d)(5)(B) (12 U.S.C. 1820(d)(5)(B)), by 
striking ‘‘bridge bank’’ and inserting ‘‘bridge depository 
institution’’; 
(C) in section 12 (12 U.S.C. 1822), by striking ‘‘new 
bank’’ each place such term appears and inserting ‘‘new 
depository institution’’;and 
(D) in section 38(j)(2) (12 U.S.C. 1831o(j)(2)), by striking 
‘‘bridge bank’’ and inserting ‘‘bridge depository institution’’. 
(2) FEDERAL CREDIT UNION ACT.—Section 207(c)(10)(C)(i) 
of the Federal Credit Union Act (12 U.S.C. 1787(c)(10)(C)(i)) 
is amended by striking ‘‘bridge bank’’ and inserting ‘‘bridge 
depository institution’’. 
(3) TITLE 11, UNITED STATES CODE.—Section 783 of title 
11, United States Code, is amended by striking ‘‘bridge bank’’ 
and inserting ‘‘bridge depository institution’’. 
(4) TITLE
26, UNITED
STATES
CODE.—Section 414(l)(2)(G) 
of the Internal Revenue Code of 1986, is amended by striking 
‘‘bridge bank’’ and inserting ‘‘bridge depository institution’’. 
(c) REPEAL OF DEPOSIT LIMITATION.—Section 11(n)(1)(B)(i) of 
the Federal Deposit Insurance Act (12 U.S.C. 1821(n)(1)(B)(i)) is 
amended by striking ‘‘, except that’’ and all that follows through 
‘‘another insured depository institution’’. 
(d) FEDERAL RESERVE BANK LENDING TO BRIDGE DEPOSITORY 
INSTITUTIONS.—Section 11(n)(5) of the Federal Deposit Insurance 
Act (12 U.S.C. 1821(n)(5)) is amended by adding at the end the 
following new subparagraph: 
‘‘(D) CAPITAL LEVELS.—A bridge depository institution 
shall not be considered an undercapitalized depository 
institution or a critically undercapitalized depository 
institution for purposes of section 10B(b) of the Federal 
Reserve Act.’’.
H. R. 3221—178 
‘‘(ii) 150 percent of the dollar amount limitation 
determined under the sixth sentence of such section 
305(a)(2) for a residence of applicable size; 
except that the dollar amount limitation in effect under 
this subparagraph for any size residence for any area may 
not be less than the greater of: (I) the dollar amount 
limitation in effect under this section for the area on 
October 21, 1998; or (II) 65 percent of the dollar amount 
limitation determined under the sixth sentence of such 
section 305(a)(2) for a residence of the applicable size; 
and 
‘‘(B) not to exceed 100 percent of the appraised value 
of the property.’’; and 
(2) in the matter following subparagraph (B), by striking 
the second sentence (relating to a definition of ‘‘average closing 
cost’’) and all that follows through ‘‘section 3103A(d) of title 
38, United States Code.’’. 
(b) TREATMENT OF UP-FRONT PREMIUMS.—Section 203(d) of the 
National Housing Act (12 U.S.C. 1709(d)) is amended— 
(1) by striking ‘‘Notwithstanding any’’ and inserting the 
following: ‘‘Except as provided in paragraph (2) of this sub-
section, notwithstanding’’; 
(2) by inserting ‘‘(1)’’ after ‘‘(d)’’; and 
(3) by adding at the end the following new paragraph: 
‘‘(2) The maximum amount of a mortgage determined under 
subsection (b)(2)(B) of this section may not be increased as provided 
in paragraph (1).’’. 
(c) EFFECTIVE DATE.— The amendments made by subsection 
(a) shall take effect upon the expiration of the date described 
in section 202(a) of the Economic Stimulus Act of 2008 (Public 
Law 110–185; 122 Stat. 620). 
SEC. 2113. CASH INVESTMENT REQUIREMENT AND PROHIBITION OF 
SELLER-FUNDED DOWN PAYMENT ASSISTANCE. 
Paragraph (9) of section 203(b) of the National Housing Act 
(12 U.S.C. 1709(b)(9)) is amended to read as follows: 
‘‘(9) CASH INVESTMENT REQUIREMENT.— 
‘‘(A) IN GENERAL.—A mortgage insured under this sec-
tion shall be executed by a mortgagor who shall have 
paid, in cash or its equivalent, on account of the property 
an amount equal to not less than 3.5 percent of the 
appraised value of the property or such larger amount 
as the Secretary may determine. 
‘‘(B) FAMILY
MEMBERS.—For purposes of this para-
graph, the Secretary shall consider as cash or its equivalent 
any amounts borrowed from a family member (as such 
term is defined in section 201), subject only to the require-
ments that, in any case in which the repayment of such 
borrowed amounts is secured by a lien against the property, 
that— 
‘‘(i) such lien shall be subordinate to the mortgage; 
and 
‘‘(ii) the sum of the principal obligation of the 
mortgage and the obligation secured by such lien may 
not exceed 100 percent of the appraised value of the 
property plus any initial service charges, appraisal,
H. R. 3221—179 
inspection, and other fees in connection with the mort-
gage. 
‘‘(C) PROHIBITED SOURCES.—In no case shall the funds 
required by subparagraph (A) consist, in whole or in part, 
of funds provided by any of the following parties before, 
during, or after closing of the property sale: 
‘‘(i) The seller or any other person or entity that 
financially benefits from the transaction. 
‘‘(ii) Any third party or entity that is reimbursed, 
directly or indirectly, by any of the parties described 
in clause (i). 
This subparagraph shall apply only to mortgages for which 
the mortgagee has issued credit approval for the borrower 
on or after October 1, 2008.’’. 
SEC. 2114. MORTGAGE INSURANCE PREMIUMS. 
Section 203(c)(2) of the National Housing Act (12 U.S.C. 
1709(c)(2)) is amended— 
(1) in the matter preceding subparagraph (A), by striking 
‘‘or of the General Insurance Fund’’ and all that follows through 
‘‘section 234(c),,’’; and 
(2) in subparagraph (A)— 
(A) by striking ‘‘2.25 percent’’ and inserting ‘‘3 percent’’; 
and 
(B) by striking ‘‘2.0 percent’’ and inserting ‘‘2.75 per-
cent’’. 
SEC. 2115. REHABILITATION LOANS. 
Subsection (k) of section 203 of the National Housing Act (12 
U.S.C. 1709(k)) is amended— 
(1) in paragraph (1), by striking ‘‘on’’ and all that follows 
through ‘‘1978’’; and 
(2) in paragraph (5)— 
(A) by striking ‘‘General Insurance Fund’’ the first 
place it appears and inserting ‘‘Mutual Mortgage Insurance 
Fund’’; and 
(B) in the second sentence, by striking the comma 
and all that follows through ‘‘General Insurance Fund’’. 
SEC. 2116. DISCRETIONARY ACTION. 
The National Housing Act is amended— 
(1) in subsection (e) of section 202 (12 U.S.C. 1708(e))— 
(A) in paragraph (3)(B), by striking ‘‘section 202(e) 
of the National Housing Act’’ and inserting ‘‘this sub-
section’’; and 
(B) by redesignating such subsection as subsection (f); 
(2) by striking paragraph (4) of section 203(s) (12 U.S.C. 
1709(s)(4)) and inserting the following new paragraph: 
‘‘(4) the Secretary of Agriculture;’’; and 
(3) by transferring subsection (s) of section 203 (as amended 
by paragraph (2) of this section) to section 202, inserting such 
subsection after subsection (d) of section 202, and redesignating 
such subsection as subsection (e). 
SEC. 2117. INSURANCE OF CONDOMINIUMS. 
(a) IN GENERAL.—Section 234 of the National Housing Act 
(12 U.S.C. 1715y) is amended— 
(1) in subsection (c), in the first sentence—
H. R. 3221—180 
(A) by striking ‘‘and’’ before ‘‘(2)’’; and 
(B) by inserting before the period at the end the fol-
lowing: ‘‘, and (3) the project has a blanket mortgage 
insured by the Secretary under subsection (d)’’; and 
(2) in subsection (g), by striking ‘‘, except that’’ and all 
that follows and inserting a period. 
(b) DEFINITION OF MORTGAGE.—Section 201(a) of the National 
Housing Act (12 U.S.C. 1707(a)) is amended— 
(1) before ‘‘a first mortgage’’ insert ‘‘(A)’’; 
(2) by striking ‘‘or on a leasehold (1)’’ and inserting ‘‘(B) 
a first mortgage on a leasehold on real estate (i)’’; 
(3) by striking ‘‘or (2)’’ and inserting ‘‘, or (ii)’’; and 
(4) by inserting before the semicolon the following: ‘‘, or 
(C) a first mortgage given to secure the unpaid purchase price 
of a fee interest in, or long-term leasehold interest in, real 
estate consisting of a one-family unit in a multifamily project, 
including a project in which the dwelling units are attached, 
or are manufactured housing units, semi-detached, or detached, 
and an undivided interest in the common areas and facilities 
which serve the project’’. 
(c) DEFINITION OF REAL ESTATE.—Section 201 of the National 
Housing Act (12 U.S.C. 1707) is amended by adding at the end 
the following new subsection: 
‘‘(g) The term ‘real estate’ means land and all natural resources 
and structures permanently affixed to the land, including residential 
buildings and stationary manufactured housing. The Secretary may 
not require, for treatment of any land or other property as real 
estate for purposes of this title, that such land or property be 
treated as real estate for purposes of State taxation.’’. 
SEC. 2118. MUTUAL MORTGAGE INSURANCE FUND. 
(a) IN GENERAL.—Subsection (a) of section 202 of the National 
Housing Act (12 U.S.C. 1708(a)) is amended to read as follows: 
‘‘(a) MUTUAL MORTGAGE INSURANCE FUND.— 
‘‘(1) ESTABLISHMENT.—Subject to the provisions of the Fed-
eral Credit Reform Act of 1990, there is hereby created a 
Mutual Mortgage Insurance Fund (in this title referred to as 
the ‘Fund’), which shall be used by the Secretary to carry 
out the provisions of this title with respect to mortgages insured 
under section 203. The Secretary may enter into commitments 
to guarantee, and may guarantee, such insured mortgages. 
‘‘(2) LIMIT ON LOAN GUARANTEES.—The authority of the 
Secretary to enter into commitments to guarantee such insured 
mortgages shall be effective for any fiscal year only to the 
extent that the aggregate original principal loan amount under 
such mortgages, any part of which is guaranteed, does not 
exceed the amount specified in appropriations Acts for such 
fiscal year. 
‘‘(3) FIDUCIARY
RESPONSIBILITY.—The Secretary has a 
responsibility to ensure that the Mutual Mortgage Insurance 
Fund remains financially sound. 
‘‘(4) ANNUAL
INDEPENDENT
ACTUARIAL
STUDY.—The Sec-
retary shall provide for an independent actuarial study of the 
Fund to be conducted annually, which shall analyze the finan-
cial position of the Fund. The Secretary shall submit a report 
annually to the Congress describing the results of such study 
and assessing the financial status of the Fund. The report
H. R. 3221—181 
shall recommend adjustments to underwriting standards, pro-
gram participation, or premiums, if necessary, to ensure that 
the Fund remains financially sound. The report shall also 
include an evaluation of the quality control procedures and 
accuracy of information utilized in the process of underwriting 
loans guaranteed by the Fund. Such evaluation shall include 
a review of the risk characteristics of loans based not only 
on borrower information and performance, but on risks associ-
ated with loans originated or funded by various entities or 
financial institutions. 
‘‘(5) QUARTERLY
REPORTS.—During each fiscal year, the 
Secretary shall submit a report to the Congress for each cal-
endar quarter, which shall specify for mortgages that are obliga-
tions of the Fund— 
‘‘(A) the cumulative volume of loan guarantee commit-
ments that have been made during such fiscal year through 
the end of the quarter for which the report is submitted; 
‘‘(B) the types of loans insured, categorized by risk; 
‘‘(C) any significant changes between actual and pro-
jected claim and prepayment activity; 
‘‘(D) projected versus actual loss rates; and 
‘‘(E) updated projections of the annual subsidy rates 
to ensure that increases in risk to the Fund are identified 
and mitigated by adjustments to underwriting standards, 
program participation, or premiums, and the financial 
soundness of the Fund is maintained. 
The first quarterly report under this paragraph shall be sub-
mitted on the last day of the first quarter of fiscal year 2008, 
or on the last day of the first full calendar quarter following 
the enactment of the Building American Homeownership Act 
of 2008, whichever is later. 
‘‘(6) ADJUSTMENT OF PREMIUMS.—If, pursuant to the inde-
pendent actuarial study of the Fund required under paragraph 
(4), the Secretary determines that the Fund is not meeting 
the operational goals established under paragraph (7) or there 
is a substantial probability that the Fund will not maintain 
its established target subsidy rate, the Secretary may either 
make programmatic adjustments under this title as necessary 
to reduce the risk to the Fund, or make appropriate premium 
adjustments. 
‘‘(7) OPERATIONAL GOALS.—The operational goals for the 
Fund are— 
‘‘(A) to minimize the default risk to the Fund and 
to homeowners by among other actions instituting fraud 
prevention quality control screening not later than 18 
months after the date of enactment of the Building Amer-
ican Homeownership Act of 2008; and 
‘‘(B) to meet the housing needs of the borrowers that 
the single family mortgage insurance program under this 
title is designed to serve.’’. 
(b) OBLIGATIONS
OF FUND.—The National Housing Act is 
amended as follows: 
(1) HOMEOWNERSHIP VOUCHER PROGRAM MORTGAGES.—In 
section 203(v) (12 U.S.C. 1709(v))— 
(A) by striking ‘‘Notwithstanding section 202 of this 
title, the’’ and inserting ‘‘The’’; and
H. R. 3221—182 
(B) by striking ‘‘General Insurance Fund’’ the first 
place such term appears and all that follows through the 
end of the subsection and inserting ‘‘Mutual Mortgage 
Insurance Fund.’’. 
(2) 
HOME
EQUITY
CONVERSION
MORTGAGES.—Section 
255(i)(2)(A) of the National Housing Act (12 U.S.C. 1715z– 
20(i)(2)(A)) is amended by striking ‘‘General Insurance Fund’’ 
and inserting ‘‘Mutual Mortgage Insurance Fund’’. 
(c) CONFORMING AMENDMENTS.—The National Housing Act is 
amended— 
(1) in section 205 (12 U.S.C. 1711), by striking subsections 
(g) and (h); and 
(2) in section 519(e) (12 U.S.C. 1735c(e)), by striking 
‘‘203(b)’’ and all that follows through ‘‘203(i)’’ and inserting 
‘‘203, except as determined by the Secretary’’. 
SEC. 2119. HAWAIIAN HOME LANDS AND INDIAN RESERVATIONS. 
(a) HAWAIIAN HOME LANDS.—Section 247(c) of the National 
Housing Act (12 U.S.C. 1715z–12(c)) is amended— 
(1) by striking ‘‘General Insurance Fund established in 
section 519’’ and inserting ‘‘Mutual Mortgage Insurance Fund’’; 
and 
(2) in the second sentence, by striking ‘‘(1) all references’’ 
and all that follows through ‘‘and (2)’’. 
(b) INDIAN
RESERVATIONS.—Section 248(f) of the National 
Housing Act (12 U.S.C. 1715z–13(f)) is amended— 
(1) by striking ‘‘General Insurance Fund’’ the first place 
it appears through ‘‘519’’ and inserting ‘‘Mutual Mortgage Insur-
ance Fund’’; and 
(2) in the second sentence, by striking ‘‘(1) all references’’ 
and all that follows through ‘‘and (2)’’. 
SEC. 2120. CONFORMING AND TECHNICAL AMENDMENTS. 
(a) REPEALS.—The following provisions of the National Housing 
Act are repealed: 
(1) Subsection (i) of section 203 (12 U.S.C. 1709(i)). 
(2) Subsection (o) of section 203 (12 U.S.C. 1709(o)). 
(3) Subsection (p) of section 203 (12 U.S.C. 1709(p)). 
(4) Subsection (q) of section 203 (12 U.S.C. 1709(q)). 
(5) Section 222 (12 U.S.C. 1715m). 
(6) Section 237 (12 U.S.C. 1715z–2). 
(7) Section 245 (12 U.S.C. 1715z–10). 
(b) DEFINITION OF AREA.—Section 203(u)(2)(A) of the National 
Housing Act (12 U.S.C. 1709(u)(2)(A)) is amended by striking ‘‘shall’’ 
and all that follows and inserting ‘‘means a metropolitan statistical 
area as established by the Office of Management and Budget;’’. 
(c) DEFINITION
OF STATE.—Section 201(d) of the National 
Housing Act (12 U.S.C. 1707(d)) is amended by striking ‘‘the Trust 
Territory of the Pacific Islands’’ and inserting ‘‘the Commonwealth 
of the Northern Mariana Islands’’. 
SEC. 2121. INSURANCE OF MORTGAGES. 
Subsection (n)(2) of section 203 of the National Housing Act 
(12 U.S.C. 1709(n)(2)) is amended— 
(1) in subparagraph (A), by inserting ‘‘or subordinate mort-
gage or’’ before ‘‘lien given’’; and 
(2) in subparagraph (C), by inserting ‘‘or subordinate mort-
gage or’’ before ‘‘lien’’.
H. R. 3221—183 
SEC. 2122. HOME EQUITY CONVERSION MORTGAGES. 
(a) IN GENERAL.—Section 255 of the National Housing Act 
(12 U.S.C. 1715z–20) is amended— 
(1) in subsection (b)(2), insert ‘‘ ‘real estate,’ ’’ after ‘‘ ‘mort-
gagor’,’’; 
(2) by amending subsection (d)(1) to read as follows: 
‘‘(1) have been originated by a mortgagee approved by 
the Secretary;’’; 
(3) by amending subsection (d)(2)(B) to read as follows: 
‘‘(B) has received adequate counseling, as provided in 
subsection (f), by an independent third party that is not, 
either directly or indirectly, associated with or compensated 
by a party involved in— 
‘‘(i) originating or servicing the mortgage; 
‘‘(ii) funding the loan underlying the mortgage; 
or 
‘‘(iii) the sale of annuities, investments, long-term 
care insurance, or any other type of financial or insur-
ance product;’’; 
(4) in subsection (f)— 
(A) by striking ‘‘(f) INFORMATION SERVICES FOR MORT-
GAGORS.—’’ and inserting ‘‘(f) COUNSELING SERVICES AND 
INFORMATION FOR MORTGAGORS.—’’; and 
(B) by amending the matter preceding paragraph (1) 
to read as follows: ‘‘The Secretary shall provide or cause 
to be provided adequate counseling for the mortgagor, as 
described in subsection (d)(2)(B). Such counseling shall be 
provided by counselors that meet qualification standards 
and follow uniform counseling protocols. The qualification 
standards and counseling protocols shall be established 
by the Secretary within 12 months of the date of enactment 
of the Building American Homeownership Act of 2008. 
The protocols shall require a qualified counselor to discuss 
with each mortgagor information which shall include— 
’’ 
(5) in subsection (g), by striking ‘‘established under section 
203(b)(2)’’ and all that follows through ‘‘located’’ and inserting 
‘‘limitation established under section 305(a)(2) of the Federal 
Home Loan Mortgage Corporation Act for a 1-family residence’’; 
(6) by striking subsection (l); 
(7) by redesignating subsection (m) as subsection (l); 
(8) by amending subsection (l), as so redesignated, to read 
as follows: 
‘‘(l) FUNDING FOR COUNSELING.—The Secretary may use a por-
tion of the mortgage insurance premiums collected under the pro-
gram under this section to adequately fund the counseling and 
disclosure activities required under subsection (f), including coun-
seling for those homeowners who elect not to take out a home 
equity conversion mortgage, provided that the use of such funds 
is based upon accepted actuarial principles.’’; and 
(9) by adding at the end the following new subsection: 
‘‘(m) AUTHORITY TO INSURE HOME PURCHASE MORTGAGE.— 
‘‘(1) IN GENERAL.—Notwithstanding any other provision of 
this section, the Secretary may insure, upon application by 
a mortgagee, a home equity conversion mortgage upon such 
terms and conditions as the Secretary may prescribe, when 
the home equity conversion mortgage will be used to purchase
H. R. 3221—184 
a 1- to 4-family dwelling unit, one unit of which the mortgagor 
will occupy as a primary residence, and to provide for any 
future payments to the mortgagor, based on available equity, 
as authorized under subsection (d)(9). 
‘‘(2) LIMITATION ON PRINCIPAL OBLIGATION.—A home equity 
conversion mortgage insured pursuant to paragraph (1) shall 
involve a principal obligation that does not exceed the dollar 
amount limitation determined under section 305(a)(2) of the 
Federal Home Loan Mortgage Corporation Act for a 1-family 
residence. 
‘‘(n) REQUIREMENTS ON MORTGAGE ORIGINATORS.— 
‘‘(1) IN GENERAL.—The mortgagee and any other party that 
participates in the origination of a mortgage to be insured 
under this section shall— 
‘‘(A) not participate in, be associated with, or employ 
any party that participates in or is associated with any 
other financial or insurance activity; or 
‘‘(B) demonstrate to the Secretary that the mortgagee 
or other party maintains, or will maintain, firewalls and 
other safeguards designed to ensure that— 
‘‘(i) individuals participating in the origination of 
the mortgage shall have no involvement with, or incen-
tive to provide the mortgagor with, any other financial 
or insurance product; and 
‘‘(ii) the mortgagor shall not be required, directly 
or indirectly, as a condition of obtaining a mortgage 
under this section, to purchase any other financial 
or insurance product. 
‘‘(2) APPROVAL OF OTHER PARTIES.—All parties that partici-
pate in the origination of a mortgage to be insured under 
this section shall be approved by the Secretary. 
‘‘(o) PROHIBITION AGAINST REQUIREMENTS TO PURCHASE ADDI-
TIONAL PRODUCTS.—The mortgagor or any other party shall not 
be required by the mortgagee or any other party to purchase an 
insurance, annuity, or other similar product as a requirement or 
condition of eligibility for insurance under subsection (c), except 
for title insurance, hazard, flood, or other peril insurance, or other 
such products that are customary and normal under subsection 
(c), as determined by the Secretary. 
‘‘(p) STUDY TO DETERMINE CONSUMER PROTECTIONS AND UNDER-
WRITING STANDARDS.—The Secretary shall conduct a study to 
examine and determine appropriate consumer protections and 
underwriting standards to ensure that the purchase of products 
referred to in subsection (o) is appropriate for the consumer. In 
conducting such study, the Secretary shall consult with consumer 
advocates (including recognized experts in consumer protection), 
industry representatives, representatives of counseling organiza-
tions, and other interested parties.’’. 
(b) MORTGAGES FOR COOPERATIVES.—Subsection (b) of section 
255 of the National Housing Act (12 U.S.C. 1715z–20(b)) is 
amended— 
(1) in paragraph (4)— 
(A) by inserting ‘‘a first or subordinate mortgage or 
lien’’ before ‘‘on all stock’’; 
(B) by inserting ‘‘unit’’ after ‘‘dwelling’’; and 
(C) by inserting ‘‘a first mortgage or first lien’’ before 
‘‘on a leasehold’’; and
H. R. 3221—185 
(2) in paragraph (5), by inserting ‘‘a first or subordinate 
lien on’’ before ‘‘all stock’’. 
(c) LIMITATION
ON ORIGINATION FEES.—Section 255 of the 
National Housing Act (12 U.S.C. 1715z–20), as amended by the 
preceding provisions of this section, is further amended by adding 
at the end the following new subsection: 
‘‘(r) LIMITATION ON ORIGINATION FEES.—The Secretary shall 
establish limits on the origination fee that may be charged to 
a mortgagor under a mortgage insured under this section, which 
limitations shall— 
‘‘(1) be equal to 2.0 percent of the maximum claim amount 
of the mortgage, up to a maximum claim amount of $200,000 
plus 1 percent of any portion of the maximum claim amount 
that is greater than $200,000, unless adjusted thereafter on 
the basis of an analysis of— 
‘‘(A) the costs to mortgagors; and 
‘‘(B) the impact on the reverse mortgage market; 
‘‘(2) be subject to a minimum allowable amount; 
‘‘(3) provide that the origination fee may be fully financed 
with the mortgage; 
‘‘(4) include any fees paid to correspondent mortgagees 
approved by the Secretary; 
‘‘(5) have the same effective date as subsection (m)(2) 
regarding the limitation on principal obligation; and 
‘‘(6) be subject to a maximum origination fee of $6,000, 
except that such maximum limit shall be adjusted in accordance 
with the annual percentage increase in the Consumer Price 
Index of the Bureau of Labor Statistics of the Department 
of Labor in increments of $500 only when the percentage 
increase in such index, when applied to the maximum origina-
tion fee, produces dollar increases that exceed $500.’’. 
(d) STUDY REGARDING PROGRAM COSTS
AND CREDIT AVAIL-
ABILITY.— 
(1) IN GENERAL.—The Comptroller General of the United 
States shall conduct a study regarding the costs and availability 
of credit under the home equity conversion mortgages for 
elderly homeowners program under section 255 of the National 
Housing Act (12 U.S.C. 1715z–20) (in this subsection referred 
to as the ‘‘program’’). 
(2) PURPOSE.—The purpose of the study required under 
paragraph (1) is to help Congress analyze and determine the 
effects of limiting the amounts of the costs or fees under the 
program from the amounts charged under the program as of 
the date of the enactment of this title. 
(3) CONTENT OF REPORT.—The study required under para-
graph (1) should focus on— 
(A) the cost to mortgagors of participating in the pro-
gram; 
(B) the financial soundness of the program; 
(C) the availability of credit under the program; and 
(D) the costs to elderly homeowners participating in 
the program, including— 
(i) mortgage insurance premiums charged under 
the program; 
(ii) up-front fees charged under the program; and 
(iii) margin rates charged under the program.
H. R. 3221—186 
(4) TIMING OF REPORT.—Not later than 12 months after 
the date of the enactment of this title, the Comptroller General 
shall submit a report to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee on Finan-
cial Services of the House of Representatives setting forth the 
results and conclusions of the study required under paragraph 
(1). 
SEC. 2123. ENERGY EFFICIENT MORTGAGES PROGRAM. 
Section 106(a)(2) of the Energy Policy Act of 1992 (42 U.S.C. 
12712 note) is amended— 
(1) by amending subparagraph (C) to read as follows: 
‘‘(C) COSTS OF IMPROVEMENTS.—The cost of cost-effec-
tive energy efficiency improvements shall not exceed the 
greater of— 
‘‘(i) 5 percent of the property value (not to exceed 
5 percent of the limit established under section 
203(b)(2)(A)) of the National Housing Act (12 U.S.C. 
1709(b)(2)(A); or 
‘‘(ii) 2 percent of the limit established under section 
203(b)(2)(B) of such Act.’’; and 
(2) by adding at the end the following: 
‘‘(D) LIMITATION.—In any fiscal year, the aggregate 
number of mortgages insured pursuant to this section may 
not exceed 5 percent of the aggregate number of mortgages 
for 1- to 4-family residences insured by the Secretary of 
Housing and Urban Development under title II of the 
National Housing Act (12 U.S.C. 1707 et seq.) during the 
preceding fiscal year.’’. 
SEC. 2124. PILOT PROGRAM FOR AUTOMATED PROCESS FOR BOR-
ROWERS WITHOUT SUFFICIENT CREDIT HISTORY. 
(a) ESTABLISHMENT.—Title II of the National Housing Act (12 
U.S.C. 1707 et seq.) is amended by adding at the end the following 
new section: 
‘‘SEC. 257. PILOT PROGRAM FOR AUTOMATED PROCESS FOR BOR-
ROWERS WITHOUT SUFFICIENT CREDIT HISTORY. 
‘‘(a) ESTABLISHMENT.—The Secretary shall carry out a pilot 
program to establish, and make available to mortgagees, an auto-
mated process for providing alternative credit rating information 
for mortgagors and prospective mortgagors under mortgages on 
1- to 4-family residences to be insured under this title who have 
insufficient credit histories for determining their creditworthiness. 
Such alternative credit rating information may include rent, utili-
ties, and insurance payment histories, and such other information 
as the Secretary considers appropriate. 
‘‘(b) SCOPE.—The Secretary may carry out the pilot program 
under this section on a limited basis or scope, and may consider 
limiting the program to first-time homebuyers. 
‘‘(c) LIMITATION.—In any fiscal year, the aggregate number 
of mortgages insured pursuant to the automated process established 
under this section may not exceed 5 percent of the aggregate 
number of mortgages for 1- to 4-family residences insured by the 
Secretary under this title during the preceding fiscal year. 
‘‘(d) SUNSET.—After the expiration of the 5-year period begin-
ning on the date of the enactment of the Building American 
Homeownership Act of 2008, the Secretary may not enter into