I 
111TH CONGRESS 
1ST SESSION 
H. R. 472 
To reform the Troubled Assets Relief Program of the Secretary of the 
Treasury by establishing the Family Foreclosure Rescue Corporation 
modeled on the successful Home Owner’s Loan Corporation, and to 
purchase and insure home mortgage loans for the purposes of providing 
relief to homeowners, restoring stability to the financial system, pre-
venting further harm to the economy, and protecting taxpayers. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 13, 2009 
Mr. BACA introduced the following bill; which was referred to the Committee 
on Financial Services, and in addition to the Committee on Ways and 
Means, for a period to be subsequently determined by the Speaker, in 
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned 
A BILL 
To reform the Troubled Assets Relief Program of the Sec-
retary of the Treasury by establishing the Family Fore-
closure Rescue Corporation modeled on the successful 
Home Owner’s Loan Corporation, and to purchase and 
insure home mortgage loans for the purposes of pro-
viding relief to homeowners, restoring stability to the 
financial system, preventing further harm to the econ-
omy, and protecting taxpayers. 
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 ‘‘Family Foreclosure 
Rescue Corporation Act of 2009’’. 
SEC. 2. PURPOSES. 
The purposes of this Act are— 
(1) to provide immediate authority and facilities 
that the Secretary of the Treasury can use to assist 
struggling homeowners in order to restore liquidity 
and stability to the financial system of the United 
States; and 
(2) to ensure that such authority and such fa-
cilities are used in a manner that— 
(A) protects America’s family equity in-
cluding home values, college funds, retirement 
accounts, and life savings; 
(B) preserves homeownership and pro-
motes jobs and economic growth; 
(C) maximizes overall returns to the tax-
payers of the United States; and 
(D) provides public accountability for the 
exercise of such authority. 
SEC. 3. AMENDMENTS TO TARP. 
(a) FAMILY FORECLOSURE RESCUE CORPORATION 
PROGRAM UNDER TARP.—Title I of the Emergency Eco-
nomic Stabilization Act of 2008 (12 U.S.C. 5211) is 
amended— 
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(1) by inserting after the title designation and 
heading the following: 
‘‘Subtitle A—Program for 
Purchases of Troubled Assets’’; and 
(2) by adding at the end the following new sub-
title: 
‘‘Subtitle B—Family Foreclosure 
Rescue Corporation Program 
‘‘SEC. 150. AUTHORITY UNDER TARP PROGRAM. 
‘‘The authority of the Secretary to take any action 
under this title includes the authority to take the actions 
authorized under this subtitle and to use amounts made 
available under subtitle A under the provisions of this sub-
title. 
‘‘SEC. 151. PURCHASES OF HOME MORTGAGES. 
‘‘(a) OFFICES; AUTHORITY.— 
‘‘(1) AUTHORITY.—The Secretary is authorized 
to establish a Family Foreclosure Rescue Corpora-
tion program (or ‘FFRC program’) to purchase, and 
to make and fund commitments to purchase, home 
mortgage loans from any financial institution, on 
such terms and conditions as are determined by the 
Secretary, and in accordance with this subtitle and 
the policies and procedures developed and published 
by the Secretary. 
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‘‘(2) COMMENCEMENT
OF
PROGRAM.—Estab-
lishment of the policies and procedures and other 
similar administrative requirements imposed on the 
Secretary by this subtitle are not intended to delay 
the commencement of the FFRC program. 
‘‘(3) ESTABLISHMENT OF THE FAMILY FORE-
CLOSURE
RESCUE
CORPORATION.—The 
Family 
Foreclosure Rescue Corporation is hereby estab-
lished as an independent office within the Treasury, 
which office shall be headed by Chairman, who shall 
report to the Secretary, and shall be appointed by 
the President, by and with the advice and consent 
of the Senate, except that an interim Chairman may 
serve pending confirmation by the Senate. 
‘‘(b) CONSULTATION.—In exercising the authority 
under this section, the Secretary shall consult with the 
Board of Governors of the Federal Reserve System, the 
Corporation, the Comptroller of the Currency, the Direc-
tor of the Office of Thrift Supervision, and the Secretary 
of Housing and Urban Development. 
‘‘(c) NECESSARY ACTIONS.—The Secretary is author-
ized to take such actions as the Secretary deems necessary 
to carry out the authorities in this subtitle, including, 
without limitation, the following: 
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‘‘(1) The Secretary shall have direct hiring au-
thority with respect to the appointment of employees 
to administer this subtitle. 
‘‘(2) Entering into contracts, including con-
tracts for services authorized by section 3109 of title 
5, United States Code. 
‘‘(3) Designating financial institutions, the Cor-
poration, the Board, the Federal Housing Adminis-
tration, the Federal National Mortgage Association, 
and the Federal Home Loan Mortgage Corporation, 
as financial agents of the Federal Government for 
purposes of implementing the provisions of this sub-
title, and such institutions shall perform all such 
reasonable duties related to this subtitle as financial 
agents of the Federal Government as may be re-
quired 
‘‘(4) In order to provide the Secretary with the 
flexibility to manage home mortgages in a manner 
designed to minimize cost to the taxpayers, estab-
lishing vehicles that are authorized, subject to super-
vision by the Secretary, to purchase, hold, guarantee 
and sell home mortgages and to issue obligations. 
‘‘(5) Issuing such regulations and other guid-
ance as may be necessary or appropriate to define 
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terms or carry out the authorities or purposes of 
this subtitle. 
‘‘(6) Entering into indemnity agreements with 
servicers or trustees that would indemnify the 
servicer or trustees for legal liability to investors 
arising from sale, disposition or modification of 
home mortgages if— 
‘‘(A) the servicer or trustee has acted rea-
sonably in selling, disposing of or modifying the 
mortgage; and 
‘‘(B) the servicer or trustee has acted in 
accordance with a request for sale, modification 
or disposition from the Secretary or his des-
ignee under the FFRC program established by 
this subtitle. 
‘‘(7) Developing a program, with respect to 
first-lien home mortgage loans purchased by the 
Secretary, through which the security interests of 
second lien-holders with respect to the residential 
property securing the first-lien home mortgage loan 
purchased by the Secretary, are extinguished in ex-
change for partial payment. 
‘‘(d) PROGRAM GUIDELINES.—Before the earlier of 
the end of the 2-business-day period beginning on the date 
of the first purchase of home mortgages pursuant to the 
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authority under this section or the end of the 45-day pe-
riod beginning on the date of enactment of this subtitle, 
the Secretary shall publish program guidelines, including 
the following: 
‘‘(1) Mechanisms for purchasing home mort-
gages in exchange for cash, Treasury securities or 
other assets. 
‘‘(2) Methods for pricing and valuing home 
mortgages. 
‘‘(3) Procedures for selecting home mortgage 
asset managers. 
‘‘(4) Criteria for identifying home mortgages 
for purchase. Such criteria shall include (A) loan-to- 
value ratio, (B) debt-to-income ratio; and (C) such 
other criteria as the Secretary may prescribe. 
‘‘(e) PREVENTING UNJUST ENRICHMENT.—In mak-
ing purchases under the authority of this subtitle, the Sec-
retary shall take such steps as may be necessary to pre-
vent unjust enrichment of financial institutions and home 
owners participating in a program established under this 
subtitle. 
‘‘SEC. 152. INSURANCE OF HOME MORTGAGES. 
‘‘(a) AUTHORITY.— 
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish a program to guarantee home mortgages con-
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sistent with section 159(b) and the purposes of this 
subtitle. 
‘‘(2) GUARANTEES.—In establishing any pro-
gram under this subsection, the Secretary shall de-
velop guarantees of home mortgages and the associ-
ated premiums for such guarantees. Such guaran-
tees and premiums may be determined by category 
or class of the home mortgages to be guaranteed. 
‘‘(3) EXTENT OF GUARANTEE.—The Secretary 
may guarantee the timely payment of principal of, 
and interest on, home mortgages in amounts not to 
exceed 100 percent of such payments. Such guar-
antee may be on such terms and conditions as are 
determined by the Secretary, provided that such 
terms and conditions are consistent with section 
159(b) and the purposes of this subtitle. 
‘‘(b) REPORTS.—Not later than 90 days after the 
date of enactment of this subtitle, the Secretary shall re-
port to the appropriate committees of Congress on the 
program established under subsection (a). 
‘‘(c) PREMIUMS.— 
‘‘(1) IN GENERAL.—The Secretary shall collect 
premiums from any financial institution and any 
borrower participating in the program established 
under subsection (a). Such premiums shall be in an 
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amount that the Secretary determines necessary to 
meet the purposes of this subtitle and to provide suf-
ficient reserves pursuant to paragraph (3). 
‘‘(2) AUTHORITY TO BASE PREMIUMS ON PROD-
UCT
RISK.—In establishing any premium under 
paragraph (1), the Secretary may provide for vari-
ations in such rates according to the credit risks and 
other risks associated with the particular home 
mortgage that is being guaranteed. The Secretary 
shall publish the methodology for setting the pre-
mium for a class of home mortgages together with 
an explanation of the appropriateness of the class of 
home mortgages for participation the program estab-
lished under this section. The methodology shall en-
sure that the premium is consistent with paragraph 
(3). 
‘‘(3) MINIMUM LEVEL.—The premiums referred 
to in paragraph (1) shall be set by the Secretary at 
a level necessary to create reserves sufficient to meet 
anticipated claims, based on an actuarial analysis, 
and to ensure that taxpayers are fully protected, un-
less the Secretary determines that a lower premium 
combined with other protections for taxpayers, in-
cluding but not limited to provisions for shared eq-
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‘‘(H) a description of the vehicles estab-
lished to exercise such authority. 
‘‘(b) TRANCHE REPORTS TO CONGRESS.— 
‘‘(1) REPORTS.—The Secretary shall provide to 
the appropriate committees of Congress, at the times 
specified in paragraph (2), a written report, includ-
ing— 
‘‘(A) a description of all of the transactions 
made during the reporting period; 
‘‘(B) a description of the pricing mecha-
nism for the transactions; 
‘‘(C) a justification of the price paid for 
and other financial terms associated with the 
transactions; 
‘‘(D) a description of the impact of the ex-
ercise of such authority on the financial system, 
supported to the extent possible, by specific 
data; 
‘‘(E) a description of challenges that re-
main in the financial system, including any 
benchmarks yet to be achieved; and 
‘‘(F) an estimate of additional actions 
under the authority provided under this subtitle 
that may be necessary to address such chal-
lenges. 
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