the Truth in Lending Act (15 U.S.C. 1602(aa)(1)(A)) is 
amended by striking ‘‘10 percentage points’’ and inserting 
‘‘8 percentage points’’. 
(d) PRE-LOAN COUNSELING REQUIRED FOR HIGH 
COST MORTGAGES.—Section 129 of the Truth in Lending 
Act (15 U.S.C. 1639) is amended by inserting after sub-
section (l) the following new subsection: 
‘‘(m) PRE-LOAN COUNSELING.— 
‘‘(1) IN GENERAL.—A creditor may not extend 
credit to a consumer under a mortgage referred to 
in section 103(aa) without first receiving certifi-
cation from a counselor that is approved by the Sec-
retary of Housing and Urban Development, that the 
consumer has received— 
‘‘(A) and successfully completed coun-
seling, in person or by telephone, on the advis-
ability of the loan transaction; and 
‘‘(B) a general range of interest rates that 
the applicant qualifies for given their credit 
score. 
‘‘(2) 
NONAFFILIATION
RULE
FOR
COUN-
SELORS.—A counselor providing a certification to a 
creditor under paragraph (1) may not be employed 
by the creditor or an affiliate of the creditor or be 
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affiliated with the creditor in any other manner (in-
cluding any referral agreement). 
‘‘(3) DISCLOSURES REQUIRED PRIOR TO COUN-
SELING.—No counselor may certify that a borrower 
has received counseling on the advisability of the 
loan transaction unless the counselor can verify that 
the consumer has received each statement required 
(in connection with such loan) by this section, or by 
the Real Estate Settlement Procedures Act of 1974, 
with respect to the transaction. 
‘‘(4) REGULATIONS.—The Secretary of Housing 
and Urban Development may prescribe such regula-
tions as the Secretary determines to be appropriate 
to carry out the requirements of paragraph (1).’’. 
SEC. 306. LIMITATION ON ROLLOVERS OF PAYDAY LOANS. 
Section 128 of the Truth in Lending Act (15 U.S.C. 
1638) is amended by adding at the end the following new 
subsection: 
‘‘(e) LIMITATIONS ON ROLLOVERS OR REFINANCING 
OF PAYDAY LOANS WITH THE SAME CREDITOR.— 
‘‘(1) IN GENERAL.—A payday lender— 
‘‘(A) may not refinance or roll over any 
payday loan made by such lender, or any affil-
iate or other associate of the payday lender, to 
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any consumer with another payday loan more 
than 3 times; and 
‘‘(B) shall provide a consumer who seeks 
to refinance or roll over any payday loan made 
by such lender, or any affiliate or other asso-
ciate of the payday lender, to the consumer 
with another payday loan more than 2 times 
with a disclosure notice, which the Board shall 
prescribe by regulation, regarding the hazards 
of payday lending and the benefits of banking 
traditionally, in prominent format and type-size, 
that is separate from the disclosures required 
under subsection (a) with regard to such exten-
sion of credit. 
‘‘(2) DEFINITIONS.— 
‘‘(A) CHECK.—The term ‘check’ means 
any negotiable demand draft drawn on or pay-
able through an office of a depository institu-
tion (as defined in section 19(b)(1)(A) of the 
Federal Reserve Act) located in any State. 
‘‘(B) PAYDAY LENDER.—The term ‘payday 
lender’ means any person who extends credit to 
any other person through a payday loan. 
‘‘(C) PAYDAY
LOAN.—The term ‘payday 
loan’ means means a transaction in which cred-
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it is extended by a payday lender, for a speci-
fied period of time, upon receipt by the lender 
of— 
‘‘(i) a check made by the borrower for 
the amount of the credit extended, the pre-
sentment or negotiation of which, by mu-
tual agreement of the lender and borrower, 
will be deferred for such specified period; 
or 
‘‘(ii) authorization from the borrower 
for the payday lender to initiate an elec-
tronic fund transfer at the end of the spec-
ified period from the account of the bor-
rower for the amount of the credit ex-
tended.’’. 
SEC. 307. FAIR TREATMENT OF EMPLOYEE BENEFITS. 
(a) DEFINITION OF CLAIM.—Section 101(5) of title 
11, United States Code, is amended— 
(1) in subparagraph (A), by striking ‘‘or’’ at 
the end; 
(2) in subparagraph (B), by inserting ‘‘or’’ 
after the semicolon; and 
(3) by adding at the end the following: 
‘‘(C) right or interest in equity securities 
of the debtor, or an affiliate of the debtor, held 
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in a pension plan (within the meaning of sec-
tion 3(2) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1002(2))) for 
the benefit of an individual who is not an offi-
cer or director of the debtor, if such securities 
were attributable to— 
‘‘(i) employer contributions by the 
debtor or an affiliate of the debtor other 
than elective deferrals (within the meaning 
of section 402(g) of the Internal Revenue 
Code of 1986), and any earnings thereon; 
and 
‘‘(ii) elective deferrals (and any earn-
ings thereon) that are required to be in-
vested in such securities under the terms 
of the plan or at the direction of a person 
other than the individual or any bene-
ficiary, 
except that this subparagraph shall not apply to 
any such securities during any period during 
which the individual or any beneficiary has the 
right to direct the plan to divest such securities 
and to reinvest an equivalent amount in other 
investment options of the plan;’’. 
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(b) PRIORITIES.—Section 507(a)(4) of title 11, 
United States Code, is amended— 
(1) in subparagraph (B), by indenting the left 
margin of clauses (i) and (ii) 2 ems to the right and 
redesignating such clauses as subclauses (I) and 
(II), respectively; 
(2) by indenting the left margin of subpara-
graphs (A) and (B) 2 ems to the right and redesig-
nating such subparagraphs as clauses (i) and (ii), 
respectively; 
(3) in the matter preceding clause (i), as so re-
designated, by striking ‘‘Fourth’’ and all that follows 
through ‘‘plan—’’ and inserting the following: 
‘‘Fourth— 
‘‘(A) allowed unsecured claims for con-
tributions to an employee benefit plan—’’. 
(4) by striking the period at the end and insert-
ing the following: ‘‘or’’; and 
(5) by adding at the end the following: 
‘‘(B) allowed unsecured claims with respect 
to rights or interests in equity securities of the 
debtor, or an affiliate of the debtor, that are 
held in a pension plan (within the meaning of 
section 3(2) of the Employee Retirement In-
come Security Act of 1974), without regard to 
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when services were rendered or limitation in 
amount, and measured by the market value of 
the stock at the time the stock was contributed 
to, or purchased by, the plan.’’. 
SEC. 308. WAGE PRIORITY AND EMPLOYEE BENEFIT CAP. 
Section 507(a) of title 11, United States Code, is 
amended— 
(1) in paragraph (3), by striking ‘‘$4,000’’ and 
inserting ‘‘$13,500’’; and 
(2) 
in 
paragraph 
(4)(B)(i), 
by 
striking 
‘‘$4,000’’ and inserting ‘‘$13,500’’. 
SEC. 309. SUBORDINATION. 
Section 510(b) of title 11, United States Code, is 
amended by inserting ‘‘, other than a claim described in 
section 105(5)(C).’’ after ‘‘claim’’ the 1st place it appears. 
Æ 
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