H. R. 4173—809 
(b) INCREASE IN PENALTY AMOUNTS.—Section 6(f) of the Real 
Estate Settlement Procedures Act of 1974 (12 U.S.C. 2605(f)) is 
amended— 
(1) in paragraphs (1)(B) and (2)(B), by striking ‘‘$1,000’’ 
each place such term appears and inserting ‘‘$2,000’’; and 
(2) in paragraph (2)(B)(i), by striking ‘‘$500,000’’ and 
inserting ‘‘$1,000,000’’. 
(c) DECREASE IN RESPONSE TIMES.—Section 6(e) of the Real 
Estate Settlement Procedures Act of 1974 (12 U.S.C. 2605(e)) is 
amended— 
(1) in paragraph (1)(A), by striking ‘‘20 days’’ and inserting 
‘‘5 days’’; 
(2) in paragraph (2), by striking ‘‘60 days’’ and inserting 
‘‘30 days’’; and 
(3) by adding at the end the following new paragraph: 
‘‘(4) LIMITED EXTENSION OF RESPONSE TIME.—The 30-day 
period described in paragraph (2) may be extended for not 
more than 15 days if, before the end of such 30-day period, 
the servicer notifies the borrower of the extension and the 
reasons for the delay in responding.’’. 
(d) PROMPT REFUND OF ESCROW ACCOUNTS UPON PAYOFF.— 
Section 6(g) of the Real Estate Settlement Procedures Act of 1974 
(12 U.S.C. 2605(g)) is amended by adding at the end the following 
new sentence: ‘‘Any balance in any such account that is within 
the servicer’s control at the time the loan is paid off shall be 
promptly returned to the borrower within 20 business days or 
credited to a similar account for a new mortgage loan to the bor-
rower with the same lender.’’. 
SEC. 1464. TRUTH IN LENDING ACT AMENDMENTS. 
(a) REQUIREMENTS FOR PROMPT CREDITING OF HOME LOAN PAY-
MENTS.—Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 
et seq.) is amended by inserting after section 129E (as added 
by section 1472) the following new section: 
‘‘§ 129F. Requirements for prompt crediting of home loan 
payments 
‘‘(a) IN GENERAL.—In connection with a consumer credit trans-
action secured by a consumer’s principal dwelling, no servicer shall 
fail to credit a payment to the consumer’s loan account as of 
the date of receipt, except when a delay in crediting does not 
result in any charge to the consumer or in the reporting of negative 
information to a consumer reporting agency, except as required 
in subsection (b). 
‘‘(b) EXCEPTION.—If a servicer specifies in writing requirements 
for the consumer to follow in making payments, but accepts a 
payment that does not conform to the requirements, the servicer 
shall credit the payment as of 5 days after receipt.’’. 
(b) REQUESTS FOR PAYOFF AMOUNTS.—Chapter 2 of the Truth 
in Lending Act (15 U.S.C. 1631 et seq.), as amended by this title, 
is amended by inserting after section 129F (as added by subsection 
(a)) the following new section: 
‘‘§ 129G. Requests for payoff amounts of home loan 
‘‘A creditor or servicer of a home loan shall send an accurate 
payoff balance within a reasonable time, but in no case more
H. R. 4173—810 
than 7 business days, after the receipt of a written request for 
such balance from or on behalf of the borrower.’’. 
SEC. 1465. ESCROWS INCLUDED IN REPAYMENT ANALYSIS. 
Section 128(b) of the Truth in Lending Act (15 U.S.C. 1638(b)) 
is amended by adding at the end the following new paragraph: 
‘‘(4) REPAYMENT ANALYSIS REQUIRED TO INCLUDE ESCROW 
PAYMENTS.— 
‘‘(A) IN GENERAL.—In the case of any consumer credit 
transaction secured by a first mortgage or lien on the 
principal dwelling of the consumer, other than a consumer 
credit transaction under an open end credit plan or a 
reverse mortgage, for which an impound, trust, or other 
type of account has been or will be established in connection 
with the transaction for the payment of property taxes, 
hazard and flood (if any) insurance premiums, or other 
periodic payments or premiums with respect to the prop-
erty, the information required to be provided under sub-
section (a) with respect to the number, amount, and due 
dates or period of payments scheduled to repay the total 
of payments shall take into account the amount of any 
monthly payment to such account for each such repayment 
in accordance with section 10(a)(2) of the Real Estate 
Settlement Procedures Act of 1974. 
‘‘(B) ASSESSMENT
VALUE.—The amount taken into 
account under subparagraph (A) for the payment of prop-
erty taxes, hazard and flood (if any) insurance premiums, 
or other periodic payments or premiums with respect to 
the property shall reflect the taxable assessed value of 
the real property securing the transaction after the con-
summation of the transaction, including the value of any 
improvements on the property or to be constructed on 
the property (whether or not such construction will be 
financed from the proceeds of the transaction), if known, 
and the replacement costs of the property for hazard insur-
ance, in the initial year after the transaction.’’. 
Subtitle F—Appraisal Activities 
SEC. 1471. PROPERTY APPRAISAL REQUIREMENTS. 
Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et 
seq.) is amended by inserting after 129G (as added by section 
1464(b)) the following new section: 
‘‘§ 129H. Property appraisal requirements 
‘‘(a) IN GENERAL.—A creditor may not extend credit in the 
form of a higher-risk mortgage to any consumer without first 
obtaining a written appraisal of the property to be mortgaged 
prepared in accordance with the requirements of this section. 
‘‘(b) APPRAISAL REQUIREMENTS.— 
‘‘(1) PHYSICAL PROPERTY VISIT.—Subject to the rules pre-
scribed under paragraph (4), an appraisal of property to be 
secured by a higher-risk mortgage does not meet the require-
ment of this section unless it is performed by a certified or 
licensed appraiser who conducts a physical property visit of 
the interior of the mortgaged property. 
‘‘(2) SECOND APPRAISAL UNDER CERTAIN CIRCUMSTANCES.—
H. R. 4173—811 
‘‘(A) IN GENERAL.—If the purpose of a higher-risk mort-
gage is to finance the purchase or acquisition of the mort-
gaged property from a person within 180 days of the pur-
chase or acquisition of such property by that person at 
a price that was lower than the current sale price of the 
property, the creditor shall obtain a second appraisal from 
a different certified or licensed appraiser. The second 
appraisal shall include an analysis of the difference in 
sale prices, changes in market conditions, and any improve-
ments made to the property between the date of the pre-
vious sale and the current sale. 
‘‘(B) NO COST TO APPLICANT.—The cost of any second 
appraisal required under subparagraph (A) may not be 
charged to the applicant. 
‘‘(3) CERTIFIED OR LICENSED APPRAISER DEFINED.—For pur-
poses of this section, the term ‘certified or licensed appraiser’ 
means a person who— 
‘‘(A) is, at a minimum, certified or licensed by the 
State in which the property to be appraised is located; 
and 
‘‘(B) performs each appraisal in conformity with the 
Uniform Standards of Professional Appraisal Practice and 
title XI of the Financial Institutions Reform, Recovery, 
and Enforcement Act of 1989, and the regulations pre-
scribed under such title, as in effect on the date of the 
appraisal. 
‘‘(4) REGULATIONS.— 
‘‘(A) IN GENERAL.—The Board, the Comptroller of the 
Currency, the Federal Deposit Insurance Corporation, the 
National Credit Union Administration Board, the Federal 
Housing Finance Agency, and the Bureau shall jointly pre-
scribe regulations to implement this section. 
‘‘(B) EXEMPTION.—The agencies listed in subparagraph 
(A) may jointly exempt, by rule, a class of loans from 
the requirements of this subsection or subsection (a) if 
the agencies determine that the exemption is in the public 
interest and promotes the safety and soundness of creditors. 
‘‘(c) FREE COPY OF APPRAISAL.—A creditor shall provide 1 copy 
of each appraisal conducted in accordance with this section in 
connection with a higher-risk mortgage to the applicant without 
charge, and at least 3 days prior to the transaction closing date. 
‘‘(d) CONSUMER NOTIFICATION.—At the time of the initial mort-
gage application, the applicant shall be provided with a statement 
by the creditor that any appraisal prepared for the mortgage is 
for the sole use of the creditor, and that the applicant may choose 
to have a separate appraisal conducted at the expense of the 
applicant. 
‘‘(e) VIOLATIONS.—In addition to any other liability to any per-
son under this title, a creditor found to have willfully failed to 
obtain an appraisal as required in this section shall be liable 
to the applicant or borrower for the sum of $2,000. 
‘‘(f) HIGHER-RISK MORTGAGE DEFINED.—For purposes of this 
section, the term ‘higher-risk mortgage’ means a residential mort-
gage loan, other than a reverse mortgage loan that is a qualified 
mortgage, as defined in section 129C, secured by a principal 
dwelling—
H. R. 4173—812 
‘‘(1) that is not a qualified mortgage, as defined in section 
129C; and 
‘‘(2) with an annual percentage rate that exceeds the aver-
age prime offer rate for a comparable transaction, as defined 
in section 129C, as of the date the interest rate is set— 
‘‘(A) by 1.5 or more percentage points, in the case 
of a first lien residential mortgage loan having an original 
principal obligation amount that does not exceed the 
amount of the maximum limitation on the original principal 
obligation of mortgage in effect for a residence of the 
applicable size, as of the date of such interest rate set, 
pursuant to the sixth sentence of section 305(a)(2) the 
Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
1454(a)(2)); 
‘‘(B) by 2.5 or more percentage points, in the case 
of a first lien residential mortgage loan having an original 
principal obligation amount that exceeds the amount of 
the maximum limitation on the original principal obligation 
of mortgage in effect for a residence of the applicable size, 
as of the date of such interest rate set, pursuant to the 
sixth sentence of section 305(a)(2) the Federal Home Loan 
Mortgage Corporation Act (12 U.S.C. 1454(a)(2)); and 
‘‘(C) by 3.5 or more percentage points for a subordinate 
lien residential mortgage loan.’’. 
SEC. 1472. APPRAISAL INDEPENDENCE REQUIREMENTS. 
(a) IN GENERAL.—Chapter 2 of the Truth in Lending Act (15 
U.S.C. 1631 et seq.) is amended by inserting after section 129D 
(as added by section 1461(a)) the following new section: 
‘‘§ 129E. Appraisal independence requirements 
‘‘(a) IN GENERAL.—It shall be unlawful, in extending credit 
or in providing any services for a consumer credit transaction 
secured by the principal dwelling of the consumer, to engage in 
any act or practice that violates appraisal independence as described 
in or pursuant to regulations prescribed under this section. 
‘‘(b) APPRAISAL INDEPENDENCE.—For purposes of subsection (a), 
acts or practices that violate appraisal independence shall include— 
‘‘(1) any appraisal of a property offered as security for 
repayment of the consumer credit transaction that is conducted 
in connection with such transaction in which a person with 
an interest in the underlying transaction compensates, coerces, 
extorts, colludes, instructs, induces, bribes, or intimidates a 
person, appraisal management company, firm, or other entity 
conducting or involved in an appraisal, or attempts, to com-
pensate, coerce, extort, collude, instruct, induce, bribe, or intimi-
date such a person, for the purpose of causing the appraised 
value assigned, under the appraisal, to the property to be 
based on any factor other than the independent judgment of 
the appraiser; 
‘‘(2) 
mischaracterizing, 
or 
suborning 
any 
mischaracterization of, the appraised value of the property 
securing the extension of the credit; 
‘‘(3) seeking to influence an appraiser or otherwise to 
encourage a targeted value in order to facilitate the making 
or pricing of the transaction; and