(1) Responsible community mortgage lenders 
engaged in traditional mortgage lending were not re-
sponsible for the recent mortgage crisis. 
(2) Responsible community mortgage lenders 
provide a valuable and critical service to consumers 
by, among other things, fulfilling the housing fi-
nance needs of the communities they serve and pro-
viding locally based alternative sources for mortgage 
financing. 
(3) The activities and business practices of re-
sponsible community mortgage lenders do not pose 
a substantial risk to consumers, and did not pose a 
substantial risk to consumers when the Dodd-Frank 
Wall Street Reform and Consumer Protection Act 
was enacted. 
(4) Responsible community mortgage lenders 
are subject to the oversight and control of various 
governmental authorities and nongovernmental ac-
tors, including the Bureau of Consumer Financial 
Protection, the Department of Housing and Urban 
Development, the Federal Trade Commission, State 
supervisory regulators, local government supervisory 
regulators, mortgage loan investors, warehouse lend-
ers, and various other authorities or entities. As a 
result of this oversight and control, the business 
VerDate Sep 11 2014 
22:15 Aug 02, 2016
Jkt 059200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H5907.IH
H5907
sradovich on DSK3GMQ082PROD with BILLS
practices and activities of responsible community 
mortgage lenders are safe, transparent to the public 
and the government, and do not pose a threat to 
consumers, the public at large, the United States fi-
nancial markets, or the United States economy in 
general. 
(5) Responsible community mortgage lenders 
are unreasonably burdened by increasing regulation 
geared to problems that they did not create and ac-
tivities that they did not and do not engage in, and 
therefore responsible community mortgage lenders 
are entitled to relief from certain provisions of the 
Dodd-Frank Wall Street Reform and Consumer Pro-
tection Act and its attendant regulations, including 
the regulations of the Bureau of Consumer Finan-
cial Protection. 
(6) Without relief many responsible community 
mortgage lenders will be driven from the market 
thus limiting the consumer’s ability to choose a local 
lender for mortgage financing and dangerously con-
solidating the mortgage lending market into a small-
er number of lenders. 
(7) The preservation of responsible community 
mortgage lenders is critical to preserving competition 
VerDate Sep 11 2014 
22:15 Aug 02, 2016
Jkt 059200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H5907.IH
H5907
sradovich on DSK3GMQ082PROD with BILLS
and preventing increasing concentration in mortgage 
lending. 
(8) The Bureau of Consumer Financial Protec-
tion should prioritize its resources and ability to 
carry out examinations by creating reasonable exclu-
sions for smaller, responsible mortgage lenders. 
SEC. 3. DEFINITIONS. 
(a) IN GENERAL.—Section 1002 of the Consumer Fi-
nancial Protection Act of 2010 (12 U.S.C. 5481) is 
amended by adding at the end the following: 
‘‘(30) COMMUNITY
MORTGAGE
LENDER.—The 
term ‘community mortgage lender’ means a lender— 
‘‘(A) who— 
‘‘(i) in the case of a depository insti-
tution or credit union— 
‘‘(I) has assets of less than 
$2,000,000,000; and 
‘‘(II) 
originated 
fewer 
than 
25,000 mortgage loans in the pre-
ceding calendar year or originated a 
gross mortgage loan origination vol-
ume of less than $5,000,000,000 in 
the preceding calendar year; or 
‘‘(ii) in the case of a person other 
than a depository institution— 
VerDate Sep 11 2014 
22:15 Aug 02, 2016
Jkt 059200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H5907.IH
H5907
sradovich on DSK3GMQ082PROD with BILLS
‘‘(I) has net worth of less than 
$50,000,000; and 
‘‘(II) 
originated 
fewer 
than 
25,000 mortgage loans in the pre-
ceding calendar year or originated a 
gross mortgage loan origination vol-
ume of less than $5,000,000,000 in 
the preceding calendar year; and 
‘‘(B) had mortgage loan originations in the 
preceding three calendar years that consisted of 
95 percent qualified mortgages when measured 
by either— 
‘‘(i) the number of mortgage loans 
originated; or 
‘‘(ii) the dollar volume of mortgage 
loans originated. 
‘‘(31) RESPONSIBLE
COMMUNITY
MORTGAGE 
LENDER.—The term ‘responsible community mort-
gage lender’ means a community mortgage lender 
who has not been found by a court of competent ju-
risdiction to have violated the law, or been subject 
to a cease and desist order, relating to its mortgage 
loan originations— 
‘‘(A) during the preceding two years; or 
VerDate Sep 11 2014 
22:15 Aug 02, 2016
Jkt 059200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H5907.IH
H5907
sradovich on DSK3GMQ082PROD with BILLS
‘‘(B) since such person began originating 
mortgage loans, if such period is less than two 
years. 
‘‘(32) MORTGAGE LOAN.—The term ‘mortgage 
loan’ means a loan secured by a first lien on a 1– 
4 unit family residence. 
‘‘(33) 
QUALIFIED
MORTGAGE.—The 
term 
‘qualified mortgage’— 
‘‘(A) has the meaning given that term 
under section 129C(b)(2) of the Truth in Lend-
ing Act; and 
‘‘(B) includes loans insured, guaranteed, or 
administered by— 
‘‘(i) the Department of Housing and 
Urban Development, with regard to mort-
gages insured under the National Housing 
Act (12 U.S.C. 1707 et seq.); 
‘‘(ii) the Department of Veterans Af-
fairs, with regard to a loan made or guar-
anteed by the Secretary of Veterans Af-
fairs; 
‘‘(iii) the Department of Agriculture, 
with regard to loans guaranteed by the 
Secretary of Agriculture pursuant to sec-
VerDate Sep 11 2014 
22:15 Aug 02, 2016
Jkt 059200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H5907.IH
H5907
sradovich on DSK3GMQ082PROD with BILLS
tion 502(h) of the Housing Act of 1949 
(42 U.S.C. 1472(h)); and 
‘‘(iv) the Rural Housing Service, with 
regard to loans insured by the Rural Hous-
ing Service.’’. 
(b) TREATMENT OF THE QUALIFIED MORTGAGE RE-
QUIREMENT DURING CALENDAR YEAR 2016.—For pur-
poses of computing mortgage loan originations under sec-
tion 1002(30)(B) of the Consumer Financial Protection 
Act of 2010 during calendar year 2016, such computation 
shall be based only on the preceding two calendar years 
instead of the preceding three calendar years. 
SEC. 4. PRIORITIZATION OF BUREAU EXAMINATION AND 
ENFORCEMENT AUTHORITY RESOURCES. 
(a) IN GENERAL.—The Consumer Financial Protec-
tion Act of 2010 (12 U.S.C. 5481 et seq.) is amended by 
inserting after section 1031 the following: 
‘‘SEC. 1031A. EXCLUSION RELATING TO RESPONSIBLE COM-
MUNITY MORTGAGE LENDERS. 
‘‘(a) LIMITATIONS OF EXAMINATION OF RESPON-
SIBLE COMMUNITY MORTGAGE LENDERS.—Except as 
permitted in subsection (b), the Bureau may not conduct 
any audit, examination, or investigation of, or take an en-
forcement against, a responsible community mortgage 
lender. 
VerDate Sep 11 2014 
22:15 Aug 02, 2016
Jkt 059200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H5907.IH
H5907
sradovich on DSK3GMQ082PROD with BILLS
‘‘(b) REFERRALS BY OTHER AGENCIES.—The Bu-
reau may conduct an audit, examination, or investigation 
of, or take an enforcement action against, a responsible 
community mortgage lender if requested by— 
‘‘(1) a State or local regulator; 
‘‘(2) a Federal department or agency that guar-
antees mortgage loans originated, held, or serviced 
by such lender; 
‘‘(3) the Federal Housing Finance Agency or 
entities supervised by such Agency; or 
‘‘(4) any other Federal department or agency 
that exercises supervisory authority over such lender. 
‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed as modifying, limiting, or super-
seding the operation of any provision of Federal or State 
law, or otherwise affecting the authority of any Federal 
or State department or agency other than the Bureau.’’. 
(b) CLERICAL AMENDMENT.—The table of contents 
under section 1(b) of the Dodd-Frank Wall Street Reform 
and Consumer Protection Act is amended by inserting 
after the item relating to section 1031 the following: 
‘‘Sec. 1031A. Exclusion relating to responsible community mortgage lenders.’’. 
SEC. 5. STREAMLINED VENDOR AUDITS. 
(a) IN GENERAL.—The Consumer Financial Protec-
tion Act of 2010 (12 U.S.C. 5481 et seq.), as amended 
VerDate Sep 11 2014 
22:15 Aug 02, 2016
Jkt 059200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H5907.IH
H5907
sradovich on DSK3GMQ082PROD with BILLS
by section 4(a), is further amended by inserting after sec-
tion 1031A the following: 
‘‘SEC. 1031B. VENDOR AUDIT REQUIREMENTS RELATING TO 
RESPONSIBLE 
COMMUNITY 
MORTGAGE 
LENDERS. 
‘‘(a) VENDOR AUDITS.—The Bureau and the appro-
priate Federal banking agencies may only require a re-
sponsible community mortgage lender to perform an audit 
of a vendor or third-party contractor of the lender if the 
Bureau or the appropriate Federal banking agency, as ap-
plicable, has reasonable cause to believe that such vendor 
or third-party contractor is performing services for the 
lender in a manner that is causing the lender to violate 
the law.’’. 
(b) CLERICAL AMENDMENT.—The table of contents 
under section 1(b) of the Dodd-Frank Wall Street Reform 
and Consumer Protection Act, as amended by section 
4(b), is further amended by inserting after the item relat-
ing to section 1031A the following: 
‘‘Sec. 1031B. Vendor audit requirements relating to responsible community 
mortgage lenders.’’. 
Æ 
VerDate Sep 11 2014 
22:15 Aug 02, 2016
Jkt 059200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6301
E:\BILLS\H5907.IH
H5907
sradovich on DSK3GMQ082PROD with BILLS