I 
110TH CONGRESS 
2D SESSION 
H. R. 7328 
To amend title 11 of the United States Code with respect to modification 
of certain mortgages on principal residences, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 10, 2008 
Mr. CONYERS (for himself, Mr. DELAHUNT, and Mr. NADLER) introduced the 
following bill; which was referred to the Committee on the Judiciary 
A BILL 
To amend title 11 of the United States Code with respect 
to modification of certain mortgages on principal resi-
dences, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Homeowners’ Protec-
tion Act of 2008’’. 
SEC. 2. WAIVER OF COUNSELING REQUIREMENT WHEN 
HOUSES ARE IN FORECLOSURE. 
Section 109(h) of title 11, United States Code, is 
amended by adding at the end the following: 
VerDate Aug 31 2005 
06:16 Dec 11, 2008
Jkt 079200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H7328.IH
H7328
smartinez on PROD1PC64 with BILLS
‘‘(5) The requirements of paragraph (1) shall not 
apply in a case under chapter 13 with respect to a debtor 
who submits to the court a certification that the debtor 
has received notice that the holder of a claim secured by 
the debtor’s principal residence may commence a fore-
closure on the debtor’s principal residence.’’. 
SEC. 3. AUTHORITY TO MODIFY CERTAIN MORTGAGES. 
Section 1322(b) of title 11, United States Code, is 
amended— 
(1) by redesignating paragraph (11) as para-
graph (12), 
(2) in paragraph (10) by striking ‘‘and’’ at the 
end, and 
(3) by inserting after paragraph (10) the fol-
lowing: 
‘‘(11) notwithstanding paragraph (2) and other-
wise applicable nonbankruptcy law, with respect to a 
claim for a debt for a loan secured by a security in-
terest in the debtor’s principal residence that is the 
subject of a notice that a foreclosure may be com-
menced, modify the rights of the holder of such 
claim— 
‘‘(A) by reducing such claim to equal the 
value of the interest of the debtor in such resi-
dence securing such claim; 
VerDate Aug 31 2005 
06:16 Dec 11, 2008
Jkt 079200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H7328.IH
H7328
smartinez on PROD1PC64 with BILLS
‘‘(B) by waiving any otherwise applicable 
early repayment or prepayment penalties; 
‘‘(C) if any applicable rate of interest is 
adjustable under the terms of such security in-
terest by prohibiting, reducing, or delaying ad-
justments to such rate of interest applicable on 
and after the date of filing of the plan; and 
‘‘(D) by modifying the terms and condi-
tions of such loan— 
‘‘(i) to extend the repayment period 
for a period that is the longer of 40 years 
(reduced by the period for which such loan 
has been outstanding) or the remaining 
term of such loan, beginning on the date of 
the order for relief under this chapter; and 
‘‘(ii) to provide for the payment of in-
terest accruing after the date of the order 
for relief under this chapter at an annual 
percentage rate calculated at a fixed an-
nual percentage rate, in an amount equal 
to the then most recently published annual 
yield on conventional mortgages published 
by the Board of Governors of the Federal 
Reserve System, as of the applicable time 
VerDate Aug 31 2005 
06:16 Dec 11, 2008
Jkt 079200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H7328.IH
H7328
smartinez on PROD1PC64 with BILLS
set forth in the rules of the Board, plus a 
reasonable premium for risk; and’’. 
SEC. 4. COMBATING EXCESSIVE FEES. 
Section 1322(c) of title 11, the United States Code, 
is amended— 
(1) in paragraph (1) by striking ‘‘and’’ at the 
end, 
(2) in paragraph (2) by striking the period at 
the end and inserting a semicolon, and 
(3) by adding at the end the following: 
‘‘(3) the debtor, the debtor’s property, and 
property of the estate are not liable for a fee, cost, 
or charge that is incurred while the case is pending 
and arises from a debt that is secured by the debt-
or’s principal residence except to the extent that— 
‘‘(A) the holder of the claim for such debt 
files with the court notice of such fee, cost, or 
charge before the earlier of— 
‘‘(i) 1 year after such fee, cost, or 
charge is incurred; or 
‘‘(ii) 60 days before the closing of the 
case; and 
‘‘(B) such fee, cost, or charge— 
‘‘(i) is lawful under applicable non-
bankruptcy law, reasonable, and provided 
VerDate Aug 31 2005 
06:16 Dec 11, 2008
Jkt 079200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H7328.IH
H7328
smartinez on PROD1PC64 with BILLS
for in the applicable security agreement; 
and 
‘‘(ii) is secured by property the value 
of which is greater than the amount of 
such claim, including such fee, cost, or 
charge; 
‘‘(4) the failure of a party to give notice de-
scribed in paragraph (3) shall be deemed a waiver 
of any claim for fees, costs, or charges described in 
paragraph (3) for all purposes, and any attempt to 
collect such fees, costs, or charges shall constitute a 
violation of section 524(a)(2) or, if the violation oc-
curs before the date of discharge, of section 362(a); 
and 
‘‘(5) a plan may provide for the waiver of any 
prepayment penalty on a claim secured by the debt-
or’s principal residence.’’. 
SEC. 5. CONFIRMATION OF PLAN. 
Section 1325(a) of title 11, the United States Code, 
is amended— 
(1) in paragraph (8) by striking ‘‘and’’ at the 
end, 
(2) in paragraph (9) by striking the period at 
the end and inserting a semicolon, and 
VerDate Aug 31 2005 
06:16 Dec 11, 2008
Jkt 079200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H7328.IH
H7328
smartinez on PROD1PC64 with BILLS
(3) by inserting after paragraph (9) the fol-
lowing: 
‘‘(10) notwithstanding subclause (I) of para-
graph (5)(B)(i), the plan provides that the holder of 
a claim whose rights are modified pursuant to sec-
tion 1322(b)(11) retain the lien until the later of— 
‘‘(A) the payment of such claim as reduced 
and modified; or 
‘‘(B) discharge under section 1328; and 
‘‘(11) the plan modifies a claim in accordance 
with section 1322(b)(11), and the court finds that 
such modification is in good faith.’’. 
SEC. 6. DISCHARGE. 
Section 1328 of title 11, the United States Code, is 
amended— 
(1) in subsection (a)— 
(A) by inserting ‘‘(other than payments to 
holders of claims whose rights are modified 
under section 1322(b)(11)’’ after ‘‘paid’’ the 
1st place it appears, and 
(B) in paragraph (1) by inserting ‘‘or, to 
the extent of the unpaid portion of the claim as 
reduced, provided for in section 1322(b)(11)’’ 
after ‘‘1322(b)(5)’’, and 
VerDate Aug 31 2005 
06:16 Dec 11, 2008
Jkt 079200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H7328.IH
H7328
smartinez on PROD1PC64 with BILLS
(2) in subsection (c)(1) by inserting ‘‘or, to the 
extent of the unpaid portion of the claim as reduced, 
provided 
for 
in 
section 
1322(b)(11)’’ 
after 
‘‘1322(b)(5)’’. 
SEC. 7. EFFECTIVE DATE; APPLICATION OF AMENDMENTS. 
(a) EFFECTIVE DATE.—Except as provided in sub-
section (b), this Act and the amendments made by this 
Act shall take effect on the date of the enactment of this 
Act. 
(b) APPLICATION OF AMENDMENTS.—The amend-
ments made by this Act shall apply only with respect to 
cases commenced under title 11 of the United States Code 
on or after the date of the enactment of this Act. 
Æ 
VerDate Aug 31 2005 
06:16 Dec 11, 2008
Jkt 079200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6301
E:\BILLS\H7328.IH
H7328
smartinez on PROD1PC64 with BILLS