Title: PARITY Act of 2019
Policy area: Finance and Financial Sector

Summary:
Preserving Access to Rural Installment Transactions for Years Act of 2019 or the PARITY Act of 2019
This bill revises the definition of a mortgage originator for the purposes of compliance with registration and compensation requirements.
Among other things, it exempts from mortgage originator requirements those lenders providing financing to five (currently three) or fewer properties in a year, including corporations and partnerships that would otherwise be regulated as mortgage originators. The bill also removes the requirement that such lenders, in order to be exempt from these requirements, must verify the buyer's ability to repay the loan.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1036 Introduced in House (IH)]

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116th CONGRESS
  1st Session
                                H. R. 1036

 To amend the Truth in Lending Act to clarify the exclusion for seller-
  financers from the definition of mortgage originator, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 7, 2019

Mr. Riggleman introduced the following bill; which was referred to the 
                    Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
 To amend the Truth in Lending Act to clarify the exclusion for seller-
  financers from the definition of mortgage originator, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Preserving Access to Rural 
Installment Transactions for Years Act of 2019'' or the ``PARITY Act of 
2019''.

SEC. 2. AMENDMENTS RELATED TO THE EXCLUSION OF SELLER-FINANCERS IN THE 
              DEFINITION OF MORTGAGE ORIGINATOR.

    Section 103(dd)(2)(E) of the Truth in Lending Act (15 U.S.C. 
1602(dd)(2)(E)) is amended--
            (1) in the matter preceding clause (i)--
                    (A) by striking ``3 properties'' and inserting ``5 
                properties'';
                    (B) by striking ``a person, estate, or trust'' and 
                inserting ``a person or entity (including a 
                corporation, partnership, proprietorship, association, 
                cooperative, estate, or trust)''; and
                    (C) by striking ``such person, estate, or trust'' 
                and inserting ``such a person or entity'';
            (2) in clause (i)--
                    (A) by inserting ``or'' after the semicolon;
                    (B) by striking ``a person, estate, or trust that 
                has constructed'' and inserting ``such a person or 
                entity that--
                                    ``(I) has constructed''; and
                    (C) by inserting at the end the following new 
                subclause:
                                    ``(II) has received any other 
                                compensation related to such loan, 
                                including origination points or fees 
                                and excluding interest payments;'';
            (3) by striking clauses (ii), (iii), and (iv); and
            (4) by inserting after clause (i) the following new 
        clauses:
                            ``(ii) is not a high-cost mortgage;
                            ``(iii) does not include terms under which 
                        the outstanding principal balance will increase 
                        at any time over the course of the loan because 
                        the regular periodic payments do not cover the 
                        full amount of interest due;
                            ``(iv) has--
                                    ``(I) a fixed rate; or
                                    ``(II) an adjustable rate that was 
                                not determined by a prior contractual 
                                obligation between the consumer and 
                                such a person or entity and--
                                            ``(aa) is adjustable after 
                                        5 or more years (as determined 
                                        by the addition of a margin to 
                                        a widely available index rate) 
                                        subject to reasonable annual 
                                        and lifetime limitations on 
                                        interest rate increases or is 
                                        determined by a prior 
                                        obligation that is included in 
                                        or assumed by the terms of the 
                                        loan; or
                                            ``(bb) with respect to any 
                                        part of such loan contractually 
                                        required to be used to make 
                                        payments on an existing 
                                        mortgage loan secured by such a 
                                        property, is adjustable on or 
                                        after the date of a rate 
                                        adjustment on such existing 
                                        mortgage loan; and''.
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