Title: Housing Financial Literacy Act of 2020
Policy area: Housing and Community Development

Summary:
Housing Financial Literacy Act of 2020
This bill modifies the discount given by the Federal Housing Administration (FHA) on single-family mortgage-insurance premium payments for first-time homebuyers who complete a financial-management counseling program. Under current law, the maximum premium amount for such homebuyers is 2.75% of the original insured principal obligation of the mortgage (compared to 3% for other homebuyers).
The bill instead requires that the premium amount for such homebuyers (1) in the case of a mortgage insured within four years of enactment, be 25 basis points (0.25% of the original insured principal obligation of mortgage) lower than the amount otherwise established by the FHA; or (2) in the case of a mortgage insured four years after enactment, at a rate set by the FHA that corresponds to the reduced risk of loss due to the counseling.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3639 Introduced in Senate (IS)]

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116th CONGRESS
  2d Session
                                S. 3639

 To require the Secretary of Housing and Urban Development to discount 
 FHA single-family mortgage insurance premium payments for first-time 
    homebuyers who complete a financial literacy housing counseling 
                                program.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 7, 2020

Mr. Peters (for himself and Mr. Cornyn) introduced the following bill; 
which was read twice and referred to the Committee on Banking, Housing, 
                           and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
 To require the Secretary of Housing and Urban Development to discount 
 FHA single-family mortgage insurance premium payments for first-time 
    homebuyers who complete a financial literacy housing counseling 
                                program.

    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 ``Housing Financial Literacy Act of 
2020''.

SEC. 2. DISCOUNT ON MORTGAGE INSURANCE PREMIUM PAYMENTS FOR FIRST-TIME 
              HOMEBUYERS WHO COMPLETE FINANCIAL LITERACY HOUSING 
              COUNSELING PROGRAMS.

    The second sentence of section 203(c)(2)(A) of the National Housing 
Act (12 U.S.C. 1709(c)(2)(A)) is amended by striking ``not exceed 2.75 
percent of the amount of the original insured principal obligation of 
the mortgage.'' and inserting ``be, in the case of a mortgage insured 
during the 4-year period beginning on the date that is 1 year after the 
date of enactment of the Housing Financial Literacy Act of 2020, 25 
basis points lower than the premium payment amount established by the 
Secretary under the first sentence of this subparagraph, and, in the 
case of a mortgage insured after that 4-year period, set by the 
Secretary at a number of basis points lower than that premium payment 
amount that corresponds to the reduced risk of loss, if any, due to the 
counseling.''.
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