FHA Fairness Act

Bill: 116-hr-8974
Sponsor: full_name: Rep. Aguilar, Pete [D-CA-31]
Introduced: 2020-12-16
Policy area: Finance and Financial Sector
Subjects: Housing finance and home ownership

Insurance industry and regulation

Life, casualty, property insurance
Latest action: action_date: 2020-12-16
text: Referred to the House Committee on Financial Services.

Summaries:
action_date: 2020-12-16
action_desc: Introduced in House
text: <p><b>FHA Fairness Act </b></p> <p>This bill increases the mortgage limit for federal mortgage insurance eligibility for homes in certain cities and counties. Specifically, this increase applies to metropolitan cities and urban counties with higher housing costs that have experienced a decrease in home values over a specified time period. </p>

tv_txt: I 116th CONGRESS 2d Session H. R. 8974 IN THE HOUSE OF REPRESENTATIVES December 16, 2020 Mr. Aguilar introduced the following bill; which was referred to the Committee on Financial Services A BILL To increase the principal obligation limits for mortgage insurance under the National Housing Act for residences in eligible metropolitan cities and urban counties.

1. Short title This Act may be cited as the FHA Fairness Act . 2. FHA Principal obligation limits for residences in eligible cities and counties Section 203(b) of the National Housing Act ( 12 U.S.C. 1709 ) is amended by adding at the end of paragraph (2) the following undesignated paragraph: Notwithstanding any other provision of this paragraph, in the case of a residence located in an eligible city or county, clause (i) and (ii) of subparagraph (A) shall be considered to require that a mortgage shall involve a principal obligation in an amount that does not exceed in the case of a 1-family residence, 125 percent of the median 1-family house price in the eligible city or county in which the residence is located, as defined by the Secretary; in the case of a 2-family residence, 125 percent of the median 2-family house price in the eligible city or county in which the residence is located, as defined by the Secretary; in the case of a 3-family residence, 125 percent of the median 3-family house price in the eligible city or county in which the residence is located, as defined by the Secretary; and in the case of a 4-family residence, 125 percent of the median 4-family house price in the eligible city or county in which the residence is located, as defined by the Secretary. For the purposes of the preceding sentence, the term eligible city or county means a metropolitan city or urban county (as such terms are defined in section 102 of the Housing and Community Development Act of 1974 ( 42 U.S.C. 5302 )) that has a median 1-family home price that exceeds the amount determined under subparagraph (A)(ii) of this paragraph for the area (as the term is defined in the first sentence after subparagraph (B)) within which such city or county is located and is located in an area that, as determined by the Secretary, experienced a decrease in maximum principal obligation amount under this paragraph for 1-family residences equal to or in excess of 20 percent between January 1, 2013, and January 1, 2014. . 3. Effective date The amendment made by this Act shall apply only to mortgages for which the mortgagee has issued credit approval for the borrower on or after January 1, 2021.